AAQL 10-Q
Antiaging Quantum Living Inc. (AAQL)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
OF THE SECURITIES EXCHANGE ACT OF 1934
For
the quarterly period ended
or
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from _____ to ______
Commission
File Number
(Exact name of registrant as specified in its charter)
| (State or Other Jurisdiction | (I.R.S. Employer | |
| of Incorporation or Organization) | Identification No.) |
(Address of Principal Executive Offices) (Zip Code)
(Registrant’s telephone number, including area code)
N/A(Former name, former address and former fiscal year, if changed since last report)
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
| Not Applicable | Not Applicable | Not Applicable |
Indicate
by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.
Indicate
by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule
405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant
was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| Large accelerated filer | ☐ | Accelerated filer | ☐ |
| ☒ | Smaller reporting company | ||
| Emerging growth company |
If
an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Indicate
by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No
As of August 14, 2025, the registrant had shares of Class A common stock outstanding.
TABLE OF CONTENTS
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NOTE ABOUT FORWARD-LOOKING STATEMENTS
Except for historical information, this quarterly report on Form 10-Q contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements contained in this quarterly report on Form 10-Q other than statements of historical fact, including statements regarding our future results of operations and financial position, our business strategy and plans, and our objectives for future operations, are forward-looking statements. The words “believe,” “may,” “will,” “estimate,” “continue,” “anticipate,” “intend,” “expect,” and similar expressions are intended to identify forward-looking statements. We have based these forward-looking statements largely on our current expectations and projections about future events and trends that we believe may affect our financial condition, results of operations, business strategy, short-term and long-term business operations and objectives, and financial needs. These forward-looking statements are subject to a number of risks, uncertainties and assumptions. Moreover, we operate in a very competitive and rapidly changing environment. New risks emerge from time to time. It is not possible for our management to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements we may make. In light of these risks, uncertainties and assumptions, the future events and trends discussed in this quarterly report on Form 10-Q may not occur and actual results could differ materially and adversely from those anticipated or implied in the forward-looking statements.
We undertake no obligation to revise or publicly release the results of any revision to these forward-looking statements, except as required by law. Given these risks and uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements.
Unless expressly indicated or the context requires otherwise, the terms “Antiaging,” “company,” “we,” “us,” and “our” in this document refer to Antiaging Quantum Living Inc, a New York corporation.
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PART I – FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
INDEX TO FINANCIAL STATEMENTS
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ANTIAGING QUANTUM LIVING INC.
Condensed Consolidated Balance Sheets
As of June 30, 2025 and March 31, 2025
| June 30, | March 31, | |||||||
| 2025 | 2025 | |||||||
| (Unaudited) | (Audited) | |||||||
| ASSETS | ||||||||
| Current Assets | ||||||||
| Cash and cash equivalents | $ | $ | ||||||
| Accounts receivable, net | ||||||||
| Advances to suppliers | ||||||||
| Other receivables and current assets | ||||||||
| Total Current Assets | ||||||||
| Non-Current Assets | ||||||||
| Property and equipment, net | ||||||||
| Intangible assets, net | ||||||||
| Operating lease right of use asset, net | ||||||||
| Total Non-Current Assets | ||||||||
| Total Assets | ||||||||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||
| Current Liabilities | ||||||||
| Accounts payable and accrued expenses | ||||||||
| Other payables | ||||||||
| Due to related parties | ||||||||
| Taxes payable | ||||||||
| Advances from customers | ||||||||
| Operating lease liabilities - current portion | ||||||||
| Total Current Liabilities | ||||||||
| Non-Current Liabilities | ||||||||
| Operating lease liabilities - non-current | ||||||||
| Long term notes and loans payable-related party | ||||||||
| Total Non-Current Liabilities | ||||||||
| Total Liabilities | ||||||||
| Commitments and Contingencies | ||||||||
| Shareholders’ Equity | ||||||||
| Class A Common stock, par value $ per share; shares authorized; shares issued and outstanding at June 30, 2025 and March 31, 2025 | ||||||||
| Class B Common stock, par value $ per share; shares authorized; shares issued and outstanding at June 30, 2025 and March 31, 2025 | ||||||||
| Class C Common stock, par value $ per share; shares authorized; shares issued and outstanding at June 30, 2025 and March 31, 2025 | ||||||||
| Class D Common stock, par value $ per share; shares authorized; shares issued and outstanding at June 30, 2025 and March 31, 2025 | ||||||||
| Class E Common stock, par value $ per share; shares authorized; shares issued and outstanding at June 30, 2025 and March 31, 2025 | ||||||||
| Additional paid-in capital | ||||||||
| Accumulated deficit | ( | ) | ( | ) | ||||
| Accumulated other comprehensive (loss) income | ( | ) | ||||||
| Total Shareholders’ Deficit | ( | ) | ( | ) | ||||
| Total Liabilities and Shareholders’ Deficit | $ | $ | ||||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
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ANTIAGING QUANTUM LIVING INC.
Condensed Consolidated Statements of Operations and Comprehensive Income
For the Three months ended June 30, 2025 and 2024
Unaudited
| Three months ended | ||||||||
| June 30, | June 30, | |||||||
| 2025 | 2024 | |||||||
| Revenues, net | $ | $ | ||||||
| Cost of revenues | ||||||||
| Gross profit | ||||||||
| Operating expenses: | ||||||||
| Selling and marketing expense | ||||||||
| General and administrative expenses | ||||||||
| Total operating expenses | ||||||||
| Loss from operations | ( | ) | ( | ) | ||||
| Other income (expenses): | ||||||||
| Interest income | ||||||||
| Other income (expense), net | ||||||||
| Total other income | ||||||||
| Loss before income tax | ( | ) | ( | ) | ||||
| Income tax expense | ||||||||
| Net loss | $ | ( | ) | $ | ( | ) | ||
| Weighted average shares outstanding | ||||||||
| Basic and diluted | ||||||||
| Loss per share | ||||||||
| Basic and diluted | $ | ) | $ | ) | ||||
| Comprehensive income (loss): | ||||||||
| Net loss | $ | ( | ) | $ | ( | ) | ||
| Other comprehensive income (loss): | ||||||||
| Foreign currency translation adjustment | ( | ) | ||||||
| Total comprehensive loss | $ | ( | ) | $ | ( | ) | ||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
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ANTIAGING QUANTUM LIVING INC.
Condensed Consolidated Statements of Changes in Shareholders’ Deficit
For the Three months ended June 30, 2025 and 2024
Unaudited
| Class A Common stock | Additional | Accumulated other | ||||||||||||||||||||||
Number of Shares | Amount |
Paid-in Capital | Accumulated Deficit |
Comprehensive Income | Total | |||||||||||||||||||
| Balance at March 31, 2024 | $ | $ | $ | ( | ) | $ | $ | ( | ) | |||||||||||||||
| Net income | ( | ) | ( | ) | ||||||||||||||||||||
| Foreign currency translation adjustment | ||||||||||||||||||||||||
| Balance at June 30, 2024 | ( | ) | ( | ) | ||||||||||||||||||||
| Balance at March 31, 2025 | ( | ) | ( | ) | ||||||||||||||||||||
| Net income | ( | ) | ( | ) | ||||||||||||||||||||
| Foreign currency translation adjustment | ( | ) | ( | ) | ||||||||||||||||||||
| Balance at June 30, 2025 | ( | ) | ( | ) | ( | ) | ||||||||||||||||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
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ANTIAGING QUANTUM LIVING INC.
Condensed Consolidated Statements of Cash Flows
For the Three months ended June 30, 2025 and 2024
Unaudited
Three months ended | ||||||||
June 30, 2025 | June 30, 2024 | |||||||
| Cash flows from operating activities | ||||||||
| Net loss | $ | ( | ) | $ | ( | ) | ||
| Adjustments to reconcile net loss to net cash used in operating activities | ||||||||
| Depreciation and amortization expense | ||||||||
| Amortization of operating lease ROU assets | ||||||||
| Impairments and write-offs of assets | ||||||||
| Changes in assets and liabilities | ||||||||
| Increase in accounts receivable | ( | ) | ( | ) | ||||
| Decrease (increase) in advances to suppliers | ( | ) | ||||||
| Decrease (increase) in other receivables and current assets | ( | ) | ||||||
| Increase in accounts payable | ||||||||
| (Decrease) increase in accrued and other payables | ( | ) | ||||||
| Increase in taxes payable | ||||||||
| Decrease in operating lease liabilities | ( | ) | ||||||
| Decrease in other long-term liabilities | ( | ) | ||||||
| Net cash used in operating activities | ( | ) | ( | ) | ||||
| Cash flows from investing activities | ||||||||
| Purchase of fixed assets | ( | ) | ( | ) | ||||
| Net cash used in investing activities | ( | ) | ( | ) | ||||
| Cash flows from financing activities | ||||||||
| Proceeds from related party payables | ||||||||
| Net cash provided by financing activities | ||||||||
| Net increase (decrease) of cash and cash equivalents | ( | ) | ||||||
| Effect of foreign currency translation on cash and cash equivalents | ( | ) | ||||||
| Cash and cash equivalents – beginning | ||||||||
| Cash and cash equivalents – ending | $ | $ | ||||||
| Supplementary cash flow information: | ||||||||
| Interest paid | $ | $ | ||||||
| Income taxes paid | $ | $ | ||||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
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ANTIAGING QUANTUM LIVING INC (FKA. ACHISON INC)
NOTES TO THE UNAUDITED FINANCIAL STATEMENTS
(UNAUDITED)
NOTE 1 – ORGANIZATION AND PRINCIPAL ACTIVITIES
Antiaging
Quantum Living Inc. (FKA: Achison Inc.) (the “Company”, “us”, “we” or “our”) was incorporated
under the laws of the State of
On
July 1, 2019, Lansdale Inc, the principal stockholder of the Company (“Seller”) an entity controlled by the Company’s
former President, Mr. Wanjun Xie, entered into a Stock Purchase Agreement (the “Agreement”) with Dazhong 368 Inc, (the “Buyer”),
pursuant to which, a total of shares of Class A common stock of the Company were transferred to the Buyer, representing approximately
On
April 10, 2023, Mr. Barry Wan acquired control of restricted shares of common stock (the “Purchased Shares”) of
the Company, representing approximately
In connection with the transaction, on April 10, 2023, Mr. Dingshan Zhang resigned from all positions he held with the Company. On April 10, 2023, Ms. Jing Wan was appointed by our majority shareholder as our Chief Executive Officer, Chief Financial Officer, President and Director. On June 16, 2023, Mr. Barry Wan consented to act as the new CEO and CFO after Ms. Jing Wan resigned. The Company was renamed as Antiaging Quantum Living Inc on June 14, 2023 by the new management. The Company is an investment holding company; its primary business operations are conducted through its subsidiaries as described below.
AAQL Inc. (“BVI Holding”) was incorporated under the Laws of the British Virgin Islands to function as a holding company responsible for managing all business operations outside of the United States.
AAQL HK Limited (“Hong Kong Holding”) was incorporated under the Laws of Hong Kong as a wholly-owned subsidiary of the BVI Holding. Hong Kong Holding’s primary role is to act as a holding company overseeing business activities exclusively within the Asia-Pacific markets.
Antiaging Doctor Hangzhou Holding LTD (“Dao Ling Doctor Hangzhou”) was incorporated as a wholly-owned subsidiary of Hong Kong Holding on November 13, 2023 under the laws of the People’s Republic of China, with its principal place of business situated in Xiaoshan District, Hangzhou, Zhejiang Province.
Dao Ling Doctor (Zhejiang) Health Management Limited (“Dao Ling Doctor Zhejiang”) was incorporated as a wholly-owned subsidiary of Dao Ling Doctor Hangzhou on November 30, 2023 under the laws of the People’s Republic of China, with its principal place of business situated in Hangzhou, Zhejiang Province.
Dao Ling Doctor (Huzhou) Health Management Limited (“Dao Ling Doctor Huzhou”) was incorporated as a wholly-owned subsidiary of Dao Ling Doctor Hangzhou on December 6, 2023 under the laws of the People’s Republic of China, with its principal place of business situated in Huzhou, Zhejiang Province.
Anti-Aging Care LLC (“Anti-Aging Care”) was incorporated as a wholly-owned subsidiary of Antiaging Quantum Living Inc. on October 21, 2024 under the laws of New York.
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The subsidiaries’ business includes e-commerce platform development and management, personalized marketing strategies, and brand licensing. It also provides technical support and maintenance for distributors, along with health consulting (excluding diagnosis and treatment), network security software development, and big data services. Through these integrated offerings, the group enhances the market presence and operational efficiency of the ‘Dao Ling Doctor’ brand.”
Antiaging Quantum Living Inc. and its subsidiaries are collectively referred to as the “Company”.
NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation and Principles of Consolidation
The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”), and include the assets, liabilities, revenues, expenses and cash flows of all subsidiaries. All significant inter-company transactions and balances between the Company and its subsidiaries are eliminated upon consolidation.
In the opinion of management, the unaudited interim condensed financial statements reflect all adjustments of a normal recurring nature that are necessary for a fair presentation of the results for the interim periods presented. However, the results of operations included in such financial statements may not necessary be indicative of annual results.
The Company uses the same accounting policies in preparing quarterly and annual financial statements. Certain information and footnote disclosures normally included in the annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) have been condensed or omitted. These unaudited condensed financial statements should be read in conjunction with the Company’s audited financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended March 31, 2025 filed with the Securities and Exchange Commission (“SEC”) on July 2, 2025.
Use of Estimates
The accompanying financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) and the rules and regulations of the Securities and Exchange Commission (the “SEC”).
The preparation of the Company’s financial statements in conformity with GAAP requires management to make estimates, judgments and assumptions that affect the amounts reported in the financial statements and footnotes thereto. Actual results may differ from those estimates and assumptions.
Functional and presentation currency
The functional currency of the Company is the currency of the primary economic environment in which the Company operates which is Chinese Yuan (“RMB”). The RMB is not freely convertible into the US dollar and may be subject to PRC currency restrictions for payments, including the distributions of dividends or retained earnings to the Company by its subsidiaries or its variable interest entities.
Transactions in currencies other than the entity’s functional currency are recorded at the rates of exchange prevailing on the date of the transaction. At the end of each reporting period, monetary items denominated in foreign currencies are translated at the rates prevailing at the end of the reporting periods. Exchange differences arising on the settlement of monetary items and on translation of monetary items at period-end are included in income statement of the period.
For the purpose of presenting these financial statements, the Company’s assets and liabilities are expressed in US$ at the exchange rate on the balance sheet date, stockholder’s equity accounts are translated at historical rates, and income and expense items are translated at the weighted average exchange rate during the period. The resulting translation adjustments are reported under accumulated other comprehensive income (loss) in the stockholder’s equity (deficits) section of the balance sheets.
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Exchange rate used for the translation as follows:
| US$ to RMB | Period End | Average | ||||||
| June 30, 2025 | ||||||||
| March 31, 2025 | ||||||||
| June 30, 2024 | ||||||||
Cash and Cash Equivalents
Cash and cash equivalents include cash in banks, bank deposits, and highly liquid investments with maturities of three months or less at the date of origination.
Accounts receivable, net
The Company records accounts receivable at net realizable value consisting of the carrying amount less an allowance for uncollectible accounts. The allowance for doubtful accounts is the Company’s best estimate of the amount of probable credit losses in the Company’s existing accounts receivable. The Company determines the allowance based on aging data, historical collection experience, customer specific facts and economic conditions. Account balances are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote.
Advances to Suppliers
The Company occasionally makes advance payments to suppliers, contractors, and service providers to secure future deliveries of goods or completion of services. These advances are recorded as assets on the balance sheet and are reclassified to the appropriate expense or asset account (such as inventory, property and equipment, or repairs and maintenance) when the related goods are received or the services are rendered. These advances may include, but are not limited to, payments for inventory goods to be sold, deposits for services, or prepayments for capital improvements.
The Company periodically reviews the recoverability of advances to suppliers and establishes allowances for potential losses when necessary.
Other receivables and current assets
Other receivables and current assets consist primarily of prepaid expenses, advances, and refundable security deposits. These items are recorded at their original transaction amounts and are not discounted as the impact of discounting is not material to the consolidated financial statements. The Company evaluates the collectability of other receivables on a regular basis and establishes allowances for estimated credit losses, if necessary, in accordance with ASC 326.
Impairment of Other Assets
The Company has adopted Accounting Standards Codification subtopic 340-10, Other Assets (“ASC 340-10”). ASC 340-10 requires that prepaid expenses, deferred costs, and other capitalized expenditures be reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The Company evaluates these assets for impairment periodically, or more frequently if events and circumstances warrant. Indicators of impairment may include contract cancellations, supplier bankruptcy, significant adverse changes in expected future benefits, or other factors reducing the asset’s recoverability.
The Company assesses recoverability based on the expected future benefits associated with the asset. If it is determined that the carrying value is no longer recoverable, the asset is written down to its net realizable value or zero if no recovery is expected. Impairment losses, if any, are recorded in the income statement as a charge to expense.
Write-offs on advances to suppliers was $ and $ for the three months ended June 30, 2025 and 2024, respectively.
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Property and Equipment
Property and equipment are carried at cost net of accumulated depreciation. Expenditures that improve the functionality of the related asset or extend the useful life are capitalized. When property and equipment is retired or otherwise disposed of, the related gain or loss is included in operating income. Leasehold improvements are depreciated on the straight-line method over the shorter of the remaining lease term or estimated useful life of the asset.
Property and equipment are depreciated on a straight-line basis over the following periods:
| Leasehold improvements | ||||
| Office furniture and equipment |
Intangible assets
Intangible assets are carried at cost, net of accumulated amortization. Expenditures that enhance the functionality or extend the useful life of the intangible asset are capitalized. When intangible assets are retired or otherwise disposed of, the related gain or loss is included in operating income.
Intangible assets with finite useful lives are amortized on a straight-line basis over their estimated useful lives. The Company reviews intangible assets for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable.
Intangible assets are amortized on a straight-line basis over the following periods:
| Patent |
Impairment of Long-Lived Assets
The Company has adopted Accounting Standards Codification subtopic 360-10, Property, Plant and Equipment (“ASC 360-10”). ASC 360-10 requires that long-lived assets and certain identifiable intangibles held and used by the Company be reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The Company evaluates its long-lived assets for impairment annually or more often if events and circumstances warrant. Events relating to recoverability may include significant unfavorable changes in business conditions, recurring losses, or a forecasted inability to achieve breakeven operating results over an extended period. The Company evaluates the recoverability of long-lived assets based upon forecasted undiscounted cash flows. Should impairment in value be indicated, the carrying value of intangible assets will be adjusted, based on estimates of future discounted cash flows resulting from the use and ultimate disposition of the asset. ASC 360-10 also requires assets to be disposed of be reported at the lower of the carrying amount or the fair value less costs to sell.
Impairment
loss on property and equipment or intangible assets were $
Customer Advances
The Company records customer advances as liabilities when consideration is received in advance of the transfer of goods. These advances are recognized as revenue when the performance obligations associated with the advance are satisfied. These advances relate to the advance payment for orders of goods placed by the customers.
Leases
The Company adopted FASB Accounting Standards Codification, Topic 842, Leases (“ASC 842”) using the modified retrospective approach, electing the practical expedient that allows the Company not to restate its comparative periods prior to the adoption of the standard on January 1, 2019.
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The new leasing standard requires recognition of leases on the balance sheets as right-of-use (“ROU”) assets and lease liabilities. ROU assets represent the Company’s right to use underlying assets for the lease terms and lease liabilities represent the Company’s obligation to make lease payments arising from the leases. Operating lease ROU assets and operating lease liabilities are recognized based on the present value and future minimum lease payments over the lease term at commencement date. The Company’s future minimum based payments used to determine the Company’s lease liabilities mainly include minimum based rent payments. As most of the Company’s leases do not provide an implicit rate, the Company uses its estimated incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The Company does not recognize any leases with an initial term of 12 months or less on the balance sheets.
Operating lease cost is recognized as a single lease cost on a straight-line basis over the lease term. Variable lease payments for common area maintenance, property taxes and other operating expenses are recognized as expense in the period when the changes in facts and circumstances on which the variable lease payments are based occur.
Revenue Recognition
Revenue is recognized when control of the promised goods or services is transferred to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services. The Company determines revenue recognition by applying the following steps: 1) identification of the contract, or contracts, with a customer; 2) identification of the performance obligations in the contract; 3) determination of the transaction price; 4) allocation of the transaction price to the performance obligations in the contract; and 5) recognition of revenue when, or as, we satisfy a performance obligation.
Online advertising
The Company operates an online advertising platform that connects advertisers with publishers to display digital advertisements.
For the Company, revenue recognition occurs upon the following events: when a customer places an order, payment is received, and the advertisement is delivered and viewable to the end-user with no other terms and conditions.
Sales of goods
The Company operates a mobile application (“App”) through which it sells health and beauty products to customers.
For the Company, revenue recognition occurs upon the following events: when a customer places an order, payment is received, and the goods are delivered to or drop-shipped to and accepted by the customer. Provisions are made for estimated sales returns based on historical return rates and experience which are immaterial. The Company may record contract liabilities, such as customer advances, when payments are received from customers prior to delivery or acceptance of goods by customers.
Online platform technical operation support and maintenance services
The Company provides technical operation support and maintenance services for its online platforms, ensuring platform functionality, continuous availability, and technical support for end-users.
Revenue from these services is recognized ratably over each service period as the services are rendered, or upon completion of the service, depending on the nature of the arrangement. Billing frequency may vary (e.g., weekly, monthly, quarterly, or upon completion) as specified in the respective contracts. Service fees are determined based on contract terms and may be structured as fixed fees, milestone-based pricing, or as a percentage of gross transaction value (GTV) generated from the customer’s e-commerce platform. Each billing period or completed service cycle represents a distinct performance obligation, with revenue recognized upon completion and invoicing.
The major direct cost of providing these services is wages and salaries.
In instances where payments are received in advance, they are recorded as contract liabilities (deferred revenue) until the services are delivered.
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For each revenue stream, the Company is a principal because it controls the specified goods or services before they are transferred to the customer. As a principal, the Company is primarily responsible for fulfilling the contractual obligations, has discretion in establishing the price, and bears the risk of inventory or service provision until completion, therefore revenue is recognized on a gross basis for each revenue stream.
Selling, General and Administrative Expenses
Selling, general, and administrative expenses primarily consist of costs related to sales and marketing activities, administrative functions, and certain start-up costs.
Selling expenses include, but are not limited to, sales commissions, advertising costs, shipping and handling expenses, and costs associated with trade shows and promotional events. General and administrative expenses encompass salaries and benefits of employees not directly involved in production, rent, utilities, office supplies, legal and professional fees, other overhead costs, and certain start-up costs.
Start-up costs represent expenses associated with the establishment of new operations, including activities such as market research, product development, and initial marketing efforts.
The Company recognizes these expenses as incurred, consistently matching with the revenues generated.
Defined Contribution Plans
The
Company contributes to various government-mandated employee benefit plans in the People’s Republic of China, including pension,
medical, unemployment, and housing provident funds. These contributions are made in accordance with local laws and regulations and are
expensed as incurred. The Company’s obligations under these plans are limited to the amounts required to be contributed. For the
three months ended June 30, 2025 and 2024, the Company contributed approximately $
Income Taxes
The Company records income tax expense using the asset-and-liability method of accounting for deferred income taxes. Under this method, deferred taxes are recognized for the tax consequences in future years of differences between the tax bases of assets and liabilities and their financial reporting amounts at each year-end based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income. Deferred tax assets are reduced by a valuation allowance if, based on available evidence, it is more likely than not that the deferred tax assets will not be realized.
When tax returns are filed, it is likely some positions taken would be sustained upon examination by the taxing authorities, while others are subject to uncertainty about the merits of the position taken or the amount of the position that would be ultimately sustained. The benefit of a tax position is recognized in the financial statements in the period during which, based on all available evidence, management believes it is more-likely-than-not the position will be sustained upon examination, including the resolution of appeals or litigation processes, if any. Tax positions taken are not offset or aggregated with other positions. Tax positions that meet the more-likely-than-not recognition threshold are measured as the largest amount of tax benefit that is more than 50% likely of being realized upon settlement with the applicable taxing authority. The portion of the benefits associated with tax positions taken that exceeds the amount described above is reflected as a liability for unrecognized tax benefits in the accompanying balance sheets along with any associated interest and penalties that would be payable to the taxing authorities upon examination. Interest associated with unrecognized tax benefits is classified as interest expense and penalties are classified in general and administrative expenses in the statements of operations.
The Company computes basic and diluted earnings per share amounts in accordance with ASC Topic 260, Earnings per Share. Basic earnings per share is computed by dividing net income (loss) available to common shareholders by the weighted average number of common shares outstanding during the reporting period. Diluted earnings per share reflects the potential dilution that could occur if stock options and other commitments to issue common stock were exercised or equity awards vest resulting in the issuance of common stock that could share in the earnings of the Company.
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As of June 30, 2025 and March 31, 2025, the Company does not have any potentially dilutive instrument.
Contingencies
Certain conditions may exist as of the date the financial statements are issued, which could result in a loss to the Company which will be resolved when one or more future events occur or fail to occur. The Company’s management assesses such contingent liabilities, and such assessment inherently involves judgment. In assessing loss contingencies arising from legal proceedings pending against the Company or unasserted claims that may rise from such proceedings, the Company’s management evaluates the perceived merits of any legal proceedings or unasserted claims as well as the perceived merits of the amount of relief sought or expected to be sought.
If the assessment of a contingency indicates it is probable a material loss will be incurred and the amount of the loss can be reasonably estimated, then the estimated loss is accrued in the Company’s financial statements. If the assessment indicates a material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, together with an estimate of the range of possible loss if determinable and material would be disclosed.
Fair Value Measurements
Fair value accounting establishes a framework for measuring fair value and expands disclosure about fair value measurements. Fair value, which is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. This framework provides a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three levels as follows:
| ● | Level 1 inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets. | |
| ● | Level 2 inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the assets or liabilities, either directly or indirectly, for substantially the full term of the financial instruments. | |
| ● | Level 3 inputs to the valuation methodology are unobservable and significant to the fair value. |
The Company’s financial instruments consisted of cash, accounts receivables, accounts payable, contract liabilities and loan from shareholders. The estimated fair value of those balances approximates the carrying amount due to the short maturity of these instruments.
Credit Losses on Financial Instruments
The Company recognizes credit losses on financial instruments in accordance with Accounting Standards Codification (ASC) Topic 326, Financial Instruments – Credit Losses. The Company uses the Current Expected Credit Losses (CECL) model to estimate credit losses on financial assets measured at amortized cost, as well as certain off-balance sheet credit exposures.
Under the CECL model, the estimation of credit losses involves significant judgment and estimation uncertainty. Management exercises its judgment based on historical loss experience, current economic conditions, and reasonable and supportable forecasts. Changes in these factors could have a material impact on the estimated credit losses.
| 15 |
Segment reporting
Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision maker (the “CODM”), which is comprised of the chief executive officer of the Company’s management team. Consequently, the Company has determined that it has only one reportable operating segment.
Recent Accounting Pronouncements
Accounting Standards Update (“ASU”) 2025-04, Compensation—Stock Compensation (Topic 718) and Revenue from Contracts with Customers (Topic 606): Customer Share-Based Payment Awards, clarifies how entities account for share-based consideration payable to a customer. The ASU requires customer awards with vesting conditions tied to purchases to be treated as performance conditions, eliminates the forfeiture policy election, and states that the variable consideration constraint under ASC 606 does not apply to these awards. The standard is effective for annual periods beginning after December 15, 2026, with early adoption permitted. The Company is currently evaluating the impact of this guidance on its financial statements.
ASU 2025-03, Business Combinations (Topic 805) and Consolidation (Topic 810): Accounting Acquirer in a Business Combination Involving a Variable Interest Entity, clarifies that when a business that is a VIE is acquired primarily with equity interests, the determination of the accounting acquirer should follow ASC 805 rather than defaulting to the primary beneficiary under ASC 810. The standard is effective for fiscal years beginning after December 15, 2026, including interim periods within those fiscal years. Early adoption is permitted. The Company does not expect a material impact upon adoption.
ASU 2025-02, Liabilities (Topic 405): Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 122, removes the guidance previously provided under SAB 121 and codified in ASC 405-S99. The amendment reflects the SEC’s rescission of SAB 121 and clarifies that custodians of crypto-assets should assess loss contingencies under ASC 450-20. This update is effective retrospectively for public business entities for annual periods beginning after December 15, 2024. The Company does not expect the adoption of this standard to have a material impact on its financial statements.
ASU 2025-01, Presentation of Financial Statements (Topic 220): Clarifying the Effective Date of Disaggregation of Income Statement Expenses, confirms the effective date of ASU 2024-03 for public business entities. The guidance requires disaggregated expense information in the income statement and is effective for annual periods beginning after December 15, 2026, and interim periods within fiscal years beginning after that date. Early adoption is permitted. The Company is currently evaluating the impact of this standard.
ASU 2024-03, “Debt—Debt with Conversion and Other Options (Subtopic 470-20): Induced Conversions of Convertible Debt Instruments”. The amendments in this ASU are effective for fiscal years beginning after December 15, 2025, and interim reporting periods within those annual reporting periods. Early adoption is permitted as of the beginning of a reporting period if the entity has also adopted ASU 2020-06 for that period. The Company is evaluating the impact of the standard on its consolidated financial statements and disclosures.
ASU 2024-03, Disaggregation of Income Statement Expenses. The guidance primarily will require enhanced disclosures about certain types of expenses. The amendments in ASU 2024-03 are effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027 and may be applied either on a prospective or retrospective basis. The Company is evaluating the impact of the standard on its consolidated financial statements and disclosures.
ASU 2023-09, Improvements to Income Tax Disclosures. This ASU requires greater disaggregation of information about a reporting entity’s effective tax rate reconciliation as well as information on income taxes paid. This ASU applies to all entities subject to income taxes and is intended to help investors better understand an entity’s exposure to potential changes in jurisdictional tax legislation and assess income tax information that affects cash flow forecasts and capital allocation decisions. This ASU is effective for annual periods beginning after December 15, 2024, with early adoption permitted. This ASU should be applied on a prospective basis although retrospective application is permitted. The Company is currently evaluating the impact that adoption of this accounting standard will have on its consolidated financial statements and disclosures.
Management does not believe that other recently issued but not yet adopted accounting pronouncements will have a material impact on the Company’s financial position, results of operations, or cash flows.
| 16 |
NOTE 3 – GOING CONCERN
The
Company’s financial statements have been prepared on a going concern basis, which contemplates the realization of assets and settlement
of liabilities and commitments in the normal course of business. The Company had an accumulated deficit of $
Management’s plan to alleviate the substantial doubt about the Company’s ability to continue as a going concern include attempting to improve its business profitability, its ability to generate sufficient cash flow from its operations to meet its operating needs on a timely basis, obtain additional working capital funds from the majority shareholder and President of the Company to eliminate inefficiencies in order to meet its anticipated cash requirements. However, there can be no assurance that these plans and arrangements will be sufficient to fund the Company’s ongoing capital expenditures and other requirements.
The financial statements do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts and classification of liabilities that might be necessary in the event that the Company cannot continue as a going concern.
NOTE 4 – ACCOUNTS RECEIVABLES
Accounts receivables, net comprised of the following:
| June 30, 2025 | March 31, 2025 | |||||||
| Accounts receivables | $ | $ | ||||||
| Less: Allowance for credit loss | ||||||||
| Total, net | $ | $ | ||||||
There
was
NOTE 5 – OTHER RECEIVABLES AND CURRENT ASSETS
Other
receivables and current assets, net comprised of the following:
| June 30, 2025 | March 31, 2025 | |||||||
| Other receivables and prepayments | $ | $ | ||||||
| Security deposits | ||||||||
| Less: Allowance for credit loss | ||||||||
| Total, net | $ | $ | ||||||
There
was
NOTE 6 – PROPERTY AND EQUIPMENT
Property and equipment, net comprised of the following:
| June 30, 2025 | March 31, 2025 | |||||||
| At Cost: | ||||||||
| Leasehold improvements in progress | $ | $ | ||||||
| Leasehold improvements | ||||||||
| Office furniture and equipment | ||||||||
| Total cost | ||||||||
| Less: Accumulated depreciation | ( | ) | ( | ) | ||||
| Total, net | $ | $ | ||||||
Depreciation
expenses were $
Impairment
losses were $
| 17 |
NOTE 7 – INTANGIBLE ASSET
Intangible asset, net comprised of the following:
| June 30, 2025 | March 31, 2025 | |||||||
| At Cost: | ||||||||
| Patent | $ | $ | ||||||
| Total cost | ||||||||
| Less: Accumulated amortization | ( | ) | ( | ) | ||||
| Total, net | $ | $ | ||||||
Amortization
expenses were $
The amortization expenses for the succeeding five years as follows:
| For the year ending March 31, | ||||
| 2026 (9 months remaining) | $ | |||
| 2027 | ||||
| 2028 | ||||
| 2029 | ||||
| 2030 | ||||
| Total | $ | |||
NOTE 8 – LOANS PAYABLE AND NOTES PAYABLE
On
December 31, 2024, the Company entered into a promissory note agreement amending the terms of existing loan agreements with outstanding
balances of CNY
On March 24, 2025, the Company borrowed CNY ($) from the unrelated third party pursuant to a loan agreement. The loan is unsecured, non-interest-bearing, with a maturity date of .
On
March 31, 2025, the Company entered into a Tripartite Debt Assignment Agreement with Mr. Barry Wan (a related party) and the unrelated
party, pursuant to which the CNY
As of June 30, 2025 and March 31, 2025, there was outstanding balance of the Notes Payable and loans payable to unrelated third party.
NOTE 9 – RELATED PARTY TRANSACTIONS
Due to related parties
Due
to related parties comprised of the following:
| June 30, 2025 | March 31, 2025 | |||||||
| Barry Wan (“Mr. Wan”) | $ | $ | ||||||
| Total | $ | $ | ||||||
| 18 |
Due to related parties balances above are unsecured and non-interest-bearing.
Promissory notes payable and loans payable
Promissory notes payable and loans payable related parties comprised of the following:
| June 30, 2025 | March 31, 2025 | |||||||
| Mr. Wan – Promissory note maturity date December 31, 2029 | $ | $ | ||||||
| Mr. Wan – Loans maturity date December 9, 2027 | ||||||||
| New Lite – Promissory note maturity date December 31, 2029 | ||||||||
| Total | $ | $ | ||||||
All promissory notes and loans payable are unsecured and non-interest-bearing.
Advances from Mr. Wan
During
the three months ended June 30, 2025, the Company received advances from Mr. Wan, our President for working capital purpose. The outstanding
amount due to Mr. Wan was $
Debt Assignment to Mr. Wan
On
March 31, 2025, the Company entered into a Tripartite Debt Assignment Agreement with Mr. Barry Wan (a related party) and the unrelated
third-party original lender, pursuant to which the CNY
Advances from Tairan Baohe Insurance Sales Co., Ltd. (“Tairan”)
During
the year ended March 31, 2025, the Company borrowed funds from Tairan, an entity where Mr. Wan’s spouse is a shareholder, for working
capital purpose. The outstanding amount due to Tairan was $ and $ as of June 30, 2025 and March 31, 2025, respectively. The loan
was unsecured, non-interest-bearing and due on demand. On December 31, 2024, the Company formalized a promissory note agreement for CNY
Advances from New Lite Ventures LLC (“New Lite”)
During the year ended March 31, 2025, the Company borrowed funds from New Lite, an entity where Mr. Wan is a controlling member, for working capital purpose. The amount was unsecured, non-interest-bearing and due on demand.
On
December 31, 2024, the Company formalized a promissory note agreement for $
| 19 |
NOTE 10 – INCOME TAX
The Company has not recognized an income tax benefit for its operating losses generated based on uncertainties concerning its ability to generate taxable income in future periods. The tax benefit for the period presented is offset by a valuation allowance established against deferred tax assets arising from the net operating losses, the realization of which could not be considered more likely than not. In future periods, tax benefits and related deferred tax assets will be recognized when management considers realization of such amounts to be more likely than not.
United States
Hong Kong
Companies
incorporated in Hong Kong are subject to Hong Kong Profits Tax on the taxable income as reported in its statutory financial statements
adjusted in accordance with relevant Hong Kong tax laws. The applicable tax rate is
PRC
Effective
on January 1, 2008, the PRC Enterprise Income Tax Law, EIT Law, and Implementing Rules impose a unified enterprise income tax rate of
Income Taxes Paid
For the three months ended June 30, 2025 and 2024, the Company did not pay any income taxes, either domestically or in foreign jurisdictions.
The following table summarizes the taxable income (loss) before income taxes by jurisdiction:
| Three months ended June 30, | ||||||||
| 2025 | 2024 | |||||||
| United States | $ | ( | ) | $ | ( | ) | ||
| Hong Kong | ||||||||
| China | ( | ) | ||||||
| Total | $ | ( | ) | $ | ( | ) | ||
The following table summarizes a reconciliation of income tax expense for operations, calculated at the statutory income tax rate to total income tax expense (benefit):
Three months ended June 30, | ||||||||
| 2025 | 2024 | |||||||
| Loss before income taxes | $ | ( | ) | $ | ( | ) | ||
| U.S. federal tax benefits ( | ( | ) | ( | ) | ||||
| State tax benefit, net of federal benefits | ( | ) | ( | ) | ||||
| PRC tax expenses (benefits) ( | ( | ) | ||||||
| Hong Kong tax benefits ( | ||||||||
| Income tax expenses (benefits) at statutory rate | ( | ) | ( | ) | ||||
| Foreign tax rate differential | ||||||||
| Change in valuation allowance | ||||||||
| Other | ||||||||
| Provision for income taxes expenses (benefits) | $ | $ | ||||||
| Effective tax rate | % | % | ||||||
| 20 |
NOTE 11 – SHAREHOLDERS’ EQUITY
The Company is authorized to issued shares of Class A common stock, Class B common stock, Class C common stock, Class D common stock, and Class E common stock; all with a par value of $ per share.
As of June 30, 2025, the Company had shares of Class A common stock issued and outstanding; and shares of Class B, Class C, Class D, or Class E common stock were issued and outstanding.
On March 28, 2023, the Company amended its article with New York State to change the authorized common shares with a par value of $ to shares, preferred shares.
During
the years ended March 31, 2024, a shareholder loan in the amount of $
On June 6, 2024, the Company amended its article with New York State to increase the authorized shares of common stock of the Company from thirty million () shares of common stock, par value $ per share, to six billion () shares of common stock, par value $ per share (the “Authorized Capital Increase”). Upon the effectiveness of the authorized shares increase, the shares of common stock will be categorized as follows: Class A shares, Class B shares, Class C shares, Class D shares, and Class E shares.
NOTE 12 – DISAGGREGATION OF REVENUE
The
Company disaggregates its revenue by major revenue streams, as the Company believes this disaggregation best depicts how the nature,
amount, timing and uncertainty of the revenue and cash flows are affected by economic factors.
Three months ended June 30, | ||||||||
| 2025 | 2024 | |||||||
| Technical operation support and maintenance services | $ | $ | ||||||
| Total | $ | $ | ||||||
NOTE 13 – LEASES
The Company has various operating leases for its office space and retail space.
Operating lease right-of-use assets and liabilities are recognized at the commencement date based on the present value of lease payments over the lease term. The discount rate used to calculate the present value is incremental borrowing rate or, if available, the rate implicit in the lease. The Company determines the incremental borrowing rate for each leases based primarily on its lease term.
| 21 |
Certain lease agreements may include renewal options that are exercisable at the Company’s discretion. The Company includes renewal periods in the lease term when it is reasonably certain that the renewal option will be exercised. For leases where the renewal is not reasonably certain, the extension options are excluded from the measurement of lease liabilities and right-of-use assets. The lease term used reflects only the non-cancellable period and any renewal options that the Company is reasonably certain to exercise.
Operating
lease expenses were $
The components of lease expense and supplemental cash flow information related to leases for the period are as follows:
Three months ended June 30, | ||||||||
| 2025 | 2024 | |||||||
| Lease cost | ||||||||
| Operating lease cost | $ | $ | ||||||
| Other Information | ||||||||
| Cash paid for amounts included in the measurement of lease liabilities | $ | $ | ||||||
| Weighted average remaining lease term – operating leases (in years) | ||||||||
| Average discount rate – operating lease | % | % | ||||||
The supplemental balance sheet information related to leases is as follows:
| June 30, 2025 | March 31, 2025 | |||||||
| Operating leases | ||||||||
| Right-of-use assets | $ | $ | ||||||
| Operating lease liabilities | $ | $ | ||||||
The undiscounted future minimum lease payment schedule as follows:
| For the year ending March 31, | ||||
| 2026 (9 months remaining) | $ | |||
| 2027 | ||||
| 2028 | ||||
| 2029 | ||||
| 2030 | ||||
| Thereafter | ||||
| Total undiscounted lease payments | ||||
| Less: interest | ( | ) | ||
| Total lease liabilities | $ | |||
NOTE 14 – RISKS, COMMITMENTS AND CONTINGENCIES
Litigations and claims
To the best of the Company’s knowledge and based on information available as of June 30, 2025, the Company is not involved in any material claims or legal actions arising from the ordinary course of business. However, the Company is exposed to various risks and uncertainties that could potentially result in litigation or claims in the future. The Company continuously evaluates these contingencies and will adjust its disclosures as necessary.
Concentration Risks
For
the three months ended June 30, 2025,
The Company is economically dependent on this customer, and the loss of this relationship could have a material adverse effect on its financial condition, results of operations, and cash flows.
NOTE 15 – SUBSEQUENT EVENTS
The Company evaluated all events or transactions that occurred after June 30, 2025 through the date the financial statements were issued. During the period, the Company did not have any material recognizable subsequent events required to be disclosed or adjusted as of and for the three months ended June 30, 2025.
| 22 |
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
This Quarterly Report on Form 10-Q contains forward-looking statements, particularly those identified with the words, “anticipates,” “believes,” “expects,” “plans,” “intends,” “objectives,” and similar expressions. These statements reflect management’s best judgment based on factors known at the time of such statements. The reader may find discussions containing such forward-looking statements in the material set forth under “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” generally, and specifically therein under the captions “Liquidity and Capital Resources” as well as elsewhere in this Quarterly Report on Form 10-Q. Actual events or results may differ materially from those discussed herein. The forward-looking statements specified in the following information have been compiled by our management on the basis of assumptions made by management and considered by management to be reasonable. Our future operating results, however, are impossible to predict and no representation, guarantee, or warranty is to be inferred from those forward-looking statements. The assumptions used for purposes of the forward-looking statements specified in the following information represent estimates of future events and are subject to uncertainty as to possible changes in economic, legislative, industry, and other circumstances. As a result, the identification and interpretation of data and other information and their use in developing and selecting assumptions from and among reasonable alternatives require the exercise of judgment. To the extent that the assumed events do not occur, the outcome may vary substantially from anticipated or projected results, and, accordingly, no opinion is expressed on the achievability of those forward-looking statements. No assurance can be given that any of the assumptions relating to the forward-looking statements specified in the following information are accurate, and we assume no obligation to update any such forward-looking statements.
Overview
Antiaging Quantum Living Inc. (FKA: Achison Inc.) (the “Company”, “us”, “we” or “our”) was incorporated under the laws of the State of New York on December 29, 2014.
On July 1, 2019, Lansdale Inc., the principal stockholder of the Company (“Seller”) and an entity controlled by the Company’s former President, Mr. Wanjun Xie, entered into a Stock Purchase Agreement (the “Agreement”) with Dazhong 368 Inc., (the “Buyer”), pursuant to which, a total of 9,000,000 shares of Class A common stock of the Company were transferred to the Buyer, representing approximately 90% of the Company’s issued and outstanding shares of Class A common stock, resulting in a change of the control of the Company. Mr. Dingshan Zhang was appointed as the President and CEO of the Company on the same date.
On April 10, 2023, Mr. Barry Wan acquired control of 29,215,000 restricted shares of Class A common stock (the “Purchased Shares”) of the Company, representing approximately 97% of the Company’s total issued and outstanding common stock from Dazhong 368 Inc and Sophia 33 Inc, two New York corporations controlled by the Company’s then President, Chief Executive Officer and sole director, Dingshan Zhang (the former President) pursuant to the terms of a Stock Purchase Agreement by and among the parties thereto (the “Stock Purchase Agreement”). Pursuant to the Stock Purchase Agreement, Mr. Wan paid an aggregate purchase price of four hundred thousand dollars ($400,000.00) to Mr. Zhang in exchange for the purchased shares. The foregoing transaction resulted in a change of control of the Company, with Mr. Wan acquiring 97% of the Company’s outstanding Class A common stock held through New Lite Ventures LLC, a New York LLC. Both before and after the transactions, the Company had 29,995,000 shares of its Class A common stock outstanding.
In connection with the transaction, on April 10, 2023, Mr. Dingshan Zhang resigned from all positions he held with the Company. On April 10, 2023, Ms. Jing Wan was appointed by our majority shareholder as our Chief Executive Officer, Chief Financial Officer, President and Director. On June 16, 2023, Mr. Barry Wan consented to act as the new Chief Executive Officer and Chief Financial Officer after Ms. Jing Wan resigned. The Company changed its name to Antiaging Quantum Living Inc. on June 14, 2023.
| 23 |
The change in control with respect to the Company was effectuated to better reflect its new business direction, with the intention of acquiring businesses involved in healthcare management and insurance services.
In line with this expansion, the Company established AAQL Inc. AAQL HK Limited Dao Ling Doctor Hangzhou, Dao Ling Doctor Zhejiang, and Dao Ling Doctor Huzhou entities.
On July 25, 2024, the Board of Directors of the Company approved the appointment of J&S Associate PLT to be the new independent registered public accounting firm for the financial period ending June 30, 2024. This appointment addressed the vacancy created by the resignation of PWN LLP as the Company’s former independent registered public accounting firm.
On September 6, 2024, the holders of a majority of the issued and outstanding voting securities of the Company approved an amendment to its Certificate of Incorporation increase in the number of authorized shares of common stock of the Company from thirty million (30,000,000) shares of common stock, par value $0.001 per share, to six billion (6,000,000,000) shares of common stock, par value $0.00001 per share (the “Authorized Capital Increase”). Upon the effectiveness of the Authorized Capital Increase, the shares of common stock will be categorized as follows: 1,200,000,000 Class A shares, 1,200,000,000 Class B shares, 1,200,000,000 Class C shares, 1,200,000,000 Class D shares, and 1,200,000,000 Class E shares. On the same day, the Certificate of Amendment to the Certificate of Incorporation of the Company was filed with New York State Department effectuating the Authorized Capital Increase.
Results of Operation for the three months ended June 30, 2025 and 2024
| 2025 | 2024 | $ Changed | % Changed | |||||||||||||
| Revenue | 291,438 | 202,069 | 89,369 | 44.23 | % | |||||||||||
| Cost of revenues | 56,706 | 165 | 56,541 | 34,267.27 | % | |||||||||||
| Gross profit | 234,732 | 201,904 | 32,828 | 16.26 | % | |||||||||||
| Gross margin | 80.54 | % | 99.9 | % | (19.38 | )% | ||||||||||
| Selling, general and administrative expenses | 372,935 | 415,837 | (42,902 | ) | (10.32 | )% | ||||||||||
| Loss from operations | (138,203 | ) | (213,933 | ) | 75,730 | (35.40 | )% | |||||||||
| Other income (loss) | 10,831 | 25 | 10,806 | 43,224 | % | |||||||||||
| Income tax expenses (benefits) | 6,000 | - | 6,000 | 100 | % | |||||||||||
| Net loss | (133,372 | ) | (213,908 | ) | 80,536 | (37.65 | )% | |||||||||
During the three months ended June 30, 2025 and 2024, the Company generated revenues of $291,438 and $202,069, respectively. The increase in revenue was primarily due to the online platform technical operation support and maintenance services, which accounted for the entire revenue for the period.
Cost of revenues was $56,706 and $165 for the three months ended June 30, 2025 and 2024, respectively. Gross profit increased to $234,732 (gross margin of 80.54%) for the three months ended June 30, 2025, as compared to gross profit of $201,904 (gross margin of 99.9%) for the three months ended June 30, 2024. The change in gross margin is primarily due to the shift in revenue streams to technical support and maintenance services business, which carries a different cost structure.
The Company incurred operating expenses of $372,935 and $415,837 for the three months ended June 30, 2025 and 2024, respectively. The decrease in operating expenses was mainly due to the decrease in employee wages and benefits and legal and professional fees.
For the three months ended June 30, 2025, the Company received renovation subsidy of $10,810, which was recognized as other income, along with interest income.
For the three months ended June 30, 2025, our net loss was $133,372 comparing to a net loss of $213,908 for the three months ended June 30, 2024. The decrease in net loss is mainly due to the increased revenues and increase of other income.
Equity and Capital Resources
As of June 30, 2025, we had an accumulated deficit of $1,543,084 and working capital of $110,373, compared to accumulated deficit of $1,409,712 and a working capital of $132,689 as of March 31, 2025.
The decrease in the working capital was primarily driven by the increases in accounts receivables offset by the increase in operating lease liabilities – current portion and due to related parties, which impacted available cash.
The Company’s net loss was partially offset by non-cash expenses, including $35,782 in depreciation and amortization, and $98,337 in amortization related to right-of-use (ROU) assets, mainly associated with leased office and retail spaces and leasehold improvements. Additionally, an increase of accounts receivables of $187,547 affected net cash used in operating activities for the three months ended June 30, 2025.
During the three months ended June 30, 2025 and 2024, the Company purchased fixed assets totaling $1,089 and $29,643, respectively.
During the three months ended June 30, 2025 and 2024, the Company received advances of $220,000 and $199,803 from related parties for working capital purposes, which shareholders are prepared to provide additional funding as needed.
As of June 30, 2025, we held approximately $405,725 in cash and cash equivalents. Our liabilities are primarily funded by shareholder loans and unrelated parties’ loans, which do not require immediate repayment. Operations are continuing as usual, and management is committed to implementing expense control measures in the near term to support liquidity.
Going Concern Assessment
The Company demonstrates adverse conditions that raise substantial doubt about the Company’s ability to continue as a going concern. These adverse conditions are negative financial trends, specifically cash outflow from operating activities, operating losses, accumulated deficit and other adverse key financial ratios.
Management’s plan to alleviate the substantial doubt about the Company’s ability to continue as a going concern include attempts to consummate a business combination and to generate sufficient cash flow from its operations to meet its operating needs on a timely basis; as well as to obtain additional working capital funds as loans from the majority shareholder and the President of the Company.
| 24 |
The unaudited condensed and consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts and classification of liabilities that might be necessary in the event that the Company cannot continue as a going concern.
Off-Balance Sheet Arrangements
We have no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to stockholders.
Critical Accounting Policies
The financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements requires making estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. The estimates are based on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis of making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.
The critical accounting policies are discussed in further detail in the notes to the unaudited financial statements appearing elsewhere in this 10-Q report. Management believes that the application of these policies on a consistent basis enables us to provide useful and reliable financial information about our operating results and financial condition
Item 3. Quantitative and Qualitative Disclosures About Market Risk
As a “smaller reporting company” we are not required to provide this information under this item pursuant to Regulation S-K.
Item 4. Controls and Procedures.
Evaluation of Disclosure Controls and Procedures
Disclosure controls and procedures are designed with an objective of ensuring that information required to be disclosed in our periodic reports filed with the Securities and Exchange Commission, such as this Quarterly Report on Form 10-Q, is recorded, processed, summarized and reported within the time periods specified by the Securities and Exchange Commission. Disclosure controls are also designed with an objective of ensuring that such information is accumulated and communicated to our management, including our chief executive officer, in order to allow timely consideration regarding required disclosures.
The evaluation of our disclosure controls by our principal executive officer included a review of the controls’ objectives and design, the operation of the controls, and the effect of the controls on the information presented in this Annual Report. Based on our management’s evaluation, our Chief Executive Officer, have concluded that as of such date, our disclosure controls were not, in design and operation, effective at a reasonable assurance level due to the material weaknesses in internal control over financial reporting. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Also, projections of any evaluation of the disclosure controls and procedures to future periods are subject to the risk that the disclosure controls and procedures may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
| 25 |
As of the end of the period covered by this report, we carried out an evaluation, under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934 as of the end of the period covered by this report. Based on that evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that there were material weakness in our internal controls over Financial reporting as of June 30, 2025 and they were therefore not as effective as they could be to ensure that information required to be disclosed by us in reports that we file or submit under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms. The material weakness in our controls and procedure were lack of US GAAP knowledge and segregation duties. Management does not believe that any of these material weaknesses materially affected the results and accuracy of its financial statements. However, in view of this discovery of such weaknesses, management has begun a review to improve them.
Changes in Internal Control over Financial Reporting
There were no changes in our internal control over financial reporting identified in connection with the evaluation required by paragraph (d) of Rule 13a-15 or Rule 15d-15 under the Exchange Act that occurred during the quarter ended June 30, 2025 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
PART II – OTHER INFORMATION
Item 1. Legal Proceedings.
None
Item 1A. Risk Factors.
As a “smaller reporting company”, we are not required to provide this information under this item pursuant to Regulation S-K.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
None
Item 3. Defaults Upon Senior Securities
None
Item 4. Mine Safety Disclosures
Not applicable.
Item 5. Other Information
None
| 26 |
Item 6. Exhibits
** Filed herewith.
| 27 |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| ANTIAGING QUANTUM LIVING INC | |
| Date: August 14, 2025 | /s/ Barry Wan |
| Barry Wan, Chief Executive Officer | |
| Date: August 14, 2025 | /s/ Barry Wan |
| Barry Wan, Chief Financial Officer |
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