Cheer Holding, Inc 6-K, filed Jul 28, 2026
Cheer Holding, Inc. (CHR)
About this 6-K
Cheer Holding, Inc filed this 6-K on July 28, 2026.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934
For the month of July
Commission File Number:
19F, Block B, Xinhua Technology Building,
No. 8 Tuofangying South Road,
Jiuxianqiao, Chaoyang District, Beijing, China 100016
(Address of principal executive office)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:
Form 20-F ☒ Form 40-F ☐
Explanatory Note
CHEER HOLDING, INC. (the “Company”) is furnishing this Form 6-K to provide its six-month interim financial statements and to incorporate such financial statements into the Company’s registration statements referenced below.
This Form 6-K and Exhibits 99.1 and 99.2 to this Form 6-K shall be deemed to be incorporated by reference in the registration statements of on Form S-8 (File Nos. 333-297566, 333-282386, and 333-237788) and on Form F-3 (File No. 333-279221), each as filed with the Securities and Exchange Commission, to the extent not superseded by documents or reports subsequently filed.
Press Release
A news release entitled “Cheer Holding Reports 2026 Half Year Results” is attached as Exhibit 99.3. The news release referred to in this report and attached as an exhibit hereto shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, and shall not be deemed incorporated by reference into any filings made by the Company under the Securities Act, or the Exchange Act, except as may be expressly set forth by specific reference in such filing.
1
Exhibit Index
Exhibit Index
| Exhibit No. | Exhibit Description | |
| 99.1 | Unaudited Interim Condensed Consolidated Financial Statements for the Six Months Ended June 30, 2026 and 2025. | |
| 99.2 | Operating and Financial Review and Prospectus in connection with the Unaudited Interim Condensed Consolidated Financial Statements for the Six Months Ended June 30, 2026 and 2025. | |
| 99.3 | Press Release - Cheer Holding Reports 2026 Half Year Results | |
| 101.INS | Inline XBRL Instance Document | |
| 101.SCH | Inline XBRL Taxonomy Extension Schema Document | |
| 101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document | |
| 101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document | |
| 101.LAB | Inline XBRL Taxonomy Extension Label Linkbase Document | |
| 101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document | |
| 104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) |
2
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| Dated: July 28, 2026 | Cheer Holding, Inc. | |
| By: | /s/ Bing Zhang | |
| Name: | Bing Zhang | |
| Title: | Chief Executive Officer | |
3
Exhibit 99.1
CHEER HOLDING, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In U.S. dollars in thousands, except share and per share data)
| As of June 30, 2026 |
As of December 31, 2025 |
|||||||
| (unaudited) | (audited) | |||||||
| Assets | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | $ | ||||||
| Accounts receivable | ||||||||
| Prepayment and other current assets | ||||||||
| Total current assets | ||||||||
| Property, plant and equipment, net | ||||||||
| Intangible assets, net | ||||||||
| Unamortized produced content, net | ||||||||
| Right-of-use assets | ||||||||
| Other non-current assets | ||||||||
| Total non-current assets | ||||||||
| TOTAL ASSETS | $ | $ | ||||||
| Liabilities and Shareholders’ Equity | ||||||||
| Current liabilities: | ||||||||
| Short-term bank loans | $ | $ | ||||||
| Accounts payable | ||||||||
| Contract liabilities | ||||||||
| Accrued liabilities and other payables | ||||||||
| Due to related parties | ||||||||
| Other taxes payable | ||||||||
| Lease liabilities current | ||||||||
| Total current liabilities | ||||||||
| Lease liabilities non-current | ||||||||
| Total non-current liabilities | ||||||||
| TOTAL LIABILITIES | $ | $ | ||||||
| Shareholders’ Equity | ||||||||
| Preferred shares (par value of $ | $ | $ | ||||||
| Class A Ordinary shares (par value of $ | ||||||||
| Class B Ordinary shares (par value of $ | ||||||||
| Additional paid-in capital | ||||||||
| Statutory reserve | ||||||||
| Retained earnings | ||||||||
| Accumulated other comprehensive income (loss) | ( | ) | ||||||
| TOTAL CHEER HOLDING, INC SHAREHOLDERS’ EQUITY | ||||||||
| Non-controlling interest | ||||||||
| TOTAL SHAREHOLDERS’ EQUITY | ||||||||
| TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | $ | $ | ||||||
| * |
| ** |
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
F-1
CHEER HOLDING, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME
(In U.S. dollars in thousands, except share and per share data)
| For the Six Months Ended June 30, |
||||||||
| 2026 | 2025 | |||||||
| Revenues | $ | $ | ||||||
| Operating expenses: | ||||||||
| Cost of revenues | ( | ) | ( | ) | ||||
| Selling and marketing | ( | ) | ( | ) | ||||
| General and administrative | ( | ) | ( | ) | ||||
| Research and development | ( | ) | ( | ) | ||||
| Total operating expenses | ( | ) | ( | ) | ||||
| Income from operations | ||||||||
| Other income (expenses): | ||||||||
| Interest income (expenses), net | ( | ) | ||||||
| Other income (expenses), net | ( | ) | ||||||
| Total other income (expenses) | ( | ) | ||||||
| Income before income tax | ||||||||
| Income tax (expense) benefit | ( | ) | ||||||
| Net income | ||||||||
| Less: net gain attributable to non-controlling interest | ||||||||
| Net income attributable to Cheer Holding, Inc.’s shareholders | $ | $ | ||||||
| Other comprehensive gain | ||||||||
| Unrealized foreign currency translation gain | ||||||||
| Comprehensive income | ||||||||
| Less: comprehensive gain attributable to non-controlling interests | ||||||||
| Comprehensive income attributable to Cheer Holding, Inc.’s shareholders | $ | $ | ||||||
| Earnings per ordinary share | ||||||||
| Basic and dilutive* | $ | $ | ||||||
| Weighted average shares used in calculating earnings per ordinary share | ||||||||
| Basic and dilutive* | ||||||||
| * |
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
F-2
CHEER HOLDING, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY
(In U.S. dollars in thousands, except share and per share data)
| Cheer Holding, Inc.’s Shareholders | ||||||||||||||||||||||||||||||||||||||||||||
| Class A ordinary shares |
Class B ordinary shares |
Additional paid-in |
Retained | Statutory | Accumulated other comprehensive |
Total Cheer Holding, Inc.s’ shareholder’ |
Non-controlling | Total Shareholders’ |
||||||||||||||||||||||||||||||||||||
| Shares* | Amount | Shares | Amount** | capital | earnings | reserve | Income (loss) | equity | interests | Equity | ||||||||||||||||||||||||||||||||||
| Balance as of December 31, 2024 | $ | $ | $ | $ | $ | $ | ( | ) | $ | $ | $ | |||||||||||||||||||||||||||||||||
| Share-based compensation | - | |||||||||||||||||||||||||||||||||||||||||||
| Net income for the period | - | - | ||||||||||||||||||||||||||||||||||||||||||
| Foreign currency translation adjustment | - | - | ||||||||||||||||||||||||||||||||||||||||||
| Balance as of June 30, 2025 | $ | $ | $ | $ | $ | $ | ( | ) | $ | $ | $ | |||||||||||||||||||||||||||||||||
| Balance as of December 31, 2025 | $ | $ | $ | $ | $ | $ | ( | ) | $ | $ | $ | |||||||||||||||||||||||||||||||||
| Issuance of shares due to roundup of fractional shares in share consolidation | ||||||||||||||||||||||||||||||||||||||||||||
| Issuance of shares to settle outstanding warrants | ( | ) | ||||||||||||||||||||||||||||||||||||||||||
| Net income for the period | - | - | ||||||||||||||||||||||||||||||||||||||||||
| Foreign currency translation adjustment | - | - | ||||||||||||||||||||||||||||||||||||||||||
| Balance as of June 30, 2026 | $ | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||
| * |
| ** |
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
F-3
CHEER HOLDING, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In U.S. dollars in thousands)
| For the Six Months Ended June 30, |
||||||||
| 2026 | 2025 | |||||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||
| Net cash (used in) provided by operating activities | $ | ( | ) | $ | ||||
| CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||
| Purchase of property and equipment | ( | ) | ||||||
| Purchase of intangible assets | ( | ) | ||||||
| Net cash used in investing activities | ( | ) | ||||||
| CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||
| Proceeds from bank loans | ||||||||
| Repayments of bank loans | ( | ) | ( | ) | ||||
| Payment of loan origination fees | ( | ) | ||||||
| Net cash used in financing activities | ( | ) | ( | ) | ||||
| Effect of exchange rate changes | ||||||||
| Net increase (decrease) in cash and cash equivalents | ( | ) | ||||||
| Cash and cash equivalents, at beginning of period | ||||||||
| Cash and cash equivalents, at end of period | $ | |||||||
| SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: | ||||||||
| Interests paid | $ | $ | ||||||
| Acquisition of intangible asset from settlement of prepayments | $ | $ | ||||||
| Lease liabilities arising from obtaining right-of-use assets | $ | $ | ||||||
| Issuance of shares to settle outstanding warrants | $ | $ | ||||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
F-4
CHEER HOLDING, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In U.S. dollars in thousands, except share and per share data)
1. ORGANIZATION AND PRINCIPAL ACTIVITIES
Cheer Holding, Inc. (“CHR” or the “Company”) is an exempted company incorporated on
On May 12, 2025, the shareholders of the Company, at the Annual General Meeting, approved to increase the authorized share capital of the Company from US$
On December 22, 2025, the Company effected a share consolidation at a ratio of one-for-fifty (
On April 6, 2026, the Company effected a share consolidation by the cancellation of one authorized but unissued Class A ordinary share of a par value of US$
As of June 30, 2026, the Company’s subsidiaries, the VIEs and the VIE’s subsidiaries were as the following:
| Date of incorporation | Place of incorporation | Percentage of legal/beneficial ownership by the Company | Principal activities | |||||||||
| Subsidiaries: | ||||||||||||
| Glory Star New Media Group HK Limited (“Glory Star HK”) | % | |||||||||||
| Glory Star New Media (Beijing) Technology Co., Ltd. (“WFOE”) | % | |||||||||||
| VIEs: | ||||||||||||
| Xing Cui Can International Media (Beijing) Co., Ltd. (“Xing Cui Can”) | % | |||||||||||
| Horgos Glory Star Media Co., Ltd. (“Horgos”) | % | |||||||||||
| VIEs’ subsidiaries | ||||||||||||
| Glory Star Media (Beijing) Co., Ltd. (“Glory Star Beijing”) | % | |||||||||||
| Leshare Star (Beijing) Technology Co., Ltd. (“Beijing Leshare”) | % | |||||||||||
| Horgos Glary Prosperity Culture Co., Ltd. (“Glary Prosperity”) | % | |||||||||||
| Glory Star (Horgos) Media Technology Co., Ltd (“Horgos Technology”) | % | |||||||||||
| * | On June 13, 2025, we dissolved Horgos Glary Prosperity Culture Co., Ltd. Beijing Branch due to its inactive operations. For the year ended December 31, 2025, we recognized minimal gain arising from the dissolution and recorded in the account of “other income, net” in the unaudited condensed consolidated statements of income and comprehensive income. |
F-5
CHEER HOLDING, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In U.S. dollars in thousands, except share and per share data)
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of presentation
The unaudited condensed consolidated financial statements have been prepared in accordance with the rules and regulations of the Security and Exchange Commission and accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial reporting. Certain information and footnote disclosures normally included in financial statements prepared in conformity with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations. Accordingly, these statements should be read in conjunction with the Company’s audited consolidated financial statements for the year ended December 31, 2025 filed on March 20, 2026.
In the opinion of the management, the accompanying unaudited condensed consolidated financial statements reflect all normal recurring adjustments, which are necessary for a fair presentation of financial results for the interim periods presented. The Company believes that the disclosures are adequate to make the information presented not misleading. The accompanying unaudited condensed consolidated financial statements have been prepared using the same accounting policies as used in the preparation of the Company’s consolidated financial statements for the year ended December 31, 2025. The results of operations for the six months ended June 30, 2026 and 2025 are not necessarily indicative of the results for the full years.
Financial statement amounts and balances of the VIEs and the VIEs’ subsidiaries
Total assets and liabilities presented on the Company’s unaudited condensed consolidated balance sheets and revenue, expense, net income presented on the Company’s unaudited condensed consolidated statements of income as well as the cash flow from operating, investing and financing activities presented on the unaudited condensed consolidated statements of cash flows are substantially the financial position, operation and cash flow of the VIEs and the VIEs’ subsidiaries. CHR has not provided any financial support to the VIEs and the VIEs’ subsidiaries for the six months ended June 30, 2026 and 2025.
| As of June 30, 2026 | As of December 31, 2025 | |||||||
| Total assets | $ | $ | ||||||
| Total liabilities | $ | $ | ||||||
| For the Six Months Ended June 30, | ||||||||
| 2026 | 2025 | |||||||
| Total revenues | $ | $ | ||||||
| Net income | $ | $ | ||||||
| Net cash (used in) provided by operating activities | $ | ( | ) | $ | ||||
| Net cash used in investing activities | $ | ( | ) | $ | ||||
| Net cash used in financing activities | $ | ( | ) | $ | ( | ) | ||
The VIEs and the VIEs’ subsidiaries contributed
F-6
CHEER HOLDING, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In U.S. dollars in thousands, except share and per share data)
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)
Financial statement amounts and balances of the VIEs and the VIEs’ subsidiaries (cont.)
There are no terms in any arrangements, considering both explicit arrangements and implicit variable interests that require the Company or its subsidiaries to provide financial support to the VIEs. However, the Company has provided and will continue to provide financial support to the VIEs considering the business requirements of the VIEs, as well as the Company’s own business objectives in the future.
There are no assets held in the VIEs and the VIEs’ subsidiaries that can be used only to settle obligations of the VIEs and the VIEs’ subsidiaries, except for registered capital and the PRC statutory reserves. As the VIEs and the VIEs’ subsidiaries are incorporated as a limited liability company under the PRC Company Law, creditors of the VIEs and the VIEs’ subsidiaries do not have recourse to the general credit of the Company for any of the liabilities of the VIEs and the VIEs’ subsidiaries. Relevant PRC laws and regulations restrict the VIEs and the VIEs’ subsidiaries from transferring a portion of their net assets, equivalent to the balance of its statutory reserve and its share capital, to the Company in the form of loans and advances or cash dividends.
Accounts Receivable
Accounts receivable are recorded at the gross billing amount less an allowance for expected credit losses against accounts receivable due from the customers. Accounts receivable do not bear interest.
The Company adopted Accounting Standards Update (“ASU”) No. 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”). Upon adoption, the Company changed the impairment model to utilize a forward-looking current expected credit losses (CECL) model in place of the incurred loss methodology for financial instruments measured at amortized cost and receivables resulting from the application of ASC 606, including contract assets.
The Company maintains an allowance for credit losses and records the allowance for credit losses as an offset to accounts receivable and the estimated credit losses charged to the allowance is classified as “General and administrative expenses” in the unaudited condensed consolidated statements of income and comprehensive income. The Company assesses collectability by reviewing accounts receivable on aging schedules because the accounts receivable were primarily consisted of receivables arising from advertising revenue. In determining the amount of the allowance for credit losses, the Company considers historical collectability based on past due status, the age of the balances, current economic conditions, reasonable and supportable forecasts of future economic conditions, and other factors that may affect the Company’s ability to collect from customers. Delinquent account balances are written-off against the allowance for expected credit loss after management has determined that the likelihood of collection is not probable.
For the six months ended June 30, 2026 and 2025, the Company provided credit loss of and $
F-7
CHEER HOLDING, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In U.S. dollars in thousands, except share and per share data)
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)
Unamortized produced content
Produced content includes direct production costs, production overhead and acquisition costs and is stated at the lower of unamortized cost or estimated fair value. Produced content also includes cash expenditures made to enter into arrangements with third parties to co-produce certain of its productions.
The Company uses the individual-film-forecast-computation method and amortizes the produced content based on the ratio of current period actual revenue (numerator) to estimated remaining unrecognized ultimate revenue as of the beginning of the fiscal year (denominator) in accordance with ASC 926. Ultimate revenue estimates for the produced content are periodically reviewed and adjustments, if any, will result in prospective changes to amortization rates. When estimates of total revenues and other events or changes in circumstances indicate that a film or television series has a fair value that is less than its unamortized cost, a loss is recognized currently for the amount by which the unamortized cost exceeds the film or television series’ fair value. For the six months ended June 30, 2026 and 2025, $
Revenue Recognition
The Company adopted Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers, to recognize revenues. The core principle of this new revenue standard is that a company should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. The following five steps are applied to achieve that core principle:
| ● | Step 1: Identify the contract with the customer |
| ● | Step 2: Identify the performance obligations in the contract |
| ● | Step 3: Determine the transaction price |
| ● | Step 4: Allocate the transaction price to the performance obligations in the contract |
| ● | Step 5: Recognize revenue when the company satisfies a performance obligation |
Copyright revenue
The Company mainly offers and generates revenue from the copyright licensing of self-produced content, advertising and customized content production and others. Revenue recognition policies are discussed as follows:
The Company self produces or coproduces TV series featuring lifestyle, culture and fashion, and licenses the copyright of the TV series on an episode basis to the customer for broadcast over a period of time. Generally, the Company signs a contract with a customer which requires the Company to deliver a series of episodes that are substantially the same and that have the same pattern of transfer to the customer. Accordingly, the delivery of the series of episodes is defined as the only performance obligation in the contract.
F-8
CHEER HOLDING, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In U.S. dollars in thousands, except share and per share data)
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)
Copyright revenue (cont.)
For the TV series produced solely by the Company, the Company satisfies its performance obligation over time by measuring the progress toward the delivery of the entire series of episodes which is made available to the licensee for exhibition after the license period has begun. Therefore, the copyright revenue in a contract is recognized over time based on the progress of the number of episodes delivered.
The Company also coproduces TV series with other producers and licenses the copyright to third-party video broadcast platforms for broadcast. For TV series produced by the Company with co-producers, the Company satisfies its performance obligations over time by the delivery of the entire series of episodes to the customer, and requires the customer to pay consideration based on the number and the unit price of valid subsequent views of the TV series that occur on a broadcast platform. Therefore, the copyright revenue is recognized when the later of the valid subsequent view occurs or the performance obligation relating to the delivery of a number of episodes has been satisfied.
Advertising revenue
The Company generates revenue from sales of various forms of advertising on its TV series and streaming content by way of 1) advertisement displays, or 2) the integration of promotion activities in TV series and content to be broadcast. Advertising contracts are signed to establish the different contract prices for different advertising scenarios, consistent with the advertising period. The Company enters into advertising contracts directly with the advertisers or the third-party advertising agencies that represent advertisers.
For the contracts that involve the third-party advertising agencies, the Company is principal as the Company is responsible for fulfilling the promise of providing advertising services and has the discretion in establishing the price for the specified advertisement. Under a framework contract, the Company receives separate purchase orders from advertising agencies before the broadcast. Accordingly, each purchase order is identified as a separate performance obligation, containing a bundle of advertisements that are substantially the same and that have the same pattern of transfer to the customer. Where collectability is reasonably assured, revenue is recognized monthly over the service period of the purchase order.
For contracts signed directly with the advertisers, the Company commits to display a series of advertisements which are substantially the same or similar in content and transfer pattern, and the display of the whole series of advertisements is identified as the single performance obligation under the contract. The Company satisfies its performance obligations over time by measuring the progress toward the display of the whole series of advertisements in a contract, and advertising revenue is recognized over time based on the number of advertisements displayed.
Payment terms and conditions vary by contract types, and terms typically include a requirement for payment within a period from 6 to 9 months. Both direct advertisers and third-party advertising agencies are generally billed at the end of the display period and require the Company to issue VAT invoices in order to make their payments.
Customized content production revenue
The Company produces customized short streaming videos according to its customers’ requirement, and earns fixed fees based on delivery. Revenue is recognized upon the delivery of short streaming videos.
F-9
CHEER HOLDING, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In U.S. dollars in thousands, except share and per share data)
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)
CHEERS E-mall marketplace service revenue
The Company through CHEERS E-mall, an online e-commerce platform, enables third-party merchants to sell their products to consumers in China. The Company charges fees for platform services to merchants for sales transactions completed on the Cheer E-Mall including but not limited to products displaying, promotion and transaction settlement services. The Company does not take control of the products provided by the merchants at any point in the time during the transactions and does not have latitude over pricing of the merchandise. Transaction services fee is determined as the difference between the platform sales price and the settlement price with the merchants. CHEERS E-mall marketplace service revenue is recognized at a point of time when the Company’s performance obligation to provide marketplace services to the merchants are determined to have been completed under each sales transaction upon the consumers confirming the receipts of goods. Payments for services are generally received before deliveries.
The Company provides coupons to consumers at our own discretion as incentives to promote CHEERS E-mall marketplace with validity usually around or less than one week, which can only be used in future purchases of eligible merchandise offered on CHEERS E-mall to reduce purchase price that are not specific to any merchant. Consumers are not customers of the Company, therefore incentives offered to consumers are not considered consideration payable to customers. As the consumers are required to make future purchases of the merchants’ merchandise to redeem these coupons, the Company does not accrue any expense for coupons when granted and recognizes the amounts of redeemed coupons as marketing expenses when future purchases are made.
Other Revenues
Other revenue primarily consists of copyrights trading of purchased and produced TV-series and the sales of products on Taobao platform. For copyright licensing of purchased and produced TV-series, the Company recognize revenue on net basis at a point of time upon the delivery of master tape and authorization of broadcasting right. For sales of product, the company recognize revenue upon the transfer of products according to the fixed price and production amount in sales orders. The following table identifies the disaggregation of our revenue for the six months ended June 30, 2026 and 2025, respectively:
| For the Six Months Ended June 30, | ||||||||
| 2026 | 2025 | |||||||
| Category of Revenue: | ||||||||
| Advertising revenue | $ | $ | ||||||
| CHEERS e-Mall marketplace service revenue | ||||||||
| Other revenue | ||||||||
| Total | $ | $ | ||||||
| Timing of Revenue Recognition: | ||||||||
| Services transferred over time | $ | $ | ||||||
| Services transferred at a point in time | ||||||||
| Goods transferred at a point in time | ||||||||
| Total | $ | $ | ||||||
The Company applied a practical expedient to expense costs as incurred for costs to obtain a contract with a customer when the amortization period would have been one year or less. The Company does not have any significant incremental costs of obtaining contracts with customers incurred and/or costs incurred in fulfilling contracts with customers within the scope of ASC Topic 606, that shall be recognized as an asset and amortized to expenses in a pattern that matches the timing of the revenue recognition of the related contract.
F-10
CHEER HOLDING, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In U.S. dollars in thousands, except share and per share data)
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)
Segment reporting
An operating segment is a component of the Company that engages in business activities from which it may earn revenue and incur expenses and is identified on the basis of the internal financial reports that are provided to and regularly reviewed by the Company’s chief operating decision maker in order to allocate resources and assess performance of the segment.
In accordance with ASC 280, Segment Reporting, operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker (“CODM”), in deciding how to allocate resources and in assessing performance. The Company uses the “management approach” in determining reportable operating segments. The management approach considers the internal organization and reporting used by the Company’s chief operating decision maker for making operating decisions and assessing performance as the source for determining the Company’s reportable segments. The Company’s CODM has been identified as the chief executive officer (the “CEO”), who reviews consolidated results when making decisions about allocating resources and assessing performance of the Company.
In accordance with ASC 280, Segment Reporting, one reporting segment meet three criteria: (i) CODM views revenue stream together, (ii) They have similar economic characteristics (nature of the products/services), and (iii) They are managed as a single business unit.
For the six months ended June 30, 2026 and 2025, the Company identified two segments, namely (i) Cheers APP internet business, and (ii) traditional media businesses.
Concentration and Credit Risk
Financial instruments that potentially subject the Company to concentrations of credit risk are cash and cash equivalents, and accounts receivable arising from its normal business activities. The Company places its cash and cash equivalents in what it believes to be credit-worthy financial institutions.
The Company’s operations are carried out in the PRC. Accordingly, our business, financial condition, and results of operations may be influenced by the political, economic, and legal environment in the PRC, and by the general state of the economy of the PRC. Our operations in the PRC are subject to specific considerations and significant risks not typically associated with companies in North America. The Company’s results may be adversely affected by changes in governmental policies with respect to laws and regulations, anti-inflationary measures, currency conversion and remittance abroad, and rates and methods of taxation, among other things. Financial instruments which potentially subject us to concentrations of credit risk consist principally of cash and cash equivalent. All of our cash is maintained with state-owned banks, commercial banks or third-party service provider certified by the People’s bank of China, such as Alipay, within the PRC. Per PRC regulations, the maximum insured bank deposit amount is RMB
Accounts receivable are typically unsecured and derived from revenue earned from customers, thereby exposed to credit risk. The risk is mitigated by the Company’s assessment of its customers’ creditworthiness and its ongoing monitoring of outstanding balances.
The Company’s sales are made to customers that are located primarily in China. The Company has a concentration of its revenues and receivables with specific customers. For the six months ended June 30, 2026, six customers accounted for
As of June 30, 2026, six customers accounted for
F-11
CHEER HOLDING, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In U.S. dollars in thousands, except share and per share data)
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)
Concentration and Credit Risk (cont.)
As of June 30, 2026, two vendors accounted for
Foreign Currency Translation
The reporting currency of the Company is the U.S. dollar (“USD”). The functional currency of subsidiaries, VIEs and VIEs’ subsidiaries located in China is the Chinese Renminbi (“RMB”). For the entities whose functional currency is the RMB, result of operations and cash flows are translated at average exchange rates during the period, assets and liabilities are translated at the unified exchange rate at the end of the period, and equity is translated at historical exchange rates. As a result, amounts relating to assets and liabilities reported on the statements of cash flows may not necessarily agree with the changes in the corresponding balances on the balance sheets. Translation adjustments resulting from the process of translating the local currency financial statements into U.S. dollars are included in determining comprehensive income/loss. Transactions denominated in foreign currencies are translated into the functional currency at the exchange rates prevailing on the transaction dates. Assets and liabilities denominated in foreign currencies are translated into the functional currency at the exchange rates prevailing at the balance sheet date with any transaction gains and losses that arise from exchange rate fluctuations on transactions denominated in a currency other than the functional currency are included in the results of operations as incurred.
All of the Company’s revenue and expense transactions are transacted in the functional currency of the operating subsidiaries. The Company does not enter into any material transaction in foreign currencies. Transaction gains or losses have not had, and are not expected to have, a material effect on the results of operations of the Company.
The consolidated balance sheet amounts, with the exception of equity, at June 30, 2026 and December 31, 2025 were translated at RMB
Recent Accounting Pronouncements
In December 2025, the FASB issued ASU 2025-12, which is to correct, clarify, and otherwise improve U.S. GAAP. ASU 2025-12 includes 33 improvements that span a wide range of topics, including Clarifying diluted earnings per share (EPS) calculation when a loss from continuing operations exists, Clarifying disclosure requirements for lease receivables from sales-type or direct financing leases, Revising the calculation of the reference amount for beneficial interests to prevent double counting credit losses, Clarifying the permissible methods to account for treasury stock retirements, and Clarifying the guidance for transfers of receivables from contracts with customers. The amendments in this Update are effective for all entities for annual reporting periods beginning after December 15, 2026, and interim reporting periods within those annual reporting periods. Early adoption is permitted in both interim and annual reporting periods in which financial statements have not yet been issued or made available for issuance. If an entity adopts the amendments in this Update in an interim period, it must adopt them as of the beginning of the annual reporting period that includes that interim reporting period. An entity may elect to early adopt the amendments on an issue-by-issue basis. For example, an entity may decide to early adopt certain amendments and adopt the remaining amendments at the effective date. An entity should apply the amendments in this Update (except for the amendments to Topic 260, Earnings Per Share, related to Issue 4) using one of the following transition methods: (i) Prospectively to all transactions recognized on or after the date that the entity first applies the amendments, or (ii) Retrospectively to the beginning of the earliest comparative period presented. An entity should adjust the opening balance of retained earnings (or other appropriate components of equity or net assets in the statement of financial position) as of the beginning of the earliest comparative period presented. The Company is currently evaluating these new disclosure requirements and does not expect the adoption to have a material impact.
F-12
CHEER HOLDING, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In U.S. dollars in thousands, except share and per share data)
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)
Recent Accounting Pronouncements (cont.)
In December 2025, the FASB issued ASU 2025-11, which is intended to improve the navigability of the guidance in ASC 270 and clarify when it applies. Under the amendments, an entity is subject to ASC 270 if it provides interim financial statements and notes in accordance with GAAP. The ASU also addresses the form and content of such financial statements, adds lists to ASC 270 of the interim disclosures required by all other Codification topics, and establishes a principle under which an entity must disclose events since the end of the last annual reporting period that have a material impact on the entity. As the Board stated in the proposed guidance and reiterates in the ASU, the amendments are not intended to change the fundamental nature of interim reporting or expand or reduce current interim disclosure requirements. For public business entities, the amendments in ASU 2025-11 are effective for interim reporting periods within annual reporting periods beginning after December 15, 2027. For entities other than public business entities, for interim reporting periods within annual reporting periods beginning after December 15, 2028. Early adoption is permitted for all entities. The Company is currently evaluating these new disclosure requirements and does not expect the adoption to have a material impact.
On July 30, 2025, the FASB issued ASU 2025-05, which amends ASC 326-20 to provide a practical expedient for all entities which elect a practical expedient that assumes that current conditions as of the balance sheet date do not change for the remaining life of the asset in developing reasonable and supportable forecasts as part of estimating expected credit losses, and an accounting policy election for all entities, other than a public business entity, that elect the practical expedient related to the estimation of expected credit losses for current accounts receivable and current contract assets that arise from transactions accounted for under ASC 606. Under ASU 2025-05, an entity is required to disclose whether it has elected to use the practical expedient and, if so, whether it has also applied the accounting policy election. An entity that makes the accounting policy election is required to disclose the date through which subsequent cash collections are evaluated. ASU 2025-05 is effective for annual reporting periods beginning after December 15, 2025, and interim reporting periods within those annual reporting periods, with early adoption permitted. Entities should apply the new guidance prospectively. The Company is currently evaluating these new disclosure requirements and does not expect the adoption to have a material impact.
Other accounting standards that have been issued or proposed by FASB that do not require adoption until a future date are not expected to have a material impact on the consolidated financial statements upon adoption. The Company does not discuss recent pronouncements that are not anticipated to have an impact on or are unrelated to its unaudited condensed consolidated financial condition, results of operations, cash flows or disclosures.
F-13
CHEER HOLDING, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In U.S. dollars in thousands, except share and per share data)
3. ACCOUNTS RECEIVABLE
As of June 30, 2026 and December 31, 2025, accounts receivable consisted of the following:
| As of June 30, 2026 | As of December 31, 2025 | |||||||
| Accounts receivable | $ | $ | ||||||
For the six months ended June 30, 2026 and 2025, the Company provided credit loss of and $
4. PREPAYMENT AND OTHER CURRENT ASSETS
As of June 30, 2026 and December 31, 2025, prepayment and other current assets consisted of the following:
| As of June 30, 2026 | As of December 31, 2025 | |||||||
| Advances to vendors | $ | $ | ||||||
| Staff advance | ||||||||
| Others | ||||||||
| Prepayment and other assets | $ | $ | ||||||
For the six months ended June 30, 2026 and 2025, the Company did not provide allowance against the advances to vendors.
5. PROPERTY, PLANT AND EQUIPMENT, NET
As of June 30, 2026 and December 31, 2025, property, plant and equipment consisted of the following:
| As of June 30, 2026 | As of December 31, 2025 | |||||||
| Electronic equipment | $ | $ | ||||||
| Office equipment and furniture | ||||||||
| Leasehold improvement | ||||||||
| Less: accumulated depreciation | ( | ) | ( | ) | ||||
| $ | $ | |||||||
For the six months ended June 30, 2026 and 2025, depreciation expense amounted to $
F-14
CHEER HOLDING, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In U.S. dollars in thousands, except share and per share data)
6. INTANGIBLE ASSETS, NET
As of June 30, 2026 and December 31, 2025, intangible assets consisted of the following:
| As of June 30, 2026 | As of December 31, 2025 | |||||||
| Intangible assets | $ | $ | ||||||
| Less: accumulated amortization | ( | ) | ( | ) | ||||
| Less: accumulated impairment | ( | ) | ( | ) | ||||
| $ | $ | |||||||
The balance of intangible assets mainly represents software related to CHEERS App, primarily consisting of e-mall, online game, video media library and data warehouse modules, etc., CheerCar App, NFT App, Cheer Chat App, and AI App which were acquired externally tailored to the Company’s requirements and is amortized straight-line over
| For the six months ending December 31, 2026 | $ | |||
| For the twelve months ending December 31, 2027 | ||||
| For the twelve months ending December 31, 2028 | ||||
| For the twelve months ending December 31, 2029 | ||||
| For the twelve months ending December 31, 2030 and thereafter | ||||
| Total | $ |
7. ACCRUED LIABILITIES AND OTHER PAYABLES
As of June 30, 2026 and December 31, 2025, accrued liabilities and other payables consisted of the following:
| As of June 30, 2026 | As of December 31, 2025 | |||||||
| Payroll payables | $ | $ | ||||||
| Other payables | ||||||||
| $ | $ | |||||||
8. OTHER TAXES PAYABLE
As of June 30, 2026 and December 31, 2025, other taxes payable consisted of the following:
| As of June 30, 2026 | As of December 31, 2025 | |||||||
| VAT payable | $ | $ | ||||||
| Income tax payable | ||||||||
| Business tax payable | ||||||||
| Others | ||||||||
| $ | $ | |||||||
F-15
CHEER HOLDING, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In U.S. dollars in thousands, except share and per share data)
9. BANK LOANS, CURRENT AND NON-CURRENT
Bank loans represent the amounts due to various banks that are due within and over one year. As of June 30, 2026 and December 31, 2025, bank loans consisted of the following:
| As of June 30, 2026 | As of December 31, 2025 | |||||||
| Short-term bank loans: | ||||||||
| Loan from China Citic Bank | $ | $ | ||||||
| Loan from Huaxia Bank | ||||||||
| Loan from China Construction Bank | ||||||||
| $ | $ | |||||||
For the six months ended June 30, 2026, the Company did not enter into loan agreements with banks, while the Company repaid an aggregate of $
For the six months ended June 30, 2025, the Company entered into loan agreements with three banks, pursuant to the Company borrowed an aggregate of $
Guarantee information
As of June 30, 2026, the Company did not provide guarantee on the bank borrowing. As of December 31, 2025, the guarantee information for bank borrowings were as below: (i) The loans from Huaxia Bank Co., Ltd. West Railway Station Branch were guaranteed by Beijing Zhongguancun Technology Financing Guarantee Co., Ltd, and Mr. Bing Zhang, the Chairman of the Company’s board of directors, and (ii) The loans from China Citic Bank were guaranteed by Horgos and Mr. Bing Zhang.
F-16
CHEER HOLDING, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In U.S. dollars in thousands, except share and per share data)
10. LEASES
The Company leases offices space under non-cancelable operating leases, with terms ranging from to years. The Company considers those renewal or termination options that are reasonably certain to be exercised in the determination of the lease term and initial measurement of right of use assets and lease liabilities. Lease expense for lease payment is recognized on a straight-line basis over the lease term. Leases with initial term of 12 months or less are not recorded on the balance sheet.
The Company determines whether a contract is or contains a lease at inception of the contract and whether that lease meets the classification criteria of a finance or operating lease. When available, the Company uses the rate implicit in the lease to discount lease payments to present value; however, most of the Company’s leases do not provide a readily determinable implicit rate. Therefore, the Company discount lease payments based on an estimate of its incremental borrowing rate.
The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants.
Supplemental balance sheet information related to operating lease was as follows:
| As of June 30, 2026 | As of December 31, 2025 | |||||||
| Right-of-use assets | $ | $ | ||||||
| Lease liabilities current | $ | |||||||
| Lease liabilities non-current | ||||||||
| $ | $ | |||||||
The weighted average remaining lease terms and discount rates for the operating lease were as follows for the six months ended June 30, 2026 and 2025:
| For the Six Months Ended June 30, | ||||||||
| 2026 | 2025 | |||||||
| Remaining lease term and discount rate: | ||||||||
| Weighted average remaining lease term (years) | $ | |||||||
| Weighted average discount rate | % | % | ||||||
For the six months ended June 30, 2026 and 2025, the Company incurred total operating lease expenses of $
The following is a schedule of maturities of lease liabilities as of June 30, 2026:
| June 30, 2026 | ||||
| For the six months ending Dember 31, 2026 | $ | |||
| For the twelve months ending Dember 31, 2027 | ||||
| For the twelve months ending Dember 31, 2028 | ||||
| Total lease payments | ||||
| Less: Imputed interest | ( | ) | ||
| Present value of lease liabilities | $ | |||
F-17
CHEER HOLDING, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In U.S. dollars in thousands, except share and per share data)
11. RELATED PARTY TRANSACTIONS
1) Nature of relationships with related parties
The table below sets forth the major related parties and their relationships with the Company, with which the Company entered into transactions during the six months ended June 30, 2026 and 2025, or recorded balances as of June 30, 2026 and December 31, 2025.
| Name | Relationship with the Company | |
| Mr. Bing Zhang | ||
| Happy Starlight Limited |
2) Transactions with related parties
For the six months ended June 30, 2026 and 2025, the Company did not enter into transactions with any related parties.
3) Balances with related parties
As of June 30, 2026 and December 31, 2025, the balances with related party were as follows:
| As of June 30, 2026 | As of December 31, 2025 | |||||||
| Loans payable due to related parties | ||||||||
| Mr. Bing Zhang | $ | $ | ||||||
| Happy Starlight Limited | ||||||||
| Other payable | ||||||||
| Other | ||||||||
| $ | $ | |||||||
For the years ended December 31, 2025 and 2023, the Company borrowed loans of $
For the years ended December 31, 2025, the Company also borrowed loans of $
12. INCOME TAXES
The Company evaluates the level of authority for each uncertain tax position (including the potential application of interest and penalties) based on the technical merits, and measures the unrecognized benefits associated with the tax positions. For the six months ended June 30, 2026 and 2025, the Company had unrecognized tax benefits. Due to uncertainties surrounding future utilization, the Company estimates there will not be sufficient future income to realize the deferred tax assets arising from net operating losses for the VIEs and the VIEs’ subsidiaries. The Company maintains a full valuation allowance on its net deferred tax assets arising from net operating losses as of June 30, 2026 and December 31, 2025.
As of June 30, 2026 and December 31, 2025, the Company had deferred tax.
The Company does not anticipate any significant increase to its liability for unrecognized tax benefit within the next 12 months. The Company will classify interest and penalties related to income tax matters, if any, in income tax expense. For the six months ended June 30, 2026 and 2025, the Company had deferred income tax benefits of and $
F-18
CHEER HOLDING, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In U.S. dollars in thousands, except share and per share data)
12. INCOME TAXES (cont.)
Uncertain tax positions
The Company accounts for uncertainty in income taxes using a two-step approach to recognizing and measuring uncertain tax positions. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained on audit, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount that is more than 50% likely of being realized upon settlement. Interest and penalties related to uncertain tax positions are recognized and recorded as necessary in the provision for income taxes. The Company is subject to income taxes in the PRC. According to the PRC Tax Administration and Collection Law, the statute of limitations is three years if the underpayment of taxes is due to computational errors made by the taxpayer or the withholding agent. The statute of limitations is extended to five years under special circumstances, where the underpayment of taxes is more than RMB
13. SHARE-BASED COMPENSATION TO EMPLOYEES
On January 7, 2025, the Company granted
For the six months ended June 30, 2026, the Company did not grant ordinary shares to employees. As of June 30, 2026, there are unrecognized compensation expense.
14. EQUITY
Preferred Shares
The Company is authorized to issue
F-19
CHEER HOLDING, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In U.S. dollars in thousands, except share and per share data)
14. EQUITY (cont.)
Ordinary Shares
As of December 31, 2025, there were
On April 6, 2026, the Company effected a share consolidation by the cancellation of one authorized but unissued Class A ordinary share of a par value of US$
For the six months ended June 30, 2026, the Company also issued
As of June 30, 2026 and December 31, 2025, there were
Statutory reserve
Horgos, Beijing Glory Star, Beijing Leshare, Glary Prosperity, Horgos Technology and Xing Cui Can operate in the PRC, are required to reserve
Non-controlling interest
As of June 30, 2026 and December 31, 2025, the Company’s non-controlling interest represented
F-20
CHEER HOLDING, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In U.S. dollars in thousands, except share and per share data)
16. SEGMENT INFORMATION
Based on management’s assessment, the Company has determined that it has
The CODM measures the performance of each segment based on metrics of revenues and earnings from operations and uses these results to evaluate the performance of, and to allocate resources to, each of the segments.
The table below provides a summary of the Company’s operating segment results for the six months ended June 30, 2026 and 2025:
| For the Six Months Ended June 30, | ||||||||
| 2026 | 2025 | |||||||
| Net revenues: | ||||||||
| Cheers APPs Internet Business | $ | $ | ||||||
| Traditional Media Business | ||||||||
| Total consolidated net revenues | ||||||||
| Operating expenses: | ||||||||
| Cheers APPs Internet Business | ( | ) | ( | ) | ||||
| Traditional Media Business | ( | ) | ( | ) | ||||
| Total segment operating expenses | ( | ) | ( | ) | ||||
| Operating income: | ||||||||
| Cheers APPs Internet Business | ||||||||
| Traditional Media Business | ||||||||
| Total segment operating income | ||||||||
| Unallocated item * | ( | ) | ||||||
| Total consolidated operating income | $ | $ | ||||||
| * |
F-21
CHEER HOLDING, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In U.S. dollars in thousands, except share and per share data)
17. COMMITMENTS
Operating lease commitments
The total future minimum lease payments including the agreed property management fee under the non-cancellable operating lease with respect to the contractual obligations as of June 30, 2026 are payable as follows:
| June 30, 2026 | ||||
| Within 1 year | $ | |||
| 2 – 5 years | ||||
| Total | $ | |||
Capital expenditure commitments
The Company has commitments for capital expenditures totaling $
18. SUBSEQUENT EVENTS
On July 7, 2026, at the 2026 Annual General Meeting, the shareholders of the Company authorized and approved an increase in the authorized share capital of the Company from US$
These unaudited condensed consolidated financial statements were approved by management and available for issuance on July 28, 2026. The Company has evaluated subsequent events through this date and concluded that there are no additional reportable subsequent events other than that disclosed in above.
F-22
Exhibit 99.2
OPERATING AND FINANCIAL REVIEW AND PROSPECTS
Presentation of Financial and Other Information
As used in this Form 6-K, references to the “Company”, “we”, “us” and “our” are to Cheer Holding, Inc. and, except as the context otherwise requires, its consolidated subsidiaries and variable interest entities.
Except as otherwise indicated, all financial information with respect to us presented in this Form 6-K is presented on a consolidated basis. Our fiscal year ends on December 31 of each year. We prepare interim consolidated financial statements in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”). Our interim condensed consolidated financial statements, including the notes thereto, for the six months ended June 30, 2026 and 2025 are included in Exhibit 99.1 to this Form 6-K. The interim condensed consolidated financial statements included in this Form 6-K have been reviewed in accordance with the standards of the Public Company Accounting Oversight Board (United States) by our independent registered public accounting firm.
Overview
We provide advertisement and content production services and operate a leading mobile and online advertising, media and entertainment business in China. Major production from us includes short videos, online variety show, online drama, living stream and CHEERS series. We are fast becoming one of the leading contents driven e-commerce platforms in China. We focus on creating original lifestyle content to monetize our advertising and e-commerce platform. We mainly offer and generate revenue from the copyright licensing of self-produced content, advertising and customized content production and CHEERS e-Mall marketplace service, membership fees, and others.
Operating activities
In February 2024, we launched the Year of the Dragon Edition of CHEERS Telepathy. This major upgrade included substantial advancements in model architecture, computing power, and content creation capabilities, including painting, text-to-image, image-to-image, commercial scenarios, dialogue, and long-form text generation.
In June 2024, we released CHEERS Telepathy 2.0. This version featured more advanced and complicated algorithms and models, more powerful application capacity, and more comprehensive AI interaction functionalities to improve user experience, as well as a richer, more diverse and authentic generation effect.
In December 2024, we released CHEERS Telepathy 2.5. This upgrade provided further technical and application advancements, integrating innovative AI tools for content creators.
In January 2025, we discontinued our CheerReal platform and ceased all related operations. No revenue was generated from CheerReal during the year ended December 31, 2025.
In October 2025, we released CHEERS Telepathy 3.0. This version features the AI Portrait Studio, which introduces advance portrait-creation technology, powered by our new, self-developed Polaris Intelligent Cloud 3.0 model. This release further solidifies CHEERS Telepathy’s position as a comprehensive, end-to-end AI application tool for integrated marketing of creative content, unlocking unprecedented possibilities for artistic expression and digital production. In addition, we have opened the AI Portrait API to brands, photographers, and other developers, to build a collaborative creation environment. CHEERS Telepathy currently supports users in 12 countries and regions.
In April 2026, we released CHEERS Telepathy version 3.1.0, featuring new multimodal AI translation capabilities and a global AI assistant system. The latest update underscores the Company’s commitment to making AI capabilities more accessible while enhancing collaborative creative workflows, further strengthening CHEERS Telepathy’s position in the AI agent space.
In July 2026, we officially unveiled Klon AI, our proprietary platform dedicated to AI-driven portraiture and digital identity. Following a highly successful closed beta across North America, Latin America, Japan, South Korea, and Southeast Asia, Klon AI has established itself as a standout consumer-grade application that seamlessly integrates advanced visual generation with comprehensive personal identity management.
Financing and investing activities
On October 2, 2025, the Company closed on a best efforts public offering for the sale of 253,731 units, each consisting of one Class A ordinary share of the Company, par value $0.05 per share, or in lieu thereof, a pre-funded warrant to purchase one Class A Ordinary Share (each a “Pre-Funded Warrant”), one series A warrant to purchase one Class A Ordinary Share (each a “Series A Warrant”) and one series B warrant to purchase one Class A Ordinary Share (each a “Series B Warrant”) for gross proceeds of approximately $8.5 million, before deducting placement agent fees and other estimated expenses payable by the Company, excluding the exercise of any warrants offered. As of June 30, 2026, the Company has issued 1,533,487 Class A Ordinary Shares in the offering.
On November 6, 2025, the Company closed on a registered direct offering for the sale of 3,750,000 Class A Ordinary Shares, or in lieu thereof, a pre-funded warrant to purchase one Class A Ordinary Share for gross proceeds of approximately $15 million, before deducting placement agent fees and other estimated expenses payable by us, including the pre-paid exercise price of the pre-funded warrants offered. As of June 30, 2026, the Company has issued 2,900,000 Class A Ordinary Shares in the offering.
Share Consolidation and Share Increase
On December 22, 2025, the Company effected a share consolidation at a ratio of one-for-fifty (50), whereby every fifty Class A ordinary shares with a par value of US$0.001 each in the Company’s issued and unissued share capital into one Class A ordinary share with a par value of US$0.05 (“the Share Consolidation”). Immediately following the Share Consolidation, the authorized share capital of the Company to be US$500,700 divided into 10,000,000 Class A ordinary shares of a par value of US$0.05 each; 500,000 Class B ordinary shares of a par value of US$0.001 each; and 2,000,000 preferred shares of a par value of US$0.0001 each. The Company has retroactively adjusted all share and per share data from ordinary share to Class A Ordinary Shares for all periods presented.
On April 6, 2026, the Company effected a share consolidation at a ratio of one-for-three (3), whereby every three Class A ordinary shares with a par value of US$0.05 each in the Company’s issued and unissued share capital into one Class A ordinary share with a par value of US$0.15 (the “Share Consolidation”). Immediately following the Share Consolidation, the authorized share capital of the Company was reduced and amended from US$500,700 divided into 10,000,000 Class A ordinary shares of a par value of US$0.05 each; 500,000 Class B ordinary shares of a par value of US$0.001 each; and 2,000,000 preferred shares of a par value of US$0.0001 each; to US$500,699.95 divided into 3,333,333 Class A ordinary shares of a par value of US$0.15 each; 500,000 Class B ordinary shares of a par value of US$0.001 each; and 2,000,000 preferred shares of a par value of US$0.0001 each. The Company’s ordinary shares continue to trade on the Nasdaq Capital Market under the symbol “CHR” and began trading on a post-consolidation-adjusted basis on April 7, 2026.
On July 7, 2026, the Company effected an increase to the authorized share capital of the Company from US$500,699.95 divided into 3,333,333 Class A ordinary shares of a par value of US$0.15 each, 500,000 Class B ordinary shares of US$0.001 each and 2,000,000 preferred shares of a par value of US$0.0001 each to US$7,500,700.00 divided into 50,000,000 Class A ordinary shares of a par value of US$0.15 each, 500,000 Class B ordinary shares of US$0.001 each and 2,000,000 preferred shares of a par value of US$0.0001 each by the creation of an additional 46,666,667 Class A ordinary shares of a par value of US$0.15 each (the “Share Increase”). Class A Shares and Class B Shares shall at all times vote together as one class, and each Class A Share shall be entitled to one (1) vote and each Class B Share shall be entitled to one hundred (100) votes. Class B Shares are not convertible into Class A Shares, and may be redeemed by the Company at par value at the option of the holder.
Key Factors that Affect Operating Results
We believe that our results of operations are significantly affected by the following key factors:
Ability to maintain and grow users and user time spent on the CHEERS App
Our success depends on our ability to maintain and grow users and user time spent on the CHEERS App. To attract and retain users and compete against our competitors, we must continue to offer high-quality content, especially popular original content that provides our users with a superior online entertainment experience. To this end, we must continue to produce new original content and source new talent and producers in a cost-effective manner. Given that we operate in a rapidly evolving industry, we must anticipate user preferences and industry trends and respond to such trends in a timely and effective manner.
2
Ability to obtain adequate capital to meet our capital needs
The operation of an internet video streaming content provider and producer of television shows requires significant and continuous investment in content production or acquisition and video production technology. Producing high-quality original content is costly and time-consuming and typically requires a long period of time in order to realize a return on investment, if at all.
Ability to provide our users with compelling content choices
In addition to our content production for television shows, we have experienced significant user growth for our mobile and on-line video and e-commerce products over the past several years. Our ability to continue to retain users and attract new users will depend in part on our ability to consistently provide our users with compelling content choices, as well as a quality experience for selecting and viewing video content.
Ability to maintain and enhance our brand
We believe that maintaining and enhancing our brand is of significant importance to the success of our business. Our well-recognized brand is critical to increasing our user base and, in turn, expanding our shoppers for our e-commerce platform and attractiveness to advertising customers and content providers. Since the internet video industry is highly competitive, maintaining and enhancing our brand depends largely on our ability to become and remain a market leader in China, which may be difficult and expensive to accomplish.
Segment information
We have two operating segments, namely CHEERS App Internet Business and Traditional Media Businesses. Our CHEERS App Internet Business generates advertising revenue from broadcasting IP short videos, live streaming and APP advertising through our CHEERS App and service revenue from our Cheers E-mall marketplace. Our Traditional Media Business mainly contributes to the advertising revenue from our Cheers TV-series, copyright revenue, customized content production revenue and others. The table below measures the performance of each segment based on metrics of revenues and earnings from operations and uses these results to evaluate the performance of, and to allocate resources to, each of the segments.
| For the Six Months Ended June 30, | ||||||||
| 2026 | 2025 | |||||||
| Net revenues: | ||||||||
| Cheers APPs Internet Business | $ | 57,733 | $ | 65,497 | ||||
| Traditional Media Business | 2,796 | 5,496 | ||||||
| Total consolidated net revenues | 60,529 | 70,993 | ||||||
| Operating expenses: | ||||||||
| Cheers APPs Internet Business | (47,724 | ) | (54,655 | ) | ||||
| Traditional Media Business | (2,312 | ) | (4,585 | ) | ||||
| Total segment operating expenses | (50,036 | ) | (59,240 | ) | ||||
| Operating income: | ||||||||
| Cheers APPs Internet Business | 10,009 | 10,842 | ||||||
| Traditional Media Business | 484 | 911 | ||||||
| Total segment operating income | 10,493 | 11,753 | ||||||
| Unallocated item * | - | (3,429 | ) | |||||
| Total consolidated operating income | $ | 10,493 | $ | 8,324 | ||||
| * | The unallocated item for the six months ended June 30, 2026 and 2025 presents the share-based compensation for employees, which is not allocated to segments. |
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A. Operating Results
The following table summarizes our consolidated results of operations in absolute amount and as a percentage of our total net revenues for the periods indicated. Period-to-period comparisons of historical results of operations should not be relied upon as indicative of future performance. The numbers are expressed in U.S. dollars in thousands, except for percentages.
| For the Six Months Ended June 30, | ||||||||||||||||||||||||
| 2026 | 2025 | Change | ||||||||||||||||||||||
| $ | % | $ | % | $ | % | |||||||||||||||||||
| Revenues | 60,529 | 100.00 | 70,993 | 100.00 | (10,464 | ) | (14.7 | ) | ||||||||||||||||
| Operating expenses: | ||||||||||||||||||||||||
| Cost of revenues | (14,120 | ) | (23.33 | ) | (20,772 | ) | (29.26 | ) | 6,652 | (32.0 | ) | |||||||||||||
| Selling and marketing | (31,295 | ) | (51.70 | ) | (35,321 | ) | (49.75 | ) | 4,026 | (11.4 | ) | |||||||||||||
| General and administrative | (1,407 | ) | (2.32 | ) | (4,243 | ) | (5.98 | ) | 2,836 | (66.8 | ) | |||||||||||||
| Research and development | (3,214 | ) | (5.31 | ) | (2,333 | ) | (3.29 | ) | (881 | ) | 37.8 | |||||||||||||
| Total operating expenses | (50,036 | ) | (82.66 | ) | (62,669 | ) | (88.27 | ) | 12,633 | (20.2 | ) | |||||||||||||
| Income from operations | 10,493 | 17.34 | 8,324 | 11.73 | 2,169 | 26.1 | ||||||||||||||||||
| Other income (expenses): | ||||||||||||||||||||||||
| Interest income (expenses), net | 311 | 0.51 | (61 | ) | (0.09 | ) | 372 | (609.8 | ) | |||||||||||||||
| Other income (expenses), net | 28 | 0.05 | (511 | ) | (0.72 | ) | 539 | (105.5 | ) | |||||||||||||||
| Total other income (expenses) | 339 | 0.56 | (572 | ) | (0.81 | ) | 911 | (159.3 | ) | |||||||||||||||
| Income before income taxes | 10,832 | 17.90 | 7,752 | 10.92 | 3,080 | 39.7 | ||||||||||||||||||
| Income tax (expense) benefit | (2,770 | ) | (4.58 | ) | 4 | 0.01 | (2,774 | ) | (69,350.0 | ) | ||||||||||||||
| Net income | 8,062 | 13.32 | 7,756 | 10.93 | 306 | 4.0 | ||||||||||||||||||
Revenues
For the six months ended June 30, 2026 and 2025, we primarily generated revenues from two revenue streams: advertising and CHEERS e-Mall market service. For the six months ended June 30, 2026 and 2025, approximately 100.0% and 99.9% of our revenues derived from advertising services.
Our revenues for the six months ended June 30, 2026 were approximately $60.5 million, representing a decrease of approximately $10.5 million, or 14.7% from approximately $71.0 million for the six months ended June 30, 2025. The decrease in revenues was mainly caused by a decrease of orders from our customers. Our customers adopted cost saving strategies due to downward trend of macroeconomic environment.
We expect to further expand our customers base with our efforts to enhance brand recognition and user traffic generation, leading to more exposure and high popularity of our Apps.
Operating expenses
Operating expenses consists of cost of revenues, selling and marketing, general and administrative and research and development expense.
Cost of revenues consists primarily of production cost of TV series, short stream video, live stream and network drama, labor cost and related benefits, payments to various channel owners for broadcast, purchase cost of goods and copyrights and costs associated with the operation of our online game and shopping platform CHEERS App such as bandwidth cost and amortization of intangible assets. Our cost of revenues decreased by approximately $6.7 million, or 32.0%, from approximately $20.8 million for the six months ended June 30, 2025 to approximately $14.1 million for the six months ended June 30, 2026. The change in cost of revenues was primarily because (i) the decrease was in line with the decrease in revenues. However, our gross margin increased which was primarily due to higher service fees were incurred to attract increasing orders placed by our advertising customers in the six months ended June 30, 2025. We expect to achieve a further increase in advertising revenues with our continuous investment in advertising business. However, it may take time to make further investments before we generate revenues.
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Our sales and marketing expenses primarily consist of salaries and benefits of sales department, user acquisition expense, advertising fee, travelling expense and CHEERS e-Mall marketing expense. Our sales and marketing expenses decreased by approximately $4.0 million, from approximately $35.3 million for the six months ended June 30, 2025 to approximately $31.3 million for the six months ended June 30, 2026. The decrease was mainly caused by a decrease of promotion campaigns expenses of because we believe higher promotion campaigns expenses may not achieve expected effects given the customers adopted cost saving strategies.
Our general and administrative expenses consist primarily of salaries and benefits for members of our management, provision of expected credit losses, impairment of intangible assets and professional service fees. Our general and administrative expenses decreased by approximately $2.8 million, to approximately $1.4 million for the six months ended June 30, 2026 from approximately $4.2 million for the six months ended June 30, 2025. The change was primarily caused by recognition of share-based compensation expenses of approximately $3.4 million in the six months ended June 30, 2025, partially offset by an increase in amortization of intangible assets as a result of increase of intangible assets.
Our research and development expenses consist primarily of salaries and benefits for our research and development department. Research and development expenses for the six months ended June 30, 2026 and 2025 were approximately $3.2 million and approximately $2.3 million, respectively. This increase was primarily due to continued investments in AI and IT infrastructure.
Income tax (expense) benefits
Income tax expenses for the six months ended June 30, 2026 were approximately $2.8 million because we utilized net operating losses brought forward and reported taxable income. Income tax benefits for the six months ended June 30, 2025 were approximately $4,000 because we recognized deferred tax benefits arising from allowance for expected credit losses of accounts receivable and allowance for prepayments.
Net Income
As a result of the foregoing, we had a net income of approximately $8.1 million and $7.8 million for the six months ended June 30, 2026 and 2025, respectively.
B. Liquidity and Capital Resources
As of June 30, 2026 and December 31, 2025, our principal sources of liquidity were cash and cash equivalents of approximately $213.8 million and $242.1 million, respectively. Working capital at June 30, 2026 was approximately $346.7 million. We believe that our current cash and cash equivalents and our anticipated cash flows from operations will be sufficient to meet our anticipated working capital requirements and capital expenditures for the next 12 months. If we determine that our cash requirements exceed the amount of cash and cash equivalents we have on hand at the time, we may seek to issue equity or debt securities or obtain credit facilities. The issuance and sale of additional equity would result in further dilution to our shareholders. The incurrence of indebtedness would result in increased fixed obligations and could result in operating covenants that might restrict our operations. We cannot assure you that financing will be available in amounts or on terms acceptable to us, if at all
Substantially all of our cash and cash equivalents as of June 30, 2026 were held in China, of which all are denominated in Renminbi (RMB). In addition, we are a holding company with no material operations of our own. We conduct our operations primarily through our subsidiaries and variable interest entities (VIEs) in China. As a result, our ability to pay dividends, if any, depends upon dividends paid by our wholly-owned subsidiaries. We do not anticipate to pay any dividends in the future as any net income earned will be reinvested in the Company. In addition, Glory Star New Media (Beijing) Technology Co., Ltd., a wholly foreign-owned enterprise limited liability company and indirectly wholly-owned by CHEER Holdings (“WFOE”), is permitted to pay dividends to us only out of their retained earnings, if any, as determined in accordance with PRC accounting standards and regulations. Under PRC law, our WFOE and each of its consolidated entities is required to set aside at least 10% of its after-tax profits each year, if any, to fund a statutory reserve until such reserve reaches 50% of its registered capital. Although the statutory reserves can be used, among other ways, to increase the registered capital and eliminate future losses in excess of retained earnings of the respective companies, the reserve funds are not distributable as cash dividends except in the event of liquidation. Remittance of dividends by a wholly foreign-owned company out of China is subject to examination by the banks designated by the State Administration of Foreign Exchange (SAFE). We currently plan to reinvest all earnings from our WFOE to business development and do not plan to request dividend distributions from the WFOE.
If we experience an adverse operating environment or incurred anticipated capital expenditure requirement, or if we accelerate our growth, then additional financing may be required. No assurance can be given, however, that the additional financing, if required, would be on favorable terms or available at all. Such financing may include the use of additional debt or the sale or additional securities. Any financing, which involves the sale of equity securities or instruments that are convertible into equity securities, could result in immediate and possibly significant dilutions to our existing shareholders.
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Cash Flows
The following table summarizes our cash flows for the peirods indicated. The numbers are expressed in U.S. dollars in thousands, except for percentages.
| For the Six Months Ended June 30, (In U.S. dollars in thousands) | ||||||||
| 2026 | 2025 | |||||||
| Net cash (used in) provided by operating activities | $ | (30,194 | ) | $ | 3,920 | |||
| Net cash used in investing activities | (23 | ) | - | |||||
| Net cash used in financing activities | (5,100 | ) | (2,116 | ) | ||||
| Effect of exchange rate changes | 6,999 | 3,764 | ||||||
| Net increase (decrease) in cash and cash equivalents | (28,318 | ) | 5,568 | |||||
| Cash and cash equivalents, at beginning of period | 242,082 | 197,660 | ||||||
| Cash and cash equivalents, at end of period | $ | 213,764 | 203,228 | |||||
We primarily fund our operations from our net revenues, bank loans and equity financing through private placements. For the six months ended June 30, 2026 and 2025, our accounts receivable increased by approximately $24.0 million and $7.7 million, respectively. We intend to continue focusing on timelier collections of account receivable which should enhance our cash flows. We anticipate that the major capital expenditure in the near future is for the further enhancement of our CHEERS App. For the six months ended June 30, 2026 and 2025, our prepayments and other current assets increased by approximately $21.0 million and $3.2 million, respectively. The changes were primarily caused by changes in prepayments to our vendors for customer acquisition.
To enhance its proposed growth, we anticipate raising capital through the issuance of equity or debt securities or obtain credit facilities. The issuance and sale of additional equity would result in further dilution to our shareholders. The incurrence of indebtedness would result in increased fixed obligations and could result in operating covenants that might restrict our operations. We cannot assure you that financing will be available in amounts or on terms acceptable to us, if at all.
Operating Activities
Net cash used in in operating activities was approximately $30.2 million for the six months ended June 30, 2026, derived mainly from (i) net income of approximately $8.1 million for the six months ended June 30, 2026 adjusted for depreciation and amortization expenses of approximately $4.0 million, and (ii) net changes in our operating assets and liabilities, principally comprising of an increase of approximately $24.0 million in accounts receivable due to delayed payments from one customer, an increase of approximately $21.0 million in prepayments to our vendors because we increased our purchase of AI App which required of repayments, an increase of approximately $1.0 million in accounts payables as a result of increase in purchase, and an increase of approximately $1.7 million in other tax payable.
Net cash provided by in operating activities was approximately $3.9 million for the six months ended June 30, 2025, derived mainly from (i) net income of approximately $7.8 million for the six months ended June 30, 2025 adjusted for depreciation and amortization expenses of approximately $3.2 million and share-based compensation expenses of approximately $3.4 million, and (ii) net changes in our operating assets and liabilities, principally comprising of an increase of approximately $7.7 million in accounts receivable due to delayed payments from one customer, an increase of approximately $3.3 million in prepayments to our vendors because we increased our purchase of content production which required of prepayments, a decrease of approximately $0.6 million in accounts payables as we improved our payment process, and an increase of approximately $1.1 million in other tax payable.
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Investing Activities
Net cash used in investing activities was approximately $23,000 for the six months ended June 30, 2026, which was primarily derived from purchase of property and equipment of approximately $22,000 and purchase of intangible assets of approximately $1,000.
For the six months ended June 30, 2025, we did not report cash provided by or used in investing activities.
Financing Activities
Net cash used in financing activities was approximately $5.1 million for the six months ended June 30, 2026, which was primarily derived from repayment of bank loans of approximately $5.1 million.
Net cash used in financing activities was approximately $2.1 million for the six months ended June 30, 2025, which was primarily derived from repayment of bank loans of approximately $9.7 million, partially net off by proceeds of approximately $7.6 million from bank loans.
Please refer to “Notes to Unaudited Condensed Consolidated Financial Statements—Note 9. Bank Loans” for the details of loan terms and interest rates.
Off-Balance Sheet Arrangements.
We have not entered into any financial guarantees or other commitments to guarantee the payment obligations of any third parties. In addition, we have not entered into any derivative contracts that are indexed to our shares and classified as shareholder’s equity or that are not reflected in our unaudited condensed consolidated financial statements. Furthermore, we do not have any retained or contingent interest in assets transferred to an unconsolidated entity that serves as credit, liquidity or market risk support to such entity. We do not have any variable interests in any unconsolidated entity that provides financing, liquidity, market risk or credit support to us or engages in leasing, hedging or product development services with us.
Capital Expenditures
Our capital expenditures were approximately $23,000 and $nil for the six months ended June 30, 2026 and 2025, respectively. In these periods, our capital expenditures were mainly used to purchase property, equipment and intangible assets. We will continue to make capital expenditures to meet the expected growth of our business.
C. Research and development
We have a team of experienced engineers who are primarily based at our headquarters in Beijing. We compete aggressively for engineering talent and work closely with top IT firms through outsourcing to address challenges such as AI recommended search engine, block chain scoring e-mall, network games battle platform, data warehouse, social networking E-commence V3.0, video media warehouse. For the six months ended June 30, 2026 and 2025, our research and development expenditures were approximately $3.2 million and $2.3 million, respectively. In addition, intangible asset was approximately $42.4 million and $34.7 million as of June 30, 2026 and December 31, 2025, respectively. For the six months ended June 30, 2026 and 2025, we acquired intangible assets of approximately $10.6 million and $0.7 million through settlement of prepayments. We plan to continue investing in and improving our CHEERS App to further increase user friendliness, functionality and efficiency.
D. Trend information
S See “A. Operating Results” of this Operating And Financial Review And Prospects and “Item 3.D. Key Information—Risk Factors” of 2025 Form 20-F.
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E. Critical Accounting Estimates
We prepare our financial statements in accordance with U.S. GAAP, which requires our management to make judgments, estimates and assumptions. We continually evaluate these judgments, estimates and assumptions based on our own historical experience, knowledge and assessment of current business and other conditions, our expectations regarding the future based on available information and various assumptions that we believe to be reasonable, which together form our basis for making judgments about matters that are not readily apparent from other sources. Since the use of estimates is an integral component of the financial reporting process, our actual results could differ from those estimates. Some of our accounting policies require a higher degree of judgment than others in their application.
The selection of critical accounting policies, the judgments and other uncertainties affecting application of those policies and the sensitivity of reported results to changes in conditions and assumptions are factors that should be considered when reviewing our financial statements. We believe the following accounting policies involve the most significant judgments and estimates used in the preparation of our financial statements. You should read the following description of critical accounting policies, judgments and estimates in conjunction with our unaudited condensed consolidated financial statements and other disclosures included in this report.
A list of critical accounting policies, judgements and estimates that are relevant to us is included in note 2 of our unaudited condensed consolidated financial statements included elsewhere in this report.
Recently issued accounting pronouncements
A list of recently issued accounting pronouncements that are relevant to us is included in note 2 of our unaudited condensed consolidated financial statements included elsewhere in this report.
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Exhibit 99.3
Cheer Holding Announces First Half 2026 Financial Results
BEIJING, July 28, 2026 (GLOBE NEWSWIRE) -- Cheer Holding, Inc. (NASDAQ: CHR) (“Cheer Holding” or the “Company”), a leading provider of advanced mobile internet infrastructure and platform services, today announced its financial results for the six months ended June 30, 2026.
Management Commentary
“We are pleased to report a solid first half of 2026, highlighted by a 26.1% increase in income from operations and a 4.0% increase in net income, driven by continued operational discipline across our CHEERS ecosystem,” said Mr. Bing Zhang, Chairman and Chief Executive Officer of Cheer Holding. “While revenues declined year-over-year due to macroeconomic headwinds impacting customer spending, we successfully reduced operating expenses by 20.2%, demonstrating our commitment to cost efficiency and margin expansion. Our gross margin improved to 76.7% from 70.7%, and our operating margin expanded to 17.3% from 11.7%, underscoring our effective cost optimization while maintaining service quality.”
“Strategically, we have continued to advance our artificial intelligence initiatives. In April 2026, we released CHEERS Telepathy version 3.1.0, featuring new multimodal AI translation capabilities and a global AI assistant system. In July 2026, we officially unveiled Klon AI, our proprietary platform dedicated to AI-driven portraiture and digital identity, which has established itself as a standout consumer-grade application following successful closed beta testing across multiple regions. With a strong balance sheet and cash position of $213.8 million, we remain well-positioned to execute our long-term vision of becoming a global leader in AI-powered digital ecosystems.”
Financial Highlights For The Six Months Ended June 30, 2026
| ● | Total revenues were $60.5 million, compared to $71.0 million in the same period of 2025. |
| ● | Gross margin improved to 76.7%, compared to 70.7% in the prior-year period. |
| ● | Operating margin improved to 17.3%, compared to 11.7% in the prior-year period. |
| ● | Income from operations increased by 26.1% to $10.5 million, compared to $8.3 million in the same period of 2025. |
| ● | Net income attributable to Cheer Holding’s shareholders increased by 4.0% to $8.1 million, compared to $7.8 million in the prior-year period. |
| ● | Cash and cash equivalents stood at $213.8 million as of June 30, 2026. |
Operational Highlights
| ● | The Company released CHEERS Telepathy version 3.1.0 in April 2026, featuring new multimodal AI translation capabilities and a global AI assistant system, further strengthening CHEERS Telepathy’s position in the AI agent space. |
| ● | In July 2026, the Company officially unveiled Klon AI, its proprietary platform dedicated to AI-driven portraiture and digital identity, following successful closed beta testing across North America, Latin America, Japan, South Korea, and Southeast Asia. |
Financial Results for the Six Months Ended June 30, 2026
Revenues
Revenues for the six months ended June 30, 2026 were approximately $60.5 million, representing a decrease of approximately $10.5 million, or 14.7%, from approximately $71.0 million for the six months ended June 30, 2025. The decrease was mainly caused by a reduction in orders from customers, as customers adopted cost-saving strategies due to the downward trend of the macroeconomic environment. Approximately 100.0% of revenues derived from advertising services.
Operating Expenses
Total operating expenses decreased by 20.2% to approximately $50.0 million, compared to $62.7 million in the prior-year period.
| ● | Cost of revenues decreased by 32.0% to approximately $14.1 million, compared to $20.8 million in the prior-year period, primarily in line with the decrease in revenues. Gross margin improved to 76.7% from 70.7% in the prior-year period. |
| ● | Selling and marketing expenses decreased by 11.4% to approximately $31.3 million, compared to $35.3 million in the prior-year period, mainly due to reduced promotion campaign expenses. |
| ● | General and administrative expenses decreased by 66.8% to approximately $1.4 million, compared to $4.2 million in the prior-year period, primarily due to recognition of share-based compensation expenses of $3.4 million in prior-year period, partially offset by an increase of amortization of intangible assets with addition of intangible assets during the six months ended June 30, 2026. |
| ● | Research and development expenses increased by 37.8% to approximately $3.2 million, compared to $2.3 million in the prior-year period, reflecting continued investments in AI and IT infrastructure. |
Income from Operations
Income from operations increased by 26.1% to approximately $10.5 million, compared to $8.3 million in the prior-year period. Operating margin improved to 17.3% from 11.7% in the prior-year period, reflecting enhanced operational efficiency.
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Net Income
Net income attributable to Cheer Holding’s shareholders was approximately $8.1 million, compared to $7.8 million in the prior-year period, representing an increase of 4.0%.
Balance Sheet and Cash Flow
As of June 30, 2026, the Company had cash and cash equivalents of approximately $213.8 million, compared to $242.1 million as of December 31, 2025. Working capital was approximately $346.7 million. Total assets were $419.6 million, up from $401.7 million as of December 31, 2025. Total shareholders’ equity was $389.3 million, compared to $369.8 million as of December 31, 2025.
Net cash used in operating activities was approximately $30.2 million for the six months ended June 30, 2026, compared to net cash provided by operating activities of approximately $3.9 million in the prior-year period.
About Cheer Holding, Inc.
Cheer Holding is a leading provider of next-generation mobile internet infrastructure and platform services in China. The Company operates a comprehensive digital ecosystem integrating platforms, applications, technology, and industry, with a focus on AI-driven content creation, e-commerce, and metaverse development. For more information, please visit ir.gsmg.co.
Safe Harbor Statement
Certain statements in this announcement are forward-looking statements. These forward-looking statements involve known and unknown risks and uncertainties and are based on current expectations and projections about future events and financial trends that the Company believes may affect its financial condition, results of operations, business strategy and financial needs. Investors can identify these forward-looking statements by words or phrases such as “may,” “will,” “expect,” “anticipate,” “aim,” “estimate,” “intend,” “plan,” “believe,” “potential,” “continue,” “is/are likely to” or other similar expressions. These forward-looking statements include, but are not limited to, our success in our artificial intelligence initiatives, changes or other circumstances that could affect the Company’s ability to continue successful development and launch of global expansion, artificial intelligence initiatives and technology infrastructure; the possibility that the Company may not succeed in developing its new lines of businesses due to, among other things, changes in the business environment and technological developments, competition, changes in regulation, or other economic and policy factors; the possibility that the Company’s new lines of business may be adversely affected by other economic, business, and/or competitive factors, or that the Company will be able to continue to have its Class A ordinary shares listed on The Nasdaq Capital Market. In addition, the Company is subject to a number of risks and uncertainties set forth in documents filed by the Company with the Securities and Exchange Commission from time to time. The Company undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law. Such information speaks only as of the date of this release.
For investor and media inquiries, please contact:
James Li
Email: ir@gsmg.co
Tel: +86 10 6778 2900 (CN)
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