10-Q - CIMG - Equibles

UNITED

STATES

SECURITIES

AND EXCHANGE COMMISSION

WASHINGTON,

D.C. 20549

FORM

10-Q

(MarkOne)

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Forthe quarterly period ended ### December 31, 2024

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the transition period from _____ to _____

Commission

File Number 001-39338

CIMGInc.

(Exact name of registrant as specified in its charter)

Nevada	38-3849791
(State<br> or other jurisdiction of<br><br> <br>incorporation<br> or organization)	(I.R.S.<br> Employer<br><br> <br>Identification<br> No.)

RoomR2, FTY D, 16/F, Kin Ga Industrial Building,

9San On Street, Tuen Mun, Hong Kong00000.

(Address of principal executive offices)

+

852 70106695

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title<br> of each class	Trading<br> Symbol(s)	Name<br> of each exchange on which registered
Common<br> Stock, $0.00001 par value	IMG	The<br> NASDAQ Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☐ No ☒

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☐ No ☒

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As

of August 19, 2025, there were 36,397,418 shares of the registrant’s Common Stock outstanding.

CIMG

INC.

INDEX

TO FORM 10-Q

FOR

THE QUARTERLY PERIOD ENDED DECEMBER 31, 2024

PART I.	FINANCIAL INFORMATION	4
Item<br> 1.	Financial<br> Statements	4
	Consolidated<br> Balance Sheets (unaudited)	4
	Consolidated<br> Statements of Operations (unaudited)	5
	Consolidated<br> Statements of Comprehensive Loss (unaudited)	6
	Consolidated<br> Statements of Changes in Stockholders’ Equity (unaudited)	7
	Consolidated<br> Statements of Cash Flows (unaudited)	8
	Notes<br> to Consolidated Financial Statements (unaudited)	9
PART II.	OTHER INFORMATION	23
Item<br> 1.	Legal<br> Proceedings	23
Item<br> 1A.	Risk<br> Factors	23
Item<br> 2.	Unregistered<br> Sales of Equity Securities and Use of Proceeds	23
Item<br> 3.	Defaults<br> Upon Senior Securities	23
Item<br> 4.	Mine<br> Safety Disclosures	23
Item<br> 5.	Other<br> Information	23
Item<br> 6.	Exhibits	24
	SIGNATURES	25

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Cautionary

Note Regarding Forward-Looking Statements

This Quarterly Report on Form 10-Q and the documents incorporated by reference contain “forward-looking statements”, within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, which include information relating to future events, future financial performance, strategies, expectations, competitive environment, regulation and availability of resources. These forward-looking statements include, without limitation, statements regarding: proposed new programs; expectations that regulatory developments or other matters will or will not have a material adverse effect on our consolidated financial position, results of operations or liquidity; statements concerning projections, predictions, expectations, estimates or forecasts as to our business, financial and operating results and future economic performance; and statements of management’s goals and objectives and other similar expressions concerning matters that are not historical facts. Words such as “may,” “should,” “could,” “would,” “predicts,” “potential,” “continue,” “expects,” “anticipates,” “future,” “intends,” “plans,” “believes,” “estimates,” and similar expressions, as well as statements in future tense, identify forward-looking statements.

Forward-looking statements should not be read as a guarantee of future performance or results and will not necessarily be accurate indications of the times at, or by, which such performance or results will be achieved. Forward-looking statements are based on information available at the time those statements are made and/or management’s good faith belief as of that time with respect to future events and are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in or suggested by the forward-looking statements. Important factors that could cause such differences include, but are not limited to:

●	our<br> plans to obtain funding for our operations, including funding necessary to develop, manufacture and commercialize our products, provide<br> our co-packing services, and to continue as a going concern;
●	our<br> expectation that our existing capital resources will be sufficient to fund our operations for at least the next three months and<br> our expectation to need additional capital to fund our planned operations beyond that;
●	the<br> accuracy of our estimates regarding expenses, future revenue, capital requirements and needs for additional financing;
●	our<br> expectations regarding our ability to maintain compliance with the listing requirements of the Nasdaq Capital Market;
●	the<br> impact to our business, including any supply chain interruptions, resulting from changes in general economic, business and political<br> conditions, including changes in the financial markets and macroeconomic conditions resulting from a pandemic;
●	the<br> evolving coffee preferences of coffee consumers in North America and East Asia;
●	the<br> size and growth of the markets for our products and co-packing services;
●	our<br> ability to compete with companies producing similar products or providing similar co-packing services;
●	our<br> ability to successfully achieve the anticipated results of strategic transactions;
●	our<br> expectation regarding our future co-packing revenues;
●	our<br> ability to develop or offer innovative new products and services, and expand our co-packing services to other products that are complementary<br> to our current single serve coffee product offerings;
●	our<br> expectations regarding additional manufacturing, coffee roasting and co-packing capabilities to be provided through our manufacturing<br> partners, as well as our manufacturing partners’ ability to successfully facilitate distribution efforts;
●	our<br> reliance on third-party roasters or manufacturing partners to roast coffee beans necessary to manufacture our products and to fulfill<br> every aspect of our co-packing services;
●	regulatory<br> developments in the U.S. and in non-U.S. countries;
●	our<br> ability to retain key management, sales and marketing personnel;
●	the<br> scope of protection we are able to establish and maintain for intellectual property rights covering our products and technology;
●	our<br> ability to develop and maintain our corporate infrastructure, including our internal control over financial reporting;
●	the<br> outcome of pending, threatened or future litigation;
●	our<br> financial performance; and
●	our<br> use of the net proceeds from our recent offering.
●	other<br> factors discussed in the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2024 under the headings<br> “Business,” “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and<br> Results of Operations” as applicable.

Forward-looking statements speak only as of the date the statements are made. Except as required under the federal securities laws and rules and regulations of the United States Securities and Exchange Commission, we undertake no obligation to update or revise forward-looking statements to reflect actual results, changes in assumptions or changes in other factors affecting forward-looking information. We caution you not to unduly rely on the forward-looking statements when evaluating the information presented herein.

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PART

I – FINANCIAL INFORMATION

Item1. FINANCIAL STATEMENTS

CIMG

Inc.

CONSOLIDATED

BALANCE SHEETS

(UNAUDITED)

	December<br> 31, 2024			September<br> 30, 2024
ASSETS
Current<br> assets:
Cash<br> & cash equivalent	$	124,715		$	464,222
Inventories,<br> net		4,608,307			4,548,035
Assets<br> Held for Sale-Current		10,736			10,736
Prepaid<br> expenses and other current assets		291,162			382,648
Total<br> current assets		5,034,920			5,405,641
Non-current<br> assets:
Property<br> and equipment, net		1,997			2,268
Right-of-use<br> asset - operating lease		58,397			99,746
Intangible<br> assets, net		72,500			80,000
Total<br> non current liabilities		132,894			182,014
Total<br> assets	$	5,167,814		$	5,587,655
LIABILITIES<br> AND STOCKHOLDERS’ EQUITY
Current<br> liabilities:
Accounts<br> payable and accrued expenses	$	1,820,200		$	2,240,337
Short<br> term loan		433,512			1,920,507
Current<br> portion of lease liability - operating lease		58,303			100,962
Convertible<br> Notes		678,308			1,063,624
Convertible<br> Note-related party		-			319,220
Convertible<br> Note		-			319,220
Other<br> payables-related party		18,000			7,500
Other<br> current liabilities		631,921			586,173
Total<br> current liabilities		3,640,244			6,238,323
Total<br> liabilities	$	3,640,244		$	6,238,323
Stockholders’<br> equity:
10,739,800 and 4,978,245<br> shares issued and outstanding as of December 31, 2024 and September 30 2024, respectively		107			50
Additional<br> paid in capital		85,167,073			81,260,605
Accumulated<br> deficit		(83,880,971	)		(82,344,722	)
Accumulated<br> other comprehensive income		241,361			433,399
Total<br> stockholders’ equity		1,527,570			(650,668	)
Total<br> liabilities and stockholders’ equity	$	5,167,814		$	5,587,655

The

accompanying notes are an integral part of these consolidated financial statements.

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CIMG

Inc.

CONSOLIDATED

STATEMENTS OF OPERATIONS

(UNAUDITED)

	Three<br> Months Ended			Three<br> Months Ended
	December<br> 31, 2024			December<br> 31, 2023
Revenues,<br> net	$	22,853		$	965,932
Cost<br> of sales		(7,374	)		(841,398	)
Gross profit		15,479			124,534
Operating<br> expenses		(1,517,758	)		(2,145,642	)
Loss from operations		(1,502,279	)		(2,021,108	)
Other<br> income		9,047			46,832
Loss<br> from equity method investment		-			(2,051	)
Other<br> expense		(43,017	)		(49,195	)
Interest<br> expense, net		-			(685	)
Net loss from continuing operations		(1,536,249	)		(2,026,207	)
Losses<br> caused by the termination of business		-			(122,404	)
Net loss	$	(1,536,249	)		(2,148,611	)
Basic<br> and diluted loss per common share		(0.17	)		(1.84	)
Basic<br> and diluted weighted average number of common stock outstanding		8,982,676			1,168,221

The

accompanying notes are an integral part of these consolidated financial statements.

*The discrepancy in financial data as of December 31, 2023 is due to the split of discontinued operations .(Refer to “Note 6. Discontinued operations”)

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CIMG

Inc.

CONSOLIDATED

STATEMENTS OF COMPREHENSIVE LOSS

(UNAUDITED)

	Three Months Ended			Three Months Ended
For<br> the three months ended December 31	December<br> 31, 2024			December 31, 2023
Net<br> loss	$	(1,536,249	)	$	(2,148,611	)
Foreign<br> currency translation		(192,038	)		42,408
Total<br> other comprehensive income (loss), net of tax		(192,038	)		42,408
Comprehensive<br> loss	$	(1,728,287	)	$	(2,106,203	)

The

accompanying notes are an integral part of these consolidated financial statements.

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CIMG

Inc.

CONSOLIDATED

STATEMENTS OF STOCKHOLDERS’ EQUITY

(UNAUDITED)

	Shares		Amount		capital		deficit			income			Total
	Common<br> Stock				Additional<br><br> paid-in		Accumulated			Accumulated<br><br> Other<br> Comprehensive
	Shares		Amount		capital		deficit			income			Total
Balance<br> September 30, 2024		4,978,245	$	50	$	81,260,605	$	(82,344,722	)	$	433,399		$	(650,668	)
Common<br> Stock issued for cash		1,396,813		13		1,382,831		-			-			1,382,844
Common<br> stock compensation		800,000		8		523,672		-			-			523,680
Issued<br> private placement		3,508,769		35		1,999,965		-			-			2,000,000
Issued<br> warrants		55,973		1		-		-			-			1
Other<br> comprehensive income		-		-		-		-			(192,038	)		(192,038	)
Net<br> loss		-		-		-		(1,536,249	)		-			(1,536,249	)
Balance<br> December 31, 2024		10,739,800	$	107	$	85,167,073	$	(83,880,971	)	$	241,361		$	1,527,570
	Common<br> Stock				Additional<br><br> paid-in		Accumulated			Accumulated<br><br> Other<br> Comprehensive
---	---	---	---	---	---	---	---	---	---	---	---	---	---	---
	Shares		Amount		capital		deficit			income		Total
Balance<br> September 30, 2023		748,644	$	8	$	74,925,843	$	(73,371,987	)	$	120,493	$	1,674,357
Balance		748,644	$	8	$	74,925,843	$	(73,371,987	)	$	120,493	$	1,674,357
Common<br> Stock issued for cash		488,750		5		1,277,113		-			-		1,277,118
Stock<br> option expense		-		-		11,505		-			-		11,505
Issued<br> private placement		46,800		-		129,662		-			-		129,662
Other<br> comprehensive income		-		-		-		-			42,408		42,408
Net<br> loss		-		-		-		(2,148,611	)		-		(2,148,611	)
Balance<br> December 31, 2023		1,284,194	$	13	$	76,344,123	$	(75,520,598	)	$	162,901	$	986,439
Balance		1,284,194	$	13	$	76,344,123	$	(75,520,598	)	$	162,901	$	986,439

The

accompanying notes are an integral part of these consolidated financial statements.

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CIMG

Inc.

CONSOLIDATED

STATEMENTS OF CASH FLOWS

(UNAUDITED)

		Three Months Ended			Three Months Ended
		December 31, 2024			December 31, 2023
Operating activities:
Net<br> loss from continuing operations	$	(1,536,249	)	$	(2,026,207	)
Losses<br> caused by the termination of business		-			(122,404	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation<br> and amortization		7,771			35,195
Noncash<br> lease expense		41,349			68,203
Common<br> stock compensation		523,680			-
Stock<br> option expense		-			11,505
Loss<br> from equity method investment		-			2,051
Change in operating assets and liabilities:
Accounts<br> receivable		-			(521,427	)
Inventories		(60,272	)		(250,388	)
Prepaid<br> expenses and other current assets		91,487			(88,410	)
Other<br> assets		-			2,353
Accounts<br> payable		(420,136	)		707,618
Deferred<br> income		-			(74,363	)
Lease<br> liability - operating lease		(42,659	)		(104,378	)
Accrued<br> Expenses & Other Current Liabilities		56,248			(71,810	)
Other<br> current liabilities		-			116,619
Net cash used in operating activities		(1,338,781	)		(2,193,439	)
Discontinued Operations:
Adjustments<br> to reconcile net income (loss) to net cash
Interest<br> income(expense), net		-			169
Depreciation<br> from discontinued operations		-			4,785
Changes<br> in operating assets and liabilities		-			48,868
Net cash used in discontinued business operations		-			(68,582	)
Investing activities:
Purchase<br> of property and equipment		-			(307,044	)
Net cash used in investing activities		-			(307,044	)
Financing activities:
Repayment<br> from loans		(1,486,996	)		(2,021	)
Repayment<br> of finance lease		-			(7,797	)
Proceeds<br> from equipment finance		-			262,893
Proceeds<br> from issuance of convertible notes		678,308			-
Proceeds<br> from exercise of options		-			177,864
Proceeds<br> from issuance of common stock, exercise of stock options		2,000,000			1,099,254
Proceeds<br> from private placement		-			129,662
Net cash provided by financing activities		1,191,312			1,659,855
Effect<br> of foreign exchange on cash		(192,038	)		42,408
Net<br> change in cash		(339,507	)		(866,802	)
Cash,<br> beginning of period		464,222			982,869
Cash,<br> end of period	$	124,715			116,067
Supplemental disclosure of cash flow information:
Cash<br> paid for interest		-		$	782
Cash<br> paid for taxes		-		$	1,288
Noncash investing and financing activities:
Deferred<br> Stock Offering cost accrued ROU assets and liabilities added during the period	$	32,092			105,825

The

accompanying notes are an integral part of these consolidated financial statements.

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CIMG

Inc.

Notes

to Consolidated Financial Statements (unaudited)

December

31, 2024

1.

ORGANIZATION

CIMG Inc. is a company incorporated in Nevada and listed on Nasdaq since June 2020. We were formerly known as “Nuzee, Inc.” with a previous ticker symbol “NUZE”, and we changed our corporate name and ticker symbol to “CIMG Inc.” and “IMG” in October 2024. We previously focused on specialty coffee and related technologies but are now expanding our sales and distribution channels in Asia to encompass a broader range of consumer food and beverage products. This expansion is fueled by our online sales platform, which leverages a natural language search function.

CIMG, our holding company, or DZR Tech, its subsidiary incorporated in Hong Kong, or Weiwin, our subsidiary incorporated in Florida, may transfer cash to our PRC subsidiaries, Beijing Zhongyan, through capital injections and intra-group loans.

2.

BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Preparation

The accompanying unaudited consolidated financial statements of CIMG, Inc. and subsidiaries (“the Company”) have been prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial reporting and should be read in conjunction with the audited consolidated financial statements and notes included in the Company’s Annual Report on Form 10-K for the year ended September 30, 2024. Certain information or footnote disclosures normally included in the annual financial statements prepared in accordance with U.S. GAAP have been condensed or omitted, pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). In the opinion of the Company’s management, these financial statements include all normal and recurring adjustments necessary to present fairly the financial position, results of operations, and cash flows for the interim periods presented. However, the results of operations included in such financial statements may not necessarily be indicative of future or annual results.

Principlesof Consolidation

The Company prepares its financial statements on the basis of accounting. The accompanying consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All significant intercompany accounts, balances and transactions have been eliminated upon consolidation.

The Company consolidates DZR Tech, Wewin and Beijing Zhongyan in accordance with ASC 810, and specifically ASC 810-10-15-8 which states, the usual condition for a controlling financial interest is ownership of a majority voting interest, and, therefore, as a general rule ownership by one reporting entity, directly or indirectly, of over 50% of the outstanding voting shares of another entity is a condition pointing toward consolidation.

Earningsper Share

Basic earnings per common share are equal to net earnings or loss divided by the weighted average of shares outstanding during the reporting period. Diluted earnings per share reflect the potential dilution that could occur if stock options, warrants and other commitments to issue Common Stock were exercised or equity awards vest resulting in the issuance of Common Stock that could share in the earnings of the Company. As of December 31, 2024 and December 31, 2023, the total number of Common Stock equivalents was 158,877 and 240,863, respectively, and composed of stock options and warrants. The Company incurred a net loss for the three months ended December 31, 2024 and 2023, respectively and therefore, basic and diluted earnings per share for those periods are the same because all potential common equivalent shares would be antidilutive.

GoingConcern and Capital Resources

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern.

Since

its inception, the Company has devoted substantially all of its efforts to business planning, research and development, recruiting management and technical staff, acquiring operating assets, raising capital and the commercialization and manufacture of its single serve coffee products. As of December 31, 2024, the Company had cash of $124,715 and working capital of $1,394,676.

Management has evaluated the Company’s ability to continue as a going concern under ASC 205-40, Presentation of Financial Statements - Going Concern, and considered its financial condition, projected cash flows, obligations due within 12 months, and sources of liquidity. Based on this assessment, management has concluded that no substantial doubt exists regarding the Company’s ability to continue as a going concern for at least one year from the date of issuance of these consolidated financial statements. Accordingly, the financial statements have been prepared on a going concern basis.

Useof Estimates

In preparing these consolidated financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amount of revenues and expenses during the reporting periods. Actual results could differ from those estimates.

FairValue of Financial Instruments

Fair value is an estimate of the exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants (i.e., the exit price at the measurement date).

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On

August 20, 2024, the Company entered into a convertible note purchase agreement with certain investors (the “August Notes Investors”) to issue and sell convertible notes in the aggregate principal amount of $1,300,000 (the “August Notes”). The Notes bear interest at an annual rate of 7% and have a maturity date of one year from the issuance date. The Notes shall not be converted until the Company obtains shareholder approval for the issuance of shares underlying the Notes. Upon obtaining such approval, the holder may convert the Notes into a number of shares of Common Stock equal to (i) the outstanding principal amount of the Notes, plus any accrued but unpaid interest, divided by (ii) $0.94, the conversion price. Any conversion of the Notes resulting in a fractional share shall be rounded down to the nearest whole share. On October 31, 2024, the conversion of this convertible note into stocks has been completed.

Per ASC 470-20-25-5, An embedded beneficial conversion feature (“BCF”) present in a convertible instrument shall be recognized separately at issuance by allocating a portion of the proceeds equal to the intrinsic value of that feature to additional paid-in capital.

The company evaluated that the fair value of the instrument is slightly higher than the proceeds from the instrument issuance. The BCF is embedded in the convertible note.

Still, since the converting period is short (only 50 days) and the fair value of the embedded BCF is relatively small, we decided not to separate the feature until the proceeds to paid-in-capital. Since we do not directly pay the interest expenses, but to put them in the total repayable amount and convert to shares, we do not amortize the interest expense.

For the three months ended December 31, the fair value on convertible notes has not changed.

Cashand Cash Equivalents

The Company considers all highly liquid investments with original maturities of three months or less when purchased to be cash equivalents. The Company had no cash equivalents as of December 31, 2024 and September 30, 2024.

Concentrationof Credit Risk

Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash and cash equivalents. The Company places its cash with high quality banking institutions. From time to time, the Company may or may not maintain cash balances at certain institutions in excess of the Federal Deposit Insurance Corporation limit.

AccountsReceivable,net

Trade accounts receivable is periodically evaluated for collectability based on past credit history with customers and their current financial condition. Bad debts expense or write offs of receivables are determined on the basis of loss experience, known and inherent risks in the receivable portfolio and current economic conditions. The Company recorded an allowance for credit loss of $Nil and $3,450,141 as of both December 31, 2024, and September 30, 2024.

SCHEDULE OF ACCOUNTS RECEIVABLES

	December 31,<br><br> <br>2024		September 30,<br><br> <br>2024
Accounts receivable	$	-	$	3,450,141
Less: allowance for credit loss		-		(3,450,141	)
Total accounts receivable	$	-	$	-

AssetsHeld for Sale-Current

As

of December 31, 2024 and September 30, 2024, assets held for Sale-Current were $10,736 and $10,736. This is mainly the equipment planned for sale.

SCHEDULE OF ASSETS HELD FOR SALE

	December 31,<br><br> <br>2024			September 30,<br><br> <br>2024
Assets Held for Sale	$	214,709		$	214,709
Current<br> Assets Held for Sale		214,709			214,709
Property<br> and equipment asset impairment		(203,973	)		(203,973	)
Total	$	10,736		$	10,736

MajorCustomers

For the three months ended December 31, 2024 and 2023, revenue was primarily derived from major customers disclosed below.

Three months ended December 31, 2024:

SCHEDULE OF REVENUE BY MAJOR CUSTOMERS

Customer<br> Name	Sales<br> <br>Amount		%<br> of Total<br> Revenue			Accounts<br><br> Receivable<br> Amount		%<br> of Total<br> Accounts<br> Receivable
Customer<br> LXM	$	13,524		59	%	$	-		-

Three months ended December 31, 2023:

Customer<br> Name	Sales<br>Amount		%<br> of Total<br> Revenue			Accounts<br><br> Receivable<br> Amount		%<br> of Total<br> Accounts<br> Receivable
Customer<br> CL	$	577,420		43	%	$	552,587		49	%

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Leases

In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842), to provide guidance on recognizing lease assets and lease liabilities on the consolidated balance sheet and disclosing key information about leasing arrangements, specifically differentiating between different types of leases. The Company implemented ASU No. 2016-02 on October 1, 2019.

The Company conducts a quarterly analysis of leases to determine if there are any operating leases that require recognition under ASC 842. The Company has a long-term operating lease for office and manufacturing space in Plano, Texas. The leased property in Plano, Texas, has a remaining lease term through June 2024 and Tenancy terminated. The Company did not apply the recognition requirements of ASC 842 to operating leases with a remaining lease term of 12 months or less.

In May 2022, the Company renewed the office and manufacturing space in Vista, California through March 31, 2025, which was scheduled to expire on January 31, 2023. The lease has a monthly base rent of $8,451, plus common area expenses. Along with the extension,

we leased

an additional 1,796 square feet that has a monthly base rent of $2,514 through March 31, 2025 .

The

Company leased a new larger office and manufacturing space in Seoul, Korea beginning November 15, 2021, through November 15, 2023. The lease has a monthly expense of $7,040. Accordingly, we have added ROU Assets and Lease Liabilities related to those leases as of September 30, 2023.

Effective

September 1, 2024, we have leased a principal office space located at 16097 Poppyseed Cir, Unit 1904, Delray Beach, Florida, 33484, which we lease for $3,500 per month until August 31, 2025.

The

lease in San On Street, Tuen Mun, Hong Kong has a term of 12 months from December 18, 2024 to December 17, 2025 at a rate of RMB 4,167 ($594) per month. The lease is a short-term lease which has a lease term of 12 months and does not include an option to purchase the underlying asset. The Company did not recognize ROU assets or lease liabilities for short term leases.

As of December 31, 2024, the Company’s operating leases had a weighted average remaining lease term of 1 years and a weighted-average discount rate of 5%. Other information related to our operating leases is as follows:

SCHEDULE OF OTHER INFORMATION RELATED TO OPERATING LEASE

ROU Asset<br> – October 1, 2024	$	99,746
Disposal of ROU		-
ROU<br> Asset added during the period		(41,349	)
Amortization<br> during the period		-
ROU<br> Asset – December 31, 2024	$	58,397
Lease Liability –<br> October 1, 2024	$	100,962
Lease<br> Liability added during the period		-
Amortization<br> during the period		-
disposal<br> of lease liability		(42,659	)
Lease<br> Liability – December 31, 2024	$	58,303
Lease<br> Liability – Short-Term	$	58,303
Lease<br> Liability – Long-Term		-
Lease<br> Liability – Total	$	58,303

The table below reconciles the fixed component of the undiscounted cash flows for each of the first five years and the total remaining years to the lease liabilities recorded on the Consolidated Balance Sheet as of December 31, 2024.

Amounts due within 12 months of December 31, 2024

SCHEDULE OF FUTURE MINIMUM RENTAL PAYMENTS FOR OPERATING LEASES

2025		59,231
2026		-
Total<br> Minimum Lease Payments		59,231
Less<br> Effect of Discounting		928
Present<br> Value of Future Minimum Lease Payments		58,303
Less<br> Current Portion of Operating Lease Obligations		58,303
Long-Term<br> Operating Lease Obligations	$	-

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During the year ended December 31, 2024, we had the following cash and non-cash activities associated with our leases:

SCHEDULE

OF CASH AND NON-CASH ACTIVITIES OF LEASES

Operating<br> cash outflows from operating leases:	$	40,256
Operating<br> cash outflows from finance leases:	$	-
Financing<br> cash outflows from finance lease:	$	-

ForeignCurrency Translation

The

financial position and results of operations of each of the Company’s foreign subsidiaries are measured using the foreign subsidiary’s local currency as the functional currency. Revenues and expenses of each such subsidiary have been translated into U.S. dollars at average exchange rates prevailing during the period. Assets and liabilities have been translated at the rates of exchange on the balance sheet date. The resulting translation gain and loss adjustments are recorded directly as a separate component of stockholders’ equity, unless there is a sale or complete liquidation of the underlying foreign investment. For the three months ended December 31, 2024 and 2023, the foreign currency translation adjustment attributable to CIMG Inc., recorded in other comprehensive income (loss), was $(192,038) and $42,408, respectively.

Transaction gains and losses arise from exchange rate fluctuations on transactions denominated in a currency.

RevenueRecognition

In FY 2024, We have reduced our single-serving pour-over coffee packaging business, and in the portion of bagged coffee sales, we have added other brands, such as “Maca Coffee” and other finished products with maca as the main raw material, such as “Maca Noni”. In 2024, we sell maca peptide coffee and other new products on a distribution model. We usually sign distribution contracts with distributors on a batch basis. Based on the contract, we deliver the goods after full payment to our bank account. We courier the goods to the customer. The customer will sign a receipt after receiving the goods. The customers can also choose to pick up their goods from our warehouse on their own. Also, the customer will sign a receipt.

In May 2014, the FASB issued Accounting Standards Update No. 2014-09 (Topic 606) “Revenue from Contracts with Customers.” Topic 606 supersedes the revenue recognition requirements in Topic 605 “Revenue Recognition” (Topic 605). The new standard’s core principle is that an entity will recognize revenue at an amount that reflects the consideration to which the entity expects to be entitled in exchange for transferring goods or services to a customer. The principles in the standard are applied in five steps: 1) Identify the contract(s) with a customer; 2) Identify the performance obligations in the contract; 3) Determine the transaction price; 4) Allocate the transaction price to the performance obligations in the contract; and 5) Recognize revenue when (or as) the entity satisfies a performance obligation. We adopted Topic 606 as of October 1, 2018 on a modified retrospective basis. The adoption of Topic 606 did not have a material impact on our consolidated financial statements, including the presentation of revenues in our Consolidated Statements of Operations.

Per ASC 606-10-32-2, an entity shall consider the terms of the contract and its customary business practices to determine the transaction price. The transaction price is the amount of consideration to which an entity expects to be entitled in exchange for transferring promised goods or services to a customer, excluding amounts collected on behalf of third parties (for example, some sales taxes). The consideration promised in a contract with a customer may include fixed amounts, variable amounts, or both.

Per ASC 606-10-25-23 An entity shall recognize revenue when (or as) the entity satisfies a performance obligation by transferring a promised good or service (that is, an asset) to a customer.

Per ASC 606-10-55-37 An entity is a principal if it controls the specified good or service before that good or service is transferred to a customer. However, an entity does not necessarily control a specified good if the entity obtains legal title to that good only momentarily before legal title is transferred to a customer. An entity that is a principal may satisfy its performance obligation to provide the specified good or service itself or it may engage another party (for example, a subcontractor) to satisfy some or all of the performance obligation on its behalf.

ASC 606-10-55-38 An entity is an agent if the entity’s performance obligation is to arrange for the provision of the specified good or service by another party. An entity that is an agent does not control the specified good or service provided by another party before that good or service is transferred to the customer. When (or as) an entity that is an agent satisfies a performance obligation, the entity recognizes revenue in the amount of any fee or commission to which it expects to be entitled in exchange for arranging for the specified goods or services to be provided by the other party. An entity’s fee or commission might be the net amount of consideration that the entity retains after paying the other party the consideration received in exchange for the goods or services to be provided by that party.

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Returnand Exchange Policy

All products are thoroughly inspected and securely packaged before they are shipped to ensure buyers receive the best possible product. If for any reason buyers are unsatisfied with the products, they can return them, and the Company will exchange or refund the purchase minus any shipping charges. For wholesale customers, return policies vary based on their specific agreements with customers. Under chargebacks agreements with the customers, the Company agrees to reimburse the seller for a portion of the costs incurred by the seller to advertise and promote certain of the Company’s products. The Company estimates, accrues and recognizes such chargebacks. These amounts are included in the determination of net sales. For three months ended December 31, 2024 and 2023, the Company has no sales allowances for estimated chargebacks and returns, respectively.

Accountspayable and accrued expenses

As

of December 31, 2024 and September 30, 2024, the accounts payable are $1,109,759 and $1,098,582 respectively.

As

of December 31, 2024 and September 30, 2024, the accrued expenses are $710,441 and $1,141,755 respectively, it mainly includes the accounts payable settlement costs of Nuzee single-serving coffee and DRIPKIT products.

Accounts payable and accrued expenses as of December 31, 2024 and September 30, 2024 are as follows:

SCHEDULE OF ACCOUNTS PAYABLE

AND ACCRUED EXPENSES

	December 31,<br><br> <br>2024		September 30,<br><br> <br>2024
Accounts<br> payable	$	1,109,759	$	1,098,582
Accrued<br> expenses		710,441		1,141,755
Total	$	1,820,200	$	2,240,337

Othercurrent liabilities

As

of December 31, 2024 and September 30, 2024, the other current liabilities are $631,921 and $586,173 respectively. The mainly achieved through financing to purchase equipment and pay for the goods.

CostRecognition

The Maca Series products are pure plant products that we purchase maca raw materials and entrust to process. Therefore, the raw materials

the procurement cost of maca, the packaging cost of goods, the freight cost of goods and so on.

Operatingexpenses

For

the three months ended December 31, 2024, the operating expenses were $1,517,758. This mainly includes personnel costs of $617,824, sales and marketing expenses of $104,403, depreciation and amortization of $7,771, professional services such as lawyers, auditors and consultants of $642,125, travel expenses of $35,084, office expenses of $73,585 and other expenses of $36,966.

For the three months ended December

31, 2023, the operating expenses were $2,145,642 .It primarily comprised of personnel costs, selling and marketing expenses, depreciation and amortization, insurance expenses, professional services, travel and office expenses, etc. In some cases, the company bears shipping costs for shipping customer orders, and shipping and handling costs are recorded under operating expenses in the consolidated statement of operations.

Otherincome

For the three months ended December

31, 2024, the other income was $9,047. It is mainly because of the write-off other payables.

For the three months ended December 31, 2023, the other income was $46,832.

It is mainly because of the rental income.

OtherExpense

Other

expense of $43,017 and $49,195 for the three months ended December 31, 2024 and 2023, respectively, primarily includes write off of deferred financing costs and sublease expense.

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Prepaidexpenses and other current assets

Prepaid expenses and other current assets as of December 31, 2024 and September 30, 2024 are as follows:

SCHEDULE OF PREPAID EXPENSES AND OTHER CURRENT ASSETS

	December<br>31,<br><br> <br>2024		September<br>30,<br><br> <br>2024
Prepaid<br> expenses	$	150,702	$	197,217
Other<br> current assets		140,460		185,431
Total	$	291,162	$	382,648

The

Prepaid expenses and other current assets balance of $291,162 as of December 31, 2024 primarily consists of prepaid rent, a retainer for professional services.

Inventories,net

Inventories,

net, consisting principally of raw materials, work in process and finished goods held for production and sale, is stated at the lower cost or net realizable value, cost being determined using the weighted average cost method. The Company reviews inventory levels at least quarterly and records a valuation allowance when appropriate. On December 31, 2024, the carrying value of inventory of $4,608,307.

SCHEDULE OF INVENTORY

	December 31,<br><br> <br>2024		September<br>30,<br><br> <br>2024
Raw<br> materials	$	4,540,113	$	4,490,728
Finished<br> goods	$	68,194	$	57,307
Total	$	4,608,307	$	4,548,035

Propertyand Equipment, net

Property

and equipment are stated at cost, net of accumulated depreciation. Office equipment is depreciated over a 3-year life, furniture over a 7-year life, and other equipment over a 5-year life. Depreciation expense for three months ended December 31, 2024 and 2023 was $271 and $32,480, respectively. Property and equipment as of December 31,2024 and September 30, 2024 consist of:

SCHEDULE OF PROPERTY AND EQUIPMENT

	December 31,<br><br> <br>2024			September 30,<br><br> <br>2024
Machinery<br> & Equipment	$	2,268		$	1,465,566
Vehicles		-			57,431
Less<br> - Accumulated Depreciation		(271	)		(1,127,820	)
Less-Impairment<br> on Property and Equipment		-			(214,709	)
Disposal<br> of property and equipment		-			(178,200	)
Net<br> Property and Equipment	$	1,997		$	2,268

The Company is required to make deposits or prepayments and progress payments on equipment purchases before the Company receives possession and title. As a result, the Company accounts for such payments as Other Assets until it has possession at which time the equipment is recorded as Property and Equipment. There were no such deposits as of December 31, 2024 or September 30, 2024.

Samples

The Company distributes samples of its products as a component of its marketing program. Costs for samples are expensed at the time the samples are produced and recorded under operating expenses in the consolidated statements of operations.

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Long-LivedAssets

The Company tests long-lived assets or asset groups for recoverability when events or changes in circumstances indicated that their carrying amount may not be recoverable. Circumstances which could trigger a review include, but are not limited to: significant decreases in the market price of the asset; significant adverse changes in the business climate or legal factors; accumulation of costs significantly in excess of the amount originally expected for the acquisition or construction of the asset; current period cash flow or operating losses combined with a history of losses or a forecast of continuing losses associated with the use of the asset; and a current expectation that the asset will more likely than not be sold or disposed significantly before the end of its estimated useful life. Recoverability is assessed based on the carrying amount of the asset and its fair value which is generally determined based on the sum of the undiscounted cash flows expected to result from the use and the eventual disposal of the asset, as well as specific appraisal in certain instances.

Intangibleassets

Intangible assets have either an identifiable or indefinite useful life. Intangible assets with identifiable useful lives are amortized on a straight-line basis over their economic or legal life, whichever is shorter. We have identifiable useful life intangible assets related to acquired Dripkit tradename and customer relationships. We evaluate these intangible assets annually for impairment, and when indications of potential impairment exist. The management uses considerable judgment to determine key assumptions, including projected revenue, projected costs, marketing expenses and projected profits, etc. This kind of analysis requires important estimates and judgments, including the estimation of future cash flows, which depends on internal forecasts, the estimation of the long-term growth rate of our business, the estimation of the useful life of the cash flows that will occur, customer churn, and the determination of our weighted average cost of capital.

IncomeTaxes

In accordance with ASC 740 - Income Taxes, the provision for income taxes is computed using the asset and liability method. Under the asset and liability method, deferred income tax assets and liabilities are determined based on the differences between the financial reporting and tax bases of assets and liabilities and are measured using the currently enacted tax rates and laws. A valuation allowance is provided for the amount of deferred tax assets that, based on available evidence, are not expected to be realized.

The Company also follows the guidance related to accounting for income tax uncertainties. In accounting for uncertainty in income taxes, the Company recognizes the financial statement benefit of a tax position only after determining that the relevant tax authority would more likely than not sustain the position following an audit. For tax positions meeting the more likely than not threshold, the amount recognized in the financial statements is the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement with the relevant tax authority. No liability for unrecognized tax benefits was recorded as of December 31, 2024 and September 30, 2024.

Relatedparties

A party is considered to be related to the Company if the party directly or indirectly or through one or more intermediaries, controls, is controlled by, or is under common control with the Company. Related parties also include principal owners of the Company, its management, members of the immediate families of principal owners of the Company and its management and other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests. A party which can significantly influence the management or operating policies of the transacting parties or if it has an ownership interest in one of the transacting parties and can significantly influence the other to an extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interests is also a related party.

Stock-basedCompensation

We account for share-based awards issued to employees in accordance with Accounting Standards Codification (ASC) 718, “Compensation-Stock Compensation”. Accordingly, employee share-based payment compensation is measured at the grant date, based on the fair value of the award, and is recognized as an expense over the requisite service period, which is normally the vesting period. Share-based compensation to directors is treated in the same manner as share-based compensation to employees, regardless of whether the directors are also employees. In June 2018, the FASB issued ASU 2018-07 which simplifies several aspects of the accounting for non-employee transactions by stipulating that the existing accounting guidance for share-based payments to employees (accounted for under ASC Topic 718, “Compensation-Stock Compensation”) will also apply to non-employee share-based transactions (accounted for under ASC Topic 505, “Equity”). The Company implemented ASU 2018-07 on October 1, 2019 and the impact of the implementation was not material to the financial statements.

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We determine the fair value of share-based payments using the Black Scholes option-pricing model for common stock options and warrants and the closing price of our common stock for common share issuances. We recognize forfeitures as they occurred.

For

three months ended December 31, 2024, the Company issued 800,000 shares of its common stock under the 2024 Equity Incentive Plan.

Comprehensiveincome/loss

Comprehensive income/loss is defined to include all changes in equity except those resulting from investments by owners and distributions to owners. Among other disclosures, all items that are required to be recognized under current accounting standards as components of comprehensive income/loss are required to be reported in a financial statement that is presented with the same prominence as other financial statements. The Company’s current component of other comprehensive income/loss pertains to foreign currency translation adjustments.

SegmentInformation

ASC Topic 280, “Disclosures about Segments of an Enterprise and Related Information,” established standards for the way that public business enterprises report information about operating segments in annual financial statements and requires those enterprises to report selected information about operating segments in interim financial reports issued to stockholders. Management has determined that the Company operates in one business segment, which is the commercialization and development of functional beverages.

RecentAccounting Pronouncements

In August 2020, the FASB issued ASU 2020-06, Debt — Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging-Contracts in Entity’s Own Equity (Subtopic 815-40), Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity. ASU 2020-06 simplifies the accounting for convertible instruments by reducing the number of accounting models available for convertible debt instruments. This guidance also eliminates the treasury stock method to calculate diluted earnings per share for convertible instruments and requires the use of the if-converted method. The amendments in this Update are effective for public business entities that meet the definition of a Securities and Exchange Commission (SEC) filer, excluding entities eligible to be smaller reporting companies as defined by the SEC, for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years. Early adoption is permitted.

In November 2023, the FASB issued ASU 2023-07, Segment Reporting-Improvements to Reportable Segment Disclosures. The amendments in this Update improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. The amendments in this Update are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted. A public entity should apply the amendments in this Update retrospectively to all prior periods presented in the financial statements. Upon transition, the segment expense categories and amounts disclosed in the prior periods should be based on the significant segment expense categories identified and disclosed in the period of adoption. The Group adopted ASU 2023-07 in the consolidated financial statements for the year ended December 31, 2024. The Company concluded that it has no material impact on the consolidated financial statements.

In December 2023, the FASB issued ASU 2023-09, Improvements to Income Tax Disclosures, which applies to all entities subject to income taxes. ASU 2023-09 requires disaggregated information about a reporting entity’s effective tax rate reconciliation as well as information on income taxes paid. For public business entities, ASU 2023-09 will be effective for annual periods beginning after December 15, 2024. For entities other than public business entities, the requirements will be effective for annual periods beginning after December 15, 2025. The guidance will be applied on a prospective basis with the option to apply the standard retrospectively. Early adoption is permitted. The Company is currently evaluating the impact of these accounting standard updates on its consolidated financial statements.

All other newly issued accounting pronouncements but not yet effective have been deemed either immaterial or not applicable.

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DiscontinuedOperations

ASC 205-20-45-10 In the period(s) that a discontinued operation is classified as held for sale and for all prior periods presented, the assets and liabilities of the discontinued operation shall be presented separately in the asset and liability sections, respectively, of the statement of financial position.

ASC 205-20-45-3 The statement in which net income of a business entity is reported or the statement of activities of a not-for-profit entity (NFP) for current and prior periods shall report the results of operations of the discontinued operation, including any gain or loss recognized in accordance with paragraph 205-20-45-3C, in the period in which a discontinued operation either has been disposed of or is classified as held for sale.

The company has terminated the sold business in accordance with ASC 205-20-45-10 and ASC 205-20-45-3. Additional information on discontinued operations can be found in Note 6-discontinued operations.

IdentifiedIntangibles and Goodwill

The Company identified tradename and customer relationships intangible assets. The tradename and customer relationships intangible assets will be amortized on a straight-line basis over their respective estimated useful lives. The goodwill recognized results from such factors as an assembled workforce and management’s industry know-how.

3.

LOANS

On

February 15, 2024, Social E-commerce Co., Ltd. provided a short-term, interest-free loan to the Company. The loan, approved by the lender and serviced by Bill.com Capital 3, LLC through their online platform, was intended to support the Company’s operations. As of December 31, 2024, the outstanding balance of this loan was $103,889.

On

April 18, 2024, SOONCHA KIM lent the company $320,000 with an annual interest rate of 7%. The outstanding balance on the loan at December 31, 2024 amounted to $320,926.

For

three months ended December 31, 2024, ZHANG XIANG provided a loan of $8,697 to the Company, bearing no interest. As of December 31, 2024, the outstanding loan balance remained at $8,697.

4.

GEOGRAPHIC CONCENTRATIONS

The Company is organized based on fundamentally one business segment although it does sell its products on a world-wide basis. The Company is organized in two geographical segments. The company jointly produces and sells its products in North America and China. Information about the Company’s geographic operations for three months ended December 31, 2024 and 2023 are as follows:

SCHEDULE OF GEOGRAPHICAL OPERATIONS

	Three<br> Months<br> <br>Ended<br> <br>December<br> 31,<br><br> <br>2024		Three<br> Months<br> <br>Ended<br> <br>December<br> 31,<br><br> <br>2023
Net<br> Revenue:
North<br> America	$	-	$	965,932
P.R.C		22,853		-
Revenues, net	$	22,853	$	965,932
	December<br> 31,<br><br> <br>2024		September 30,<br><br> <br>2024
---	---	---	---	---
Property and equipment, net:
North<br> America	$	-		-
P.R.C		1,997	$	2,268
Property and equipment, net	$	1,997	$	2,268

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5.

RELATED PARTY TRANSACTIONS

As

of December 31, 2024, the directors of Wewin Technology LLC paid an administrative fee of $18,000 on behalf of CIMG INC. The company expects to clear and repay this related-party transaction before September 30, 2025.

6.

DISCONTINUED OPERATIONS

On June 7, 2024, the company’s board of directors passed a resolution to sale (1) NuZee KOREA Ltd a company incorporated in Korea and a wholly-owned subsidiary of the Company; and (2) NuZee Investment Co., Ltd, a company incorporated in Japan and a wholly-owned subsidiary of the Company. The discontinuation of the business is primarily due to strategic considerations by the management regarding the company’s overall development, as well as the need to ensure administrative consistency.

The losses from discontinued operations for three months ended December 31, 2024 and 2023 are as follows:

SCHEDULE OF LOSSES FROM ASSET DISPOSAL OF DISCONTINUED OPERATIONS

		Three<br> Months Ended		Three<br> Months Ended
		December<br> 31, 2024		December<br> 31, 2023
Revenue	$	-	$	388,054
Cost<br> of revenue		-		(337,309	)
Gross profit		-		50,745
Operating<br> expenses		-		(172,593	)
Operations<br> Loss		-		(121,848	)
Other<br> revenue		-		179
Other<br> expense		-		(905	)
Interest<br> income, net		-		170
Loss<br> from discontinued operations before income tax		-		(122,404	)
Income<br> tax expense		-		-
Loss<br> from discontinued operation after tax		-		(122,404	)
Losses<br> from asset disposal of discontinued operations	$	-	$	(122,404	)

7.

INTANGIBLE ASSETS

Identifiablelife intangible assets

As

of December 31,2024, the net intangible assets of the company is $72,500 which is being amortized over five years from the date of acquisition at a rate of $30,000 per year.

Amortization

expense was $7,500 and $7,500 for three months ended December 31, 2024 and 2023.

Amortization expense for the next four fiscal years is as follows:

SCHEDULE

OF AMORTIZATION EXPENSE

	Tradename<br><br> Amortization
2025		22,500
2026		30,000
2027		20,000
2028		-
Grand<br> Total	$	72,500

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8.

ISSUANCE OF EQUITY SECURITIES

On August 20, 2024, the Company entered into a convertible

note purchase agreement (the “Purchase Agreement”) with certain investors (the “August Notes Investors”) to issue and sell convertible notes in the aggregate principal amount of $1,300,000 (the “August Notes”). The Notes bear interest at an annual rate of 7% and have a maturity date of one year from the issuance date. The Notes shall not be converted until the Company obtains shareholder approval for the issuance of shares underlying the Notes. Upon obtaining such approval, the holder may convert the Notes into a number of shares of Common Stock equal to (i) the outstanding principal amount of the Notes, plus any accrued but unpaid interest, divided by (ii) $0.94, the conversion price. Any conversion of the Notes resulting in a fractional share shall be rounded down to the nearest whole share.

On

October 31, 2024, all the August 2024 Notes Investors converted their August Notes to shares of Common Stock. As a result of such conversions of the August Notes, the Company issued an aggregate of 1,396,813 shares of Common Stock to the August Notes Investors.

On

October 22, 2024, the holders of warrants exercised its cashless option to purchase an aggregate of 55,973 shares of the Company’s common stock. In connection with such cashless exercise, the Company did not receive any cash proceeds.

On

September 24, 2024, the Company entered into a securities purchase agreement with certain investors (the “Investors”), providing for the sale and issuance of 3,508,769 shares of the Company’s common stock, par value $0.00001 per share, for an aggregate purchase price of $2,000,000.

On

December 24, 2024, the Company issued 800,000 shares of its common stock for a total value of $523,680 under the 2024 Equity Incentive Plan.

The following table summarizes the restricted common shares activities for the three months ended December 31, 2024 and 2023:

SCHEDULE

OF RESTRICTED STOCK SHARES ACTIVITIES

	2024		2023
Number of shares outstanding at September 30, 2024 and 2023	****	320,743	****	50,056	****
Restricted shares<br> granted		4,905,582		-
Restricted shares<br> forfeited		-		(4,300	)
Restricted<br> shares vested		-		-
Number of shares outstanding at December 31, 2024 and 2023	****	5,226,325	****	45,756	****

9.

STOCK OPTIONS AND WARRANTS

Options

During the three months ended December 31, 2024, the Company granted no new stock options.

During

the three months ended December 31, 2024, 20,430 stock options were forfeited or expired because of termination of employment, expiration of options and performance conditions not met.

The following table summarizes stock option activity for the three months ended December 31, 2024.

SCHEDULE OF STOCK OPTION ACTIVITY

			Weighted<br><br> <br>Average<br><br> <br>Exercise<br><br> <br>Price			Aggregate<br><br> <br>Intrinsic<br><br> <br>Value
Outstanding on September 30, 2024	20,430		$	177.44	0.02	$	-
Granted	-			-	-		-
Exercised	-			-	-		-
Expired	(20,430	)		177.44	0.02		-
Forfeited	-			-	-		-
Outstanding on December 31, 2024	-			-	-	$	-
Exercisable on December 31, 2024	-		$	-	-	$	-

The Company is expensing these stock option awards on a straight-line basis over the requisite service period. The Company recognized stock option expense of $Nil

and $11,505

for three months ended December 31 2024, and 2023, respectively.

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Warrants

On

October 18, 2024, the holders of warrants issued by the Company exercised its cashless option to purchase an aggregate of 55,973 shares of the Company’s common stock pursuant to warrants issued by the Company. Such warrants were previously issued pursuant to the convertible note and warrant purchase agreement dated April 27, 2024, as disclosed in the current report of the Company on Form 8-K filed with the SEC on May 2, 2024. In connection with such cashless exercise, the Company will not receive any cash proceeds. The shares of common stock issuable upon exercise of such warrants were registered under the Form S-1 effective on July 1, 2024.

The following table summarizes warrant activity for the three months ended December 31, 2024:

SCHEDULE OF WARRANT ACTIVITY

		Weighted<br><br> Average<br> Exercise <br>Price			Aggregate<br><br> Intrinsic<br> Value
Outstanding<br> on September 30, 2024	214,850	$	112.67	2.42	$	-
Issued	-		-	-		-
Exercised	55,973		1.32	-		-
Expired	-		-	-		-
Outstanding on December<br> 31, 2024	-		-	-		-
Exercisable on December<br> 31, 2024	158,877	$	151.94	1.24	$	-

10.

CONTINGENCIES

Curtin Litigation

As previously disclosed, on January 6, 2023, a former employee of the Company, Rosalina Curtin filed a complaint against the Company and another former employee of the Company, Jose Ramirez, in the Superior Court of California, County of San Diego (Case No. 37-2023-00000841-CU-WT-NC) (the “Complaint”). The Complaint alleged that Ms. Curtin was subject to harassment by Mr. Ramirez, gender discrimination throughout her employment, that she reported this discrimination and harassment to the Company, and that the Company retaliated against her and wrongfully terminated her for whistleblowing and failed to prevent discrimination, harassment, and retaliation. Ms. Curtin sought compensatory damages, including loss of past, present and future earnings, and benefits, as well as punitive damages, penalties, attorney’s fees and costs and interest. Pursuant to the terms of Ms. Curtin’s Employment Agreement with the Company, on December 22, 2023, the Court compelled the case to arbitration with the American Arbitration Association (Case Number 01-24-0002-3225).

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On

November 8, 2024, without a finding or admission of wrongdoing, the Company entered into a settlement agreement with Ms. Curtin. In exchange for mutual general releases and a dismissal of the lawsuit with prejudice, the Company paid Ms. Curtin $125,000. On January 22, 2025, the case was dismissed in its entirety.

Kim Litigation

On

October 3, 2024, Mr. Sooncha Kim filed a complaint against the Company in the Southern District of New York, (Case No. 1:24-cv-7485) (the “Complaint”). The Complaint alleges that the Company breached a Convertible Note and Warrant Purchase Agreement, dated June 6, 2024, between the Company and Mr. Kim, by, among other things, failing to deliver the registration rights agreement, excluding Mr. Kim from the S1 registration statement, delaying conversion of Mr. Kim’s notes, undertaking steps to dilute Mr. Kim’s shares, failing to honor Mr. Kim’s 50% participation right in any subsequent financing and failing to appoint a designated director, as set forth in the parties’ agreement. Mr. Kim seeks specific performance of the Convertible Note and Warrant Purchase Agreement, and monetary damages in the amount of $1,041,216, plus applicable interest. The Company filed its answer to the Complaint on December 3, 2024. On January 7, 2025, Mr. Kim filed a motion seeking a preliminary injunction against the Company (the “Motion”). The Company opposed the Motion on January 22, 2025, and on February 13, 2025, the Court denied Mr. Kim’s Motion. Discovery in the case is ongoing, and no trial date has been set.

The Company believes it has a basis to defend the claims in the Kim Litigation, however, the Company is not able to predict the outcome, and there is no assurance that the Company will be successful in its defense.

Ex-Directors Lawsuit

On

March 10, 2025, former directors of the Company, Kevin J. Connor, Chris J. Jones, Nobuki Kurita, and David Robson (collectively, the “Ex-Directors”), filed a complaint against the Company in the Superior Court of California, County of San Diego (Case No. 25CU012922N) (the “Complaint”). The Complaint alleges the Company failed to pay directors’ fees and expenses from the last quarter the fiscal year ended September 30, 2023 through the first two quarters of the fiscal year ended September 30, 2024, and is claiming breach of contract, quantum meruit, unjust enrichment, promissory estoppel, breach of the implied covenant of good faith and fair dealing, and unfair business practices. The Ex-Directors seek monetary damages in excess of $200,000, with applicable interest, costs and attorneys’ fees. The Company’s answer to the Complaint was due on April 16, 2025. On April 17, 2025, the Ex-Director’s filed a request for entry of default. To date, no default has been entered against the Company. As of the date of this quarterly report, two parties are still negotiating.

11.

SUBSEQUENT EVENTS

PrivatePlacement

SCHEDULE

OF PRIVATE PLACEMENT

Date	Transaction Description	Amount/Shares	Status
December<br> 12, 2024	Convertible<br> Note and Warrant Purchase Agreement<br><br> <br><br><br> <br>(Form<br>8-K filed on December 17, 2024, Form 8-K/A filed on January 23, 2025, Form 8-K filed on April 3, 2025)	$10,000,000<br> for up to 25,641,023 shares of Common Stock, subject to shareholders’ approval	The<br> closings of the sale of the notes and warrants occurred on January 16, 2025 and January 17,<br> 2025.<br><br> <br><br><br> <br>On<br> February 10, 2025, the Company obtained its shareholder approval for the issuance of shares underlying the notes and the warrants.<br><br> <br><br><br> <br>On<br> March 18, 2025, the investors submitted their respective conversion notices to the Company, converting their respective Notes.<br><br> <br><br><br> <br>Upon<br> receiving the conversion notices, the Company issued 19,457,618 shares of the Company’s common stock to the Investors pursuant<br> to the same.
June<br> 2, 2025	Share<br> Purchase Agreement<br><br> <br><br><br> <br>(Form<br> 8-K filed on June 5, 2025 and June 10, 2025)	$1,068,480<br> for 6,000,000 shares of common stock	The<br> closing of the sale of the 6,000,000 shares of common stock occurred on June 9, 2025.<br><br> <br><br><br> <br>6,000,000<br> shares of common stock has been issued.

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LegalProceedings

Kim Litigation

On

The Company believes it has a basis to defend the claims in the Kim Litigation. The company believes that it is very likely to succeed in the defense.

Ex-Directors Lawsuit

On

March 10, 2025, former directors of the Company, Kevin J. Connor, Chris J. Jones, Nobuki Kurita, and David Robson (collectively, the “Ex-Directors”), filed a complaint against the Company in the Superior Court of California, County of San Diego (Case No. 25CU012922N) (the “Complaint”). The Complaint alleges the Company failed to pay directors’ fees and expenses from the last quarter of the fiscal year ended September 30, 2023 through the first two quarters of the fiscal year ended September 30, 2024, and is claiming breach of contract, quantum meruit, unjust enrichment, promissory estoppel, breach of the implied covenant of good faith and fair dealing, and unfair business practices. The Ex-Directors seek monetary damages in excess of $200,000, with applicable interest, costs and attorneys’ fees. The Company’s answer to the Complaint was due on April 16, 2025. On April 17, 2025, the Ex-Director’s filed a request for entry of default. To date, no default has been entered against the Company. As of the date of this annual report, two parties are still negotiating.

New Subsidiary

On

March 10, 2025, Zhongyan Shangyue Technology Co., Ltd. (“Zhongyan”), CIMG Inc.’s wholly-owned subsidiary, entered into a Business Cooperation Intent Agreement (the “Agreement”) with Shanghai Huomao Cultural Development Co., Ltd. (“Huomao”). Pursuant to the Agreement, the three shareholders of Huomao intend to transfer an aggregate of 51% of their equity interest in Huomao to Zhongyan in exchange for 200,000 shares of Common Stock. The Common Stock shall be subject to a six-month lock-up period.

On March 21, 2025, Zhongyan Shangyue Technology Co., Ltd. established a wholly-owned subsidiary, Henan Zhongyan Shangyue Technology Co. Ltd.

On March 27, 2025, Zhongyan Shangyue Technology Co., Ltd. entered into a Business Cooperation Intent Agreement (the “Agreement”) with Xilin Online (Beijing) E-commerce Co., Ltd (“Beijing Xilin”). Pursuant to the Agreement, certain shareholders of Beijing Xilin intend to transfer an aggregate of 51% of their equity interest in Beijing Xilin to Zhongyan.

On March 31, 2025, the Company completed its acquisition of Beijing Xilin, along with the necessary business registration updates in China.

On April 22, 2025, the Company completed its acquisition of Shanghai Huomao, along with the necessary business registration updates in China.

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PART

II. OTHER INFORMATION

Item1. LEGAL PROCEEDINGS

Refer to “Note 10. Contingencies” and “Note 11. Subsequent Events – Legal Proceedings” in our Condensed Consolidated Financial Statements included in this Report.

Item1A. RISK FACTORS

In addition to the other information set forth in this Form 10-Q, you should carefully consider the risk factors discussed in Part I, Item 1A of our Form 10-K, which could affect our business, financial condition, or operating results. The risks we describe in our periodic reports are not the only risks we face. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial may also materially adversely affect our business, financial condition, or operating results. For the quarter ended December 31, 2024, the Company is not aware of any specific new and additional risk factors that were not previously disclosed.

Item2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

None.

Item3. DEFAULTS UPON SENIOR SECURITIES

None.

Item4. MINE SAFETY DISCLOSURES

Not applicable.

Item5. OTHER INFORMATION

During the fiscal quarter ended March 31, 2025, none of the Company’s directors or officers, as defined in Section 16 of the Securities Exchange Act of 1934, adopted or terminated any contract, instruction or written plan for the purchase or sale of Company securities that was intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) or any “non-Rule 10b5-1 trading arrangement” as defined under Item 408(a) of Regulation S-K.

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Item6. EXHIBITS

Exhibit<br><br> <br>Number	Description
10.1	Convertible Note Purchase Agreement dated December 12, 2024 (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on December 17, 2024, SEC File Number 001-39338)
10.2	Form of Convertible Promissory Note (incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed on December 17, 2024, SEC File Number 001-39338)
10.3	Registration Rights Agreement dated December 12, 2024 (incorporated by reference to Exhibit 10.4 to the Company’s Current Report on Form 8-K filed on December 17, 2024, SEC File Number 001-39338)
31.1*	Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2*	Certification of Chief Accounting Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32**	Certification of Principal Executive Officer and Principal Accounting Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
*	Filed<br> herewith.
---	---
**	Furnished<br> herewith. This exhibit will not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934,<br> as amended, or otherwise subject to the liability of that section. Such exhibit shall not be deemed incorporated into any filing<br> under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.

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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 hereunto duly authorized.

	CIMG<br> INC.
Date:<br> August 26, 2025	By:	/s/ Jianshuang Wang
		Jianshuang<br> Wang
		Chief<br> Executive Officer
		(Principal Executive Officer)
	By:	/s/ Feng Tian
		Feng Tian
		(Principal Financial Officer and Principal Accounting Officer)

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EXHIBIT31.1

CERTIFICATION

I, Jianshuang Wang, certify that:

1.	I<br> have reviewed this Quarterly Report on Form 10-Q of CIMG Inc.;
2.	Based<br> on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary<br> to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to<br> the period covered by this report;
3.	Based<br> on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material<br> respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in<br> this report;
4.	The<br> registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures<br> (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange<br> Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting;

5.	The<br> registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial<br> reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing<br> the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:<br> August 26, 2025
/s/ Jianshuang Wang
Jianshuang<br> Wang
Chief<br> Executive Officer
(Principal Executive Officer)

EXHIBIT31.2

CERTIFICATION

I, Feng Tian, certify that:

1.	I<br> have reviewed this Quarterly Report on Form 10-Q of CIMG Inc.;
2.	Based<br> on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary<br> to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to<br> the period covered by this report;
3.	Based<br> on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material<br> respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in<br> this report;
4.	The<br> registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures<br> (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange<br> Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

5.	The<br> registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial<br> reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing<br> the equivalent functions):

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:<br> August 26, 2025
/s/ Feng Tian
Feng<br> Tian
Chief<br> Accounting Officer
(Principal Financial and Accounting Officer)

EXHIBIT32

CERTIFICATION

Pursuantto 18 U.S.C. 1350 as adopted by

Section906 of the Sarbanes-Oxley Act of 2002

Each of the undersigned, Jianshuang Wang, Chief Executive Officer of CIMG Inc. (the “Company”), and Feng Tian, Chief Accounting Officer of the Company, has executed this certification in connection with the filing with the Securities and Exchange Commission of the Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended December 31, 2024 (the “Report”).

Each of the undersigned hereby certifies that, to his respective knowledge:

1.	The<br> Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
2.	The<br> information contained in the Report fairly presents, in all material respects, the financial condition and results of operations<br> of the Company.

Date: August 26, 2025

/s/ Jianshuang Wang
Jianshuang<br> Wang
Chief<br> Executive Officer
(Principal Executive Officer)
/s/ Feng Tian
---
Feng<br> Tian
Chief<br> Accounting Officer
(Principal Financial and Accounting Officer)