UTime Ltd 6-K, filed Mar 18, 2026
UTime Ltd (FXHO)
About this 6-K
UTime Ltd filed this 6-K on March 18, 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 March 2026
Commission
File Number:
People’s
Republic of
(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
UTime Limited (the “Company”) is furnishing this Form 6-K to provide its financial results for the six months ended September 30, 2025.
The Company hereby furnishes the following documents as exhibits to this report: “Unaudited Condensed Consolidated Financial Statements for the Six Months Ended September 30, 2025 and 2024” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”
This Form 6-K is hereby incorporated by reference into the registration statement of the Company on Form F-3 (Registration No. 333-278912), and into any prospectus outstanding under the foregoing registration statements, to the extent not superseded by documents or reports subsequently filed or furnished by the Company under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.
Exhibits
| Exhibit No. | Description | |
| 1.1 | Thid Amended and Restated Memorandum and Articles of Association | |
| 99.1 | Unaudited Condensed Consolidated Financial Statements for the Six Months Ended September 30, 2025 and 2024 | |
| 99.2 | Management’s Discussion and Analysis of Financial Condition and Results of Operations | |
| 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 and Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| UTIME LIMITED | ||
| Date: March 18, 2026 | By: | /s/ Hengcong Qiu |
| Name: | Hengcong Qiu | |
| Title: | Chief Executive Officer | |
| 3 |
Exhibit 1.1
Exhibit 99.1
UTIME
LIMITED
CONSOLIDATED BALANCE SHEETS
(Amounts in thousands, except share data and per share data, or otherwise noted)
(Unaudited)
| RMB | RMB | USD | ||||||||||
| As
of March 31, | As
of September 30, | |||||||||||
| 2025 | 2025 | |||||||||||
| RMB | RMB | USD | ||||||||||
| Assets | ||||||||||||
| Current assets | ||||||||||||
| Cash and cash equivalents | ||||||||||||
| Accounts receivable, net | ||||||||||||
| Prepaid expenses and other current assets, net | ||||||||||||
| Amount due from related parties | ||||||||||||
| Inventories | ||||||||||||
| Total current assets | ||||||||||||
| Non-current assets | ||||||||||||
| Property and equipment, net | ||||||||||||
| Operating lease right-of-use assets, net | ||||||||||||
| Finance lease right-of-use assets, net | ||||||||||||
| Intangible assets, net | ||||||||||||
| Deferred loss on sale-leaseback | ||||||||||||
| Total non-current assets | ||||||||||||
| Total assets | ||||||||||||
| Liabilities and shareholder’s equity | ||||||||||||
| Current liabilities | ||||||||||||
| Accounts payable | ||||||||||||
| Note payable | ||||||||||||
| Short-term borrowings | ||||||||||||
| Current portion of government grants | ||||||||||||
| Amount due to related parties | ||||||||||||
| Lease liability | ||||||||||||
| Other payables and accrued liabilities | ||||||||||||
| Current liabilities related to discontinued operation | ||||||||||||
| Total current liabilities | ||||||||||||
| Non-current liabilities | ||||||||||||
| Long-term borrowings | ||||||||||||
| Government grants | ||||||||||||
| Lease liability - non-current | ||||||||||||
| Total non-current liabilities | ||||||||||||
| Total
liabilities (including amounts of the consolidated VIE without recourse to the Company of RMB | ||||||||||||
| Commitments and contingencies | ||||||||||||
| Shareholder’s equity | ||||||||||||
| Class A ordinary shares, par value US$; Authorized: shares; Issued and outstanding: shares as of March 31, 2025 and shares as of September 30, 2025* | ||||||||||||
| Class B ordinary shares, par value US$; Authorized: shares; shares issued and outstanding as of March 31, 2025 and September 30, 2025* | ||||||||||||
| Additional paid-in capital | ||||||||||||
| Subscription receivables | ( | ) | ( | ) | ||||||||
| Accumulated deficit | ( | ) | ( | ) | ( | ) | ||||||
| Accumulated other comprehensive income | ||||||||||||
| Total UTime Limited shareholder’s equity | ( | ) | ||||||||||
| Non-controlling interests | ( | ) | ( | ) | ( | ) | ||||||
| Total shareholders’ equity | ( | ) | ||||||||||
| Total liabilities and shareholders’ equity | ||||||||||||
| * |
The accompanying notes are an integral part of these consolidated financial statements.
| F-1 |
UTIME
LIMITED
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
(Amounts in thousands, except share data and per share data, or otherwise noted)
(Unaudited)
| RMB | RMB | USD | ||||||||||||
| Six months ended September 30, | ||||||||||||||
| Note | 2024 | 2025 | ||||||||||||
| RMB | RMB | USD | ||||||||||||
| Revenue | 16 | |||||||||||||
| Cost of sales | ||||||||||||||
| Gross profit | ||||||||||||||
| Operating expenses: | ||||||||||||||
| Selling expenses | ||||||||||||||
| General and administrative expenses | ||||||||||||||
| Other income, net | 12 | ( | ) | ( | ) | ( | ) | |||||||
| Total operating expenses/(income) | ( | ) | ( | ) | ||||||||||
| (Loss)/Profit from operations | ( | ) | ||||||||||||
| Interest expenses | ||||||||||||||
| (Loss)/Profit before income taxes | ( | ) | ||||||||||||
| Income tax benefits | ||||||||||||||
| Net (loss)/profit | ( | ) | ||||||||||||
| Less: Net loss attributable to non-controlling interests | ||||||||||||||
| Net (loss)/profit attributable to UTime Limited | ( | ) | ||||||||||||
| Comprehensive (loss)/income | ||||||||||||||
| Net (loss)/profit | ( | ) | ||||||||||||
| Foreign currency translation adjustment | ( | ) | ( | ) | ||||||||||
| Total comprehensive loss | ( | ) | ( | ) | ( | ) | ||||||||
| Less: Comprehensive (loss)/income attributable to non-controlling interest | ||||||||||||||
| Comprehensive loss attributable to UTime Limited | ( | ) | ( | ) | ( | ) | ||||||||
| (Loss)/Earnings per share attributable to UTime Limited | ||||||||||||||
| Continuing operations | ( | ) | ||||||||||||
| Discontinued operation | ||||||||||||||
| Weighted average ordinary shares outstanding | ||||||||||||||
| Basic and diluted | ||||||||||||||
The accompanying notes are an integral part of these consolidated financial statements.
| F-2 |
UTIME
LIMITED
CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY
(Amounts in thousands, except share data, or otherwise noted)
(Unaudited)
| Equity attributable to UTime Limited | ||||||||||||||||||||||||||||||||
| Class A Ordinary shares | Additional | Retained Earnings | Accumulated Other | Non- | Total | |||||||||||||||||||||||||||
Number of Shares | Amount | Paid-in Capital | Subscription Receivable |
(Accumulated Deficit) | Comprehensive Income (Loss) | Controlling Interests | Shareholders’ Equity | |||||||||||||||||||||||||
| RMB | RMB | RMB | RMB | RMB | RMB | RMB | ||||||||||||||||||||||||||
| Balance as of April 1, 2024 | ( | ) | ( | ) | ||||||||||||||||||||||||||||
| Issuance of ordinary shares | ||||||||||||||||||||||||||||||||
| Issuance of shares to officers | ||||||||||||||||||||||||||||||||
| Net loss | - | ( | ) | ( | ) | |||||||||||||||||||||||||||
| Foreign currency translation difference | - | |||||||||||||||||||||||||||||||
| Balance as of September 30, 2024 | ( | ) | ( | ) | ||||||||||||||||||||||||||||
| Balance as of April 1, 2025 | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||
| Balance | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||
| Issuance of ordinary shares | ( |
) | ||||||||||||||||||||||||||||||
| Net profit | - | |||||||||||||||||||||||||||||||
| Net profit (loss) | - | |||||||||||||||||||||||||||||||
| Foreign currency translation difference | - | ( | ) | ( | ) | |||||||||||||||||||||||||||
| Balance as of September 30, 2025 | ( |
) | ( | ) | ( | ) | ||||||||||||||||||||||||||
| Balance | ( |
) | ( | ) | ( | ) | ||||||||||||||||||||||||||
| * | On
March 31, 2025, the Company effected a |
The accompanying notes are an integral part of these consolidated financial statements.
| F-3 |
UTIME
LIMITED
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Amounts in thousands or otherwise noted)
(Unaudited)
| RMB | RMB | USD | ||||||||||
| Six months ended September 30, | ||||||||||||
| 2024 | 2025 | |||||||||||
| RMB | RMB | USD | ||||||||||
| Cash flows from operating activities: | ||||||||||||
| Net (loss)/profit | ( | ) | ||||||||||
| Adjustments to reconcile net (loss)/income from operations to net cash used by operating activities: | ||||||||||||
| Depreciation and amortization | ||||||||||||
| Amortisation of operating lease right of use assets | ||||||||||||
| Share-based compensation | ||||||||||||
| Gain on de registration | ( | ) | ( | ) | ||||||||
| Reversal of allowance for credit losses | ( | ) | ( | ) | ||||||||
| Reversal of allowances for obsolete inventories | ( | ) | ( | ) | ||||||||
| Net changes in operating assets and liabilities: | ||||||||||||
| Accounts receivable | ( | ) | ( | ) | ( | ) | ||||||
| Prepaid expenses and other current assets | ( | ) | ( | ) | ( | ) | ||||||
| Note payable | ||||||||||||
| Inventories | ( | ) | ||||||||||
| Accounts payable | ||||||||||||
| Other payables and accrued liabilities | ||||||||||||
| Government grants | ( | ) | ( | ) | ( | ) | ||||||
| Income taxes payable | ( | ) | ||||||||||
| Other non-current assets | ||||||||||||
| Operating lease liabilities | ( | ) | ( | ) | ||||||||
| Net cash (used in)/provided by operating activities | ( | ) | ||||||||||
Cash flows from investing activities: | ||||||||||||
| Purchase of property and equipment | ( | ) | ( | ) | ||||||||
| Net cash used in investing activities | ( | ) | ( | ) | ||||||||
| Cash flows from financing activities: | ||||||||||||
| Proceeds from short-term borrowings | ||||||||||||
| Proceeds from issuance of ordinary shares | ||||||||||||
| Related parties | ||||||||||||
| Repayment of short-term borrowings | ( | ) | ( | ) | ( | ) | ||||||
| Repayment of finance liabilities | ( | ) | ( | ) | ||||||||
| Net cash provided by financing activities | ||||||||||||
| Effect of exchange rate changes on cash and cash equivalent and restricted cash | ( | ) | ( | ) | ( | ) | ||||||
| Net increase in cash and cash equivalent and restricted cash | ||||||||||||
| Cash and cash equivalents and restricted cash at beginning of period | ||||||||||||
| Cash and cash equivalents and restricted cash at end of period | ||||||||||||
| F-4 |
UTIME
LIMITED
CONSOLIDATED STATEMENTS OF CASH FLOWS — (Continued)
(Amounts in thousands or otherwise noted)
| Six months ended September 30, | ||||||||||||
| 2024 | 2025 | |||||||||||
| RMB | RMB | USD | ||||||||||
| Supplemental disclosures of cash flow information: | ||||||||||||
| Income taxes paid (refunded) | ||||||||||||
| Interest paid | ||||||||||||
| Cash paid for amounts including in the measurement of lease liabilities: | ||||||||||||
| Operating cash outflows from operating leases | ||||||||||||
| RMB | RMB | USD | ||||||||||
| As of September 30, | ||||||||||||
| 2024 | 2025 | |||||||||||
| RMB | RMB | USD | ||||||||||
| Reconciliation of cash, cash equivalents and restricted cash in unaudited condensed consolidated statements of cash flows | ||||||||||||
| Restricted cash | ||||||||||||
| Cash and cash equivalents | ||||||||||||
| Cash, cash equivalents and restricted cash | ||||||||||||
The accompanying notes are an integral part of these consolidated financial statements.
| F-5 |
UTIME
LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands, except share data and per share data, or otherwise noted)
NOTE 1 — ORGANIZATION AND PRINCIPAL ACTIVITIES
UTime Limited was incorporated as an exempted company with limited liability under the laws of the Cayman Islands on October 9, 2018. UTime Limited does not conduct any substantive operations on its own but instead conducts its business operations through its subsidiaries, its variable interest entity (“VIE”) and the subsidiaries of the VIE. UTime Limited, its subsidiaries, its VIE and the subsidiaries of the VIE (together, the “Company”) is primarily engaged in the business of designing, manufacturing and marketing mobile communication devices, and selling a variety of related accessories.
(a) History and Reorganization
The
Company commenced its operations in June 2008 through United Time Technology Co., Ltd. (“UTime SZ” or
“VIE”), a People’s Republic of China (“PRC” or “China”) company established by Mr. Minfei
Bao (“Mr. Bao”), Mr. Junlin Zhou (“Mr. Zhou”) and Mr. Bo Tang (“Mr. Tang”). As of March 31,
2017, Mr. Bao, Mr. Zhou and Mr. Tang held
In preparation for conducting an initial public offering in the United States (“IPO”), the following transactions were undertaken to reorganize the legal structure (the “Reorganization”) of the Company. In October 2018, UTime Limited was incorporated in the Cayman Islands. In November and December 2018, UTime International Limited (“UTime HK”) was incorporated in Hong Kong and Shenzhen UTime Technology Consulting Co., Ltd. (“UTime WFOE”) was incorporated in China, respectively.
In March 2019, UTime WFOE entered into a series of contractual agreements with the VIE and Mr. Bao, which were further amended and restated in August and September of 2019, respectively, and were entered into among UTime the WFOE, the VIE, Mr. Bao and Mr. Min He (“Mr. He”). Pursuant to these agreements as detailed in note 1(b), the Company believes that these contractual arrangements would enable the Company to (1) have power to direct the activities that most significantly affect the economic performance of the VIE and its subsidiaries, and (2) receive the economic benefits of the VIE and its subsidiaries that could be significant to the VIE and its subsidiaries. Accordingly, the Company is considered the primary beneficiary of the VIE and is able to consolidate the financial statements of the VIE and its subsidiaries with those of the Company.
Do
Mobile India Private Ltd. (“Do Mobile”) was incorporated on October 24, 2016 in New Delhi, India. It is an operating entity
that sells cell phone products and provides after-sale services for the Company’s own in-house brand products in India. Prior to
the reorganization, the majority of Do Mobile’s equity interests were held by Mr. Bao through an entrustment agreement with Mr. Wukai
Song through a holding company, Bridgetime Limited (“Bridgetime”). Bridgetime was incorporated on September 5, 2016 in British
Virgin Island (“BVI”) under the laws of BVI, with Mr. Wukai Song owning
On
March 5, 2018, Bridgetime issued
shares to Mr. Wukai Song, changing the shareholder structure so that Mr. Wukai Song owned a
| F-6 |
UTIME
LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands, except share data and per share data, or otherwise noted)
NOTE 1 — ORGANIZATION AND PRINCIPAL ACTIVITIES (cont.)
Thereafter,
Mr. WuKai Song owned
On
May 20, 2019, the Company approved a board resolution authorizing the transfer of
ordinary shares owned by Mr. Bao to Grandsky Phoenix Limited, a company that was established under the laws of the British Virgin Islands (“BVI”)
and
As all of the entities involved in the process of the Reorganization are under common control before and after the Reorganization, the Reorganization is accounted for in a manner similar to a pooling-of-interest with the assets and liabilities of the parties to the Reorganization carried over at their historical amounts.
On
June 3, 2019, the Company entered into a share subscription agreement with HMercury Capital Limited, a company that was incorporated
under the laws of the BVI and controlled by Mr. He. HMercury Capital Limited purchased an aggregate of ordinary shares. On
the same day, the Company’s board of directors approved a resolution authorizing the issuance of ordinary shares at par value US$ to HMercury Capital
Limited based on the share subscription agreement. As a result, Grandsky Phoenix Limited and HMercury Capital Limited own
On
April 29, 2020, the Company’s board of directors approved a resolution, which became effective immediately, authorizing the
repurchase of
and
ordinary shares at par value (the “Repurchased Shares”) from Grandsky Phoenix Limited and HMercury Capital Limited,
respectively. The Repurchased Shares were subsequently cancelled. in accordance with their respective share ownership percentages
based on the share repurchase agreement that the Company entered into with Grandsky Phoenix Limited and HMercury Capital Limited on
April 29, 2020. On August 13, 2020, the Company’s board of directors approved a resolution and signed a capital contribution
letter with each of Grandsky Phoenix Limited and HMercury Capital Limited, respectively. Based on the capital contribution letters,
each shareholder opted not to receive the consideration for the Repurchased Shares and made a pure capital contribution in the sum
of the purchase price in favor of the Company without the issuance of additional shares of the Company. Before and after the
repurchase of ordinary shares, Mr. Bao, through Grandsky Phoenix Limited, and Mr. He, through HMercury Capital Limited, own
As of September 30, 2025, details of the subsidiaries and VIE of the Company are set forth below:
SCHEDULE OF SUBSIDIARIES AND VIE
| Name | Date
of Incorporation |
Place
of Incorporation |
Percentage
of Beneficial Ownership |
Principal Activities | ||||
| Subsidiaries | ||||||||
| UTime HK | ||||||||
| UTime WFOE | ||||||||
| Bridgetime | ||||||||
| Do Mobile |
| F-7 |
UTIME
LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands, except share data and per share data, or otherwise noted)
NOTE 1 — ORGANIZATION AND PRINCIPAL ACTIVITIES (cont.)
| Name | Date
of Incorporation |
Place
of Incorporation |
Percentage
of Beneficial Ownership |
Principal Activities | ||||
| VIE | ||||||||
| UTime SZ | ||||||||
| Subsidiaries of the VIE | ||||||||
| Guizhou United Time Technology Co., Ltd. (“UTime GZ”) | ||||||||
| UTime Technology (HK) Company Limited (“UTime Trading”) | ||||||||
| UTime India Private Limited (“UTime India”) | ||||||||
| Guangxi UTime Technology Co., Ltd. (“UTime Guangxi”) | ||||||||
| Gesoper S De R.L. De C.V. (“Gesoper”) | ||||||||
| Firts Communications And Technologies De Mexico S.A. De C.V. (“Firts”) |
(b) VIE Arrangements between the VIE and the Company’s PRC subsidiary
The Company conducts a substantial majority of its business in the PRC through a series of contractual arrangements with the VIE and its subsidiaries. The VIE and the subsidiaries of the VIE hold the requisite licenses and permits necessary to conduct the Company’s business. In addition, the VIE and the subsidiaries of the VIE hold the assets necessary to operate the Company’s business and generate substantial majority of the Company’s revenues.
Our contractual arrangements with the VIE and its respective shareholders allow us to (i) determine the most significant economic activities of the VIE; (ii) receive substantially all of the economic benefits of the VIE; and (iii) have an exclusive option to purchase all or part of the equity interest in and/or assets of the VIE when and to the extent permitted by PRC laws. As a result of our direct ownership in UTime WFOE and the contractual arrangements with the VIE, we are regarded as the primary beneficiary of the VIE, and we treat the VIE and its subsidiaries as our consolidated affiliated entities under generally accepted accounting principles in the United States of America (“US GAAP”). We have consolidated the financial results of the VIE and its subsidiaries in our unaudited consolidated financial statements in accordance with US GAAP.
The following is a summary of the contractual arrangements by and among UTime WFOE, the VIE and the shareholders of the VIE and their spouses, as applicable.
Exclusive
Technical Consultation and Service Agreement. Pursuant to the exclusive technical consultation and service agreement entered
into between UTime WFOE and the VIE, dated on March 19, 2019, UTime WFOE has the exclusive right to provide or designate any entity
to provide the VIE business support and technical and consulting services. The VIE agrees to pay UTime WFOE (i) the service fees
equal to the sum of
| F-8 |
UTIME
LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands, except share data and per share data, or otherwise noted)
NOTE 1 — ORGANIZATION AND PRINCIPAL ACTIVITIES (cont.)
Equity
Pledge Agreement. Pursuant to the equity pledge agreement dated March 19, 2019 and amended on September 4, 2019 among UTime
WFOE, the VIE and the shareholders of the VIE, the shareholders of the VIE agreed to pledge
Exclusive Call Option Agreements. Pursuant to the exclusive call option agreement dated March 19, 2019 and amended on September 4, 2019 among UTime WFOE, the VIE and the shareholders of the VIE, each of the shareholders has irrevocably granted UTime WFOE an exclusive option to purchase all or part of its equity interests in the VIE, and the VIE has irrevocably granted UTime WFOE an exclusive option to purchase all or part of its assets. With regard to the equity transfer option, the total transfer price to be paid by UTime WFOE or any other entity or individual designated by UTime WFOE for exercising such option shall be the capital contribution mirrored by the corresponding transferred equity in the registered capital of the VIE. However, if the lowest price permitted by the then-effective PRC Law is lower than the above capital contribution, the transfer price shall be the lowest price permitted by PRC Law. With regard to the asset purchase option, the transfer price to be paid by UTime WFOE or any other entity or individual designated by UTime WFOE for exercising such option shall be the lowest price permitted by the then-effective PRC Law.
Power of Attorney. Pursuant to a series of powers of attorney dated March 19, 2019 and amended on September 4, 2019 issued by each shareholder of the VIE, each shareholder of the VIE irrevocably authorizes UTime WFOE or any natural person duly appointed by UTime WFOE to exercise on the behalf of such shareholders with respect to all matters concerning the shareholding of such shareholders in the VIE, including without limitation, attending shareholders’ meetings of the VIE, exercising all the shareholders’ rights and shareholders’ voting rights, and designating and appointing the legal representative, the chairperson, directors, supervisors, the chief executive officer and any other senior management of the VIE.
Business Operation Agreement. Pursuant to the business operation agreement dated March 19, 2019 and amended on September 4, 2019 among UTime WFOE, the VIE and the shareholders of the VIE, the shareholders of the VIE hereby acknowledges, agrees and jointly and severally warrants that without the prior written consent of UTime WFOE or any party designated by UTime WFOE, the VIE shall not engage in any transaction which may have a material or adverse effect on any of its assets, businesses, employees, obligations, rights or operations (except for those occurring in the due course of business or in day-to-day business operations, or those already disclosed to UTime WFOE and with the explicit prior written consent of UTime WFOE). In addition, the VIE and its shareholders hereby jointly agree to accept and strictly implement any proposal made by UTime WFOE from time to time regarding the employment and removal of the VIE’s employees, its day-to-day business management and the financial management system of the VIE.
Spouse Consent Letter. Pursuant to a series of spousal consent letters dated March 19, 2019 and amended on September 4, 2019, executed by the spouses of the shareholders of the VIE, Mr. Bao and Mr. He, the signing spouses confirmed and agreed that the equity interests of the VIE are the property of Mr. Bao and Mr. He and shall not constitute the community property of the couples. The spouses also irrevocably waived any potential right or interest that may be granted by operation of applicable law in connection with the equity interests of the VIE held by their spouses.
| F-9 |
UTIME
LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands, except share data and per share data, or otherwise noted)
NOTE 1 — ORGANIZATION AND PRINCIPAL ACTIVITIES (cont.)
Risks in relation to VIE structure
The Company believes that the contractual arrangements with its VIE and their respective shareholders are in compliance with PRC laws and regulations and are legally enforceable. However, uncertainties in the PRC legal system could limit the Company’s ability to enforce the contractual arrangements. If we or the VIE are found to be in violation of any existing or future PRC laws or regulations, or fail to obtain or maintain any of the required permits or approvals, the relevant PRC regulatory authorities would have broad discretion to take action in dealing with such violations or failures, including:
| ● | revoking the business and operating licenses of the Company’s PRC subsidiary and VIE; | |
| ● | discontinuing or restricting the operations of any related-party transactions between the Company’s PRC subsidiary and VIE; | |
| ● | limiting the Company’s business expansion in China by way of entering into contractual arrangements; | |
| ● | imposing fines, confiscating the income from the Company’s PRC subsidiary or the VIE, or imposing other requirements with which we or the VIE may not be able to comply; | |
| ● | requiring us to restructure our ownership structure or operations, including terminating the contractual arrangements with the VIE and deregistering the equity pledges of the VIE, which in turn would affect our ability to consolidate, derive economic interests from, or determine the most significant economic activities of the VIE; or | |
| ● | restricting or prohibiting our use of the proceeds of its IPO to finance our business and operations in China. |
The Company’s ability to conduct its business may be negatively affected if the PRC government were to carry out any of the aforementioned actions. As a result, the Company may not be able to consolidate its VIE in its consolidated financial statements as it may lose the ability to determine the most significant economic activities of the VIE and it may lose the ability to receive economic benefits from the VIE. The Company, however, does not believe such actions would result in the liquidation or dissolution of the Company, its PRC subsidiary or VIE.
Mr.
Bao and Mr. He hold
| F-10 |
UTIME
LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands, except share data and per share data, or otherwise noted)
NOTE 1 — ORGANIZATION AND PRINCIPAL ACTIVITIES (cont.)
The Company has aggregated the financial information of the VIE and subsidiaries of the VIE in the table below. The aggregate carrying value of assets and liabilities of VIE and its subsidiaries (after elimination of intercompany transactions and balances) in the Company’s consolidated balance sheets as of March 31, 2025 and September 30, 2025 are as follows:
SCHEDULE OF BALANCE SHEET
| As of | As of | |||||||
| March 31, | September 30, | |||||||
| 2025 | 2025 | |||||||
| RMB | RMB | |||||||
| Assets | ||||||||
| Current assets | ||||||||
| Cash and cash equivalents | ||||||||
| Accounts receivable, net | ||||||||
| Prepaid expenses and other current assets, net | ||||||||
| Due from related parties | ||||||||
| Inventories | ||||||||
| Total current assets | ||||||||
| Non-current assets | ||||||||
| Property and equipment, net | ||||||||
| Operating lease right-of-use assets, net | ||||||||
| Finance lease right-of-use assets, net | ||||||||
| Intangible assets, net | ||||||||
| Deferred loss on sale-leaseback | ||||||||
| Total non-current assets | ||||||||
| Total assets | ||||||||
| Liabilities | ||||||||
| Current liabilities | ||||||||
| Accounts payable | ||||||||
| Short-term borrowings | ||||||||
| Notes payable | ||||||||
| Current portion of government grants | ||||||||
| Due to related parties | ||||||||
| Lease liability | ||||||||
| Other payables and accrued liabilities | ||||||||
| Current liabilities related to discontinued operations | ||||||||
| Total current liabilities | ||||||||
| Non-current liabilities | ||||||||
| Long-term borrowings | ||||||||
| Government grants | ||||||||
| Lease liability - non-current | ||||||||
| Total non-current liabilities | ||||||||
| Total liabilities | ||||||||
| F-11 |
UTIME
LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands, except share data and per share data, or otherwise noted)
NOTE 1 — ORGANIZATION AND PRINCIPAL ACTIVITIES (cont.)
The table sets forth the revenue, net loss and cash flows of the VIE and subsidiaries of VIE in the table below.
SCHEDULE OF REVENUE NET INCOME AND CASH FLOWS OF VIE AND SUBSIDIARIES
| 2024 | 2025 | |||||||
| Six months ended September 30, | ||||||||
| 2024 | 2025 | |||||||
| RMB | RMB | |||||||
| Revenue | ||||||||
| Net (loss)/income | ( | ) | ||||||
| Net cash (used in)/provided by operating activities | ( | ) | ||||||
| Net cash used in investing activities | ( | ) | ||||||
| Net cash provided by financing activities | ||||||||
(c) Initial Public Offering
On
April 8, 2021, the Company completed its IPO on Nasdaq Capital Market. In the offering, of the Company’s ordinary shares
were issued and sold to the public at a price of US$ per share for gross proceeds of US$
(d) Asset Acquisitions
On
December 17, 2021, the Company, through UTime Trading, acquired a
(e) Discontinued operations
The Company terminated operations in India during the period ended September 30, 2023, where in-house brand products were produced, and ceased operations in Mexico as of the year ended March 31, 2024. Due to an overall change of business environment in India and Mexico, the Company decided to make a strategic change and terminated these operations in India and Mexico. A loss on disposal of net assets related to operations in Mexico was recorded in the consolidated financial statements as of March 31, 2024. Assets, liabilities and expenses related to Mexico are disclosed as assets, liabilities and loss of discontinued operations in the consolidated financial statements as of March 31, 2024.
On
July 16, 2025, the Company completed the industrial and commercial deregistration of Utime HZ, an inactive subsidiary in the People’s
Republic of China. Utime HZ’s assets and liabilities represented approximately
| F-12 |
UTIME
LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands, except share data and per share data, or otherwise noted)
NOTE 2 — GOING CONCERN
The Company’s financial statements are prepared using generally accepted accounting principles in the United States of America applicable to a going concern, which contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company has suffered recurring losses from operations that raise substantial doubt about its ability to continue as a going concern.
As
of September 30, 2025, the Company had current assets of RMB
The
Company had accumulated deficit of RMB
The Company continues to focus on improving operational efficiency and cost reductions, developing core cash-generating business and enhancing efficiency. In addition, the Company is also working on raising additional funding to finance its operations and expand its business.
The consolidated financials have been prepared assuming that the Company will continue as a going concern and, accordingly, financial statements do not include any adjustments related to the recoverability and classification of assets or the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.
Going Concern Considerations
The Company’s consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and settlement of liabilities in the normal course of business.
For the six months ended September 30, 2025, the Company generated positive net cash flows from operating activities and reported net
income of RMB
The improvement in the Company’s liquidity position during the period
was primarily attributable to the issuance of ordinary shares, with total subscription proceeds of approximately RMB
Management has evaluated the Company’s liquidity position and cash flow projections for the twelve-month period following the issuance date of these unaudited consolidated financial statements. Based on the Company’s current cash position, positive operating cash flows, and expected collection of subscription receivables, management believes that the Company has sufficient liquidity to meet its obligations as they become due for at least the next twelve months.
Accordingly, the unaudited consolidated financial statements have been prepared on a going concern basis.
| F-13 |
UTIME
LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands, except share data and per share data, or otherwise noted)
NOTE 3 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of presentation
The accompanying consolidated financial statements have been prepared in accordance with US GAAP and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”).
Principles of consolidation
The consolidated financial statements include the financial statements of the Company and its subsidiaries, VIE and VIE’s subsidiaries for which the Company is the primary beneficiary. All significant inter-company balances and transactions between the Company, its subsidiaries, VIE and VIE’s subsidiaries are eliminated.
Use of estimates
The preparation of the consolidated financial statements in conformity with US GAAP requires management of the Company to make a number of estimates and assumptions relating to the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the period. Management evaluates these estimates and assumptions on a regular basis. Significant accounting estimates reflected in the allowance for receivables, write down of other assets, useful lives of property and equipment, impairment on inventory, sales return, product warranties, determination of incremental borrowing rate for lease and valuation allowance against net deferred tax assets. Actual results could differ from those estimates and judgments.
Cash and cash equivalents
Cash and cash equivalents consist of cash on hand, bank deposits and short-term, highly liquid investments with original maturities of three months or less at the date of purchase, that are readily convertible to known amounts of cash and have insignificant risk of changes in value related to changes in interest rates.
Restricted cash
Restricted cash consisted of collateral representing cash deposits for long-term borrowings.
| F-14 |
UTIME
LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands, except share data and per share data, or otherwise noted)
NOTE 3 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)
Accounts receivable, net
Accounts receivable and other receivables are reflected in the Company’s consolidated balance sheets at their estimated collectible amounts. A substantial majority of its accounts receivable are derived from sales to well-known technological clients. The Company follows the allowance method of recognizing uncollectible accounts receivable and other receivables, pursuant to which the Company regularly assesses its ability to collect outstanding customer invoices and make estimates of the collectability of accounts receivable and other receivables. The Company provides an allowance for doubtful accounts when it determines that the collection of an outstanding customer receivable is not probable. The allowance for doubtful accounts is reviewed on a timely basis to assess the adequacy of the allowance. The Company takes into consideration (a) historical bad debts experience, (b) any circumstances of which it is aware of a customer’s or debtor’s inability to meet its financial obligations, (c) changes in its customer or debtor payment history, and (d) its judgments as to prevailing economic conditions in the industry and the impact of those conditions on its customers and debtors. If circumstances change, such that the financial conditions of its customers or debtors are adversely affected and they are unable to meet their financial obligations to the Company, it may need to record additional allowances, which would result in a reduction of its net income.
Concentration of credit risk and major customers
Assets
that potentially subject the Company to significant concentration of credit risk primarily consist of cash and cash equivalents, restricted
cash, accounts receivable and other current assets. The maximum exposure of such assets to credit risk is their carrying amounts as at
the balance sheet dates. As of March 31, 2025, and September 30, 2025, the aggregate amounts of cash and cash equivalents, and restricted
cash are RMB
To
limit exposure to credit risk relating to deposits, the Company primarily place cash deposits with large financial institutions in PRC.
The Company conducts credit evaluations of its customers and generally does not require collateral or other security from them. The Company
establishes an accounting policy for the allowance for credit losses on the individual customer’s financial condition, credit history,
and the current economic conditions. As of March 31, 2025 and September 30, 2025, the allowance for credit losses on accounts receivable
was RMB
Major
customers and accounts receivable — During the six months ended September 30, 2024, the Company had two customers that accounted
over 10% of revenues, and revenue from the customers amounted to RMB
Major suppliers —During the six months ended September 30, 2024, the Company had two suppliers accounting over 10% of total purchases and processing fees. During the six months ended September 30, 2025, the Company had three suppliers accounting over 10% of total purchases and processing fees.
Inventories
Inventories of the Company consist of raw materials, finished goods and work in process. Inventories are stated at lower of cost or net realizable value with cost being determined on the weighted average method. Elements of cost in inventories include raw materials, direct labor costs, other direct costs, consignment manufacturing cost and manufacturing overhead. When the estimated net realizable value of inventory is lower than its carrying amount, a write-down is recorded to reflect the lower value.
During
the six months ended September 30, 2025, the Company recorded a reversal of previously recognized inventory write-downs of approximately
RMB
| F-15 |
UTIME
LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands, except share data and per share data, or otherwise noted)
NOTE 3 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)
Property and equipment, net
Property and equipment are stated at cost less accumulated depreciation and impairment, if any. Cost represents the purchase price of the asset and other costs incurred to bring the asset into its existing use. Maintenance and repairs are charged to expenses as incurred. Depreciation of property and equipment are provided using the straight-line method over their estimated useful lives as follows:
SCHEDULE OF PROPERTY AND EQUIPMENT ARE PROVIDED USING THE STRAIGHT-LINE METHOD OVER THEIR ESTIMATED USEFUL LIVES
| Useful life | ||
| Office real estate | ||
| Furniture and equipment | ||
| Production and other machineries |
Upon retirement or sale of an asset, the cost of the asset and the related accumulated depreciation are eliminated from the accounts and any resulting gain or loss is credited or charged to other (income) expenses, net.
Intangible assets, net
Intangible
asset results from the acquisition of the licensed software and customer relationships. Identifiable intangible assets are carried at
acquisition cost less accumulated amortization and impairment loss, if any. The Company accounts for such licensed software with definite
lives and amortized using the straight-line method over its estimated useful life of
Impairment of long-lived assets
The Company reviews the carrying value of long-lived assets to be held and used when events and circumstances warrants such a review. The carrying value of a long-lived asset is considered impaired when the anticipated undiscounted cash flow from such asset is separately identifiable and is less than its carrying value. In that event, a loss is recognized based on the amount by which the carrying value exceeds the fair market value of the long-lived asset. Fair market value is determined primarily using the anticipated cash flows discounted at a rate commensurate with the risk involved. Losses on long-lived assets to be disposed are determined in a similar manner, except that fair market values are reduced for the cost to dispose. No impairment charge was recognized for all periods presented.
Equity method investment
The Company’s long-term investments consist of equity method investment. Investment in entities in which the Company can exercise significant influence and holds an investment in voting ordinary shares or in-substance ordinary shares (or both) of the investee but does not own a majority equity interest or control are accounted for using the equity method of accounting in accordance with ASC topic 323 (“ASC 323”), Investments-Equity Method and Joint Ventures. Under the equity method, the Company initially records its investment at cost. The Company subsequently adjusts the carrying amount of the investments to recognize the Company’s proportionate share of each equity investee’s net income or loss into earnings after the date of investment. The Company evaluates the equity method investment for impairment under ASC 323. An impairment loss on the equity method investment is recognized in earnings when the decline in value is determined to be other-than-temporary.
| F-16 |
UTIME
LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands, except share data and per share data, or otherwise noted)
NOTE 3 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)
Fair value of financial instruments
Under the FASB’s authoritative guidance on fair value measurements, fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. In determining the fair value, the Company uses various methods including market, income and cost approaches. Based on these approaches, the Company often utilizes certain assumptions that market participants would use in pricing the asset or liability, including assumptions about risk and the risks inherent in the inputs to the valuation technique. These inputs can be readily observable, market corroborated or generally unobservable inputs. The Company uses valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs. Based on observability of the inputs used in the valuation techniques, the Company is required to provide the following information according to the fair value hierarchy. The fair value hierarchy ranks the quality and reliability of the information used to determine fair values.
Financial assets and liabilities carried at fair value are classified and disclosed in one of the following three categories:
| Level 1 | Valuations for assets and liabilities traded in active exchange markets. Valuations are obtained from readily available pricing sources for market transactions involving identical assets or liabilities. |
| Level 2 | Valuations for assets and liabilities traded in less active dealer or broker markets. Valuations are obtained from third party pricing services for identical or similar assets or liabilities. |
| Level 3 | Valuations for assets and liabilities that are derived from other valuation methodologies, including option pricing models, discounted cash flow models and similar techniques, and not based on market exchange, dealer or broker traded transactions. Level 3 valuations incorporate certain unobservable assumptions and projections in determining the fair value assigned to such assets. |
All transfers between fair value hierarchy levels are recognized by the Company at the end of each reporting period. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, an investment’s level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement in its entirety requires judgment, and considers factors specific to the investment. The inputs or methodology used for valuing financial instruments are not necessarily an indication of the risks associated with investment in those instruments.
Fair Value Measured or Disclosed on a Recurring Basis
Borrowings — Interest rates under the borrowing agreements with the lending parties were determined based on the prevailing interest rates in the market. The Company classifies the valuation techniques that use these inputs as Level 2 fair value measurement. The carrying value of the Company’s borrowings approximates fair value as the borrowing bears interest rates that are similar to existing market rates.
Other financial items for disclosure purpose — The fair value of other financial items of the Company for disclosure purpose, including cash and cash equivalents, restricted cash, accounts receivable, other receivables, other current assets, accounts payable, other payables and accrued liabilities, approximate their carrying value due to their short-term nature.
Government Grants
Government
grants are recognized in the balance sheet initially when there is reasonable assurance that they will be received and that the enterprise
will comply with the conditions attached to them. When the Company received the government grants, but the conditions attached to the
grants have not been fulfilled, such government grants are deferred and recorded as deferred revenue. The classification of short-term
or long-term liabilities is dependent on the management’s expectation of when the conditions attached to the grant can be fulfilled.
Grants that compensate the Company for expenses incurred are recognized as other income in statement of income on a systematic basis
in the same periods in which the expenses are incurred. Government subsidies recognized as other income in the consolidated statement
of comprehensive loss for the six months ended September 30, 2024 and 2025 were RMB
| F-17 |
UTIME
LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands, except share data and per share data, or otherwise noted)
NOTE 3 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)
Leases
The Company determines if an arrangement is a lease at inception. Operating leases are included in operating lease, right-of-use (“ROU”) assets and lease liabilities in the consolidated balance sheets.
ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease, ROU assets and lease liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As most of the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. It uses the implicit rate when readily determinable. The operating lease, ROU asset also includes any lease payments made and excludes lease incentives. The Company’s lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the lease term. The Company have elected not to recognize ROU assets and lease liabilities for short-term leases for all classes of underlying assets. Short-term leases are leases with terms of 12 months or less and does not include a purchase option that is reasonably certain to exercise.
Commitments and Contingencies
In the normal course of business, the Company is subject to contingencies, including legal proceedings and claims arising out of the business that relate to a wide range of matters. The Company recognizes a liability for such contingency if it determines it is probable that a loss has occurred and a reasonable estimate of the loss can be made. The Company may consider many factors in making these assessments including historical and the specific facts and circumstances of each matter.
Revenue recognition
The Company derives revenue principally from the sale of mobile phones, notebook computers and accessories. Revenue from contracts with customers is recognized using the following 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. |
A contract contains a promise (or promises) to transfer goods or services to a customer. A performance obligation is a promise (or a group of promises) that is distinct. The transaction price is the amount of consideration the Company expects to be entitled from a customer in exchange for providing the goods or services.
| F-18 |
UTIME
LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands, except share data and per share data, or otherwise noted)
NOTE 3 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)
The unit of account for revenue recognition is a performance obligation (a good or service). A contract may contain one or more performance obligations. Performance obligations are accounted for separately if they are distinct. A good or service is distinct if the customer can benefit from the good or service either on its own or together with other resources that are readily available to the customer, and the good or service is distinct in the context of the contract. Otherwise, performance obligations are combined with other promised goods or services until the Company identifies a bundle of goods or services that is distinct. Promises in contracts which do not result in the transfer of a good or service are not performance obligations, as well as those promises that are administrative in nature, or are immaterial in the context of the contract. The Company has addressed whether various goods and services promised to the customer represent distinct performance obligations. The Company applied the guidance of ASC Topic 606-10-25-16 through 18 in order to verify which promises should be assessed for classification as distinct performance obligations.
The Company’s revenue is primary derived from (i) OEM and ODM services for well-known brands; (2) its own in-house brands, positioned in emerging middle class consumer groups and price-sensitive consumers in emerging markets. Refer to Note 18 to the consolidated financial statements for disaggregation of the Company’s revenue by type of product and geography information for the six months ended September 30, 2024 and 2025.
1) Cooperation with OEM/ODM customers
Revenue is measured based on the consideration to which the Company expects to be entitled in a contract with a customer and excludes amounts collected on behalf of third parties. The Company generates its revenue through product sales, and shipping terms generally indicate when it has fulfilled its performance obligations and passed control of products to its customer, when the goods have been shipped to the customer’s specific location (delivery). Following delivery, the customer has full discretion over the manner of distribution and price to sell the goods, has the primary responsibility when selling the goods and bears the risks of obsolescence and loss in relation to the goods but has no right to return the products (other than for defective products). A receivable is recognized by the Company when the goods are delivered to the customer as this represents the point in time at which the right to consideration becomes unconditional, as only the passage of time is required before payment is due. Revenue from OEM/ODM customers does not meet the criteria to be recognized over time since 1) it does not have the right of payment for the performance completed to date, 2) its work neither creates or enhances an asset controlled by customers until goods are delivered to the customer, 3) customers do not receive and consume benefits simultaneously provided by its performance.
| F-19 |
UTIME
LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands, except share data and per share data, or otherwise noted)
NOTE 3 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)
Contract assets and liabilities
Contract assets, such as costs to obtain or fulfill contracts, are an insignificant component of the Company’s revenue recognition process. The majority of the Company’s cost of fulfillment as a manufacturer of products is classified as inventories and property and equipment, which are accounted for under the respective guidance for those asset types. Other costs of contract fulfillment are immaterial due to the nature of the Company’s products and their respective manufacturing processes.
Contract liabilities are mainly related to advance payments received from customers.
Warranty
The Company offers a standard product warranty that the product will operate under normal use. For products sold to OEM/ODM customers, the warranty period generally ranges from one to two years from the time of final acceptance. In general, the Company ships free spare parts as product warranty to these customers while the products are sold. For products sold to end users through retailers in India, the warranty period includes a one year warranty to end users. The Company has the obligation, at its option, to either repair or replace the defective product. The customers cannot separately purchase the warranty and the warranty doesn’t provide the customer with additional service other than assurance that the product will function as expected. At the time revenue is recognized, an estimate of future warranty costs is recorded as a component of cost of revenues. The reserves established are regularly monitored based upon historical experience and any actual claims charged against the reserve.
Value added tax
In
the PRC, value added tax (the “VAT”) of
Cost of sales
Cost of sales consists primarily of material costs, direct labor costs, other direct costs, consignment manufacturing cost and manufacturing overhead, which are directly attributable to the production of products. Write-down of inventories to lower of cost or net realizable value is also recorded in cost of sales.
| F-20 |
UTIME
LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands, except share data and per share data, or otherwise noted)
NOTE 3 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)
Borrowing cost
Borrowing costs attributable directly to the acquisition, construction or production of qualifying assets which require a substantial period of time to be ready for their intended use or sale are capitalized as part of the cost of those assets. Income earned on temporary investments of specific borrowings pending their expenditure on those assets is deducted from borrowing costs capitalized. All other borrowing costs are recognized in interest expenses in the consolidated statement of comprehensive loss in the period in which they are incurred.
Income taxes
Income
taxes are accounted for using the asset and liability method as prescribed by ASC 740 “Income Taxes.” Under this method,
deferred income tax assets and liabilities are recognized for the future tax consequences attributable to temporary differences between
the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred income tax assets
and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which these temporary differences
are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in
income in the period that includes the enactment date. A valuation allowance would be provided for those deferred tax assets for which
if it is more likely than not that the related benefit will not be realized. As of March 31, 2025 and September 30, 2025, the Company did
Determination of incremental borrowing rate for leases
The Company determines the incremental borrowing rate (“IBR”) used to measure lease liabilities when the implicit rate in the lease is not readily determinable, in accordance with ASC 842, Leases. The IBR represents the rate of interest that the Company would have to pay to borrow on a collateralized basis over a similar term and in a similar economic environment for an amount equal to the lease payments.
In determining the IBR, the Company considers factors including the lease term, the Company’s credit profile, the nature and quality of the underlying collateral, and prevailing market borrowing rates for comparable financing arrangements. The Company may also consider observable market data and adjustments for differences in economic conditions, lease terms, and collateralization.
The determination of the incremental borrowing rate requires significant judgment. Changes in the Company’s credit profile, market interest rates, or other relevant factors could result in changes to the incremental borrowing rate used to measure future lease liabilities and right-of-use assets.
Uncertain tax positions
The guidance on accounting for uncertainties in income taxes prescribes a more likely than not threshold for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. Guidance was also provided on the recognition of income tax assets and liabilities, classification of current and deferred income tax assets and liabilities, accounting for interest and penalties associated with tax positions, accounting for income taxes in interim periods, and income tax disclosures. Significant judgment is required in evaluating the Company’s uncertain tax positions and determining its provision for income taxes. The Company recognizes interests and penalties, if any, under accrued expenses and other current liabilities on its balance sheet and under other expenses in its statement of comprehensive income. The Company did not recognize any interest or penalties associated with uncertain tax positions for the six months ended September 30, 2024 and 2025. As of March 31, 2025 and September 30, 2025, the Company did not have any significant unrecognized uncertain tax positions.
| F-21 |
UTIME
LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands, except share data and per share data, or otherwise noted)
NOTE 3 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)
Foreign currency translation and transactions
The reporting currency of the Company is the Chinese Yuan (“RMB”). The Company’s subsidiaries, consolidated VIE and VIE’s subsidiaries with operations in the PRC, Hong Kong, and other jurisdictions generally use their respective local currencies as their functional currencies, except that UTime Trading uses United States dollar (“US$”) as functional currency. The financial statements of the Company’s subsidiaries, other than the consolidated VIE and VIE’s subsidiary with the functional currency in RMB, are translated into RMB using the exchange rate as of the balance sheet date for assets and liabilities, historical exchange rate for equity amounts and the average rate during the reporting period for income and expense items. Translation gains and losses are recorded in accumulated other comprehensive income or loss as a component of shareholders’ equity.
In the financial statements of the Company’s subsidiaries and consolidated VIE and VIE’s subsidiary, transactions in currencies other than the functional currency are measured and recorded in the functional currency using the exchange rate in effect at the date of the transaction. At the balance sheet date, monetary assets and liabilities that are denominated in currencies other than the functional currency are translated into the functional currency using the exchange rate at the balance sheet date. All gains and losses arising from foreign currency transactions are recorded in other (income) expenses, net in the consolidated statements of comprehensive loss.
Convenience translation
Translations
of balances in the unaudited consolidated balance sheets, consolidated statements of comprehensive loss and consolidated statements of
cash flows from RMB into USD as of and for the six months ended September 30, 2025 are solely for the convenience of the reader and has
been made at the exchange rate quoted by the central parity of RMB against the USD by the People’s Bank of China on September 30,
2025 of USD 1.00 = RMB
| F-22 |
UTIME
LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands, except share data and per share data, or otherwise noted)
NOTE 3 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)
Comprehensive loss
Comprehensive loss is comprised of the Company’s net loss and comprehensive loss. The component of comprehensive loss consists solely of foreign currency translation adjustments.
Basic net (loss)/income per share is the amount of net (loss)/income available to each share of ordinary shares outstanding during the reporting period. Diluted net (loss)/income per share is the amount of net loss available to each share of ordinary shares outstanding during the reporting period adjusted to include the effect of potentially dilutive ordinary shares, if any. Basic and diluted (loss)/income per share for each of the periods presented are calculated as follows:
| 2024 | 2025 | |||||||
| Six months ended September 30, | ||||||||
| 2024 | 2025 | |||||||
| RMB | RMB | |||||||
| Numerator: | ||||||||
| Net (loss)/profit | ( | ) | ||||||
| Net (loss)/profit attributable to non-controlling interest | ||||||||
| Net (loss)/profit attributable to UTime Limited, basic and diluted | ( | ) | ||||||
| Denominator: | ||||||||
| Weighted shares outstanding, basic and diluted | ||||||||
| Net (loss)/profit attributable to UTime Limited per ordinary share: | ||||||||
| Continuing operations | ( | ) | ||||||
On March 31, 2025, the Company effected a
Recently issued accounting standards
The Company continually assesses any new accounting pronouncements to determine their applicability. When it is determined that a new accounting pronouncement affects the Company’s financial reporting, the Company undertakes a study to determine the consequences of the change to its condensed consolidated financial statements and assures that there are proper controls in place to ascertain that the Company’s condensed consolidated financial statements properly reflect the change.
| F-23 |
UTIME
LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands, except share data and per share data, or otherwise noted)
NOTE 3 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)
Recently issued accounting standards not yet adopted
ASU 2024-03 — Income Statement—Reporting Comprehensive Income (Subtopic 220-40): Expense Disaggregation Disclosures: In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income (Subtopic 220-40): Expense Disaggregation Disclosures. This ASU requires additional disclosures about specific expense categories, including purchases of inventory, employee compensation, depreciation, and intangible asset amortization included in relevant expense captions. The amendments also require qualitative disclosures regarding remaining amounts within expense captions and disclosure of total selling expenses and the entity’s definition of selling expenses.
The amendments in ASU 2024-03 are effective for fiscal years beginning after December 15, 2026, and interim reporting periods within fiscal years beginning after December 15, 2027. For the Company, the guidance will be effective for the fiscal year beginning April 1, 2027 and interim periods beginning April 1, 2028. Early adoption is permitted. The Company is currently evaluating the impact of the adoption of this standard on its consolidated financial statement disclosures.
ASU 2023-09 — Income Taxes (Topic 740): Improvements to Income Tax Disclosures: In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which enhances income tax disclosure requirements, primarily related to rate reconciliation and income taxes paid.
The amendments are effective for fiscal years beginning after December 15, 2024. For the Company, the guidance will be effective for the fiscal year beginning April 1, 2025. The Company is currently evaluating the impact of adopting this guidance on its consolidated financial statement disclosures.
The Company has adopted all accounting standards that became effective for fiscal years beginning on or before April 1, 2025, including ASU 2016-13, Financial Instruments—Credit Losses (Topic 326), and related amendments. The adoption of these standards did not have a material impact on the Company’s unaudited consolidated financial statements unless otherwise disclosed.
NOTE 4 — ACCOUNTS RECEIVABLE, NET
SCHEDULE OF ACCOUNTS RECEIVABLE, NET
| As
of March 31, | As
of September 30, | |||||||
| 2025 | 2025 | |||||||
| RMB | RMB | |||||||
| Accounts receivable | ||||||||
| Allowance for credit losses | ( | ) | ( | ) | ||||
| Accounts receivable, net | ||||||||
The Company analyzed the collectability of accounts receivable based on historical collection and the customers’ intention of payment. As a result of such analysis, the allowance for credit loss was as follows:
SCHEDULE OF ALLOWANCE FOR DOUBTFUL ACCOUNTS
| 2024 | 2025 | |||||||
| For the six months ended September 30, | ||||||||
| 2024 | 2025 | |||||||
| RMB | RMB | |||||||
| Balance at beginning of period | ||||||||
| Reversal of allowance for credit losses | ( | ) | ||||||
| Foreign currency translation difference | ( | ) | ( | ) | ||||
| Balance at the end of period | ||||||||
As
of March 31, 2025 and September 30, 2025, the allowance for credit losses amounted to RMB
| F-24 |
UTIME
LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands, except share data and per share data, or otherwise noted)
NOTE 5 — PREPAID EXPENSES AND OTHER CURRENT ASSETS, NET
SCHEDULE OF PREPAID EXPENSES AND OTHER CURRENT ASSETS, NET
| As
of March 31, | As
of September 30, | |||||||
| 2025 | 2025 | |||||||
| RMB | RMB | |||||||
| Advance to suppliers | ||||||||
| Receivables from supply chain service provider | ||||||||
| Other receivables | ||||||||
| Allowance for credit losses | ( | ) | ( | ) | ||||
| Prepaid expenses and other current assets, net | ||||||||
The Company analyzed the collectability of accounts receivable based on historical collection and the customers’ intention of payment. As a result of such analysis, the allowance for credit losses was as follows:
SCHEDULE OF PREPAID EXPENSES AND OTHER CURRENT ASSETS, NET OF ALLOWANCE FOR DOUBTFUL ACCOUNTS
| For the six months ended September 30, | ||||||||
| 2024 | 2025 | |||||||
| RMB | RMB | |||||||
| Balance at beginning of period | ||||||||
| Reversal of allowance for credit losses | ( |
) | ||||||
| Foreign currency translation difference | ( |
) | ||||||
| Balance at the end of period | ||||||||
The
Company entered into several agreements with four suppliers in China in March 2024 for purchase of raw materials. The goods were
scheduled to be delivered to the Company by October 31, 2024 and November 30, 2024 according to these agreements. Prepayments were
made to the suppliers in the total amount of RMB
During the six months ended September
30, 2025, the Company recognized reversal of allowance for credit losses RMB
| F-25 |
UTIME
LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands, except share data and per share data, or otherwise noted)
NOTE 6 — INVENTORIES
| As
of March 31, | As
of September 30, | |||||||
| 2025 | 2025 | |||||||
| RMB | RMB | |||||||
| Raw materials | ||||||||
| Work in progress | ||||||||
| Finished goods | ||||||||
| Total inventory, gross | ||||||||
| Inventory reserve | ( | ) | ( | ) | ||||
| Total inventory, net | ||||||||
The Company analyzed the valuation of inventory and disposed of obsolete inventories. As a result of such analysis, the movement of inventory reserve was as follows:
SCHEDULE OF INVENTORY RESERVE
| Six
months ended September 30, | Six
months ended September 30, | |||||||
| 2024 | 2025 | |||||||
| RMB | RMB | |||||||
| Balance at beginning of year | ||||||||
| Reversal of allowance for obsolete inventories | ( | ) | ||||||
| Foreign currency translation difference | ( | ) | ( | ) | ||||
| Balance at the end of year | ||||||||
NOTE 7 — PROPERTY AND EQUIPMENT, NET
SCHEDULE OF PROPERTY, PLANT AND EQUIPMENT, NET
| As
of March 31, | As
of September 30, | |||||||
| 2025 | 2025 | |||||||
| RMB | RMB | |||||||
| Office real estate | ||||||||
| Furniture and equipment | ||||||||
| Production and other machineries | ||||||||
| Total | ||||||||
| Less: accumulated depreciation | ( | ) | ( | ) | ||||
| Less: impairment | ( | ) | ( | ) | ||||
| Property and equipment, net | ||||||||
Depreciation
charged to expense amounted to RMB
The accumulated impairment of RMB
| F-26 |
UTIME
LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands, except share data and per share data, or otherwise noted)
NOTE 8 — LEASE LIABILITIES
Operating leases as lessee
The Company leases space under non-cancelable operating leases for office and manufacturing locations and production equipment. These leases do not have significant rent escalation holidays, concessions, leasehold improvement incentives, or other build-out clauses. Further, the leases do not contain contingent rent provisions.
Most leases include an option to renew in condition that it is agreed by the landlord before expiry. Therefore, the majority of renewals to extend the lease terms are not included in its right-of-use assets and lease liabilities as they are not reasonably certain of exercise. The Company regularly evaluates the renewal options and when they are reasonably certain of exercise, the Company includes the renewal period in its lease term.
As most of the Company’s leases do not provide an implicit rate, it uses its incremental borrowing rate based on the information available at the lease commencement date in determining the present value of the lease payments.
The components of the Company’s lease expense are as follows:
SCHEDULE OF LEASE EXPENSE
| 2024 | 2025 | |||||||
| Six months ended September 30, | ||||||||
| 2024 | 2025 | |||||||
| RMB | RMB | |||||||
| Operating lease cost | ||||||||
| Lease cost | ||||||||
| F-27 |
UTIME
LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands, except share data and per share data, or otherwise noted)
NOTE 8 — LEASE LIABILITIES (cont.)
Supplemental cash flow information related to operating leases was as follows for the six months ended September 30, 2024 and 2025:
| 2024 | 2025 | |||||||
Six months ended September 30, | ||||||||
| 2024 | 2025 | |||||||
| RMB | RMB | |||||||
| Cash paid for amounts included in the measurement of lease liabilities: | ||||||||
| Operating cash outflow from operating leases | ||||||||
Maturities of its lease liabilities for all operating leases are as follows as of September 30, 2025:
SCHEDULE OF MATURITIES OF LEASE LIABILITIES
| As
of September 30, 2025 | ||||
| RMB | ||||
| Six months ended March 31, 2026 | ||||
| Year ended March 31, 2027 and after | ||||
| Total lease payments | ||||
| Less: Interest | ( | ) | ||
| Present value of lease liabilities | ||||
| Less: Current portion, record in current liabilities | ( | ) | ||
| Non-current portion of lease liabilities | ||||
The weighted average remaining lease terms and discount rates for all of its operating leases were as follows as of March 31, 2025 and September 30, 2025:
| As
of March 31, | As
of September 30, | |||||||
| 2025 | 2025 | |||||||
| RMB | RMB | |||||||
| Remaining lease term and discount rate: | ||||||||
| Weighted average remaining lease term (years) | ||||||||
| Weighted average discount rate | % | % | ||||||
| F-28 |
UTIME
LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands, except share data and per share data, or otherwise noted)
NOTE 8 — LEASE LIABILITIES (cont.)
Financing with Sale-Leaseback
UTime
Guangxi entered into a sale-leaseback arrangement (the “Lease Financing Agreement”) with Chailease International Financial
Leasing Corp. (“CIFLC”) on January 31, 2024, for a total financing proceeds in the amount of RMB
UTime
Guangxi made payments due according to the schedule. As of September 30, 2025, the balance of Leased Equipment net of amortization was
RMB
Amortization
of the Leased Equipment was RMB
As
a result of the sale and leaseback, a deferred loss in the amount of RMB
The future minimum lease payments of the capital lease as of September 30, 2025 were as follows:
SCHEDULE OF MINIMUM LEASE PAYMENTS
| September 30, | Amount | |||
| 2026 | ||||
| 2027 | ||||
| 2028 | ||||
| 2029 | ||||
| Less: unearned discount | ( | ) | ||
| Less: Current portion lease liability | ( | ) | ||
| Non-current portion of lease liability | $ | |||
NOTE 9 — EQUITY METHOD INVESTMENT
During
the year ended March 31, 2018, the Company invested an aggregate amount of RMB
SCHEDULE OF IMPAIRMENT OF EQUITY INTEREST OF PHILECTRONICS
| 2024 | 2025 | |||||||
| Six months ended September 30, | ||||||||
| 2024 | 2025 | |||||||
| RMB | RMB | |||||||
| Cost | ||||||||
| Less: accumulated impairment | ( | ) | ||||||
| Equity method investment, net | ||||||||
| F-29 |
UTIME
LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands, except share data and per share data, or otherwise noted)
NOTE 10 — BORROWINGS
SCHEDULE OF BORROWINGS
| As
of March 31, | As
of September 30, | |||||||||
| Note | 2025 | 2025 | ||||||||
| RMB | RMB | |||||||||
| Short-term borrowings | ||||||||||
| China Resources Bank of Zhuhai Co., Ltd. Loan 3 | (a) | |||||||||
| ICBC Loan 3 | (b) | |||||||||
| Bank of Beijing Loan 1 | (c) | |||||||||
| Bank of Beijing Loan 2 | (d) | |||||||||
| China Resources SZITIC Trust Company Limited Loan 2 | (e) | |||||||||
| SH PuDong Development Bank | (h) | |||||||||
| China Post Savings Bank Meilin Branch | (i) | |||||||||
| Tianjin Jincheng Bank Co., Ltd. | ||||||||||
| Bank of China Wenjin Square Sub-branch | ||||||||||
| Long-term borrowings | ||||||||||
| Guangxi Beibu Gulf Bank Loan 1 | (f) | |||||||||
| Guangxi Beibu Gulf Bank Loan 2 | (g) | |||||||||
| F-30 |
UTIME
LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands, except share data and per share data, or otherwise noted)
NOTE 10 — BORROWINGS (cont.)
| (a) | |
| (b) | |
| (c) | On
January 2, 2024, UTime SZ entered into a credit agreement with Bank of Beijing, according to which Bank of Beijing agreed to provide
UTime SZ with a credit facility of up to RMB |
| (d) | |
| (e) | |
| (f) |
| F-31 |
UTIME
LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands, except share data and per share data, or otherwise noted)
NOTE 10 — BORROWINGS (cont.)
| (g) | |
| (h) | |
| (i) |
NOTE 11 — OTHER PAYABLES AND ACCRUED LIABILITIES
SCHEDULE OF OTHER PAYABLES AND ACCRUED LIABILITIES
| As
of March 31, | As
of September 30, | |||||||
| 2025 | 2025 | |||||||
| RMB | RMB | |||||||
| Advance from customers | ||||||||
| Accrued payroll | ||||||||
| VAT payable | ||||||||
| Other payables | ||||||||
| Total | ||||||||
As of March 31, 2025, other payables mainly included RMB
| F-32 |
UTIME
LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands, except share data and per share data, or otherwise noted)
NOTE 12 — OTHER INCOME, NET
SCHEDULE OF OTHER INCOME NET
| 2024 | 2025 | |||||||
| Six months ended September 30, | ||||||||
| 2024 | 2025 | |||||||
| RMB | RMB | |||||||
| Exchange gains | ( | ) | ||||||
| Government grants | ( | ) | ( | ) | ||||
| Others | ( | ) | ( | ) | ||||
| Total | ( | ) | ( | ) | ||||
In the period ended September 30,
2025, others mainly included RMB
NOTE 13 — RELATED PARTIES BALANCES AND TRANSACTIONS
Related parties with whom the Company had transactions are:
SCHEDULE OF RELATED PARTIES TRANSACTIONS
| Related Parties | Relationship | |
| Mr. Minfei Bao | ||
| Mr. Min He | ||
| Mr. Wu Cong | ||
| Philectronics | ||
| Grandsky Phoenix Limited |
| (1) | Due from related parties |
| As
of March 31, | As
of September 30, | |||||||
| 2025 | 2025 | |||||||
| RMB | RMB | |||||||
| Philectronics | ||||||||
| Total | ||||||||
| F-33 |
UTIME
LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands, except share data and per share data, or otherwise noted)
NOTE 13 — RELATED PARTIES BALANCES AND TRANSACTIONS (cont.)
| (2) | Due to related parties |
| As
of March 31, | As
of September 30, | |||||||
| 2025 | 2025 | |||||||
| RMB | RMB | |||||||
| Mr. Minfei Bao | ||||||||
| Grandsky Phoenix Limited | ||||||||
| Mr. Wu Cong | ||||||||
| (1) | On
April 1, 2023, the Company entered into a loan agreement with Grandsky Phoenix Limited to borrow USD |
| Starting
from July 2024, the Company has successively obtained the interest-free loans from Director Wu totaling RMB |
NOTE 14 — SHAREHOLDERS’ EQUITY
On
April 8, 2021, the Company completed its IPO and listed on the Nasdaq Capital Market. In the offering,
of the Company’s ordinary shares were issued and sold to the public at a price of US$
per share for gross proceeds of US$
On June 29, 2022, the board of directors of the Company approved the 2022 Performance Incentive Plan (the “2022 PIP”). Under the 2022 PIP, the Company reserved a total of ordinary shares for issuance as or under awards to be made to the participants of the Company. On November 7, 2022, ordinary shares were issued and granted under the 2022 PIP. The fair value of the ordinary shares granted was calculated at $ as of the date of issuance at $ per share.
On
November 15, 2023, an aggregate of
ordinary shares were granted and issued under the 2022 PIP. Total fair value of the ordinary shares granted
was calculated at $
On
November 15, 2023, the Company entered into certain securities purchase agreement (the “November 2023 SPA”) with certain
“non-U.S. Persons” (the “November 2023 Purchasers”), pursuant to which the Company agreed to sell to the
November 2023 Purchasers an aggregate of
| F-34 |
UTIME
LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands, except share data and per share data, or otherwise noted)
NOTE 14 — SHAREHOLDERS’ EQUITY (cont.)
On
January 6, 2025, the Company entered into certain securities purchase agreement (the “January 2025 SPA”) with certain
“non-U.S. Persons” (the “January 2025 Purchasers”), pursuant to which the Company agreed to sell up to an
aggregate of
On
February 27, 2025, the Company entered into certain securities purchase agreement (the “February 2025 SPA”) with certain
“non-U.S. Persons” (the “February 2025 Purchasers”) pursuant to which the Company agreed to sell up to an
aggregate of
On
August 12, 2025, the Company entered into certain securities purchase agreement with certain “non-U.S. Persons” as defined
in Regulation S of the Securities Act of 1933, as amended pursuant to which the Company agreed to sell up to an aggregate of
As of September 30, 2025, the Company had authorized Class A ordinary shares, and Class A ordinary shares were issued and outstanding. As of September 30, 2025, Class B ordinary shares were issued and outstanding.
On November 11, 2025, the Company effected a
| F-35 |
UTIME
LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands, except share data and per share data, or otherwise noted)
NOTE 15 — COMMITMENTS AND CONTINGENCIES
(a) Capital commitment
As of September 30, 2025, the Company had no capital commitments.
(b) Legal proceedings
From time to time, the Company is involved in claims and legal proceedings that arise in the ordinary course of business. Based on currently available information, management does not believe that the ultimate outcome of these unresolved matters, individually and in the aggregate, is likely to have a material adverse effect on the Company’s financial position, results of operations or cash flows. As a result, the Company has not recorded any material liabilities in this regard as of March 31, 2025, and September 30, 2025.
However, litigation is subject to inherent uncertainties and the Company’s view of these matters may change in the future. If an unfavorable outcome were to occur, there exists the possibility of a material adverse impact on the Company’s financial position and results of operations for the periods in which the unfavorable outcome occurs.
NOTE 16 — REVENUE AND GEOGRAPHY INFORMATION
SCHEDULE OF REVENUE AND GEOGRAPHY INFORMATION
| 2024 | 2025 | |||||||
| Six months ended September 30, | ||||||||
| 2024 | 2025 | |||||||
| RMB | RMB | |||||||
| Feature phone | ||||||||
| Smart phone | ||||||||
| Pad/Laptop | ||||||||
| Others | ||||||||
| Total | ||||||||
The location of the Company’s long-lived assets is as follows:
SCHEDULE OF LOCATION OF THE COMPANY’S LONG-LIVED ASSETS
| As
of March 31, | As
of September 30, | |||||||
| 2025 | 2025 | |||||||
| RMB | RMB | |||||||
| PRC | ||||||||
| Total | ||||||||
| F-36 |
UTIME
LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands, except share data and per share data, or otherwise noted)
NOTE 17 — CONDENSED FINANCIAL INFORMATION OF THE PARENT COMPANY
The
Company performed a test on the restricted net assets of consolidated subsidiary in accordance with Securities and Exchange Commission
Regulation S-X Rule 4-08 (e) (3), “General Notes to Financial Statements” and concluded that it was applicable for the Company
to disclose the financial statements for the parent company. The amounts restricted include paid-in capital, capital surplus and statutory
reserves, after intercompany eliminations, as determined pursuant to PRC generally accepted accounting principles, totaling RMB
The subsidiaries did not pay any dividend to the parent for the periods presented. For the purpose of presenting parent only financial information, the Company records investment in its subsidiary under the equity method of accounting. Such investment is presented on the separate condensed balance sheets of the Company as “Investment in subsidiary” and the income of the subsidiary is presented as “Income/Loss from equity method investments.” Certain information and footnote disclosures generally included in financial statements prepared in accordance with U.S. GAAP have been condensed and omitted.
BALANCE SHEETS
SCHEDULE OF BALANCE SHEET
| As
of March 31, | As
of September 30, | |||||||
| 2025 | 2025 | |||||||
| RMB | RMB | |||||||
| ASSETS | ||||||||
| Current assets | ||||||||
| Cash and Cash equivalents | ||||||||
| Prepaid expenses and other current assets | ||||||||
| Inter-company receivable | ||||||||
| Non-current assets | ||||||||
| Investment in subsidiary | ( | ) | ( | ) | ||||
| Total assets | ( | ) | ||||||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||
| Current liabilities | ||||||||
| Inter-company payable | ( | ) | ||||||
| Due to related parties | ||||||||
| Other payables and accrued liabilities | ||||||||
| Total liabilities | ||||||||
| Shareholders’ equity | ||||||||
| Class A ordinary shares, par value US$; Authorized: shares; Issued and outstanding: shares as of March 31, 2025 and shares as of September 30, 2025* | ||||||||
| Class B ordinary shares, par value US$; Authorized: shares; shares issued and outstanding as of March 31, 2025 and September 30, 2025 | ||||||||
| Ordinary shares | ||||||||
| Additional paid-in capital | ||||||||
| Subscription Receivables | ( | ) | ||||||
| Accumulated deficit | ( | ) | ( | ) | ||||
| Accumulated other comprehensive income | ||||||||
| Total shareholder’s equity | ( | ) | ||||||
| Total liabilities and shareholders’ equity | ( | ) | ||||||
| * |
| F-37 |
UTIME
LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands, except share data and per share data, or otherwise noted)
NOTE 17 — CONDENSED FINANCIAL INFORMATION OF THE PARENT COMPANY (cont.)
STATEMENTS OF COMPREHENSIVE (LOSS)/INCOME
SCHEDULE OF COMPREHENSIVE (LOSS)/INCOME
| 2024 | 2025 | |||||||
| Six months ended September 30, | ||||||||
| 2024 | 2025 | |||||||
| RMB | RMB | |||||||
| Loss from equity method investments | ( | ) | ||||||
| Operating expenses | ( | ) | ( | ) | ||||
| Net (loss)/income | ( | ) | ||||||
| Foreign currency translation difference | ( | ) | ||||||
| Comprehensive (loss)/income | ( | ) | ( | ) | ||||
STATEMENTS OF CASH FLOWS
SCHEDULE OF CASH FLOWS
| 2024 | 2025 | |||||||
| Six months ended September 30, | ||||||||
| 2024 | 2025 | |||||||
| RMB | RMB | |||||||
| CASH FLOW FROM OPERATING ACTIVITIES | ||||||||
| Net (loss)/income | ( | ) | ||||||
| Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
| Equity loss of subsidiaries | ( | ) | ||||||
| Share-based compensation and expenses | ||||||||
| Prepaid expenses and other current assets | ||||||||
| Inter-company payable (net of inter-company receivable) | ( | ) | ||||||
| Related parties | ( | ) | ||||||
| Other payables and accrued liabilities | ( | ) | ||||||
| Net cash (used in)/provided by operating activities | ( | ) | ||||||
| Loan received/(paid) from a shareholder | ( | ) | ||||||
| Proceeds from issuance of ordinary shares | ||||||||
| Effect of exchange rate changes on cash and cash equivalent and restricted cash | ( | ) | ||||||
| Net change in cash and cash equivalent | ( | ) | ||||||
| Cash and cash equivalents, beginning of year | ||||||||
| Cash and cash equivalents, end of year | ||||||||
The Company did not have significant capital and other commitments, long-term obligations, or guarantees as of March 31, 2025 and September 30, 2025, respectively.
| F-38 |
UTIME
LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands, except share data and per share data, or otherwise noted)
NOTE 18 — SUBSEQUENT EVENTS
On or about August 15, 2025, the Company received notice from the Nasdaq Stock Market LLC (“Nasdaq”) that it was no longer in compliance with the minimum $2,500,000 stockholders’ equity requirement for continued listing, as set forth in Nasdaq Listing Rule 5550(b)(1), based on the stockholders’ equity reported in the Company’s Annual Report on Form 20-F filed with the Securities and Exchange Commission (the “SEC”) on August 11, 2025.
On August 12, 2025, the Company completed a
$
On October 14, 2025, the Company announced it will discontinue the following subsidiaries, effective immediately: (1) Changsha Utime Business Management Co., Ltd., (2) WTO New York Inc., and (3) UT (HK) International Technology Co. Limited. The Company determined that it was in its best interests to cease operations in such entities and classify them as discontinued businesses. As a result, the Company confirms that it has divested those entities from the UTime corporate group, and their future activities, assets and liabilities will no longer be affiliated with or attributable to UTime Limited or any of its consolidated entities.
On October 17, 2025, the Company closed a best-efforts public offering
(the “October 2025 Offering”) pursuant to which the Company sold an aggregate of
On November 11, 2025, the Company completed a share consolidation of
On December 12, 2025, the Company accepted the resignation of Mr. Yihuang Chen, the Chief Operating Officer of the Company, effective immediately.
On
January 20, 2026, the Company closed a private placement pursuant to a share purchase agreement with certain investors, dated
January 14, 2026 (the “January 2026 Purchase Agreement”). Pursuant to the January 2026 Purchase Agreement, the Company
issued an aggregate of
On January 26, 2026,
| F-39 |
Exhibit 99.2
Management’s discussion and analysis of the financial condition and results of operations of UTime Ltd (the “Company,” “we,” “our,” or “us”) for the six months ended September 30, 2025 is set forth below:
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion and analysis should be read in conjunction with our unaudited consolidated financial statements, the notes to those financial statements and other financial data that appear elsewhere in this filing. In addition to historical information, the following discussion contains forward-looking statements based on current expectations that involve risks and uncertainties. Actual results and the timing of selected events could differ materially from those anticipated in these forward-looking statements as a result of various factors.
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
This discussion contains forward-looking statements. All statements contained in this discussion other than statements of historical fact, including statements regarding our future results of operations and financial position, our business strategy and plans, and our objectives for future operations, are forward-looking statements. The words “believe,” “may,” “will,” “estimate,” “continue,” “anticipate,” “intend,” “expect,” and similar expressions are intended to identify forward-looking statements. We have based these forward-looking statements largely on our current expectations and projections about future events and trends that we believe may affect our financial condition, results of operations, business strategy, short-term and long-term business operations and objectives, and financial needs. These forward-looking statements are subject to a number of risks, uncertainties, and assumptions. Moreover, we operate in a very competitive and rapidly changing environment. New risks emerge from time to time. It is not possible for our management to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements we may make. In light of these risks, uncertainties, and assumptions, the future events and trends discussed in this report may not occur and actual results could differ materially and adversely from those anticipated or implied in the forward-looking statements.
Overview
We design, manufacture, and distribute mobile phones and other consumer electronics through our operation plants in China. Our products are categorized into the following major categories: feature phone, smartphone, notebook computer and mobile phone accessories. Most of our products are produced to fulfill OEM/ODM orders received from our long-term clients and sold globally, including India, Brazil, the United States, and other emerging markets in South Asia and Africa as well as Europe. The following charts display our products contribution for the six months ended September 30, 2024 and 2025.
We derive our revenues mainly from feature phones, smart phones and notebook computers. The following table sets forth our revenues by segment and as a percentage of total revenues for the periods indicated:
| Six months ended September 30, | ||||||||||||||||||||
| 2024 | 2025 | |||||||||||||||||||
| Category | Amount | % | Amount | % | ||||||||||||||||
| RMB | RMB | US$ | ||||||||||||||||||
| (in thousands, except for percentages) | ||||||||||||||||||||
| Feature phone | 39,997 | 28.9 | 29,843 | 4,192 | 30.0 | |||||||||||||||
| Smart phone | 14,764 | 10.7 | 7,594 | 1,067 | 7.6 | |||||||||||||||
| Pad/Laptop | 40,550 | 29.3 | 57,471 | 8,073 | 57.7 | |||||||||||||||
| Others | 43,094 | 31.1 | 4,623 | 649 | 4.7 | |||||||||||||||
| Total | 138,405 | 100 | 99,531 | 13,981 | 100 | |||||||||||||||
The table below sets forth certain line items from our unaudited consolidated statement of comprehensive loss for the six months ended September 30, 2024 and 2025:
| Six months ended September 30, | ||||||||||||
| 2024 | 2025 | |||||||||||
| RMB | RMB | US$ | ||||||||||
| (in thousands) | ||||||||||||
| Revenues | 138,405 | 99,531 | 13,981 | |||||||||
| Costs of sales | 132,417 | 93,998 | 13,204 | |||||||||
| Gross profit | 5,988 | 5,533 | 777 | |||||||||
| Operating expenses | 128,605 | 7,338 | 1,031 | |||||||||
| Other income, net | (2,295 | ) | (12,835 | ) | (1,802 | ) | ||||||
| Interest expenses | 1,809 | 1,676 | 236 | |||||||||
| (Loss)/income before income taxes | (127,376 | ) | 9,354 | 1,312 | ||||||||
| Income tax benefits | (59 | ) | - | - | ||||||||
| Net (loss)/profit | (127,317 | ) | 9,354 | 1,312 | ||||||||
| ● | Revenue decreased 28.1% from RMB 138.41 million for the six months ended September 30, 2024 to RMB 99.53 million (US$13.98 million) for the six months ended September 30, 2025. The period-on-period decrease was RMB38.87 million mainly due to reduced orders from overseas clients with the rising chip and memory prices for the period. |
| 1 |
| ● | Gross profit margin increased from 4.3% for six months ended September 30, 2024 to 5.6% for the six months ended September 30, 2025 mainly attributable to the high gross margin for the new product - AI Server. | |
| ● | Net income was RMB 9.35 million (US$1.31 million), compared to net loss of RMB 127.32 million during the same period of last year. This was mainly caused by the share-based compensation expenses in RMB 110.82 million incurred in same period of last year. |
Comparison of the six months ended September 30, 2024 and 2025
Revenue
Revenue for the six months ended September 30, 2025 was RMB 99.53 million (US$13.98 million), representing a decrease of RMB38.88 million, or 28.1%, from RMB138.41 million for the same period of 2024 mainly due to reduced orders from overseas clients with the rising chip and memory prices for the period.
Cost of sales
Cost of sales for the six months ended September 30, 2025 was RMB94.00 million (US$13.20 million), representing an decrease of RMB38.42 million, or 29.0%, from RMB 132.42 million for the same period of last year. The decrease was in line with the decrease in sales volume.
Our cost of sales mainly consists of cost of raw materials, third party processing fees and rental of building and machinery.
We import screens and mother boards from overseas and purchase camera, battery and electronic components from domestic markets for mobile phone processing and assembling.
Gross profit
Gross profit for the six months ended September 30, 2025 was RMB5.53 million (US$0.78 million), representing a decrease of RMB 0.5 million, or 7.6%, from the gross profit of RMB5.99 million for the same period of 2024 as forementioned.
Overall gross profit margin for the six months ended September 30, 2025 was 5.6%, or 1.3 percentage points higher, as compared to gross profit margin of 4.3% for the same period of 2024.
| 2 |
Operating expenses
| Six months ended September 30, | ||||||||||||
| 2024 | 2025 | |||||||||||
| RMB | RMB | US$ | ||||||||||
| (in thousands) | ||||||||||||
| Selling expenses | 5,245 | 1,132 | 159 | |||||||||
| General and administrative expenses(1) | 122,711 | 3,732 | 524 | |||||||||
| R&D related expenses(1) | 5,894 | 2,474 | 348 | |||||||||
| Other income, net | (2,295 | ) | (12,835 | ) | (1,802 | ) | ||||||
| Total | 131,555 | (5,497 | ) | (771 | ) | |||||||
| (1) | These expenses are combined as general and administrative expenses in consolidated statements of comprehensive income (loss). |
Our operating expenses consist of selling expenses, general and administrative expenses, R&D expenses and other expenses, net. Operating expenses decreased by RMB137.05 million, or 104.18%, from RMB131.56 million for the six months ended September 30, 2024 to the income of RMB 5.50 million (US$0.77 million) for the six months ended September 30, 2025.
Selling expenses consist of salary and benefits, business travel, shipping expenses, entertainment, market promotion and other expenses relating to our sales and marketing activities. The decrease in selling expense was mainly due to the decrease on salary expense for the six month ended September 30, 2025.
General and administrative expenses primarily include salary and benefits to our accounting, human resources, design and executive office expenses, rental expenses, property management and utilities, office supplies. It decreased by RMB118.98 million, or 97.0%, from RMB122.71 million for the six months ended September 30, 2024 to RMB3.73 million (US$0.52 million) for the six months ended September 30, 2025, mainly attributable to the share-based compensation expenses in RMB110.82 million incurred in same period of last year combined the decrease of salary expense due to the drop of headcount.
R&D related expenses mainly consist of salary and benefits, material and consumables and other expenses to carry out R&D activities. It decreased by RMB3.42 million, or 58.0%, from RMB5.89 million for the six months ended September 30, 2024 to RMB2.47 million (US$0.35 million) for the six months ended September 30, 2025, mainly attributable to the combined effect of the drop of headcount of high paid employees.
Other income, net for the six months ended September 30, 2025 was net income of RMB12.84 million (US$1.80 million), as compared to net income of RMB2.30 million for the same period of 2024. The increase in net income was mainly attributed to change in exchange rate of U.S. Dollar against RMB and the reversed allowance of credit losses of RMB 9.13 million.
Income tax benefits
Income tax benefit is RMB0.06 million and nil for the six months ended September 30, 2024 and 2025.
| 3 |
Net income
Net income was RMB9.35 million (US$1.31 million) for the six months ended September 30, 2025 compared to net loss of RMB127.32 million for the six months ended September 30, 2024.
Liquidity and Capital Resources
As of September 30, 2025, the Company had current assets of RMB 399 million (US$56 million) and current liabilities of RMB392 million (US$55 million), resulting in a working capital surplus of approximately RMB7 million (US$1 million). As of March 31, 2025, the Company had current assets of RMB162 million and current liabilities of RMB 334 million, resulting in a working capital deficit of approximately RMB172 million.
The Company had accumulated deficit of RMB879 million and RMB870 million (US$122 million) as of March 31, 2025 and September 30, 2025, respectively. For the six months ended September 30, 2025, the Company incurred a net income of RMB9.3 million (US$1.3 million).
We continue to focus on improving operational efficiency and cost reductions, developing core cash-generating business and enhancing efficiency. We expect that the existing and future cash generated from operations will be sufficient to fund the future operating expenses and capital expenditure requirements. In addition, we are also working on raising additional funding to finance the operations as well as business expansion.
Cash and Cash Equivalents and Restricted Cash
The following table sets forth certain historical information with respect to our statements of cash flows:
| Six months ended September 30, | ||||||||||||
| 2024 | 2025 | |||||||||||
| RMB | RMB | USD | ||||||||||
| (in thousands) | ||||||||||||
| Net Cash (Used in)/Provided by Operating Activities | (8,348 | ) | 10,306 | 1,447 | ||||||||
| Net Cash Used in Investing Activities | - | (44 | ) | (6 | ) | |||||||
| Net Cash Provided by Financing Activities | 37,142 | 183,410 | 25,763 | |||||||||
| Effect of exchange rate changes on cash and cash equivalents | (128 | ) | (9,595 | ) | (1,056 | ) | ||||||
| Net Increase in Cash and Cash Equivalents | 28,666 | 184,077 | 26,148 | |||||||||
We had cash, cash equivalent and restricted cash of approximate RMB109 million and RMB293 million (US$41 million) as of March 31, 2025 and September 30, 2025, respectively.
| 4 |
Net cash provided by operating activities was RMB 10.3 million (US$1.4 million) for the six months ended September 30, 2025 as compared with net cash used in operating activities of RMB 8.3 million for the same period of 2024.
Net cash used in investing activities was RMB 0.04 million (US$0.06 million) for the six months ended September 30, 2025 as compared with nil for the same period of 2024.
Net cash provided by financing activities for the six months ended September 30, 2025 was RMB183.4 million (US$ 25.8 million) as compared to net cash provided by financing activities of RMB37.1 million for the same period of 2024.
The net cash inflow was mainly attributed to the issuance of Class A ordinary shares.
Contractual Obligations
In July 2024, UTime Guangxi entered into a Factory Lease Agreement to lease factory for production from Nanning Industrial Investment Group Cp., Ltd, for a term of up to three years, with a monthly rental payment of RMB 93,392 (including three months rent-free period).
In June 2024, UTime Guangxi entered into a Lease Agreement to lease dormitory for staff from Nanning Industrial Investment Group Cp., Ltd, for a term from June 24, 2024 to June 23, 2026, with a monthly rental payment of RMB 9,083.
The following table sets forth our contractual obligations as of September 30, 2025, which included the lease and loan arrangement described above:
| Payments due by period (in thousands) | ||||||||||||||||||||
| Contractual obligations | Total | Less than 1 year | 1-2 years | 2-3 years | More than 3 years | |||||||||||||||
| Short term borrowings | 62,367 | 62,367 | - | - | - | |||||||||||||||
| Operating lease payments | 3,568 | 2,554 | 1,014 | - | - | |||||||||||||||
| Total | 65,935 | 64,921 | 1,014 | - | - | |||||||||||||||
| 5 |