UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

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

For the quarterly period ended March 31, 2025

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

For the transition period from __________ to __________

Commission File Number: 001-37513

GD CULTURE GROUP LIMITED

(Exact name of registrant as specified in its charter)

Nevada |  | 47-3709051
(State or other jurisdiction of |  | (I.R.S. Employer
incorporation or organization) |  | Identification Number)

22F - 810 Seventh Avenue, |  |
New York, NY 10019 |  | 10019
(Address of principal executive offices) |  | (Zip Code)

Registrant’s telephone number, including area code: +1-347- 2590292

Not applicable

(Former name or former address, if changed since last report)

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

Title of each class |  | Trading Symbol(s) |  | Name of each exchange on which registered
Common Stock, par value $0.0001 |  | GDC |  | Nasdaq Capital Market

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

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

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

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

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

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

As of May 15, 2025, there were 16,795,433 shares of the Company’s common stock issued and outstanding.

TABLE OF CONTENTS

|  |  | Page
PART I. | FINANCIAL INFORMATION |  | 1
ITEM 1. | FINANCIAL STATEMENTS (UNAUDITED) |  | 1
ITEM 2. | MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS |  | 2
ITEM 3. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK |  | 8
ITEM 4. | CONTROLS AND PROCEDURES |  | 9
PART II. | OTHER INFORMATION |  | 10
ITEM 1. | LEGAL PROCEEDINGS |  | 10
ITEM 1A. | RISK FACTORS |  | 10
ITEM 2. | UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS |  | 10
ITEM 3. | DEFAULTS UPON SENIOR SECURITIES |  | 10
ITEM 4. | MINE SAFETY DISCLOSURES |  | 10
ITEM 5. | OTHER INFORMATION |  | 10
ITEM 6. | EXHIBITS |  | 11

i

CAUTIONARY NOTE REGARDING

FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains statements that may be deemed to be “forward-looking statements” within the meaning of the federal securities laws. These statements relate to anticipated future events, future results of operations and or future financial performance. In some cases, you can identify forward-looking statements by their use of terminology such as “anticipate,” “believe,” “could,” “estimate,” “expect,” “future,” “intend,” “may,” “ought to,” “plan,” “possible,” “potentially,” “predicts,” “project,” “should,” “will,” “would,” negatives of such terms or other similar terms. These forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. The forward-looking statements in this Quarterly Report on Form 10-Q include, without limitation, statements relating to:

| ● | our goals and strategies;

| ● | our future business development, results of operations and financial condition;

| ● | our estimates regarding expenses, future revenues, capital requirements and our need for additional financing;

| ● | our estimates regarding the market opportunity for our services;

| ● | the impact of government laws and regulations;

| ● | our ability to recruit and retain qualified personnel;

| ● | our failure to comply with regulatory guidelines;

| ● | uncertainty in industry demand;

| ● | general economic conditions and market conditions in the financial services industry;

| ● | future sales of large blocks or our securities, which may adversely impact our share price; and

| ● | depth of the trading market in our securities.

The preceding list is not intended to be an exhaustive list of all of our forward-looking statements. Forward-looking statements reflect our current views with respect to future events and are based on assumptions and subject to risks and uncertainties, including those described in Item 1A “Risk Factors” of our Annual Report on Form 10-K for the fiscal year ended December 31, 2024 and elsewhere in this Quarterly Report on Form 10-Q.

You should not unduly rely on any forward-looking statements. Although we believe that the expectations reflected in the forward- looking statements are reasonable, we cannot guarantee that future results, levels of activity, performance and events and circumstances reflected in the forward-looking statements will be achieved or will occur. Except as required by law, we undertake no obligation to update publicly any forward-looking statements for any reason after the date of this Quarterly Report on Form 10-Q, to conform these statements to actual results or to changes in our expectations.

ii

PART I — FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS (UNAUDITED)

UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

Index to unaudited interim condensed consolidated financial statements

|  | Page
Consolidated Financial Statements: |  |
Consolidated Balance Sheets as of March 31, 2025 (Unaudited) and December 31, 2024 |  | F-1
Unaudited Interim Condensed Consolidated Statements of Operations and Comprehensive Loss for the Three Months Ended March 31, 2025 and 2024 |  | F-2
Unaudited Interim Condensed Consolidated Statements of Changes in Shareholders’ Equity for the Three Months Ended March 31, 2025 and 2024 |  | F-3 – F-4
Unaudited Interim Condensed Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2025 and 2024 |  | F-5
Notes to Unaudited Interim Condensed Consolidated Financial Statements |  | F-6

1

GD CULTURE GROUP LIMITED AND ITS SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

|  | March 31, |  |  | December 31, |
|  | 2025 |  |  | 2024 |
|  | (unaudited) |  |  |  |
ASSETS |  |  |  |  |  |
CURRENT ASSETS |  |  |  |  |  |
Cash and cash equivalents |  | $ | 51,236 |  |  | $ | 22,538 |
Other receivables, net |  |  | 9,195 |  |  |  | 9,195 |
Prepaid and other current assets |  |  | 15,579 |  |  |  | - |
Total current assets |  |  | 76,010 |  |  |  | 31,733 |
EQUIPMENT, NET |  |  | 6,704 |  |  |  | 7,781 |
RIGHT-OF-USE ASSETS, NET |  |  | 1,229,793 |  |  |  | 1,342,333 |
OTHER ASSETS |  |  |  |  |  |  |  |
Intangible assets, net |  |  | 1,040,000 |  |  |  | 1,102,400 |
Other assets |  |  | 250,740 |  |  |  | 250,740 |
Total other assets |  |  | 1,290,740 |  |  |  | 1,353,140 |
Total assets |  | $ | 2,603,247 |  |  | $ | 2,734,987 |
LIABILITIES AND SHAREHOLDERS’ EQUITY |  |  |  |  |  |  |  |
CURRENT LIABILITIES |  |  |  |  |  |  |  |
Other payables and accrued liabilities |  | $ | 550,539 |  |  | $ | 401,821 |
Other payables - related parties |  |  | 372,276 |  |  |  | 502,266 |
Lease liabilities - current |  |  | 381,434 |  |  |  | 427,984 |
Income tax payable |  |  | 267,517 |  |  |  | 141,810 |
Total current liabilities |  |  | 1,571,766 |  |  |  | 1,473,881 |
OTHER LIABILITIES |  |  |  |  |  |  |  |
Lease liabilities – non-current |  |  | 1,026,387 |  |  |  | 1,104,552 |
Deferred tax liabilities |  |  | 69,955 |  |  |  | 153,911 |
Total other liabilities |  |  | 1,096,342 |  |  |  | 1,258,463 |
Total liabilities |  |  | 2,668,108 |  |  |  | 2,732,344 |
COMMITMENTS AND CONTINGENCIES |  |  |  |  |  |  |  |
SHAREHOLDERS’ EQUITY (DEFICIT) |  |  |  |  |  |  |  |
Preferred stock, $0.0001 par value, 20,000,000 shares authorized, no shares issued and outstanding as of March 31, 2025 and December 31, 2024, respectively |  |  | - |  |  |  | - |
Common stock, $0.0001 par value, 200,000,000 shares authorized, 12,282,894 and 11,167,294 shares issued and outstanding as of March 31, 2025 and December 31, 2024, respectively |  |  | 1,228 |  |  |  | 1,117 |
Additional paid-in capital |  |  | 83,668,864 |  |  |  | 82,758,975 |
Accumulated deficit |  |  | (84,171,896 | ) |  |  | (83,194,386 | )
Accumulated other comprehensive income |  |  | 152,589 |  |  |  | 152,585 |
Total GD Culture Group Limited shareholders’ deficits |  |  | (349,215 | ) |  |  | (281,709 | )
Noncontrolling interest |  |  | 284,354 |  |  |  | 284,352 |
Total shareholders’ equity (deficit) |  |  | (64,861 | ) |  |  | 2,643 |
Total liabilities and shareholders’ equity (deficit) |  | $ | 2,603,247 |  |  | $ | 2,734,987 |

The accompanying notes are an integral part of these unaudited interim condensed consolidated financial statements.

F-1

GD CULTURE GROUP LIMITED AND ITS SUBSIDIARIES

UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

|  | For the three months ended March 31, |
|  | 2025 |  |  | 2024 |
OPERATING EXPENSES |  |  |  |  |  |
Selling expenses |  | $ | - |  |  | $ | (2,191,667 | )
General and administrative expenses |  |  | (937,877 | ) |  |  | (1,769,280 | )
Research and development expenses |  |  | - |  |  |  | (217,500 | )
TOTAL OPERATING EXPENSES |  |  | (937,877 | ) |  |  | (4,178,447 | )
LOSS FROM OPERATIONS |  |  | (937,877 | ) |  |  | (4,178,447 | )
OTHER INCOME |  |  |  |  |  |  |  |
Interest income |  |  | 2,118 |  |  |  | 21,946 |
TOTAL OTHER INCOME |  |  | 2,118 |  |  |  | 21,946 |
LOSS BEFORE INCOME TAXES FROM CONTINUING OPERATIONS |  |  | (935,759 | ) |  |  | (4,156,501 | )
LESS: INCOME TAX EXPENSES |  |  | (41,751 | ) |  |  | (1,038 | )
LOSS FROM CONTINUING OPERATIONS |  |  | (977,510 | ) |  |  | (4,157,539 | )
Net loss from continuing operations attributable to noncontrolling interest |  |  | - |  |  |  | (178,911 | )
Net loss from continuing operations attributable to shareholders of common stock |  |  | (977,510 | ) |  |  | (3,978,628 | )
NET LOSS |  | $ | (977,510 | ) |  | $ | (4,157,539 | )
Net loss attributable to noncontrolling interest |  |  | - |  |  |  | (178,911 | )
Net loss attributable to shareholders of common stock |  |  | (977,510 | ) |  |  | (3,978,628 | )
OTHER COMPREHENSIVE INCOME (LOSS) |  |  |  |  |  |  |  |
- Foreign currency translation adjustment |  |  | 6 |  |  |  | (15,109 | )
- Fair value changes of convertible note receivables |  |  | - |  |  |  | 54,849 | )
OTHER COMPREHENSIVE GAIN (LOSS), net of tax |  |  | 6 |  |  |  | 39,740 |
COMPREHENSIVE LOSS, net of tax |  | $ | (977,504 | ) |  | $ | (4,117,799 | )
Comprehensive loss attributable to noncontrolling interest |  |  | 2 |  |  |  | (272,911 | )
Comprehensive loss attributable to shareholders of common stock |  |  | (977,506 | ) |  |  | (3,844,888 | )
WEIGHTED AVERAGE NUMBER OF COMMON STOCKS |  |  |  |  |  |  |  |
Basic and diluted |  |  | 11,514,370 |  |  |  | 7,435,069 |
Loss per share from continuing operations |  |  |  |  |  |  |  |
Basic and diluted |  | $ | (0.08 | ) |  | $ | (0.56 | )
Loss per share available to common shareholders |  |  |  |  |  |  |  |
Basic and diluted |  | $ | (0.08 | ) |  | $ | (0.56 | )

The accompanying notes are an integral part of these unaudited interim condensed consolidated financial statements.

F-2

GD CULTURE GROUP LIMITED AND ITS SUBSIDIARIES

UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY

For the three months ended March 31, 2025

|  | Attributable to GD Culture Group Limited Shareholders |  |  |  |  |  |  |
|  | Preferred |  |  |  |  |  |  |  |  | Additional |  |  |  |  |  | Accumulated Other |  |  | Total GD Culture Group Limited |  |  | Non |  |  | Total |
|  | Stock |  |  | Common Stock |  |  | Paid-in |  |  | Accumulated |  |  | Comprehensive |  |  | Shareholders’ |  |  | controlling |  |  | Shareholders’ |
|  | Shares |  |  | Amount |  |  | Shares |  |  | Amount |  |  | Capital |  |  | Deficit |  |  | Income |  |  | Deficits |  |  | Interest |  |  | Equity (Deficit) |
Balance, January 1, 2025 |  |  | - |  |  | $ | - |  |  |  | 11,167,294 |  |  | $ | 1,117 |  |  | $ | 82,758,975 |  |  | $ | (83,194,386 | ) |  | $ | 152,585 |  |  | $ | (281,709 | ) |  | $ | 284,352 |  |  | $ | 2,643 |
Net loss |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (977,510 | ) |  |  | - |  |  |  | (977,510 | ) |  |  | - |  |  |  | (977,510 | )
Issuance of common stock for cash |  |  | - |  |  |  | - |  |  |  | 1,115,600 |  |  |  | 111 |  |  |  | 909,889 |  |  |  | - |  |  |  | - |  |  |  | 910,000 |  |  |  | - |  |  |  | 910,000 |
Foreign currency translation |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 4 |  |  |  | 4 |  |  |  | 2 |  |  |  | 6 |
Balance, March 31, 2025 (Uaudited) |  |  | - |  |  | $ | - |  |  |  | 12,282,894 |  |  | $ | 1,228 |  |  | $ | 83,668,864 |  |  | $ | (84,171,896 | ) |  | $ | 152,589 |  |  | $ | (349,215 | ) |  | $ | 284,354 |  |  | $ | (64,861 | )

The accompanying notes are an integral part of these unaudited interim condensed consolidated financial statements.

F-3

GD CULTURE GROUP LIMITED AND ITS SUBSIDIARIES

UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY

For the three months ended March 31, 2024

|  | Attributable to GD Culture Group Limited Shareholders |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  | Additional |  |  |  |  |  | Accumulated Other |  |  | Total GD Culture Group Limited |  |  | Non |  |  | Total |
|  | Preferred Stock |  |  | Common Stock |  |  | Paid-in |  |  | Accumulated |  |  | Comprehensive |  |  | Shareholders’ |  |  | controlling |  |  | Shareholders’ |
|  | Shares |  |  | Amount |  |  | Shares |  |  | Amount |  |  | Capital |  |  | Deficit |  |  | Income |  |  | Equity |  |  | Interest |  |  | Equity |
Balance, January 1, 2024 |  |  | - |  |  | $ | - |  |  |  | 5,453,416 |  |  | $ | 545 |  |  | $ | 77,530,221 |  |  | $ | (69,358,225 | ) |  | $ | 175,306 |  |  | $ | 8,347,847 |  |  | $ | 3,813,636 |  |  | $ | 12,161,483 |
Net loss |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (3,978,628 | ) |  |  | - |  |  |  | (3,978,628 | ) |  |  | (178,911 | ) |  |  | (4,157,539 | )
Issuance of common stock for Cash |  |  | - |  |  |  | - |  |  |  | 810,277 |  |  |  | 81 |  |  |  | 829,798 |  |  |  | - |  |  |  | - |  |  |  | 829,879 |  |  |  | - |  |  |  | 829,879 |
Issuance of common stock for acquisition of 13.33% noncontrolling interest of Shanghai Xianzhui |  |  | - |  |  |  | - |  |  |  | 400,000 |  |  |  | 40 |  |  |  | 3,150,753 |  |  |  | - |  |  |  | - |  |  |  | 3,150,793 |  |  |  | (3,150,793 | ) |  |  | - |
Exercise of pre-funded warrants |  |  | - |  |  |  | - |  |  |  | 567,691 |  |  |  | 57 |  |  |  | 597 |  |  |  | - |  |  |  | - |  |  |  | 654 |  |  |  | - |  |  |  | 654 |
Exercise of November 2023 Registered Warrants |  |  | - |  |  |  | - |  |  |  | 709,877 |  |  |  | 71 |  |  |  | (71 | ) |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Foreign currency translation |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 78,891 |  |  |  | 78,891 |  |  |  | (94,000 | ) |  |  | (15,109 | )
Fair value changes of convertible notes receivable |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 54,849 |  |  |  | 54,849 |  |  |  | - |  |  |  | 54,849 |
Balance, March 31, 2024 (unaudited) |  |  | - |  |  | $ | - |  |  |  | 7,941,261 |  |  | $ | 794 |  |  | $ | 81,511,298 |  |  | $ | (73,336,853 | ) |  | $ | 309,046 |  |  | $ | 8,484,285 |  |  | $ | 389,932 |  |  | $ | 8,874,217 |

The accompanying notes are an integral part of these unaudited interim condensed consolidated financial statements.

F-4

GD CULTURE GROUP LIMITED AND ITS SUBSIDIARIES

UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

|  | For the three months ended March 31, |
|  | 2025 |  |  | 2024 |
CASH FLOWS FROM OPERATING ACTIVITIES: |  |  |  |  |  |
Net loss |  | $ | (977,510 | ) |  | $ | (4,157,539 | )
Adjustments to reconcile net loss to net cash used in operating activities: |  |  |  |  |  |  |  |
Depreciation of equipment |  |  | 1,077 |  |  |  | 1,183 |
Amortization of intangible assets |  |  | 62,400 |  |  |  | 182,373 |
Amortization of right-of-use assets |  |  | 112,540 |  |  |  | 95,057 |
Deferred income tax |  |  | (83,956 | ) |  |  | 1,039 |
Interest income earned from loan to a third party |  |  | - |  |  |  | (19,781 | )
Changes in operating assets and liabilities |  |  |  |  |  |  |  |
Other receivables |  |  | - |  |  |  | 264 |
Prepaid and other current assets |  |  | (15,579 | ) |  |  | 230,657 |
Other payables and accrued liabilities |  |  | 48,718 |  |  |  | 170,150 |
Lease liabilities |  |  | (124,715 | ) |  |  | (141,313 | )
Taxes payable |  |  | 125,707 |  |  |  | - |
Other payables - related parties |  |  | 20,010 |  |  |  | 20,000 |
Net cash used in operating activities |  |  | (831,308 | ) |  |  | (3,617,910 | )
CASH FLOWS FROM INVESTING ACTIVITIES: |  |  |  |  |  |  |  |
Loan to a third party |  |  | - |  |  |  | (1,900,000 | )
Net cash used in investing activities |  |  | - |  |  |  | (1,900,000 | )
CASH FLOWS FROM FINANCING ACTIVITIES: |  |  |  |  |  |  |  |
Proceeds from issuance of common stock |  |  | 910,000 |  |  |  | 829,879 |
Proceeds from exercise of prefunded warrants |  |  | - |  |  |  | 654 |
Proceeds from promissory note - related party |  |  | 50,000 |  |  |  | - |
Proceeds from shareholder loan |  |  | 100,000 |  |  |  | - |
Repayments to related party |  |  | (200,000 | ) |  |  | - |
Net cash provided by financing activities |  |  | 860,000 |  |  |  | 830,533 |
EFFECT OF EXCHANGE RATE CHANGE ON CASH AND CASH EQUIVALENTS |  |  | 6 |  |  |  | (1,940 | )
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS |  |  | 28,698 |  |  |  | (4,689,317 | )
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR |  |  | 22,538 |  |  |  | 5,175,518 |
CASH AND CASH EQUIVALENTS, END OF YEAR |  | $ | 51,236 |  |  | $ | 486,201 |
SUPPLEMENTAL CASH FLOW INFORMATION: |  |  |  |  |  |  |  |
Cash paid for income tax |  | $ | - |  |  | $ | - |
Cash paid for interest |  | $ | - |  |  | $ | - |
NON-CASH TRANSACTIONS OF INVESTING AND FINANCING ACTIVITIES |  |  |  |  |  |  |  |
Initial recognition of right-of-use assets and lease liability |  | $ | - |  |  | $ | 100,002 |
Issuance of common stock for 13.3333% interest in SH Xianzhui |  | $ | - |  |  | $ | 3,150,793 |
Exercise of November 2023 Registered Warrants |  | $ | - |  |  | $ | 71 |

The accompanying notes are an integral part of these unaudited interim condensed consolidated financial statements.

F-5

GD CULTURE GROUP LIMITED AND SUBSIDIARIES

NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 1 – Nature of Business and Organization

GD Culture Group Limited (“GDC” or the “Company”), formerly known as Code Chain New Continent Limited, TMSR Holding Company Limited and JM Global Holding Company, is a Nevada corporation and a holding company. The Company currently conducts its operations on virtual content production (the “Virtual Content Production”) through the Company and two subsidiaries, AI Catalysis corp. (“AI Catalysis”) and Shanghai Xianzhui Technology Co., Ltd. (“SH Xianzhui”). The Company focuses its business mainly on: 1) AI-driven digital human creation and customization, and 2) Live streaming and e-commerce. The Company has relentlessly been focusing on serving its customers and creating value for them through the continual innovation and optimization of its products and services. Currently, the Company’s subsidiaries, Citi Profit Investment Holding Limited (“Citi Profit BVI”), Highlights Culture Holding Co., Limited (“Highlight HK”), Shanghai Highlight Entertainment Co., Ltd. (“Highlight WFOE”) are holding companies with no material operations.

SH Xianzhui was incorporated by Highlight WFOE and two other shareholders on August 10, 2023. SH Xianzhui is principally engaged in the provision of social media marketing agency service. Highlight WFOE initially owned 60% of the total equity interest of SH Xianzhui. On October 27, 2023, the Company entered into an equity purchase agreement with Highlight WFOE and Beijing Hehe Property Management Co., Ltd. (“Beijing Hehe”), which was amended on November 10, 2023 (such equity purchase agreement, as amended, the “Agreement” for purpose of this section “Investment in JV”), pursuant to which the Highlight WFOE agreed to purchase 13.3333% of the equity interest in SH Xianzhui from Beijing Hehe and the Company agreed to issue 400,000 shares of common stock of the Company, valued at $2.7820 per share, the average closing bid price of the common stock of GDC as of the five trading days immediately preceding the date of the Agreement, to Beijing Hehe or its assigns. On January 11, 2024, the Company issued the 400,000 shares of its common stock, at the price of $2.5 per share, to Beijing Hehe and the transaction was completed. Up to the date of this unaudited interim condensed consolidated financial statements were issued, the Company owns 73.3333% of the total equity interest of SH Xianzhui.

AI Catalysis is a Nevada corporation, incorporated on May 18, 2023. AI Catalysis is expected to bridge the realms of the internet, media, and artificial intelligence (“AI”) technologies. Positioned at the crossroads of traditional and streaming media, AI Catalysis plans to elevate the experience of media with AI-based interactive and smart content, aiming to transform the whole media landscape. At present, AI Catalysis primarily focused on the application of AI digital human technology with the sectors of e-commerce and entertainment to improve the interaction experiences online. AI Catalysis strives to deliver stable interactive livestreaming products to AI Catalysis’ users. AI Catalysis foresees future expansion to a variety of business sectors with AI applications in different scenarios. AI Catalysis plans to enter into the livestreaming market with a focus on e-commerce and livestreaming interactive game.

The accompanying unaudited interim condensed consolidated financial statements reflect the activities of GDC and each of the following entities:

Name |  | Background |  | Ownership
Citi Profit BVI |  | ● | A British Virgin Island company Incorporated in April 2019 |  | 100% owned by the Company
Highlight HK |  | ● | A Hong Kong company |  | 100% owned by Citi Profit BVI
|  | ● | Incorporated in November 2022 |  |
Highlight WFOE |  | ● | A PRC limited liability company and deemed a wholly foreign owned enterprise (WFOE) |  | 100% owned by Highlight HK
|  | ● | Incorporated in January 2023 |  |
AI Catalysis |  | ● | A Nevada company |  | 100% owned by the Company
|  | ● | Incorporated in May 2023 |  |
SH Xianzhui |  | ● | A PRC limited liability company |  | 73.3333% owned by Highlight WFOE
|  | ● | Incorporated in August 2023 |  |

As of the date of this report, the Company’s primary operations are focused on the live streaming market with focus on e-commerce in the United States through its subsidiaries AI Catalysis and SH Xianzhui.

F-6

Liquidity and Capital Resources

As of March 31, 2025, the Company had $51,236 in its operating bank accounts and working capital deficit of approximately $1.5 million. From September 2024 to January 2025, Mr. Xiaojian Wang, the Chief Executive Officer of the Company (“CEO”), lent $399,485 to the Company through six loan agreements, for working capital purposes. Pursuant to the loan agreements, these loans are non-interest bearing and will be due on September 18, 2025, September 20, 2025, October 4, 2025, October 23, 2025, December 16, 2025 and January 31, 2026, respectively. On each of March 10, 2025 and March 18, 2025, the Company repaid $100,000, for an aggregated of $200,000 to the CEO, reducing the outstanding loan balance to $199,485 as of March 31, 2025. Subsequent to March 31, 2025, the Company repaid $199,485 in full to the CEO. Up to the date of the unaudited interim condensed consolidated financial statements were issued, there was no outstanding loan from the CEO.

On January 23, 2025, Green Oasis Limited, a shareholder holding less than 5% ownership shares in the Company, provided a $100,000 loan to the Company, for working capital purposes. According to the loan agreement, the loan was non-interest-bearing and was due for repayment on April 23, 2025. On April 25, 2025, Green Oasis Limited and the Company executed an amendment to the previous loan, extending the maturity date to July 23, 2025.

On March 4, 2025, the Company sold 1,115,600 shares of common stock at $0.896379 per share, generating gross proceeds of $1,000,000. The Company received net proceeds of $910,000 after deducting underwriter’s fees of $70,000 and a $20,000 reimbursement for the underwriter’s legal counsel and due diligence analysis expenses. The Company intends to use the proceeds from the offering for working capital purposes.

On May 2, 2025, the Company completed a securities offering in which it agreed to sell (i) 1,115,600 shares of its common stock at a purchase price of approximately $0.524 per share and (ii) 9,380,582 pre-funded warrants at a purchase price of approximately $0.523 per warrant. The aggregate gross proceeds from the offering will be $5,500,000. Up to the date of the unaudited condensed interim financial statements were issued, The Company received $4,478,000 in proceeds for subscription of 1,115,600 shares of its common stock and 7,468,536 pre-funded warrants. The offering remains ongoing and has not yet been fully completed. Transaction costs incurred through the reporting date included underwriter’s fees of $313,460 and a $20,000 reimbursement for the underwriter’s legal counsel and due diligence expenses. Net proceeds from the offering, after deducting these expenses, will be $5,095,000. The Company intends to use the proceeds from the offering for working capital purposes.

The Company evaluated its ability to continue as a going concern in accordance with ASC Subtopic 205-40, Presentation of Financial Statements—Going Concern, which requires management to assess whether there is substantial doubt about the Company’s ability to continue as a going concern within one year after the date the financial statements are issued.

As of March 31, 2025, the Company had cash of $51,236 and a working capital deficit of approximately $1.5 million. However, on May 2, 2025, the Company completed a public offering and partially received net proceeds of approximately $4.1 million. After considering the impact of this financing and the Company’s projected operating cash flows, management reassessed its liquidity position and concluded that the Company will have sufficient liquidity to meet its obligations as they become due for at least the next twelve months from the date the unaudited interim condensed consolidated financial statements are issued. Accordingly, management determined that substantial doubt about the Company’s ability to continue as a going concern no longer exists as of the issuance date of these unaudited interim condensed consolidated financial statements.

Note 2 – Summary of Significant Accounting Policies

Basis of Presentation

The accompanying unaudited interim condensed consolidated financial statements reflect all adjustments that, in the opinion of management, are of a normal recurring nature and are necessary to fairly present the financial statements for the interim periods. The unaudited interim condensed consolidated financial statements are presented in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and have been prepared in accordance with the regulations of the Securities and Exchange Commission (“SEC”) for interim financial statements. Results for the interim periods are not necessarily indicative of results to be expected for the full year. These unaudited interim condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related notes thereto included in the Company’s annual report on Form 10-K for the year ended December 31, 2024, which was filed with the SEC on March 18, 2025.

F-7

Principles of Consolidation

The unaudited interim condensed consolidated financial statements of the Company include the accounts of GDC and its wholly owned subsidiaries. All intercompany transactions and balances are eliminated upon consolidation.

Use of Estimates and Assumptions

The preparation of unaudited interim condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities as of the date of the unaudited interim condensed consolidated financial statements and the reported amounts of revenues and expenses during the periods presented. Significant accounting estimates reflected in the Company’s unaudited interim condensed consolidated financial statements include the useful lives of intangible assets and equipment, impairment of long-lived assets, collectability of receivables, discount rate used to measure present value of lease liabilities and valuation allowance for deferred tax assets. Actual results could differ from these estimates.

Foreign Currency Translation and Transactions

The reporting currency of the Company is the U.S. dollar. The PRC subsidiaries of the Company conduct their businesses in the local currency, Renminbi (RMB), as its functional currency. Assets and liabilities are translated at the unified exchange rate as quoted set forth in the H.10 statistical release of the Federal Reserve Board at the end of the period. The statements of operations accounts are translated at the average translation rates and the equity accounts are translated at historical rates. Translation adjustments resulting from this process are included in accumulated other comprehensive income. Transaction gains and losses that arise from exchange rate fluctuations on transactions denominated in a currency other than the functional currency are included in the results of operations as incurred.

Translation adjustments included in accumulated other comprehensive income amounted to $213,577 and $213,571 as of March 31, 2025 and December 31, 2024, respectively. The consolidated balance sheets amounts, with the exception of shareholders’ equity at March 31, 2025 and December 31, 2024 were translated at 7.26 RMB and 7.30 RMB to $1.00, respectively. The shareholders’ equity accounts were stated at their historical rate. The average translation rates applied to unaudited interim condensed consolidated statements of operations accounts for the three months ended March 31, 2025 and 2024 were 7.27 RMB and 7.19 RMB to $1.00, respectively. The unaudited interim condensed consolidated statements of cash flows are also translated at average translation rates for the periods, therefore, amounts reported on the unaudited interim condensed consolidated statements of cash flows will not necessarily agree with changes in the corresponding balances on the consolidated balance sheets.

The PRC government imposes significant exchange restrictions on fund transfers out of the PRC that are not related to business operations. These restrictions have not had a material impact on the Company because it has not engaged in any significant transactions that are subject to the restrictions.

Cash and Cash Equivalents

As of March 31, 2025 and December 31, 2024, the Company did not have any cash equivalents. All cash were unrestricted as to withdrawal and use and were demand deposits placed with commercial banks.

F-8

Prepaid and Other Current Assets

Prepaid and other current assets are advances paid to outside vendors for services purchases. The Company has legally binding contracts with its vendors, which require any outstanding prepayments to be returned to the Company when the contract ends.

Equipment

Equipment was stated at cost less accumulated depreciation. Depreciation is computed using the straight-line method after consideration of the estimated useful lives of the assets and estimated residual value. The estimated useful lives and residual value are as follows:

|  | Useful Life |  | Estimated Residual Value |
Office equipment and furnishing |  | 5 years |  |  | 5 | %

The cost and related accumulated depreciation of assets sold or otherwise retired are eliminated from the accounts and any gain or loss is included in the unaudited interim condensed consolidated statements of operations and comprehensive loss. Expenditure for maintenance and repairs are charged to earnings as incurred, while additions, renewals and betterments, which are expected to extend the useful life of assets, are capitalized. The Company also re-evaluates the periods of depreciation to determine whether subsequent events and circumstances warrant revised estimates of useful lives.

Intangible Assets

Intangible assets represent software copyright that are stated at cost, less accumulated amortization. Research and development costs associated with internally developed patents are expensed when incurred. Amortization expense is recognized on the straight-line basis over the estimated useful lives of the assets. The software copyrights have finite useful lives and are amortized using a straight-line method that reflects the estimated pattern in which the economic benefits of the intangible asset are to be consumed. The Company amortizes the cost of software copyrights, over their useful life using the straight-line method. The Company also re-evaluates the periods of amortization to determine whether subsequent events and circumstances revised estimates of useful lives. The estimated useful life is as follows:

|  | Useful Life
Software copyrights |  | 5 years

Lease

The Company determines if an arrangement is a lease at inception. Leases that transfer substantially all of the benefits and risks incidental to the ownership of assets are accounted for as finance leases as if there was an acquisition of an asset and incurrence of an obligation at the inception of the lease. All other leases are accounted for as operating leases. The Company has no significant finance leases.

F-9

The Company recognizes lease liabilities and corresponding right-of-use assets on the balance sheet for leases. Operating lease right- of-use assets (the “ROU”) are disclosed as non-current assets in the Company’s consolidated balance sheets. Current maturities of operating lease liabilities are classified as operating lease liabilities - current, and operating lease liabilities that will be due in more than one year are disclosed as non-current liabilities on the consolidated balance sheets. Operating lease right-of-use assets and operating lease liabilities are initially recognized based on the present value of future lease payments at lease commencement. The operating lease right-of-use asset also includes any lease payments made prior to lease commencement and the initial direct costs incurred by the lessee and is recorded net of any lease incentives received. As the interest rates implicit in most of the leases are not readily determinable, the Company uses the incremental borrowing rates based on the information available at lease commencement to determine the present value of the future lease payments. Operating lease expenses are recognized on a straight-line basis over the term of the lease.

Most leases have initial terms ranging from 1.1 to 5.4 years. The Company’s lease agreements did not include non-lease components. Lease expense for fixed lease payments is recognized on a straight-line basis over the lease term. The Company’s lease agreements do not contain any significant residual value guarantees or restricted covenants.

The Company evaluates the carrying value of ROU assets if there are indicators of impairment and reviews the recoverability of the related asset group.

The Company reassesses of a contract is or contains a leasing arrangement and re-measures ROU assets and liabilities upon modification of the contract. The Company will derecognize ROU assets and liabilities, with difference recognized in the income statement on the contract termination.

Impairment for Long-lived Assets

Long-lived assets, including equipment, intangible assets with finite lives and ROU assets are reviewed for impairment whenever events or changes in circumstances (such as a significant adverse change to market conditions that will impact the future use of the assets) indicate that the carrying value of an asset may not be recoverable individually or as a group at the lowest level for which there are identifiable cash flows that are largely independent of the cash flows of the other assets and liabilities. The Company assesses the recoverability of the assets (or group of assets) based on the undiscounted future cash flows the assets (or group of assets) are expected to generate and recognize an impairment loss when estimated undiscounted future cash flows expected to result from the use of the asset (or group of assets) plus net proceeds expected from disposition of the asset (or group of assets), if any, are less than the carrying value of the asset (or group of assets). If an impairment is identified, the Company would reduce the carrying amount of the asset (or group of assets) to its estimated fair value based on a discounted cash flows approach or, when available and appropriate, to comparable market values. The carrying amount of the asset (or the long-lived assets in the asset group on a pro rata basis using the relative carrying amounts) is reduced to the extent not lower than the fair value of the asset. The adjusted carrying amounts after an impairment charge represent the new cost basis and is depreciated over their remaining useful lives.

Fair Value Measurement

The accounting standard regarding fair value of financial instruments and related fair value measurements defines financial instruments and requires disclosure of the fair value of financial instruments held by the Company. The Company considers the carrying amount of cash, other receivables, other payables and accrued liabilities to approximate their fair values because of their short-term nature.

F-10

The accounting standards define fair value, establish a three-level valuation hierarchy for disclosures of fair value measurement and enhance disclosure requirements for fair value measures. The three levels are defined as follow:

| ● | Level 1 inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets.

| ● | Level 2 inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the assets or liability, either directly or indirectly, for substantially the full term of the financial instruments.

| ● | Level 3 inputs to the valuation methodology are unobservable and significant to the fair value.

As of March 31, 2025 and December 31, 2024, the carrying values of cash, other receivables and other payables approximate their fair values due to the short-term nature of the instruments.

Selling and Marketing Expenses

Selling and marketing expenses mainly consist of marketing related expenses.

General and Administrative Expenses

General and administrative expenses mainly consist of (i) staff cost, rental and depreciation related to general and administrative personnel, (ii) professional expenses.

Research and Development Expenses

Research and development expenses mainly consist of outsourced research and development expenses. Research and development expenses are expensed as incurred.

Income Taxes

The Company accounts for income taxes in accordance with U.S. GAAP. The charge for taxation is based on the results for the fiscal year as adjusted for items, which are non-assessable or disallowed. It is calculated using tax rates that have been enacted or substantively enacted by the balance sheet date.

Deferred taxes are accounted for using the asset and liability method in respect of temporary differences arising from differences between the carrying amount of assets and liabilities in the unaudited interim condensed consolidated financial statements and the corresponding tax basis used in the computation of assessable tax profit. In principle, deferred tax liabilities are recognized for all taxable temporary differences. Deferred tax assets are recognized to the extent that it is probable that taxable profit will be available against which deductible temporary differences can be utilized. Deferred tax is calculated using tax rates that are expected to apply to the period when the asset is realized or the liability is settled. Deferred tax is charged or credited in the income statement, except when it is related to items credited or charged directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Current income taxes are provided for in accordance with the laws of the relevant taxing authorities.

An uncertain tax position is recognized as a benefit only if it is “more likely than not” that the tax position would be sustained in a tax examination, with a tax examination being presumed to occur. The amount recognized is the largest amount of tax benefit that is greater than 50% likely of being realized on examination. For tax positions not meeting the “more likely than not” test, no tax benefit is recorded. Penalties and interest incurred related to underpayment of income tax are classified as income tax expense in the period incurred. For the three months ended March 31, 2025, the Company recorded $57,303 penalty and interest for failed filing the tax return timely, consisting of $15,982 interest and $41,321 penalty. For the three months ended March 31, 2024, the Company did not record any penalty and interest for failed filing the tax return timely.

F-11

Interest

Interest income is mainly generated from bank deposits and other interest earning financial assets and is recognized on an accrual basis using the effective interest method.

Net Loss per Common Stock

Basic loss per share is computed by dividing loss available to common shareholders of the Company by the weighted average common stocks outstanding during the period. Diluted loss per share takes into account the potential dilution that could occur if securities or other contracts to issue common stocks were exercised and converted into common stocks.

In May 2023 and November 2023, the Company issued and sold pre-funded warrants that are exercisable for shares of common stock at a nominal exercise price. In accordance with ASC 260, these prefunded warrants are considered to be common stock equivalents and are included in the calculation of basic and diluted earnings per share when the inclusion is dilutive. As the exercise price of the prefunded warrants is nominal and substantially all conditions necessary to exercise the warrants have been met, the prefunded warrants are included in the weighted average shares outstanding for both basic and diluted loss per share. As of March 31, 2025, all pre-funded warrants as described were exercised.

For the three months ended March 31, 2025 and 2024, 2,312,006 and 7,309,181 of outstanding warrants (excluding the Pre-funded Warrants and Exchange Warrants) which are equivalent to convertible of 2,110,618 and 3,080,017 common stocks, respectively, were excluded from the diluted loss per share calculation due to their antidilutive effect.

Comprehensive Loss

Comprehensive loss is defined as the changes in equity of the Company during a year from transactions and other events and circumstances excluding transactions resulting from investments by owners and distributions to owners. Accumulated other comprehensive income of the Company includes the foreign currency translation adjustments and unrealized gains or loss on available-for-sale investments.

Recently Accounting Pronouncements

In November 2023, the FASB issued ASU 2023-07, “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures”, which is intended to improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. The purpose of the amendment is to enable investors to better understand an entity’s overall performance and assess potential future cash flows. The guidance is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted. The guidance is to be applied retrospectively to all prior periods presented in the financial statements. The Company adopted ASU 2023-07 for the year ended December 31, 2024. The adoption has no significant impact on the Company’s financial statements and disclosure.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (ASU 2023-09), which requires disclosure of incremental income tax information within the rate reconciliation and expanded disclosures of income taxes paid, among other disclosure requirements. ASU 2023-09 is effective for fiscal years beginning after December 15, 2024. Early adoption is permitted. The Company’s management does not believe the adoption of ASU 2023-09 will have a material impact on its financial statements and disclosures.

In November 2024, the FASB issued ASU No. 2024-03, Disaggregation of Income Statement Expenses. This new guidance is designed to improve the disclosures about the types of expenses, including employee compensation, depreciation, and amortization, and costs incurred related to inventory and manufacturing activities. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027 on a prospective basis with optional retrospective application. Early adoption is permitted. The Company is currently assessing the impact that adopting this new accounting standard will have on its consolidated financial statements.

The Company does not believe other recently issued but not yet effective accounting standards, if currently adopted, would have a material effect on the Company’s unaudited interim condensed consolidated balance sheets, unaudited interim condensed consolidated statements of operations and comprehensive loss and unaudited interim condensed consolidated statements of cash flows.

F-12

Note 3 – Prepaid and Other Current Assets

Prepaid and other current assets consisted of the following as of March 31, 2025 and December 31, 2024:

|  | March 31, 2025 |  |  | December 31, 2024 |
|  | (unaudited) |  |  |  |
Prepaid car rental |  | $ | 15,579 |  |  | $ | - |
Total prepaid and other current assets |  | $ | 15,579 |  |  | $ | - |

Note 4 – Equipment, net

Equipment, net consisted of the following as of March 31, 2025 and December 31, 2024:

|  | March 31, 2025 |  |  | December 31, 2024 |
|  | (unaudited) |  |  |  |
Office equipment and furniture |  | $ | 14,190 |  |  | $ | 14,190 |
Less: accumulated depreciation |  |  | (7,486 | ) |  |  | (6,409 | )
Total |  | $ | 6,704 |  |  | $ | 7,781 |

Depreciation expense for the three months ended March 31, 2025 and 2024 amounted to $1,077 and $1,183, respectively.

Note 5 – Intangible Assets, net

Intangible assets consisted of the following as of March 31, 2025 and December 31, 2024:

|  | March 31, 2025 |  |  | December 31, 2024 |
|  | (unaudited) |  |  |  |
Software copyrights |  | $ | 4,890,092 |  |  | $ | 4,890,092 |
Subtotal |  |  | 4,890,092 |  |  |  | 4,890,092 |
Less: accumulated amortization |  |  | (1,098,918 | ) |  |  | (1,036,518 | )
Accumulated impairment |  |  | (2,751,174 | ) |  |  | (2,751,174 | )
Total |  | $ | 1,040,000 |  |  | $ | 1,102,400 |

Amortization expense for the three months ended March 31, 2025 and 2024 was $62,400 and $182,373, respectively.

As of March 31, 2025, the net book value of software copyrights was $1,040,000, after deducting accumulated amortization of $208,000. No impairment losses were recorded for the three months ended March 31, 2025 and 2024.

Future amortization of intangible assets are as follows:

|  | Amortization |
Remaining of FY2025 |  |  | 187,200 |
FY2026 |  |  | 249,600 |
FY2027 |  |  | 249,600 |
FY2028 |  |  | 249,600 |
FY2029 |  |  | 104,000 |
Total future amortization of intangible assets |  | $ | 1,040,000 |

F-13

Note 6 – Other Payables and Accrued Liabilities

Other payables and accrued liabilities consisted of the following as of March 31, 2025 and December 31, 2024:

|  | March 31, |  |  | December 31, |
|  | 2025 |  |  | 2024 |
|  | (unaudited) |  |  |  |
Professional service fee |  | $ | 431,598 |  |  | $ | 375,085 |
Payroll |  |  | 17,943 |  |  |  | 26,558 |
Loan payable - shareholder |  |  | 100,000 |  |  |  | - |
Others |  |  | 998 |  |  |  | 178 |
Total |  | $ | 550,539 |  |  | $ | 401,821 |

Note 7 – Related Party Balances and Transactions

Other payables – related parties:

Name of related party |  | Relationship |  | Nature |  | March 31, 2025 |  |  | December 31, 2024 |
|  |  |  |  |  | (unaudited) |  |  |  |
Xiaojian Wang |  | Chief Executive Officer |  | Accrued compensations |  | $ | 62,500 |  |  | $ | 50,000 |
Xiaojian Wang |  | Chief Executive Officer |  | Interest-free loans to the Company* |  |  | 199,485 |  |  |  | 349,485 |
Xiaojian Wang |  | Chief Executive Officer |  | Operating related fees paid on behalf of the Company |  |  | 50,000 |  |  |  | 50,000 |
Zihao Zhao |  | Chief Finance Officer |  | Accrued compensations |  |  | 58,333 |  |  |  | 50,833 |
Zihao Zhao |  | Chief Finance Officer |  | Reimbursement |  |  | 1,958 |  |  |  | 1,948 |
Total |  |  |  |  |  | $ | 372,276 |  |  | $ | 502,266 |

* | The terms of these loans are disclosed in Note 1- Liquidity and Capital Resources.

As of March 31, 2025 and December 31, 2024, the balance of other payables - related parties were $372,276 and $502,266, respectively, mainly consisted of accrued compensation of the Company’s officers and interest- free loans received from the Company’s officers. Up to the date the unaudited interim condensed consolidated financial statements were issued, the interest-free loans received from the Company’s officers were fully repaid.

For the three months ended March 31, 2025 and 2024, the Company recorded compensation expenses to its officers amounted to $20,000 and $20,000, respectively, for their services provided to the Company.

Note 8– Leases

Leases are classified as operating leases or finance leases in accordance with ASC 842 Leases. The Company’s operating leases mainly related to the rights to use building and office facilities. For leases with terms greater than 12 months, the Company records the related asset and liability at the present value of lease payments over the term. Certain leases include rental escalation clauses, renewal options and/or termination options, which are factored into the Company’s determination of lease payments when appropriate.

|  | March 31, 2025 |  |  | December 31, 2024 |
|  | (unaudited) |  |  |  |
Weighted average remaining lease term: |  |  |  |  |  |
Operating lease |  |  | 3.49 years |  |  |  | 3.63 years |
Weighted average discount rate: |  |  |  |  |  |  |  |
Operating lease |  |  | 7.56 | % |  |  | 7.53 | %

F-14

The balances for the operating leases where the Company is the lessee are presented as follows within the consolidated balance sheets:

|  | March 31, 2025 |  |  | December 31, 2024 |
|  | (unaudited) |  |  |  |
Operating lease right-of-use assets, net |  |  |  |  |  |
Operating lease |  | $ | 1,229,793 |  |  | $ | 1,342,333 |
Lease liabilities |  |  |  |  |  |  |  |
Current portion of operating lease liabilities |  |  | 381,434 |  |  |  | 427,984 |
Non-current portion of operating lease liabilities |  |  | 1,026,387 |  |  |  | 1,104,552 |
|  | $ | 1,407,821 |  |  | $ | 1,532,536 |

Future lease payments under operating leases as of March 31, 2025 were as follows:

|  | Operating Leases |
FY2025 |  |  | 371,061 |
FY2026 |  |  | 393,261 |
FY2027 |  |  | 401,127 |
FY2028 |  |  | 409,149 |
FY2029 |  |  | 34,605 |
Total lease payments |  | $ | 1,609,203 |
Less: imputed interest |  |  | 201,382 |
Present value of lease liabilities (1) |  | $ | 1,407,821 |

(1) | As of March 31, 2025, present value of future operating lease payments consisted of current portion of operating lease liabilities and non-current portion of operating lease liabilities, amounting to $381,434 and $1,026,387, respectively.

Lease expense for all the Company’s operating leases for the three months ended March 31, 2025 and 2024 were $123,492 and $95,057, respectively. Lease payments for all the Company’s operating leases for the three months ended March 31, 2025 and 2024 were $164,656 and $120,677, respectively.

Note 9 – Taxes

Income Tax

United States

GDC and AIC are corporations organized in the state of Nevada and operate primarily in the state of New York. As a result, they are subject to U.S. federal corporate income tax as well as state and local income taxes in New York.

For the three months ended March 31, 2025 and 2024, the applicable statutory tax rates were as follows:

| ● | Federal corporate income tax rate: 21%;

| ● | New York State corporate income tax rate: 6.5%;

| ● | New York City business corporation tax rate: 8.85%;

| ● | Metropolitan Transportation Business Tax Surcharge (MTA Tax): 30% of the New York State corporate franchise tax liability;

F-15

The Company’s effective tax rate may differ from the statutory rates due to various factors, including non-deductible expenses, tax credits, valuation allowances, and the impact of state and local taxes. Additionally, the Company evaluates uncertain tax positions in accordance with ASC 740, recognizing tax benefits only if it is more likely than not that the position will be sustained upon examination.

British Virgin Islands

Citi Profit BVI is incorporated in the British Virgin Islands and are not subject to tax on income or capital gains under current British Virgin Islands law. In addition, upon payments of dividends by these entities to their shareholders, no British Virgin Islands withholding tax will be imposed.

Hong Kong

Highlight HK is incorporated in Hong Kong and are subject to Hong Kong Profits Tax on the taxable income as reported in its statutory financial statements adjusted in accordance with relevant Hong Kong tax laws. Highlight HK is subject to Hong Kong profit tax at a rate of 8.25% for assessable profits on the first HK$2 million and 16.5% for any assessable profits in excess of HK$2 million for the three months ended March 31, 2025 and 2024. The Company did not make any provisions for Hong Kong profit tax as there were no assessable profits derived from or earned in Hong Kong since inception.

PRC

Highlight WFOE and SH Xianzhui are governed by the income tax laws of the PRC and the income tax provision in respect to operations in the PRC is calculated at the applicable tax rates on the taxable income for the periods based on existing legislation, interpretations and practices in respect thereof. Under the Enterprise Income Tax Laws of the PRC (the “EIT Laws”), Chinese enterprises are subject to income tax at a rate of 5% after appropriate tax adjustments.

The current and deferred components of income tax expenses from continuing operations appearing in the unaudited interim condensed consolidated statements of operations are as follows:

|  | For the three months ended March 31, |
|  | 2025 |  |  | 2024 |
Current tax expenses |  | (unaudited) |  |  | (unaudited) |
Federal |  | $ | (20,000 | ) |  | $ | - |
State |  |  | (105,707 | ) |  |  | - |
Total current tax expenses |  | $ | (125,707 | ) |  | $ | - |
Deferred tax benefits (expenses) |  |  |  |  |  |  |  |
Federal |  | $ | 83,956 |  |  | $ | (1,038 | )
State |  |  | - |  |  |  | - |
Total deferred tax benefits (expenses) |  | $ | 83,956 |  |  | $ | (1,038 | )
Total benefits (provision) for income taxes |  | $ | (41,751 | ) |  | $ | (1,038 | )

F-16

The Company is subject to U.S. federal income tax as well as state income tax in certain jurisdictions. The tax years 2022 to 2024 remain open to examination by the major taxing jurisdictions to which the Company is subject. The following is a reconciliation of income tax expenses at the effective rate to income tax at the calculated statutory rates:

|  | March 31, 2025 |  |  | March 31, 2024 |
(unaudited) |  | (unaudited) |
Statutory tax rate |  |  |  |  |  |
Federal |  |  | 21.00 | % |  |  | 21.00 | %
State (net of federal benefit) |  |  | 13.37 | % |  |  | - |
Foreign tax |  |  | (0.00 | )% |  |  | (2.58 | )%
Amortization of intangible assets |  |  | (21.19 | )% |  |  | - |
Change in valuation allowance |  |  | (14.34 | )% |  |  | (18.42 | )%
Others |  |  | 5.62 | % |  |  | 0.02 | %
Effective tax rate |  |  | 4.46 | % |  |  | 0.02 | %

As of March 31, 2025 and December 31, 2024, income tax payable to US tax authorities was $267,517 and $141,810, respectively. As of March 31, 2025 and December 31, 2024, no income tax was payable to Chinese tax authorities.

The principal components of the Company’s deferred income tax assets and liabilities as of March 31, 2025 and December 31, 2024 were as follows:

|  | March 31, |  |  | December 31, |
|  | 2025 |  |  | 2024 |
|  | (unaudited) |  |  |  |
Deferred tax assets |  |  |  |  |  |
Net operating losses carried forward |  | $ | 6,316,397 |  |  | $ | 6,105,138 |
Provision of credit loss on note receivable and loan receivable |  |  | 1,092,011 |  |  |  | 1,092,011 |
Impairment loss of intangible assets |  |  | 845,008 |  |  |  | 845,008 |
Lease liability |  |  | 487,997 |  |  |  | 605,169 |
Total deferred tax assets |  | $ | 8,741,413 |  |  | $ | 8,647,326 |
Less: Valuation allowance |  |  | (8,583,371 | ) |  |  | (8,020,571 | )
Deferred tax assets, net of valuation allowance |  | $ | 158,042 |  |  | $ | 626,755 |
Deferred tax liabilities |  |  |  |  |  |  |  |
Right - Of - Use assets |  | $ | (426,292 | ) |  | $ | (465,347 | )
Amortization of intangible assets |  |  | 198,295 |  |  |  | (315,319 | )
Total deferred tax liabilities |  | $ | (227,997 | ) |  | $ | (780,666 | )
Total deferred tax liabilities, net |  | $ | (69,955 | ) |  | $ | (153,911 | )

As of March 31, 2025, the Group had tax losses carry forwards of approximately $5.3 million from the entity in the PRC. The tax loss in the PRC can be carried forward for five years to offset future taxable profit and which will expire between 2028 and 2029 if not utilized. As of March 31, 2025, the Group had tax losses carry forwards of approximately $17.5 million from the entities in the U.S. The tax loss in the U.S. can be carried forward indefinitely.

Management believes that the realization of the benefits from these losses appears uncertain due to the Company’s operating history and continued losses in the United States. Accordingly, the Company has provided a 100% valuation allowance on the deferred tax asset to reduce the asset to zero. Management reviews this valuation allowance periodically and makes changes accordingly.

Note 10 – Concentration of Credit Risk

Financial instruments that potentially subject the Company to concentration of credit risk consist principally of cash deposits.

Accounts at each institution are insured by the Federal Deposit Insurance Corporation (“FDIC”) up to $250,000. At March 31, 2025 and December 31, 2024, the Company did not have any cash excess of the FDIC insured limit. As of March 31, 2025 and December 31, 2024, $3,222 and $3,267 were deposited with a financial institution located in the PRC, respectively. While management believes that these financial institutions are of high credit quality, it also continually monitors their credit worthiness.

F-17

Note 11 – Equity

Statutory Reserves and Restricted Net Assets

In accordance with the PRC Regulations on Enterprises with Foreign Investment, an enterprise established in the PRC with foreign investment is required to make appropriations to certain statutory reserves, namely a general reserve fund, an enterprise expansion fund, a staff welfare fund and a bonus fund, all of which are appropriated from net profit as reported in its PRC statutory accounts. A foreign invested enterprise is required to allocate at least 10% of its annual after-tax profits to a general reserve fund until such fund has reached 50% of its respective registered capital. Appropriations to the enterprise expansion fund and staff welfare and bonus funds are at the discretion of the board of directors for the foreign invested enterprises. For other subsidiaries incorporated in the PRC, the general reserve fund was appropriated based on 10% of net profits as reported in each subsidiary’s PRC statutory accounts. General reserve and statutory surplus funds are restricted to set-off against losses, expansion of production and operation and increasing registered capital of the respective company. Staff welfare and bonus fund and statutory public welfare funds are restricted to capital expenditures for the collective welfare of employees. The reserves are not allowed to be transferred to the Company in terms of cash dividends, loans or advances, nor are they allowed for distribution except under liquidation. As of March 31, 2025 and December 31, 2024, there are no balance of the PRC statutory reserve funds.

In addition, under PRC laws and regulations, the Company’s PRC subsidiaries are restricted in their ability to transfer their net assets to the Company in the form of dividend payments, loans or advances. Amounts of restricted net assets include paid up capital and statutory reserve funds of the Company’s PRC subsidiaries. As of March 31, 2025 and December 31, 2024, the Company did not have any restricted net assets.

Furthermore, cash transfers from the Company’s PRC subsidiaries to the Company’s subsidiaries outside of the PRC are subject to the PRC government control of currency conversion. Shortages in the availability of foreign currency may restrict the ability of the Company’s PRC subsidiaries to remit sufficient foreign currency to pay dividends or other payments to the Company, or otherwise satisfy their foreign currency denominated obligations.

Common Stock

On January 11, 2024, the Company issued the 400,000 shares of its common stock to Beijing Hehe for exchange of 13.3333% of the total equity interest of SH Xianzhui (as described in Note 1).

In March 2024, the Company entered into a placement agency agreement (the “March 2024 Placement Agency Agreement”), with Univest Securities, LLC (“Univest”), pursuant to which, Univest agrees to use its reasonable best efforts to sell the Company’s common stock in a registered direct offering and a concurrent private placement (the “March 2024 Offering”). Univest has no obligation to buy any of the securities from the Company or to arrange for the purchase or sale of any specific number or dollar amount of securities.

Pursuant to the March 2024 Offering, an aggregate of 810,277 shares of common stock of the Company, par value $0.0001 per share, were sold to certain purchasers (the “March 2024 Offering Purchasers”), pursuant to a securities purchase agreement, dated March 22, 2024 (the “March 2024 Securities Purchase Agreement”) at a price of $1.144 per common stock, for aggregated proceeds of approximately $0.9 million. The Company paid Univest a cash fee equal to 4.0% of the aggregate gross proceeds raised in the March 2024 Offering. The Company also issued warrants to Univest to purchase up to 40,514 shares of common stock of the Company at an exercise price of $1.373 per share, (the “March 2024 Placement Agent Warrants”). The March 2024 Placement Agent Warrants and the common stock underlying the March 2024 Placement Agent Warrants were not registered under the Securities Act, pursuant to the registration statement of March 2024 Offering. The March 2024 Placement Agent Warrants were issued pursuant to an exemption from the registration requirements of the Securities Act provided in Section 4(a)(2) of the Securities Act and/or Regulation D promulgated thereunder.

On May 31, 2024, the Company entered into a software purchase agreement with Shanxi Gangdong Cultural Media Co., Ltd., a seller unaffiliated with the Company (the “SGCM”). Pursuant to the agreement, the Company agreed to purchase and SGCM agreed to sell all of SGCM’s right, title, and interest in and to the certain software. The purchase price of the software shall be $1,248,000, payable in the form of issuance of 1,560,000 shares of common stock of the Company, valued at $0.80 per share. The Company plans to use the software to develop its AI business. On June 4, 2024, the Company issued 1,560,000 shares of common stock of the Company to the SGCM’s designees and the transaction was completed.

F-18

From February 2024 to October 2024, 1,489,385 shares of the Company’s common stock were issued due to the exercise of pre-funded warrants, that were sold in the fiscal year 2023.

From March 2024 to October 2024, 1,361,460 shares of the Company’s common stock were issued due to the exercise of 1,695,885 registered warrants issued in November 2023 (the “November 2023 Registered Warrants”) .

In August 2024, 92,756 shares of the Company’s common stock were issued due to the exercise of 54,646 registered warrants and 84,244 unregistered warrants that were issued in the fiscal year 2021.

On February 10, 2025, the Company entered into an At-The-Market Issuance Sales Agreement (the “ATM Agreement”) with Univest as the sales agent (the “February 2025 Offering”). Pursuant to the ATM Agreement, the Company may issue and sell from time to time, shares of its common stock having an aggregate offering price of not more than $10,000,000 through the sales agent or any of its sub-agent(s) or other designees, acting as sales agent. Up to the date the unaudited interim condensed consolidated financial statements were issued, the Company has not issue or sell any shares under the ATM Agreement.

On March 4, 2025, the Company entered into a securities purchase agreement (the “March 2025 Securities Purchase Agreement”) with certain investors for the sale of 1,115,600 shares of common stock at $0.896379 per share (the “March 2025 Offering”), generating net proceeds in the amount of $910,000, after deducting underwriter’s fees of $70,000, equal to seven percent (7%) of the aggregate gross proceeds raised in this Offering and reimbursement of $20,000 for the underwriter’s legal counsel and due diligence analysis expense. The Company plans to use the proceeds from the offering for working capital purposes.

As of March 31, 2025 and December 31, 2024, the total outstanding shares of the Company’s common stock were 12,282,894 and 11,167,294, respectively.

Warrants

In March 2024, the Company entered into a placement agency agreement (the “March 2024 Placement Agency Agreement”), with Univest, pursuant to which, Univest agrees to use its reasonable best efforts to sell the Company’s common stock in a registered direct offering and a concurrent private placement (the “March 2024 Offering”). Univest has no obligation to buy any of the securities from the Company or to arrange for the purchase or sale of any specific number or dollar amount of securities.

In connection with the March 2024 Offering, the Company issued 40,514 shares of unregistered warrants (the “March 2024 Placement Agent Warrants”) to Univest, at an exercise price of $1.373 per share. The March 2024 Placement Agent Warrants and the common stock underlying the March 2024 Placement Agent Warrants were not registered under the Securities Act, pursuant to the registration statement of March 2024 Offering. The March 2024 Placement Agent Warrants were issued pursuant to an exemption from the registration requirements of the Securities Act provided in Section 4(a)(2) of the Securities Act and/or Regulation D promulgated thereunder.

As of March 31, 2025 and December 31, 2024, 2,312,006 unregistered warrants issued to Univest were outstanding.

From February 2024 to October 2024, holders of 1,489,763 pre-funded warrants, issued in November 2023, exercised their options to purchase 1,489,385 shares of the Company’s common stock. As of March 31, 2025 and December 31, 2024, no prefunded warrants were outstanding.

On March 26, 2024, October 16, 2024 and October 17, 2024, holders of 1,695,885 registered warrants issued in November 2023 (the “November 2023 Registered Warrants”) exercised their options to purchase 1,361,460 shares of the Company’s common stock. As of March 31, 2025 and December 31, 2024, 1,616,471 shares of November 2023 Registered Warrants were outstanding.

In August 2024, holders of 54,646 registered warrants and 84,244 unregistered warrants issued in 2021 exercised their options to purchase 92,756 shares of the Company’s common stock, on a cashless basis. As of March 31, 2025 and December 31, 2024, no warrants issued in 2021 was outstanding.

F-19

The summary of warrant activities for the three months ended March 31, 2025 were as follows:

|  | Warrants |  |  | Exercisable Into Number of |  |  | Weighted Average Exercise |  |  | Average Remaining Contractual |
|  | Outstanding |  |  | Shares |  |  | Price |  |  | Life |
December 31, 2024 |  |  | 2,312,006 |  |  |  | 2,110,618 |  |  | $ | 29.94 |  |  |  | 3.46 |
Granted |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Exercised |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
March 31, 2025 (unaudited) |  |  | 2,312,006 |  |  |  | 2,110,618 |  |  | $ | 29.94 |  |  |  | 3.22 |

The summary of warrant activities for the three months ended March 31, 2024 were as follows:

|  | Warrants |  |  | Exercisable Into Number of |  |  | Weighted Average Exercise |  |  | Average Remaining Contractual |
|  | Outstanding |  |  | Shares |  |  | Price |  |  | Life |
December 31, 2023 |  |  | 9,623,806 |  |  |  | 5,394,642 |  |  | $ | 19.45 |  |  |  | 4.54 |
Granted/Acquired |  |  | 40,514 |  |  |  | 40,514 |  |  |  | 1.37 |  |  |  | 4.99 |
Exercised |  |  | 1,433,067 |  |  |  | 1,433,067 |  |  |  | 0.0001 |  |  |  | - |
March 31, 2024 (unaudited) |  |  | 8,231,253 |  |  |  | 4,002,089 |  |  | $ | 23.11 |  |  |  | 4.23 |

Note 12 – Commitments and Contingencies

Contingencies

From time to time, the Company may be subject to certain legal proceedings, claims and disputes that arise in the ordinary course of business. Although the outcomes of these legal proceedings cannot be predicted, the Company does not believe these actions, in the aggregate, will have a material adverse impact on its financial position, results of operations or liquidity.

Note 13 – Segment Reporting

The Company follows ASC 280, Segment Reporting, which requires that companies disclose segment data based on how management makes decision about allocating resources to segments and evaluating their performance. The Company’s chief operating decision maker, who has been identified as the Company’s chief executive officer, evaluates performance and determines resource allocations based on a number of factors, the primary measure being operating expenses. The Company has adopted the guidance in ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, in the accompanying financial statements using the retrospective method of adoption.

As of March 31, 2025, the Company’s remain business segment and operations is Virtual Content Production. The Company’s unaudited interim condensed consolidated results of operations and unaudited interim condensed consolidated financial position from continuing operations are all attributable to Virtual Content Production; accordingly, management believes that the consolidated balance sheets and unaudited interim condensed consolidated statements of operations and comprehensive loss provide the relevant information to assess Virtual Content Production’s performance.

Note 14 – Subsequent events

The Company evaluated subsequent events and transactions that occurred after the balance sheet date up to May 15, 2025, which is the date that the unaudited interim condensed consolidated financial statements were available to be issued. Based on this review, other than described below, the Company did not identify any subsequent event that would have required adjustment or disclosure in the unaudited interim condensed consolidated financial statements.

F-20

Debt Repayments

Subsequent to March 31, 2025, the Company repaid a total of $200,000 to its Chief Executive Officer. This amount included a repayment of $199,485 for interest-free loans previously provided by the CEO, and $515 for operating-related expenses paid by the CEO on behalf of the Company. These related party transactions are further described in Note 7 to the unaudited interim condensed consolidated financial statements.

Offerings

On May 2, 2025, the Company entered into a securities purchase agreement (the “May 2025 Securities Purchase Agreement”) with certain investors for the sale of 1,115,600 shares of common stock at approximately $0.524 per share and 9,380,582 pre-funded warrants (the “May 2025 Pre-Funded Warrants”) at approximately $0.523 per warrant (the “May 2025 Offering”). Up to the date of the unaudited condensed interim financial statements were issued, The Company received $4,478,000 in proceeds for subscription of 1,115,600 shares of its common stock and 7,468,536 pre-funded warrants. The offering remains ongoing and has not yet been fully completed. Transaction costs incurred through the reporting date included underwriter’s fees of $313,460 and a $20,000 reimbursement for the underwriter’s legal counsel and due diligence expenses. Net proceeds from the offering, after deducting these expenses, will be $5,095,000. The Company intends to use the proceeds from the offering for working capital purposes.

The Company plans to use the net proceeds from the May 2025 offering for working capital purposes. Pursuant to the Pursuant to the May 2025 Securities Purchase Agreement, the Company has agreed to use commercially reasonable efforts to, within sixty (60) calendar days after the date of the May 2025 Securities Purchase Agreement, file a registration statement on the appropriate form providing for the resale by the investors of the May 2025 Offering.

Purchase of Intangible Assets

On April 28, 2025, the Company entered into a software purchase agreement (the “Agreement”) with Gongzheng Xu and Qing Wang, who are unaffiliated with the Company (the “GXQW”). Pursuant to the Agreement, the Company agreed to purchase and the GXQW agreed to sell all of GXQW’s right, title, and interest in and to the certain software (the “Chat Box”). The purchase price of the software shall be payable in the form of issuance of 2,444,295 shares of the Company’s common stock (the “Shares”). On April 29,2025, the Company issued 2,444,295 shares of its common stock to GXQW and the transaction was completed. The Company plans to use the software to develop its AI business.

The Company is evaluating the accounting treatment of this transaction and will recognize accordingly.

Warrants Exercise

On April 30, 2025, holders of 1,051,341 registered November 2023 Registered Warrants exercised their options to purchase 952,644 shares of the Company’s common stock, on a cashless basis, resulting 565,130 shares of November 2023 Registered Warrants were outstanding up to the date the unaudited interim consolidated financial statements were issued.

F-21

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis of the results of our operations and financial condition should be read in conjunction with our unaudited condensed financial statements, and the notes to those unaudited condensed financial statements that are included elsewhere in this Report. All monetary figures are presented in U.S. dollars, unless otherwise indicated.

Our Management’s Discussion and Analysis contains not only statements that are historical facts, but also statements that are forward-looking. Forward-looking statements are, by their very nature, uncertain and risky. These risks and uncertainties include international, national, and local general economic and market conditions; our ability to sustain, manage, or forecast growth; our ability to successfully make and integrate acquisitions; new product development and introduction; existing government regulations and changes in, or the failure to comply with, government regulations; adverse publicity; competition; the loss of significant customers or suppliers; fluctuations and difficulty in forecasting operating results; change in business strategy or development plans; business disruptions; the ability to attract and retain qualified personnel; the ability to protect technology; the risk of foreign currency exchange rate; and other risks that might be detailed from time to time in our filings with the SEC.

Although the forward-looking statements in this Report reflect the good faith judgment of our management, such statements can only be based on facts and factors currently known by them. Consequently, and because forward-looking statements are inherently subject to risks and uncertainties, the actual results and outcomes may differ materially from the results and outcomes discussed in the forward-looking statements. You are urged to carefully review and consider the various disclosures made by us in this report as we attempt to advise interested parties of the risks and factors that may affect our business, financial condition, and results of operations and prospects.

Overview

GD Culture Group Limited, formerly known as JM Global Holding Company, TMSR Holding Company Limited and Code Chain New Continent Limited, is a Nevada corporation and a holding company. The Company currently conducts its operations on virtual content production (the “Virtual Content Production”) through the Company and two subsidiaries, AI Catalysis and Shanghai Xianzhui. The Company focuses its business mainly on 1) AI-driven digital human creation and customization; and 2) Live streaming and e-commerce. The company has relentlessly been focusing on serving its customers and creating value for them through the continual innovation and optimization of its products and services. The Company’s current subsidiaries, Citi Profit, Highlight HK, Highlight WFOE are holding companies with no material operations.

SyncWaveX is an AI-powered web-based video generation tool, engineered to enable users to synthesize virtual human videos with precise lip synchronization. Utilization involves text input and selection from a library of integrated character models and auditory profiles. The core technological foundation is comprised of speech synthesis, facial expression emulation, and lip-synchronization algorithms. This solution is primarily directed towards content creators, facilitating the rapid production of spoken-word videos; educational and corporate entities, for the transformation of curricular materials into illustrative video content; e-commerce vendors, for the provision of 24-hour digital broadcast capabilities; and individual users, for the creation of engaging social media content. Foundational functionalities are accessible at no cost, subject to daily generative output constraints. The principal revenue model is predicated upon personalized customization services, wherein users may upload photographic and vocal data to cultivate proprietary digital replicas. Upon depletion of complimentary allocation, a tiered fee structure, contingent on temporal duration or generative frequency, is instituted. The platform also accommodates horizontal and vertical aspect ratios, ensuring cross-platform compatibility, thereby fostering the pervasive integration of AI-driven digital human technology across creative and commercial landscapes.

The Company aims to generate revenue from customization services subscriptions.

2

Recent Development

Investment in Shanghai Xianzhui

On August 10, 2023, Highlight WFOE, Beijing Hehe Property Management Co., Ltd. (“Beijing Hehe”), and a third party, established Shanghai Xianzhui under the laws of the People’s Republic of China for social media marketing. Highlight WFOE owned 60% of the equity interest of Shanghai Xianzhui, Beijing Hehe owned 20% of the equity interest of Shanghai Xianzhui and the third party owned the remaining 20% of the equity interest of Shanghai Xianzhui.

On October 27, 2023, the Company entered into an equity purchase agreement with Highlight WFOE and Beijing Hehe, which was amended on November 10, 2023 (such equity purchase agreement, as amended, the “Agreement” for purpose of this section “Investment in Shanghai Xianzhui”), pursuant to which the Highlight WFOE agreed to purchase 13.3333% equity interest in Shanghai Xianzhui from Beijing Hehe and the Company agreed to issue 400,000 shares of common stock of the Company, valued at $2.7820 per share, the average closing bid price of the common stock of GDC as of the five trading days immediately preceding the date of the Agreement, to Beijing Hehe or its assigns. On January 11, 2024, the Company issued 400,000 shares of its common stock to Beijing Hehe, at the price of $2.5 per share, and the transaction was completed. As of March 31, 2025, the Company owns 73.3333% of the total equity interest of Shanghai Xianzhui.

Offering

On March 26, 2024, the Company issued 810,277 shares of common stock in a registered direct offering. See Note 12 of the notes to the unaudited interim condensed consolidated financial statements.

On February 10, 2025, the Company entered into an At-The-Market Issuance Sales Agreement (the “ATM Agreement”) with Univest as the sales agent (the “February 2025 Offering”). Pursuant to the ATM Agreement, the Company may issue and sell from time to time, shares of its common stock having an aggregate offering price of not more than $10,000,000 through the sales agent or any of its sub-agent(s) or other designees, acting as sales agent. Up to the date the unaudited interim condensed consolidated financial statements were issued, the Company has not issued or sold any shares under the ATM Agreement.

On March 4, 2025, the Company entered into a securities purchase agreement (the “March 2025 Securities Purchase Agreement”) with certain investor for the sale of 1,115,600 shares of common stock at $0.896379 per share (the “March 2025 Offering”), generating gross proceeds in the amount of $1,000,000, before deducting underwriter’s fees and accountable expenses and other estimated expenses. The Company plans to use the proceeds from the offering for working capital purposes. Upon closing of the March 2025 Offering, the Company paid $90,000 cash for underwriting, which consists of a total cash fee of $70,000, equal to seven percent (7%) of the aggregate gross proceeds raised in the March 2025 Offering and reimbursement of reasonable fees and expenses of $20,000 for the underwriter’s legal counsel and due diligence analysis expenses.

On May 2, 2025, the Company entered into a securities purchase agreement (the “May 2025 Securities Purchase Agreement”) with certain investors for the sale of 1,115,600 shares of common stock at approximately $0.524 per share and 9,380,582 pre-funded warrants (the “May 2025 Pre-Funded Warrants”) at approximately $0.523 per warrant (the “May 2025 Offering”). Up to the date of the unaudited condensed interim financial statements were issued, The Company received $4,478,000 in proceeds for subscription of 1,115,600 shares of its common stock and 7,468,536 pre-funded warrants. The offering remains ongoing and has not yet been fully completed. Transaction costs incurred through the reporting date included underwriter’s fees of $313,460 and a $20,000 reimbursement for the underwriter’s legal counsel and due diligence expenses. Net proceeds from the offering, after deducting these expenses, will be $5,095,000. The Company intends to use the proceeds from the offering for working capital purposes.

Pursuant to the May 2025 Securities Purchase Agreement, the Company has agreed to use commercially reasonable efforts to, within sixty (60) calendar days after the date of the May 2025 Securities Purchase Agreement, file a registration statement on the appropriate form providing for the resale by the investors of the May 2025 Offering.

3

Nasdaq Compliance

On May 13, 2024, the Company received a written notice from the Listing Qualifications Department of the Nasdaq Stock Market, LLC (“Nasdaq”) notifying the Company that, based on the closing bid price of the Company’s common stock was below $1.00 for the last 30 consecutive trading days, the Company no longer complies with the minimum bid price requirement (the “Minimum Bid Price Requirement”) for continued listing on the Nasdaq Capital Market as set forth in Nasdaq Listing Rule 5450(a)(1). Pursuant to Nasdaq Listing Rule 5810(c)(3)(A), the Company has an initial compliance period of 180 calendar days, or until November 11, 2024, to regain compliance with the Minimum Bid Price Requirement.

On June 18, 2024, the Company received a letter from Nasdaq stating that because the Company’s common stock had a closing bid price at or above $1.00 per share for 10 consecutive business days, the Company had regained compliance with the Minimum Bid Price Requirement, and that the matter is now closed.

Software Purchase Agreement

On May 31, 2024, the Company entered into a software purchase agreement with Shanxi Gangdong Cultural Media Co., Ltd., a seller unaffiliated with the Company (the “SGCM”). Pursuant to the agreement, the Company agreed to purchase and the SGCM agreed to sell all of SGCM’s right, title, and interest in and to the certain software (the “AIBox”). The purchase price of the software shall be $1,248,000, payable in the form of an issuance of 1,560,000 shares of common stock of the Company, valued at $0.80 per share. The Company plans to use the software to develop its AI business. On June 4, 2024, the Company issued 1,560,000 shares of common stock of the Company to the SGCM’s designees and the transaction was completed.

On April 28, 2025, the Company entered into a software purchase agreement (the “Agreement”) with Gongzheng Xu and Qing Wang (the “GXQW”), who are unaffiliated with the Company. Pursuant to the Agreement, the Company agreed to purchase and the GXQW agreed to sell all of GXQW’s right, title, and interest in and to the certain software (the “Chat Box”). The purchase price of the software shall be payable in the form of an issuance of 2,444,295 shares of the Company’s common stock (the “Shares”). On April 29, 2025, the Company issued 2,444,295 shares of its common stock to GXQW and the transaction was completed. The Company plans to use the software to develop its AI business.

Key Factors that Affect Operating Results

Competition

E-commerce and live streaming is a competitive industry. Our competition varies and includes content creators on TikTok and other social media platforms. Each of these competitors competes with us based on quality of content, activeness and responsiveness on the social placement, product selection, product quality, customer service, price, store format, location, or a combination of these factors. Some of these competitors may have been in business longer, may have more experience, or may have greater financial or marketing resources than us. As competition intensifies, our results of operations may be negatively impacted through a loss of sales and decrease in market share.

Retention of Key Management Team Members

Our management team comprises executives with extensive experience in technology and content creation. The management team has led us to take leaps in deploying AI technology in live-steaming, e-commerce, gaming and other sectors. The loss of any of our key executive team members might affect our business and our result of operation.

Our Ability to Grow Market Presence and Penetrate New Markets

We are still in an early development stage. We intend to expand our presence on social media to increase the market presence. If we cannot grow our market presence and penetrate new markets in an effective and cost-efficient way, our results of operation will be negatively impacted.

4

Results of Operations

Three Months Ended March 31, 2025 vs. March 31, 2024

|  | For Three Months Ended March 31, |  |  |  |  |  | Percentage |
|  | 2025 |  |  | 2024 |  |  | Change |  |  | Change |
Selling expenses |  | $ | - |  |  | $ | (2,191,667 | ) |  | $ | 2,191,667 |  |  |  | (100.0 | )%
General and administrative |  |  | (937,877 | ) |  |  | (1,769,280 | ) |  |  | 831,403 |  |  |  | (47.0 | )%
Research and development expense |  |  | - |  |  |  | (217,500 | ) |  |  | 217,500 |  |  |  | (100.0 | )%
Loss from operations |  |  | (937,877 | ) |  |  | (4,178,447 | ) |  |  | 3,240,570 |  |  |  | (77.6 | )%
Other income, net |  |  | 2,118 |  |  |  | 21,946 |  |  |  | (19,828 | ) |  |  | (90.3 | )%
Loss before income tax from continuing operations |  |  | (935,759 | ) |  |  | (4,156,501 | ) |  |  | 3,220,742 |  |  |  | (77.5 | )%
Provision for income taxes |  |  | (41,751 | ) |  |  | (1,038 | ) |  |  | (40,713 | ) |  |  | 3,922.3 | %
Loss from continuing operations |  |  | (977,510 | ) |  |  | (4,157,539 | ) |  |  | 3,180,029 |  |  |  | (76.5 | )%
Net loss attributable to noncontrolling interest |  |  | - |  |  |  | (178,911 | ) |  |  | 178,911 |  |  |  | (100.0 | ))%
Loss from continuing operations attributable to GD Culture Group Limited |  |  | (977,510 | ) |  |  | (3,978,628 | ) |  |  | 3,001,118 |  |  |  | (75.4 | )%
Net Loss |  | $ | (977,510 | ) |  | $ | (4,157,539 | ) |  | $ | 3,180,029 |  |  |  | (76.5 | )%

Operating Expenses

The Company’s operating expenses include selling and marketing (“S&M”) expenses, general and administrative (“G&A”) expenses, research and development (“R&D”) expenses. S&M expenses decreased to nil for the three months ended March 31, 2025, compared to $2,191,667 for the three months ended March 31, 2024. The decrease was mainly due to the Company decreased inputs on digital human and e-commerce live streaming marketing and advertising due to the uncertainty surrounding TikTok’s potential exit from the U.S. G&A expenses decreased by $831,403 from $1,769,280 for the three months ended March 31, 2024 to $937,877 for the three months ended March 31, 2025. The decrease was mainly due to the decrease in the professional service fee and the amortization of intangible assets. R&D expenses decreased to nil for the three months ended March 31, 2025, compared to $217,500 for the three months ended March 31, 2024. The decrease was mainly due to the Company decreased inputs on research and development about our artificial intelligence based digital human application.

Other Income, Net

The Company’s other income decreased by $19,828 during the three months ended March 31, 2025, compared to $21,946 for the three months ended March 31, 2024. The decrease was mainly due to the absence of interest income for the three months ended March 31, 2025, which had been earned from a loan to a third party in 2024.

Loss from Continuing Operations

As a result of the foregoing, loss from continuing operations for the three months ended March 31, 2025 was $935,759, a decrease of approximately 77.5%, as compared to loss from continuing operations of $4,156,501 for the three months ended March 31, 2024.

Net Loss

The Company’s net loss decreased by $3,180,029, or 76.5%, to $977,510 for the three months ended March 31, 2025, from $4,157,539 for the three months ended March 31, 2024. The decrease was mainly driven by lower operating expenses, as discussed above.

5

Liquidity and Capital Resources

As of March 31, 2025, the Company had $51,236 in its operating bank accounts and working capital deficit of approximately $1.5 million. From September 2024 to January 2025, Mr. Xiaojian Wang, the Chief Executive Officer of the Company (“CEO”), lent $399,485 to the Company through five loan agreements, for working capital purposes. Pursuant to the loan agreements, these loans are non-interest bearing and will be due on September 18, 2025, September 20, 2025, October 4, 2025, October 23, 2025, December 16, 2025 and January 31, 2026, respectively. On each of March 10, 2025 and March 18, 2025, the Company repaid $100,000, for an aggregated of $200,000 to the CEO, reducing the outstanding loan balance to $199,485 as of March 31, 2025. Subsequent to March 31, 2025, the Company repaid $199,485 in full to the CEO. Up to the date of the unaudited interim condensed consolidated financial statements were issued, there was no outstanding loan from the CEO.

On January 23, 2025, the Green Oasis Limited, a shareholder holding less than a 5% ownership shares in the Company, provided a $100,000 loan to the Company for working capital purposes. Pursuant to the loan agreement, this loan is non-interest bearing and was due on April 23, 2025. On April 25, 2025, Green Oasis Limited and the Company executed an amendment to the previous loan, extending the maturity date to July 23, 2025.

On March 4, 2025, the Company sold 1,115,600 shares of common stock at $0.896379 per share, generating gross proceeds of $1,000,000. The Company received net proceeds of $910,000 after deducting underwriter’s fees of $70,000 and a $20,000 reimbursement for the underwriter’s legal counsel and due diligence analysis expenses. The Company intends to use the proceeds from the offering for working capital purposes.

On May 2, 2025, the Company completed a securities offering in which it agreed to sell (i) 1,115,600 shares of its common stock at a purchase price of approximately $0.524 per share and (ii) 9,380,582 pre-funded warrants at a purchase price of approximately $0.523 per warrant. The aggregate gross proceeds from the offering will be $5,500,000. Up to the date of the unaudited condensed interim financial statements were issued, The Company received $4,478,000 in proceeds for subscription of 1,115,600 shares of its common stock and 7,468,536 pre-funded warrants. The offering remains ongoing and has not yet been fully completed. Transaction costs incurred through the reporting date included underwriter’s fees of $313,460 and a $20,000 reimbursement for the underwriter’s legal counsel and due diligence expenses. Net proceeds from the offering, after deducting these expenses, will be $5,095,000. The Company intends to use the proceeds from the offering for working capital purposes.

The Company evaluated its ability to continue as a going concern in accordance with ASC Subtopic 205-40, Presentation of Financial Statements—Going Concern, which requires management to assess whether there is substantial doubt about the Company’s ability to continue as a going concern within one year after the date the financial statements are issued.

As of March 31, 2025, the Company had cash of $51,236 and a working capital deficit of approximately $1.5 million. However, on May 2, 2025, the Company completed a public offering and partially received net proceeds of approximately $4.1 million. After considering the impact of this financing and the Company’s projected operating cash flows, management reassessed its liquidity position and concluded that the Company will have sufficient liquidity to meet its obligations as they become due for at least the next twelve months from the date the financial statements are issued. Accordingly, management determined that substantial doubt about the Company’s ability to continue as a going concern no longer exists as of the issuance date of these unaudited interim condensed consolidated financial statements.

The following summarizes the key components of the Company’s cash flows for the three months ended March 31, 2025 and 2024.

|  | For the Three Months Ended March 31, |
|  | 2025 |  |  | 2024 |
Net cash used in operating activities |  | $ | (831,308 | ) |  | $ | (3,617,910 | )
Net cash used in investing activities |  |  | - |  |  |  | (1,900,000 | )
Net cash provided by financing activities |  |  | 860,000 |  |  |  | 830,533 |
Effect of exchange rate change on cash and cash equivalents |  |  | 6 |  |  |  | (1,940 | )
Net change in cash and cash equivalents |  | $ | 28,698 |  |  | $ | (4,689,317 | )

6

Operating activities

Net cash used in operating activities was approximately $0.8 million for the three months ended March 31, 2025, as compared to approximately $3.6 million net cash used in operating activities for the three months ended March 31, 2024. Net loss for the three months ended March 31, 2025 was approximately $1.0 million, as compared to approximately $4.2 million for the three months ended March 31, 2024. Adjustments to reconcile net loss to net cash used in operating activities decreased by approximately $0.2 million, mainly due to the decreased amortization of intangible assets and deferred tax expenses, and changes in operating assets and liabilities decreased approximately $0.2 million.

Investing activities

Net cash used in investing activities was approximately nil for the three months ended March 31, 2025, as compared to $1.9 million for the three months ended March 31, 2024. The decrease in net cash used in investing activities was due to the absence of the loan to a third party for the three months ended March 31, 2025, as compared to the same period of 2024.

Financing activities

Net cash provided by financing activities was approximately $0.8 million for the three months ended March 31, 2024, remaining consistent with the $0.8 million net cash provided by financing activities for the three months ended March 31, 2023. The stable cash flow from financing activities primarily reflects continued proceeds from issuance of debt and new common stock, indicating that our financing structure remained relatively unchanged year over year.

Critical Accounting Policies and Estimates

The Company prepares its unaudited interim condensed consolidated financial statements in accordance with U.S. GAAP. The preparation of these unaudited interim condensed consolidated financial statements requires the Company to make estimates, assumptions and judgments that can significantly impact the amounts the Company reports as assets, liabilities, revenue, costs and expenses and the related disclosures. The Company bases its estimates on historical experience and other assumptions that it believes are reasonable under the circumstances. The Company’s actual results could differ significantly from these estimates under different assumptions and conditions. The Company identified the following critical accounting estimates.

Impairment of long-lived assets

The Company’s determination of whether or not an indication of impairment exists at the cash generating unit level requires significant management judgment pertaining to intangible assets, including a software copyright of a broadcast game (the “Tribal Light”), 55 digital humans and a software copyright of AI Box, which are used for online living-stream, as well as the operating Right-of-use (“ROU”) assets, including the offices of the Company. Management considers both external and internal sources of information in assessing whether there are any indications that the Company’s intangible assets and ROU assets are impaired.

Fair value of the long-lived assets was determined by the Company based on the income approach using the discounted cash flow associated with the underlying assets, which incorporated certain assumptions including projected revenue, growth rates and projected operating costs based on current economic condition, expectation of management and projected trends of current operating results. Considerable management judgement is used to estimate future cashflows, particularly revenues expected to be generated from the usage of the long-lived assets and estimates of the price market participants would pay to lease the operating lease right-use assets, which are based on comparable market rental information that could be reasonably obtained for the property. Accordingly, actual results may vary significantly from the Company estimates as they are forward-looking and include assumptions about economic and market conditions with uncertain future outcomes. For the three months ended March 31, 2025 and 2024, the Company did not recognized impairment losses in intangible assets.

Recently Issued Accounting Pronouncements

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (ASU 2023-09), which requires disclosure of incremental income tax information within the rate reconciliation and expanded disclosures of income taxes paid, among other disclosure requirements. ASU 2023-09 is effective for fiscal years beginning after December 15, 2024. Early adoption is permitted. The Company’s management does not believe the adoption of ASU 2023-09 will have a material impact on its financial statements and disclosures.

In November 2023, the FASB issued ASU 2023-07, “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures,” which is intended to improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. The purpose of the amendment is to enable investors to better understand an entity’s overall performance and assess potential future cash flows. The guidance is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted. The guidance is to be applied retrospectively to all prior periods presented in the financial statements. The Company adopted ASU 2023-07 for the year ending December 31, 2024.

In November 2024, the FASB issued ASU No. 2024-03, Disaggregation of Income Statement Expenses. This new guidance is designed to improve the disclosures about the types of expenses, including employee compensation, depreciation, and amortization, and costs incurred related to inventory and manufacturing activities. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027 on a prospective basis with optional retrospective application. Early adoption is permitted. The Company is currently assessing the impact that adopting this new accounting standard will have on its consolidated financial statements.

We do not believe other recently issued but not yet effective accounting standards, if currently adopted, would have a material effect on our consolidated balance sheets, statements of operations and comprehensive loss and statements of cash flows.

7

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Credit Risk

Credit risk is one of the most significant risks for the Company’s business.

Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash and accounts receivable. Cash held at major financial institutions located in the PRC are not insured by the government. While we believe that these financial institutions are of high credit quality, it also continually monitors their credit worthiness.

Accounts receivable are typically unsecured and derived from revenue earned from customers, thereby exposed to credit risk. Credit risk is controlled by the application of credit approvals, limits and monitoring procedures. The Company manages credit risk through in-house research and analysis of the Chinese economy and the underlying obligors and transaction structures. To minimize credit risk, the Company normally require prepayment from the customers prior to begin production or delivery products. The Company identifies credit risk collectively based on industry, geography and customer type. This information is monitored regularly by management.

In measuring the credit risk of our sales to our customers, the Company mainly reflects the “probability of default” by the customer on its contractual obligations and considers the current financial position of the customer and the exposures to the customer and its likely future development.

Liquidity Risk

As of March 31, 2025, the Company had $51,236 cash in its operating bank accounts and working capital of approximately $1.5 million. In May 2025, Mr. Xiaojian Wang, the Chief Executive Officer of the Company(“CEO”), executed a Letter of Support in which he agreed to provide continuing financial support to the Company for a period of at least 12 months from the issuance date of the Company’s unaudited consolidated financial statements for the period ended March 31, 2025. From September 2024 to January 2025, Mr. Xiaojian Wang, the Chief Executive Officer of the Company (“CEO”), lent $399,485 to the Company through five loan agreements, for working capital purposes. Pursuant to the loan agreements, these loans are non-interest bearing and will be due on September 18, 2025, September 20, 2025, October 4, 2025, October 23, 2025, December 16, 2025 and January 31, 2026, respectively. Subsequent to March 31, 2025, the Company repaid $399,485 in full to the CEO. Up to the date of the consolidated financial statements were issued, there was no outstanding loan from the CEO.

After considering the impact of this financing and the Company’s projected operating cash flows, management reassessed its liquidity position and concluded that the Company will have sufficient liquidity to meet its obligations as they become due for at least the next twelve months from the date the unaudited interim condensed consolidated financial statements are issued. The Company also intends to raise additional debt or equity capital to fund future operations. There is no assurance that the Company will be able to obtain sufficient additional funds when needed or that such funds, if available, will be obtainable on terms satisfactory to the Company. In addition, the Company has planned and implemented cost-cutting measures to reduce operating expenditures and loss. Management believes that the Company can adjust the pace of its business development and control operating expenses when necessary.

8

Inflation Risk

The Company is also exposed to inflation risk. Inflationary factors, such as increases in raw material and overhead costs, could impair our operating results. Although we do not believe that inflation has had a material impact on our financial position or results of operations to date, a high rate of inflation in the future may have an adverse effect on our ability to maintain current levels of gross margin and operating expenses as a percentage of sales revenue if the selling prices of our products do not increase with such increased costs.

Foreign Currency Risk

A majority of the Company’s operating activities and a significant portion of the Company’s assets and liabilities are denominated in RMB, which is not freely convertible into foreign currencies. All foreign exchange transactions take place either through the Peoples’ Bank of China (“PBOC”) or other authorized financial institutions at exchange rates quoted by PBOC. Approval of foreign currency payments by the PBOC or other regulatory institutions requires submitting a payment application form together with suppliers’ invoices and signed contracts. The value of RMB is subject to changes in central government policies and to international economic and political developments affecting supply and demand in the China Foreign Exchange Trading System market.

ITEM 4. CONTROLS AND PROCEDURES

Under the supervision and with the participation of our management, including our Chief Executive Officer, President and Chief Financial Officer (the “Certifying Officers”), we carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act. Based on the foregoing, our Certifying Officers concluded that our disclosure controls and procedures were not effective as of the end of the period covered by this Report.

Disclosure controls and procedures are controls and other procedures designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is accumulated and communicated to management, including our Certifying Officers, or persons performing similar functions, as appropriate, to allow timely decisions regarding required disclosure.

There were no changes in our internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act) during the most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

9

PART II — OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

None.

ITEM 1A. RISK FACTORS

Investing in our common stock involves a high degree of risk. You should carefully consider the information included in this Quarterly Report on Form 10-Q and the risk factors discussed in Part I, “Item 1A. Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024 before making an investment in our common stock. Our business, financial condition, results of operations, or prospects could be materially and adversely affected if any of these risks occurs, and as a result, the market price of our common stock could decline and you could lose all or part of your investment. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition and/or operating results. There are no material changes to the risk factors described in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024. This Quarterly Report on Form 10-Q also contains forward-looking statements that involve risks and uncertainties. See “Cautionary Note Regarding Forward-Looking Statements.” Our actual results could differ materially and adversely from those anticipated in these forward-looking statements as a result of certain factors, including those set forth below.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

On March 4, 2025, the Company issued 1,115,600 shares of common stock at $0.896379 per share pursuant to a securities purchase agreement with certain investor dated March 4, 2025. The Company received gross proceeds in the amount of $1,000,000, before deducting placement agent’s fees and accountable expenses and other estimated expenses, and plans to use the proceeds from the offering for working capital purposes. The securities were issued and sold by the Company to the investor in reliance upon the exemptions from the registration requirements of the Securities Act afforded by Section 4(a)(2) of the Securities Act and Rule 506(b) of Regulation D promulgated thereunder.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5. OTHER INFORMATION

None.

10

ITEM 6. EXHIBITS

The following exhibits are filed as part of, or incorporated by reference into, this Quarterly Report on Form 10-Q.

Exhibit Number |  | Description
31.1 |  | Certification of the Chief Executive Officer required by Rule 13a-14(a) or Rule 15d-14(a).
31.2 |  | Certification of the Chief Financial Officer required by Rule 13a-14(a) or Rule 15d-14(a).
32.1 |  | Certification of the Chief Executive Officer required by Rule 13a-14(b) or Rule 15d-14(b) and 18 U.S.C. 1350.
32.2 |  | Certification of the Chief Financial Officer required by Rule 13a-14(b) or Rule 15d-14(b) and 18 U.S.C. 1350.
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).

11

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized on May 15, 2025.

| GD CULTURE GROUP LIMITED
Date: May 15, 2025 | By: | /s/ Xiaojian Wang
| Name: | Xiaojian Wang
| Title: | Chief Executive Officer, President and
|  | Chairman of the Board
Date: May 15, 2025 | By: | /s/ Zihao Zhao
| Name: | Zihao Zhao
| Title: | Chief Financial Officer and Secretary
|  | (Principal Financial Officer and Principal Accounting Officer)

12

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