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BALANCE SHEET COMPONENTS

9 Months Ended

Sep. 30, 2025

Organization, Consolidation and Presentation of Financial Statements [Abstract]

(4) BALANCE SHEET COMPONENTS

Property, equipment and software, net

Property, equipment and software, net consists of the following:

Schedule of equipment
	As of September 30, 2025			As of December 31, 2024
Internal use software	$	181,139		$	-
Equipment		2,628,519			2,621,706
Vehicles		133,837			-
Total property, equity and software		2,943,495			2,621,706
Accumulated depreciation and amortization		(2,620,692	)		(2,501,835	)
Total property, equipment and software, net	$	322,803		$	119,871

For the three months ended September 30, 2025 and 2024, depreciation and amortization was $47 thousand and $75 thousand, respectively. Depreciation and amortization expense was $119 thousand and $243 thousand for the years ended September 30, 2025 and 2024, respectively.

Intangible assets

As part of the asset acquisition completed on June 30, 2025, a substantial portion of the total purchase consideration was allocated to intangible assets, primarily consisting of acquired proprietary software, which represent a group of software code and associated patents that are expected to provide future economic benefits to the Company. The allocation of the purchase price was performed on a relative fair value basis in accordance with ASC 805-50. The acquired group of proprietary software is being amortized over 3 years, its estimated useful life.

Intangible assets consisted of the following at September 30, 2025 and December 31, 2024:

Schedule of intangible assets
	As of September 30, 2025							As of December 31, 2024
	Gross Carrying Amount		Accumulated Amortization			Net		Gross Carrying Amount		Accumulated Amortization		Net
Acquired group of proprietary software	$	1,277,026	$	(105,933	)	$	1,171,093	$	-	$	-	$	-
	$	1,277,026	$	(105,933	)	$	1,171,093	$	-	$	-	$	-

Amortization expense was $106 thousand and $0 thousand in the three months ended September 30, 2025 and 2024, respectively. Amortization expense was $106 thousand and $33 thousand in the nine months ended September 30, 2025 and 2024, respectively.

Estimated amortization expenses for the future years are as follows:

Schedule of Amortization
Years ending December 31,	Amortization
2025	$	113,045
2026		423,219
2027		423,219
2028		211,610
Total	$	1,171,093

Prepaid and other current assets

Prepaid and other current assets consist of the following:

Schedule of inventories
	September 30, 2025		December 31, 2024
Insurance fee	$	55,561	$	119,757
Cloud hosting fee		85,780		-
Professional fees		40,000		-
Other		24,596		15,000
Total prepaid and other current assets	$	205,937	$	134,757

Accrued expenses and other current liabilities

Accrued expenses and other current liabilities consist of the following:

Schedule of accrued expenses
	September 30, 2025		December 31, 2024
Payroll & related benefits	$	180,506	$	-
Professional fees		377,613		185,000
Sales allowances		26,905		26,905
Sales and use tax		81,708		81,708
Income tax payable		140,268		-
Other⁽¹⁾		48,348		-
Total accrued expenses and other current liabilities	$	855,348	$	293,613

(1)

There was a balance of $7,232 due to a stockholder of the Company, Cao Yu, which represents the amount paid by Cao Yu to support the Company’s normal operating activities.

Other payables

As of September 30, 2025, other payables included $500 thousand for the assets acquisition, $180 thousand for a software development, $85 thousand for software maintenance and $20 thousand for advanced hosting fee, all payable to a single vendor.