Financial Analysis

NOTE 15 COMMITMENTS AND CONTINGENCIES Since September 2023, unauthorized individuals including Zheng Dai and Pijun Liu have repeatedly attempted to illegally interfere with the Companys operations through the submission of false documents and initiation of multiple lawsuits. In response, the Chancery Court of Wyoming issued a preliminary injunction on January 5, 2024, explicitly prohibiting these individuals from acting on behalf of the Company, including contacting regulatory authorities and service providers, or issuing shares of the Company. The Companys board of directors and management remain stable, and operations continue unaffected. Although the related parties subsequently filed additional lawsuits (including claims for corporate records inspection and alleged loan contract disputes), the Company has actively taken legal measures to defend against them. Notable developments: (i) December 2024 action court denied the injunction motion and, on December 1, 2025, granted partial summary judgment for lack of standing; (ii) New York proceedings January 6, 2026, court denied dismissal (appeal pending); (iii) Wyoming Chancery Court actions October 2025 denial of dismissal, February 2026 partial counterclaims grant. The Company firmly believes that the claims made by the opposing party are without factual or legal basis and will continue to take all necessary measures to protect the Companys and shareholders rights and interests. The Company did not have any significant capit …

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NOTE 11 SHARE-BASED COMPENSATION EXPENSE For the three months ended June 30, 2026 and 2025, total share-based compensation expenses recognized were $4,213,483 and nil , respectively. For the six months ended June 30, 2026 and 2025, total share-based compensation expenses recognized were $8,385,862 and nil , respectively. The following table sets forth the share-based compensation expenses for the three and six months ended June 30, 2026 and 2025: For the Three Months ended June 30, For the Six Months ended June 30, 2026 2025 2026 2025 Research and development expenses $ 659,073 $ - $ 1,312,832 $ - General and administrative expenses 3,554,410 - 7,073,030 - Total $ 4,213,483 $ - $ 8,385,862 $ - Share Incentive Plans At the Companys 2024 annual meeting of stockholders, our stockholders approved the Next Technology Holding Inc. 2025 Equity Incentive Plan (the 2025 Plan). The 2025 Plan authorizes the issuance of up to 80,000,000 shares of common stock to eligible employees, directors, and consultants of the Company. The purpose of the 2025 Plan is to attract, retain, and motivate personnel and advisors by aligning their interests with those of stockholders. The registration statement became effective upon filing. The Plan shall terminate automatically on the tenth anniversary of the Effective Date. Thereafter, the Company issued 70,000,000 shares of common stock under the 2025 Plan. Following the Companys 200-for-1 reverse stock split effected on September 16, 2025, the remaining …

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NOTE 12 INCOME TAX EXPENSES Next Technology Holding Inc. in Wyoming is subject to U.S. federal income tax at 21% and a state income tax rate of nil . The Company owns a subsidiary incorporated in Hong Kong and are subject to Hong Kong profits tax at a tax rate of 16.5%. The Company owns another subsidiary incorporated in the British Virgin Islands (BVI). Under the current tax laws of BVI, the subsidiarys income tax rate is nil . The current and deferred portions of income tax expense included in the consolidated statements of comprehensive loss are as follows: For the Three Months ended June 30, For the Six Months ended June 30, 2026 2025 2026 2025 Current income tax expense $ - $ - $ - $ - Deferred income tax (benefit) expense (13,229,758 ) 31,519,811 (40,524,270 ) 82,940,684 Total $ (13,229,758 ) $ 31,519,811 $ (40,524,270 ) $ 82,940,684 The (loss) income before income tax for domestic and foreign components were as follows: For the Three Months ended June 30, For the Six Months ended June 30, 2026 2025 2026 2025 US $ (42,942,430 ) $ 150,094,338 $ (176,088,673 ) $ 394,955,636 Hongkong and BVI - - - - Total $ (42,942,430 ) $ 150,094,338 $ (176,088,673 ) $ 394,955,636 For the three and six months ended June 30, 2026 and 2025, the Company paid nil for income expense. The principal components of deferred tax assets and deferred tax liabilities are as follows: As of June 30, 2026 As of December 31, 2025 Deferred tax liabilities Fair value gain of Bitcoin $ 35,371,589 $ 69,946,76 …

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(bb) Recently Accounting Pronouncements In December 2023, the FASB issued ASU No. 2023-09, Improvements to Income Tax Disclosures (ASU 2023-09), which requires entities to make incremental income tax disclosures on an annual basis. The amendments require that public business entities disclose specific categories in the rate reconciliation and provide additional information for reconciling items meeting a quantitative threshold. The amendments also require disclosure of income taxes paid to be disaggregated by jurisdiction, and the disclosure of income tax expense disaggregated by federal, state, and foreign. Amendments are effective for annual periods beginning after December 15, 2025 and thereafter, with early adoption permitted. The Company is evaluating adoption timing and the impact ASU 2023-09 will have on its financial statements and related disclosures. In November 2024, the FASB issued ASU 2024-03 Income Statement-Reporting comprehensive (loss) income-Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses (ASU 2024-03). The amendments in this update intend to improve the disclosures about a public business entitys expenses and address requests from investors for more detailed information about the types of expenses (including purchases of inventory, employee compensation, depreciation, amortization, and depletion) in commonly presented expense captions (such as cost of sales, selling, general and administrative expenses, and …

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NOTE 8 AMOUNT DUE TO RELATED PARTIES Nature of relationships with related parties Name: Relationship with the Company Weihong Liu Chief Executive Officer Nan Ding Chief Operating Officer Eve Chan Chief Financial Officer and Secretary Hongliang Liu Chief Technical Officer Hsiu Wu Director, Chairman of the Board, and Chair of Nominating Committee Wenbo Li Director and Chair of Audit Committee Guang Cui Director and Chair of Compensation Committee Gwanggeun Jo Director Lichen Dong Former Director, Chairman of the Board Qi Wang Former Director Tian Yang Former Director and Chair of Audit Committee Mahesh Thapaliya Former Director Jianbo Sun Former Director and Chair of Compensation Committee As of June 30, 2026 and December 31, 2025, remuneration payable was $735,312 and $660,259, respectively. For the three months ended June 30, 2026 and 2025, remuneration to senior management and directors were $107,660 and $57,666, respectively. For the six months ended June 30, 2026 and 2025, remuneration to senior management and directors were $180,160 and $110,666, respectively. …

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NOTE 14 SEGMENT INFORMATION The Company operates as a single reportable segment, which is consistent with how the CODM, the Chief Executive Officer , allocates resources and assesses performance. The Companys operations are centralized and integrated, with financial results reviewed and managed on a consolidated basis. Accordingly, management has determined that the Company has one reportable segment under ASC Topic 280, Segment Reporting . The CODM reviews financial information on a consolidated basis, using net (loss) income as the primary measure of segment performance to monitor budget versus actual results and decide where to allocate and invest additional resources to achieve continuing growth. Net (loss) income is defined as revenue less cost of revenues and operating expenses, and other segment items (other income or other expenses), and income tax expenses. The CODM regularly receives and reviews the following expense categories, which are included in the segments measure of operations and comprehensive income. For the Three Months Ended June 30, For the Six Months Ended June 30 2026 2025 2026 2025 Revenues $ 840,940 $ - $ 1,306,168 $ - Cost of revenues (487,113 ) - (874,457 ) - Gross profit $ 353,827 $ - $ 431,711 $ - Research and development expenses Payroll and welfare expenses (23,499 ) - (49,998 ) - Professional service expenses and others (233,250 ) - (1,676,500 ) - Share-based compensation (659,073 ) - (1,312,832 ) - Selling and marketing expenses Payroll and …

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NOTE 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (a) Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with United States generally accepted accounting principles (U.S. GAAP) and applicable rules and regulations of the Securities and Exchange Commission (SEC) regarding interim financial reporting. Certain information and note disclosures normally included in the financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations. As such, the information included in this interim financial report should be read in conjunction with the audited financial statements and accompanying notes for the year ended December 31, 2025. The accompanying unaudited condensed financial statements contain all normal recurring adjustments necessary to present fairly the financial position, operating results and cash flows of the Company for each of the periods presented. The results of operations for the six months ended June 30, 2026 are not necessarily indicative of results to be expected for any other interim period or for the year ending December 31, 2026. The condensed consolidated balance sheet as of December 31, 2025 was derived from the audited financial statements at that date but does not include all of the disclosures required by U.S. GAAP for annual financial statements. (b) Consolidation The Companys consolidated financial statements include the f …

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NOTE 10 SHAREHOLDERS EQUITY The Company has an unlimited number of authorized ordinary shares and has issued 147,296,192 and 4,882,556 shares, $0.0000 par value per share, as of June 30, 2026 and December 31, 2025, respectively. On July 21, 2022, the Company completed uplisting of its common stock to the Nasdaq Capital Market, and the closing of its public offering of 10,000,000 shares of common stock with the net proceeds of $37,057,176. The Companys total issued and outstanding common stock has been increased to 195,032,503 shares after the offering. On July 22, 2022, the Company issued 25,000 shares of common stock to certain service providers for services in connection with the public offering, the fair value of the share was $477,500. The Companys total issued and outstanding common stock has been increased to 195,057,503 shares. On June 9, 2023, the Company effected a 185-for-1 reverse stock split of its common stock. The reverse stock split reduced the number of outstanding shares from approximately 195,057,503 to approximately 1,054,530. In September 2023, there were 1,570,600 shares issued with the fair value of $12,616,454, and the Companys common stock issued and outstanding has been increased to 2,625,130 shares. In April 2024, there are 3,940,000 shares issued with the total amount of $13,396,000 for the acquisition of 20% of associate company, and the Companys common stock issued and outstanding has been increased to 6,565,130 shares. On April 9, 2024, the Compa …

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NOTE 16 SUBSEQUENT EVENTS The Company evaluated all events and transactions that occurred after June 30, 2026, up through July 24, 2026, which is the date that these financial statements are issued, unless as disclosed elsewhere and below, there was no other material subsequent events occurred that would require recognition or disclosure in the Companys financial statements. …

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