UTime Ltd. Received Nasdaq Notification Letter Regarding Stockholders' Equity Deficiency

Rhea-AI Summary

UTime Limited (NASDAQ: UTME) has received a notification from Nasdaq on August 15, 2025, indicating non-compliance with the minimum stockholders' equity requirement. The company's stockholders' equity has fallen below the required $2.5 million threshold for continued listing on the Nasdaq Capital Market.

The company has been given 45 calendar days until September 29, 2025, to submit a compliance plan. If accepted by Nasdaq, UTime could receive up to 180 calendar days extension to regain compliance. The notification does not immediately affect UTME's listing status on Nasdaq.

Positive

• None.

Negative

• Stockholders' equity fallen below minimum $2.5 million requirement
• Company does not meet alternative compliance criteria of market value or net income
• Risk of potential delisting if compliance is not achieved
• Indication of significant financial challenges

Insights

Securities Compliance Expert

UTime faces Nasdaq delisting risk due to stockholders' equity falling below $2.5M requirement, has until September 29 to submit compliance plan.

UTime Limited has received a Nasdaq notification letter regarding non-compliance with the exchange's continued listing requirements. The company failed to maintain the minimum $2,500,000 in stockholders' equity required by Nasdaq Listing Rule 5550(b)(1), as reported in its recent Form 20-F for the fiscal year ended March 31, 2025. Additionally, UTime doesn't meet the alternative compliance standards of market value of listed securities or net income from continuing operations.

This notification represents a significant regulatory challenge but doesn't immediately affect the company's listing status. Nasdaq has provided UTime with 45 calendar days (until September 29, 2025) to submit a remediation plan. If Nasdaq accepts this plan, the company could receive an extension of up to 180 calendar days from the notification date to regain compliance.

For investors, this development signals potential financial distress within the company's operations. Companies typically fall below equity requirements due to accumulated losses or significant operational challenges. UTime now faces several critical options: raising additional capital through equity offerings (which could dilute existing shareholders), divesting assets, or restructuring operations to improve its financial position.

The disclosure of this notification complies with Nasdaq Listing Rule 5815(a), which requires prompt public disclosure of such notices. This transparency measure ensures investors are informed of material compliance issues that could affect the company's exchange listing status.

BEIJING, Aug. 21, 2025 (GLOBE NEWSWIRE) -- UTime Limited ("UTime" or the "Company") (Nasdaq: WTO), today announced that on August 15, 2025, the Company received a notification letter from the Nasdaq Listing Qualifications Staff of The Nasdaq Stock Market LLC ("Nasdaq") notifying the Company that it is no longer in compliance with the requirement of maintaining a minimum of $2,500,000 in stockholders’ equity for continued listing on the Nasdaq Capital Market set forth in Nasdaq Listing Rule 5550(b)(1) based on the Company’s reported stockholders’ equity in its Form 20-F for the year ended March 31, 2025, which is below the foregoing requirement of minimum stockholders' equity. In addition, the Company does not meet the alternatives of market value of listed securities or net income from continuing operations as of August 14, 2025.

The notification received has no immediate effect on the listing of the Company's class A ordinary shares traded on Nasdaq. Nasdaq has provided the Company with 45 calendar days, or until September 29, 2025, to submit a plan to regain compliance with the minimum stockholders' equity standard. The Company will be working with its advisors to submit a plan of compliance, that if accepted by Nasdaq, can grant an extension of up to 180 calendar days from the date of the notification letter.

The Company, by filing this press release, discloses its receipt of the notification from Nasdaq in accordance with Nasdaq Listing Rule 5815(a).

Forward-Looking Statement

This press release contains "forward-looking statements." Such statements may be preceded by the words "intends," "may," "will," "plans," "expects," "anticipates," "projects," "predicts," "estimates," "aims," "believes," "hopes," "potential," or similar words. Forward-looking statements are not guarantees of future performance, are based on certain assumptions, and are subject to various known and unknown risks and uncertainties, many of which are beyond the Company's control, and cannot be predicted or quantified, and, consequently, actual results may differ materially from those expressed or implied by such forward-looking statements. None of the outcomes expressed herein are guaranteed. Such risks and uncertainties include, without limitation, risks and uncertainties associated with (i) our inability to manufacture our product candidates on a commercial scale on our own, or in collaboration with third parties; (ii) difficulties in obtaining financing on commercially reasonable terms; (iii) changes in the size and nature of our competition; (iv) loss of one or more key executives or scientists; and (v) difficulties in securing regulatory approval to proceed to the next level of the clinical trials or to market our product candidates. More detailed information about the Company and the risk factors that may affect the realization of forward-looking statements is set forth in the Company's filings with the Securities and Exchange Commission (SEC), including the Company's Annual Report on Form 20-F and its Current Reports on Form 6-K. Investors are urged to read these documents free of charge on the SEC's website at http://www.sec.gov. The Company assumes no obligation to publicly update or revise its forward-looking statements as a result of new information, future events or otherwise.

This press release does not constitute an offer to sell, or the solicitation of an offer to buy any of the Company's securities, nor shall such securities be offered or sold in the United States absent registration or an applicable exemption from registration, nor shall there be any offer, solicitation or sale of any of the Company's securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of such state or jurisdiction.

Company Contact

Hengcong Qiu

qhengcong@utimemobile.com

FAQ

Why did UTME receive a Nasdaq notification letter on August 15, 2025?

UTME received the notification because its stockholders' equity fell below Nasdaq's minimum requirement of $2.5 million for continued listing on the Nasdaq Capital Market.

What is the deadline for UTME to submit its compliance plan to Nasdaq?

UTME must submit its compliance plan by September 29, 2025, which is 45 calendar days from the notification date.

Will UTME be immediately delisted from Nasdaq due to this notification?

No, the notification has no immediate effect on UTME's listing status. The company has time to submit a compliance plan and may receive up to 180 days to regain compliance if the plan is accepted.

What options does UTME have to maintain its Nasdaq listing?

UTME can either restore its stockholders' equity to above $2.5 million, meet alternative criteria for market value of listed securities, or achieve sufficient net income from continuing operations.

How long of an extension could UTME receive if its compliance plan is accepted?

If Nasdaq accepts UTME's compliance plan, the company could receive up to 180 calendar days from the notification date to regain compliance.