[10-Q] Future FinTech Group Inc. Quarterly Earnings Report

Rhea-AI Filing Summary

Future FinTech Group, Inc. (FTFT) reported significant restructuring and liquidity events in this 10-Q. The company completed a 1-for-10 reverse stock split effective April 1, 2025, reducing authorized common shares to 6,000,000 and reporting 3,110,770 shares outstanding as of June 30, 2025.

The period included multiple disposals (including FTFT SuperComputing and other subsidiaries), recognized gains on disposals (including a reported $28.24 million gain and a $3.07 million gain on debt restructuring), and material legal developments: a NY judgment in favor of FT Global (approximately $10.6 million awarded) with related settlement actions and a forbearance agreement requiring $4.0 million paid over 18 months. The NY Court ordered turnover of unissued shares and the transfer agent issued 1,951,443 shares to the U.S. Marshal. The company reported negative operating cash flows (~$27.73 million) and stated these factors raise substantial doubt about its ability to continue as a going concern.

Positive

• Recognized substantial one-time gains on disposals and debt restructuring (including a reported $28.24 million gain and $3.07 million gain on debt restructuring).
• Completed corporate actions such as a 1-for-10 reverse stock split and completed disposal transactions that reduce certain legacy operations and liabilities.

Negative

• Going-concern disclosure: management states substantial doubt about the company’s ability to continue as a going concern due to operations and legal matters.
• Negative operating cash flows of approximately $27.73 million as of June 30, 2025.
• Material legal judgments and enforcement actions: FT Global judgment (~$10.6 million), court-ordered turnover of unissued shares, and auctioned subsidiaries with proceeds that were minimal relative to liabilities.
• Liquidity obligations and settlements: forbearance agreement requiring $4.0 million payable over 18 months and other payments toward accrued expenses.
• Concentration and credit risk: accounts receivable aged over 90 days of about $1.33 million and concentrated vendor/customer exposures noted.

Insights

Financial Analyst

TL;DR: Restructuring produced one-time gains but persistent negative operating cash flows and a large judgment create material going-concern risk.

The filing shows both creditable non-recurring gains from asset disposals and debt restructuring and continuing operating liquidity pressure. A reported $28.24 million gain and $3.07 million gain on debt restructuring bolster reported results this period, yet the company disclosed negative operating cash flows of roughly $27.73 million and substantial judgments and enforced turnover actions by the U.S. courts. The $4.0 million forbearance and the transfer of nearly 1.95 million shares to the U.S. Marshal are concrete liquidity and control events that materially affect shareholder equity and capital structure. Accounts receivable aged >90 days (~$1.33 million) and concentrated counterparty exposures add short-term collection risk. Overall, the combination of one-time gains and recurring operating shortfalls creates a mixed picture; the going-concern disclosure and court actions make near-term solvency and equity dilution primary investor concerns.

Corporate Governance / Legal Risk Specialist

TL;DR: Significant legal exposure, court-ordered asset transfers, and ongoing appeals materially affect corporate control and shareholder dilution.

The report documents substantial litigation outcomes: a judgment in favor of FT Global (approximately $10.6 million), a U.S. Marshal auction of multiple subsidiaries, and a NY Court order to turn over unissued shares for sale. The company has appealed certain turnover orders and has entered a settlement and forbearance committing $4.0 million payable over 18 months, with partial stock issuances tied to that agreement. The transfer agent issuance of 1,951,443 shares to the U.S. Marshal and the court-ordered auction proceed represent tangible erosion of assets and potential future dilution. These legal and remedial actions present material governance and control implications for existing shareholders and underline execution risk on restructuring and appeal outcomes.

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 June 30, 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: 001-34502

Future FinTech Group Inc.

(Exact name of registrant as specified in its charter)

Florida		98-0222013
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification Number)

02B-03A, 23/F, Sino Plaza, 255-257 Gloucester Road

Causeway Bay, Hong Kong

(Address of principal executive offices including zip code)

888-622-1218

(Registrant’s telephone number, including area code)

N/A

(Former name, former address and former fiscal year, 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 $0.001 per share		FTFT		Nasdaq Stock 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 Data File required to be submitted and posted 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, 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.

Class		Outstanding at July 23, 2025
Common Stock, $0.001 par value per share		3,450,770

TABLE OF CONTENTS

PART I. FINANCIAL INFORMATION		1
Item 1.	Financial Statements	1
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	29
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	35
Item 4.	Controls and Procedures	35
PART II. OTHER INFORMATION		36
Item 1.	Legal Proceedings	36
Item 1A.	Risk Factors	37
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	37
Item 3.	Defaults upon Senior Securities	37
Item 4.	Mine Safety Disclosure	37
Item 5.	Other Information	37
Item 6.	Exhibits	37
SIGNATURES		38

i

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

FUTURE FINTECH GROUP INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

		June 30, 2025				December 31, 2024
CURRENT ASSETS
Cash and cash equivalents			5,786,303				4,765,865
Short - term investment			1,397				1,391
Accounts receivable, net			1,643,601				2,088,962
Other receivables, net			924,706				1,494,483
Advances to suppliers and other current assets			4,936,961				4,943,828
Loan receivables			6,984,600				7,094,764
Amount Due from Related Party			24,322				20,000
Assets related to discontinued operation-current			-				307,594
TOTAL CURRENT ASSETS			20,301,890				20,716,887
Property, plant and equipment, net			2,423,703				2,464,641
Right of use assets - operation lease			298,903				368,982
Intangible assets			502,873				532,822
Debt investment			1,047,690				1,530,243
Assets related to discontinued operation-Non current			-				289,363
TOTAL ASSETS			24,575,059				25,902,938
LIABILITIES
CURRENT LIABILITIES
Accounts payable			4,501,367				2,219,301
Accrued expenses and other payables			3,693,114				9,636,688
Advances from customers			16,856				30,559
Convertible notes payables			426,078				553,086
Lease liability - current			193,562				179,207
Amounts due to related parties			-				8,871
Liability related to discontinued operation			-				485,653
TOTAL CURRENT LIABILITIES			8,830,977				13,113,365
							-
NON-CURRENT LIABILITIES
Other non-current liabilities			1,088,809				-
Lease liability-non-current			107,584				192,754
TOTAL NON-CURRENT LIABILITIES			1,196,393				192,754
TOTAL LIABILITIES			10,027,370				13,306,119
							-
STOCKHOLDER’ EQUITY							-
FUTURE FINTECH GROUP INC, Stockholders’ equity
Common stock, $0.001 par value; 6,000,000 shares authorized; 3,110,770 shares and 2,447,084 shares issued and outstanding as of June 30, 2025 and December 31, 2024, respectively*			3,111				2,447
Additional paid-in capital			240,474,334				237,496,176
Statutory reserve			98,357				98,357
Accumulated deficits			(221,607,102	)			(218,885,534	)
Accumulated other comprehensive income (loss)			(4,421,011	)			(4,248,561	)
Total FUTURE FINTECH GROUP INC. stockholders’ equity			14,547,689				14,462,885
Non-controlling interests			-				(1,866,066	)
TOTAL STOCKHOLDERS’ EQUITY			14,547,689				12,596,819
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY			24,575,059				25,902,938

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

1

FUTURE FINTECH GROUP INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

(Unaudited)

		For the Three Months Ended June 30,								Six Months Ended June 30,
		2025				2024				2025				2024
Revenue			605,282				268,989				1,158,259				948,178
Cost of revenues-third party			418,510				11,168				892,869				415,263
Cost of revenues-related party			-				-				-				-
Gross profit			186,772				257,821				265,390				532,915
Operating Expenses
General and administrative expenses			853,899				1,423,883				2,433,092				2,614,598
Research and Development expenses			-				-				-				-
Stock-based compensation			-				-				1,085,000				-
Selling expenses			249,048				151,521				440,678				418,206
Bad debt provision (recovery)			393,082				(275,906	)			28,762,566				443,094
Impairment Loss			-				-				-				-
Total operating expenses			1,496,029				1,299,498				32,721,336				3,475,898
Loss from operations			(1,309,257	)			(1,041,677	)			(32,455,946	)			(2,942,983	)
Other income (expenses)
Interest income			115,476				210,859				240,780				501,490
Interest expenses			(7,241	)			(20,934	)			(15,042	)			(44,432	)
Gain on Debt Restructuring			3,071,827				-				3,071,827				-
Other income(expenses) net			(19,025	)			42,593				64,757				(1,664,724	)
Total other income (expenses)			3,161,037				232,518				3,362,322				(1,207,666	)
Income (Loss) from Continuing Operations before Income Tax			1,851,780				(809,159	)			(29,093,624	)			(4,150,649	)
Income tax provision			-				-								-
Deferred income tax			-				-								-
Income (Loss) from Continuing Operations			1,851,780				(809,159	)			(29,093,624	)			(4,150,649	)
Discontinued Operations
Loss from discontinued operations			-				(989,847	)							(1,617,423	)
Gain on disposal of discontinued operations			-				-				28,238,122				645,437
NET Income (LOSS)			1,851,780				(1,799,006	)			(855,502	)			(5,122,635	)
Less: Net Income (Loss) attributable to non-controlling interests of discontinued operations			-				(38,033	)			1,866,066				(34,454	)
Less: Net Loss attributable to non-controlling interests of continued operations			-				-				-				-
Net income (loss) attibutable to Future Fintech Group, Inc.			1,851,780				(1,760,973	)			(2,721,568	)			(5,088,181	)
Other comprehensive income (loss)
Income (Loss) from continuing operations			1,851,780				(809,159	)			(29,093,624	)			(4,150,649	)
Foreign currency translation - Continuing Operations			20,644				(248,643	)			(172,450	)			(208,345	)
Comprehensive Income ( Loss) - Continuing Operations			1,872,424				(1,057,802	)			(29,266,074	)			(4,358,994	)
Income (loss) from discontinued operations			-				(989,847	)			28,238,122				(971,986	)
Foreign currency translation - Discontinued Operations			-				135,375				(179,909	)			47,453
Comprehensive Income ( Loss) - Discontinued Operations			-				(854,472	)			28,058,213				(924,533	)
			-				-
Comprehensive Income ( Loss)			1,872,424				(1,912,274	)			(1,207,861	)			(5,283,527	)
Comprehensive income (loss) attributable to non-controlling interests			-				-				-				-
Comprehensive income (loss) attributable to non-controlling interests of discontinue			-				(38,033	)			1,866,066				(34,454	)
COMPREHENSIVE INCOME ATTRIBUTABLE TO Future Fintech Group, Inc.			1,872,424				(1,874,241	)			(3,073,927	)			(5,249,073	)
Earnings per share:
Basic earnings per share from continuing operation			0.61				(0.40	)			(10.27	)			(2.08	)
Basic earnings per share from discontinued operation			0.00				(0.48	)			9.31				(0.47	)
			0.61				(0.88	)			(0.96	)			(2.55	)
Diluted Earnings per share:
Diluted earnings per share from continuing operation			0.61				(0.40	)			(10.27	)			(2.08	)
Diluted earnings per share from discontinued operation			0.00				(0.48	)			9.30				(0.47	)
			0.61				(0.88	)			(0.97	)			(2.55	)
Weighted average number of shares outstanding
Basic			3,046,639				1,998,541				2,832,375				1,992,633
Diluted			3,050,850				2,002,752				2,836,586				1,996,844

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

2

Future Fintech Group, Inc.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(Unaudited)

Three Months ended June 30, 2024

		Common stock								Additional paid-in				Statutory				Accumulated				Accumulative other comprehensive				Non-controlling
		Shares				Amount				capital				reserve				Deficts				income				interests				Total
Balance at March 31, 2024			1,998,541				1,998				236,487,477				98,357				(189,256,870	)			(4,141,900	)			(1,564,628	)			41,624,434
Net loss from continuing operation			-				-				-				-				(809,159	)			-				-				(809,159	)
Disposition of discontinued operation			-				-				-				-				(951,814	)			135,375				(38,033	)			(854,472	)
Foreign currency translation adjustment			-				-				-				-				-				(248,643	)			-				(248,643	)
Balance at June 30, 2024			1,998,541				1,998				236,487,477				98,357				(191,017,843	)			(4,255,168	)			(1,602,661	)			39,712,160

Three Months ended June 30, 2025

		Common stock								Additional paid-in				Statutory				Accumulated				Accumulative other comprehensive				Non-controlling
		Shares				Amount				capital				reserve				Deficts				income				interests				Total
Balance at March 31, 2025			3,009,289				3,009				238,721,272				98,357				(223,458,882	)			(4,441,655	)			-				10,922,101
Issuance of common stocks-conversion of debt			60,000				60				64,140				-				-				-				-				64,200
Effect to rounding fractional shares into whole shares upon reverse stock split			41,481				42				(42	)			-				-				-				-				-
Pending Equity Settlement			-				-				1,688,964				-				-				-				-				1,688,964
Net income from continuing operation			-				-				-				-				1,851,780				-				-				1,851,780
Foreign currency translation adjustment			-				-				-				-				-				20,644				-				20,644
Balance at June 30, 2025			3,110,770				3,111				240,474,334				98,357				(221,607,102	)			(4,421,011	)			-				14,547,689

3

Six Months ended June 30, 2024

		Common stock								Additional paid-in				Statutory				Accumulated				Accumulative other comprehensive				Non-controlling
		Shares				Amount				capital				reserve				Deficts				income				interests				Total
Balance at December 31, 2023			1,783,487				1,783				233,907,049				98,357				(185,929,662	)			(4,094,276	)			(1,568,207	)			42,415,044
Net loss from continuing operation			-				-				-				-				(4,150,649	)			-				-				(4,150,649	)
Net loss from discontinued operations			-				-				-				-				(1,582,969	)			-				(34,454	)			(1,617,423	)
Issuance of common stocks-cash			215,054				215				2,580,428				-				-				-				-				2,580,643
Disposition of discontinued operation			-				-				-				-				645,437				47,453				-				692,890
Foreign currency translation adjustment			-				-				-				-				-				(208,345	)			-				(208,345	)
Balance at June 30, 2024			1,998,541				1,998				236,487,477				98,357				(191,017,843	)			(4,255,168	)			(1,602,661	)			39,712,160

Six Months ended June 30, 2025

		Common stock								Additional paid-in				Statutory				Accumulated				Accumulative other comprehensive				Non-controlling
		Shares				Amount				capital				reserve				Deficts				income				interests				Total
Balance at December 31, 2024			2,447,084				2,447				237,496,176				98,357				(218,885,534	)			(4,248,561	)			(1,866,066	)			12,596,819
Issuance of common stocks-conversion of debt			121,205				121				204,737				-				-				-				-				204,858
Net loss from continuing operations			-				-				-				-				(29,093,624	)			-				-				(29,093,624	)
Effect to rounding fractional shares into whole shares upon reverse stock split			42,481				43				(43	)			-				-				-				-				-
Share-based payments-omnibus equity plan			500,000				500				1,084,500				-				-				-				-				1,085,000
Pending Equity Settlement			-				-				1,688,964				-				-				-				-				1,688,964
Foreign currency translation adjustment			-				-				-				-				-				7,459				-				7,459
Disposition of discontinued operation			-				-				-				-				26,372,056				(179,909	)			1,866,066				28,058,213
Balance at June 30, 2025			3,110,770				3,111				240,474,334				98,357				(221,607,102	)			(4,421,011	)			-				14,547,689

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

4

FUTURE FINTECH GROUP INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

		For the Six Months Ended June 30,
		2025				2024
Cash Flows from Operating Activities:
Net loss			(855,502	)			(5,122,635	)
Net income from discontinued operation			28,238,122				(971,986	)
Net loss from continuing operation			(29,093,624	)			(4,150,649	)
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation			50,971				60,300
Amortization			28,518				28,518
Bad debt provision			28,762,566				443,094
Share-based payments			1,085,000				-
Gain on Debt Restructuring			(3,071,827	)
Investment loss			-				9,337
Interest expenses related to convertible note			13,651				43,880
Changes in operating assets and liabilities:
Accounts receivable			445,361				1,039,672
Notes receivable			-				(645,451	)
Other receivable			(28,012,031	)			(4,159,876	)
Advances to suppliers and other current assets			(173,891	)			(3,341,995	)
Operating lease assets and liabilities			(736	)			(5,242	)
Accounts payable			2,282,066				(431,583	)
Accrued expenses & other payables			(1,118,584	)			389,939
Advances from customers			(13,703	)			(74,417	)
Other non-current liabilities			1,088,809				-
Net Cash Used in Operating Activities			(27,727,454	)			(10,794,473	)
Net Cash Provided in Operating Activities-Discontinued operations			28,349,426				39,234
Cash Flows from Investing Activities:
Additions to property and equipment			-				(33,554	)
Debt investment			482,553				(701,577	)
Disposal of property and equipment			-				-
Payment for Short term Investment			-				949,662
Repayment of loan receivable			139,692				-
Disposal of a subsidiary, net of cash			-				-
Net Cash Provided by Investing Activities from Continuing Operations			622,245				214,531
Net Cash Used in Investing Activities from Discontinued Operations			-				-
Cash Flows from Financing Activities:
Proceeds from the issuance of common stock, net of issurance costs			-				2,580,643
Proceeds from amounts due from related parties, net			(4,322	)			(29,345	)
Repayment of amounts due to related parties, net			(8,871	)			(103,406	)
Net Cash (Used in) Provided by Financing Activities			(13,193	)			2,447,892
Net Cash Provided by Financing Activities-dis			-				-
Effect of Exchange Rate Changes on Cash			(210,586	)			(107,612	)
Net Increase (Decrease) in Cash and Restricted Cash			1,020,438				(8,200,428	)
Cash and Restricted Cash at Beginning of Year			4,765,865				16,159,657
Cash and Restricted Cash at End of Year			5,786,303				7,959,229
Check			-				-
Less: Cash and cash equivalents from the discontinued operations, end of year			-				-
Cash and cash equivalents, from the continuing operations end of year			5,786,303				7,959,229

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

5

FUTURE FINTECH GROUP INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

1. CORPORATE INFORMATION

Future FinTech Group Inc. (the “Company”) is a holding company incorporated under the laws of the State of Florida. The Company historically engaged in the production and sale of fruit juice concentrates (including fruit purees and fruit juices), fruit beverages (including fruit juice beverages and fruit cider beverages) in the PRC. Due to drastically increased production costs and tightened environmental laws in China, the Company had transformed its business from fruit juice manufacturing and distribution to financial technology related service businesses. The main business of the Company includes supply chain financing services and trading in China. The Company also expanded into brokerage and investment banking business in Hong Kong. The Company had a contractual arrangement with a VIE E-Commerce Tianjin in China, which has generated minimal revenue and business since 2021 due to the negative impact caused by COVID-19. The Company started the process to close it down in November 2023 and completed deregistration and dissolution of the VIE with local authority on March 7, 2024.

On March 27, 2025, Future FinTech Group Inc. (the “Company”) filed with the Florida Secretary of State’s office Articles of Amendment (the “Amendment”) to amend its Second Amended and Restated Articles of Incorporation, as amended (“Articles of Incorporation”). As a result of the Amendment, the Company has authorized and approved a 1-for-10 reverse stock split of the Company’s authorized shares of common stock from 60,000,000 shares to 6,000,000 shares, accompanied by a corresponding decrease in the Company’s issued and outstanding shares of common stock (the “Reverse Stock Split”). The common stock will continue to be $0.001 par value. The Company rounded up the fractional shares that result from the Reverse Stock Split and no fractional shares were issued in connection with the Reverse Stock Split and no cash or other consideration will be paid in connection with any fractional shares that would otherwise have resulted from the Reverse Stock Split. No changes are being made to the number of preferred shares of the Company which remain as 10,000,000 preferred shares as authorized but not issued. The amendment to the Articles of Incorporation of the Company took effect at 1:00pm E.T. on April 1, 2025.

The reverse stock split would be reflected in the Company’s June 30, 2025 and December 31, 2024 statements of changes in stockholders’ equity, and in per share data for all periods presented.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of presentation

The unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information and the rules and regulations of the Securities and Exchange Commission. In the opinion of management, the unaudited financial statements have been prepared on the same basis as the annual financial statements and reflect all adjustments, which include only normal recurring adjustments, necessary to present fairly the financial position as of June 30, 2025 and the results of operations and cash flows for the periods ended June 30, 2025 and 2024. The financial data and other information disclosed in these notes to the interim financial statements related to these periods are unaudited. The results for the six months ended June 30, 2025 are not necessarily indicative of the results to be expected for any subsequent periods or for the entire year ending December 31, 2025. The balance sheet at December 31, 2024 has been derived from the audited financial statements at that date.

Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States have been condensed or omitted pursuant to the Securities and Exchange Commission’s rules and regulations. These unaudited financial statements should be read in conjunction with the Company’s audited financial statements and notes thereto for the year ended December 31, 2024 as included in the Company’s Annual Report on Form 10-K.

6

Discontinued Operations

On March 7, 2024, Chain Cloud Mall Network and Technology (Tianjin) Co., Limited was dissolved and deregistered.

On September 4, 2024, Tianjin Future Private Equity Fund Management Partnership (Ltd Partnership) was dissolved and deregistered. The loss on disposal was $22.46.

On October 18, 2024, Nice Talent Asset Management Limited (“NTAM”) was disposed of for a consideration of $ 0.31 million (HK$2.40 million). The loss on disposal was $2.32 million.

On December 6, 2024, FTFT Super Computing Inc. was disposed of for a consideration of US$1.97 million, of which (i) the assumption of the obligations of FTFT Super Computing totaling $973,072.24 and (ii) $1,000,000 was paid to an account at Olshan Frome Wolosky LLP to satisfy, in part, the right of payment held by FT Global Capital, Inc. arising from the judgment entered in favor of FT Global and against the Company registered in the Southern District of New York. The gain on disposal was $3.42 million.

On February 3, 2025, FTFT UK LIMITED, FTFT Finance UK Limited, Future Fintech Digital Number One US, LP, Future Fintech Digital Number One Offshore, LLC(Cayman), Future Fintech Digital Number One GP,LLC (USA), FTFT Digital Number One, Ltd.(Cayman), Future FinTech Labs Inc, Future Fintech Digital Capital, FTFT CAPITAL INVESTMENTS, DigiPay FinTech Limited, DCON DigiPay Limited-JPN and Global Key Shared Mall Ltd were disposed of for a consideration of US$25,000 after a court auction sale. The gain of disposal was $28.24 million.

Based on the disposal plan and in accordance with ASC 205-20, the Company presented the operating results from these operations as a discontinued operation.

Segment Information Reclassification

The Company classified business segment into Trading Commission and Consulting service, Fast-Moving Consumer Goods (FMCG), and Supply Chain Financing and Trading.

Uses of Estimates in the Preparation of Financial Statements

The Company’s condensed consolidated financial statements have been prepared in accordance with US GAAP and this requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and reported amounts of revenue and expenses during the reporting period. The significant areas requiring the use of management estimates include, but not limited to, the expected credit losses for receivables, estimated useful life and residual value of property, plant and equipment, impairment of long-lived assets, provision for staff benefit, recognition and measurement of deferred income taxes and valuation allowance for deferred tax assets. Although these estimates are based on management’s knowledge of current events and actions management may undertake in the future, actual results may ultimately differ from those estimates and such differences may be material to the Company’s condensed consolidated financial statements.

Going Concern

The Company’s financial statements are prepared assuming that the Company will continue as a going concern.

The Company incurred operating losses and had negative operating cash flows and may continue to incur operating losses and generate negative cash flows as the Company implements its future business plan. The Company’s operating losses amounted $29.09 million, and it had negative operating cash flows amounted $27.73 million as of June 30, 2025. These factors raise substantial doubts about the Company’s ability to continue as a going concern. The Company has raised funds through issuance of convertible notes and common stock.

The ability of the Company to continue as a going concern is dependent upon its ability to successfully execute its new business strategy and eventually attain profitable operations. The accompanying financial statements do not include any adjustments that may be necessary if the Company is unable to continue as a going concern.

7

Impairment of Long-Lived Assets

In accordance with the ASC 360-10, Accounting for the Impairment or Disposal of Long-Lived Assets, long-lived assets, such as property, plant and equipment and purchased intangibles subject to amortization are reviewed for impairment whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable, or it is reasonably possible that these assets could become impaired as a result of technological or other industrial changes. The determination of recoverability of assets to be held and used is made by comparing the carrying amount of an asset to future undiscounted cash flows to be generated by the assets.

If such assets are considered to be impaired, the impairment to be recognized is measured as the amount by which the carrying amount of the assets exceeds the fair value of the assets. Assets to be disposed of are reported at the lower of the carrying amount or fair value less cost to sell.

Fair Value of Financial Instruments

The Company has adopted FASB ASC Topic on Fair Value Measurements and Disclosures (“ASC 820”), which defines fair value, establishes a framework for measuring fair value in GAAP, and expands disclosures about fair value measurements. ASC 820 establishes a three-level valuation hierarchy of valuation techniques based on observable and unobservable input, which may be used to measure fair value and include the following:

Level 1 - Quoted prices in active markets for identical assets or liabilities.

Level 2 - Input other than Level 1 that is observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other input that is observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

Level 3 - Unobservable input that is supported by little or no market activity and that is significant to the fair value of the assets or liabilities.

The Company’s cash and cash equivalents and restricted cash and short-term investments are classified within level 1 of the fair value hierarchy because they are value using quoted market price.

Earnings Per Share

Under ASC 260-10, Earnings Per Share, basic EPS excludes dilution for Common Stock equivalents and is calculated by dividing net income (loss) available to common stockholders by the weighted-average number of Common Stock outstanding for the period.

Diluted EPS is calculated by using the treasury stock method, assuming conversion of all potentially dilutive securities, such as stock options and warrants. Under this method, (i) exercise of options and warrants is assumed at the beginning of the period and shares of Common Stock are assumed to be issued, (ii) the proceeds from exercise are assumed to be used to purchase Common Stock at the average market price during the period, and (iii) the incremental shares (the difference between the number of shares assumed issued and the number of shares assumed purchased) are included in the denominator of the diluted EPS computation. The numerators and denominators used in the computations of basic and diluted EPS are presented in the following table.

8

For the six months ended June 30, 2025: 

		Income				Share				Pre-share amount
Loss from continuing operations attributable to Future Fintech Group, Inc.		$	(29,093,624	)			2,832,375			$	(10.27	)
Income from discontinued operations attributable to Future Fintech Group, Inc.			26,372,056				2,832,375				9.31
Basic EPS:
Loss to common stockholders from continuing operations			(29,093,624	)			2,832,375				(10.27	)
Income available to common stockholders from discontinued operations		$	26,372,056				2,832,375			$	9.31
Dilutive EPS:
Warrants			-				4,211				-
Diluted loss per share is calculated by taking net loss, divided by the diluted weighted average common shares outstanding. Diluted net loss per share equals basic net loss per share because the effect of securities convertible into common shares is anti-dilutive from continuing operations attributable to Future Fintech Group, Inc.			(29,093,624	)			2,836,586			$	(10.27	)
Diluted earnings per share is calculated by taking net income, divided by the diluted weighted average common shares outstanding from discontinued operations			26,372,056				2,836,586				9.30

For the six months ended June 30, 2024:

		Income				Share				Pre-share amount
Loss from continuing operations attributable to Future Fintech Group, Inc.		$	(4,150,649	)			1,992,633			$	(2.08	)
Loss from discontinued operations attributable to Future Fintech Group, Inc.			(937,532	)			1,992,633				(0.47	)
Basic EPS:
Loss to common stockholders from continuing operations			(4,150,649	)			1,992,633				(2.08	)
Loss available to common stockholders from discontinued operations		$	(937,532	)			1,992,633			$	(0.47	)
Dilutive EPS:
Warrants			-				4,211				-
Diluted loss per share is calculated by taking net loss, divided by the diluted weighted average common shares outstanding. Diluted net loss per share equals basic net loss per share because the effect of securities convertible into common shares is anti-dilutive from continuing operations attributable to Future Fintech Group, Inc.			(4,150,649	)			1,996,844				(2.08	)
Diluted loss per share is calculated by taking net loss, divided by the diluted weighted average common shares outstanding from discontinued operations			(937,532	)			1,996,844				(0.47	)

9

For the three months ended June 30, 2025: 

		Income				Share				Pre-share amount
Income from continuing operations attributable to Future Fintech Group, Inc.		$	1,851,780				3,046,639			$	0.61
Income from discontinued operations attributable to Future Fintech Group, Inc.			-				3,046,639				-
Basic EPS:
Income to common stockholders from continuing operations			1,851,780				3,046,639				0.61
Income available to common stockholders from discontinued operations		$	-				3,046,639			$	-
Dilutive EPS:
Warrants			-				4,211				-
Diluted earnings per share is calculated by taking net income divided by the diluted weighted average common shares outstanding. Diluted net earnings per share equals basic net income per share because the effect of securities convertible into common shares is anti-dilutive from continuing operations attributable to Future Fintech Group, Inc.			1,851,780				3,050,850				0.61
Diluted earnings per share is calculated by taking net income, divided by the diluted weighted average common shares outstanding from discontinued operations			-				3,050,850				-

For the three months ended June 30, 2024:

		Income				Share				Pre-share amount
Loss from continuing operations attributable to Future Fintech Group, Inc.		$	(809,159	)			1,998,541			$	(0.40	)
Loss from discontinued operations attributable to Future Fintech Group, Inc.			(951,814	)			1,998,541				(0.48	)
Basic EPS:
Loss available to common stockholders from continuing operations		$	(809,159	)			1,998,541			$	(0.40	)
Loss available to common stockholders from discontinued operations		$	(951,814	)			1,998,541				(0.48	)
Dilutive EPS:
Warrants			-				4,211				-
Diluted loss per share is calculated by taking net loss, divided by the diluted weighted average common shares outstanding. Diluted net loss per share equals basic net loss per share because the effect of securities convertible into common shares is anti-dilutive		$	(809,159	)			2,002,752			$	(0.40	)
Diluted loss per share is calculated by taking net loss, divided by the diluted weighted average common shares outstanding.			(951,814	)			2,002,752				(0.48	)

10

Cash and Cash Equivalents

Cash and cash equivalents included cash on hand and demand deposits placed with banks or other financial institutions, which are unrestricted as to withdrawal and use and with an original maturity of three months or less.

Deposits in banks in the PRC are only insured by the government up to RMB500,000, in the HK are only insured by the government up to HKD500,000, in the United States of America are only insured by the Federal Deposit Insurance Corporation up to USD250,000, and are consequently exposed to risk of loss.

The Company believes the probability of a bank failure, causing loss to the Company, is remote.

Cash that is restricted as to withdrawal for use or pledged as security is reported separately on the face of the unaudited condensed consolidated balance sheets, and is not included in the total cash and cash equivalents in the unaudited condensed consolidated statements of cash flows.

Receivable and Credit Losses

Accounts receivable are recognized and carried at the original invoice amounts less an allowance for any uncollectible amount. The Company has a policy of reserving for uncollectible accounts based on the Company’s best estimate of the amount of probable credit losses in the Company’s existing accounts receivable. The Company performs ongoing credit evaluations of the Company’s customers and maintain an allowance for potential bad debts if required.

Other receivables, and loan receivables are recognized and carried at the initial amount when occurred less an allowance for credit losses. The Company has a policy of reserving for uncollectible accounts based on the Company’s best estimate of the amount of probable impairment losses in the Company’s existing receivable.

Allowances for credit losses are maintained for expected credit losses resulting from the Company’s customers’ inability to make required payments. The allowances are based on the Company’s regular assessment of various factors, including the credit-worthiness and financial condition of specific customers, historical experience with bad debts and customer deductions, receivables aging, current economic conditions, reasonable and supportable forecasts of future economic conditions, and other factors that may affect the Company’s ability to collect from customers. The Company maintains an allowance for credit losses in accordance with ASC Topic 326, Credit Losses (“ASC 326”) and records the allowance for credit losses as an offset to accounts receivable and contract assets, and the estimated credit losses charged to the allowance is classified as “Bad debt expense” in the unaudited condensed consolidated statements of comprehensive income (loss). The Company determines whether an allowance for doubtful accounts is required by evaluating specific accounts where information indicates the customers may have an inability to meet financial obligations. In these cases, The Company uses assumptions and judgment, based on the best available facts and circumstances, to record a specific allowance for those customers against amounts due to reduce the receivable to the amount expected to be collected. These specific allowances are re-evaluated and adjusted as additional information is received. The amounts calculated are analyzed to determine the total amount of the allowance. The Company may also record a general allowance as necessary.

Direct write-offs are taken in the period when the Company has exhausted the Company’s efforts to collect overdue and unpaid receivable or otherwise evaluate other circumstances that indicate that the Company should abandon such efforts.

The Company has assessed its accounts receivable including credit term and corresponding all its accounts receivables as of June 30, 2025. Bad debt expense was $28,762,566 and $443,094 during the six months ended June 30, 2025 and 2024, respectively. Accounts receivables of $1.33 million and $1.15 million have been outstanding for over 90 days as of June 30, 2025 and December 31, 2024, respectively.

11

Revenue Recognition

The Company applies the five steps defined under ASC 606: (i) identify the contract(s) with a customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations in the contract, and (v) recognize revenue when (or as) the entity satisfies a performance obligation. The Company assesses its revenue arrangements against specific criteria in order to determine if it is acting as principal or agent. Revenue arrangements with multiple performance obligations are divided into separate distinct goods or services. The Company allocates the transaction price to each performance obligation based on the relative standalone selling price of the goods or services provided. Revenue is recognized upon the transfer of control of promised goods or services to a customer. Control is generally transferred when the Company has a present right to payment and title and the significant risks and rewards of ownership of products or services are transferred to its customers.

The Company does not make any significant judgment in evaluating when control is transferred. Revenue is recorded net of value-added tax.

Revenue recognitions are as follows:

Sales of coals, aluminum ingots, sand and steel

The Company recognizes revenue when the receipt of merchandise is confirmed by the customers, which is the point that the title of the goods is transferred to the customer. Revenue was $1,341 and $506,438 during the six months ended June 30, 2025 and 2024, respectively.

Sales of fast-moving consumer goods

The Company operates an e-commerce platform specializing in fast-moving consumer. For sales transacted through the Company’s online stores in mainland China, the standard return policy permits customers to return eligible products within seven days of purchase. Historically, customer returns were immaterial.

Property, Plant and Equipment

Property, plant and equipment are stated at cost less accumulated depreciation and any impairment losses. Depreciation is computed using the straight-line method over the useful lives of the assets. Major renewals and betterments are capitalized and depreciated; maintenance and repairs that do not extend the life of the respective assets are expensed as incurred. Upon disposal of assets, the cost and related accumulated depreciation are removed from the accounts and any gain or loss is included in the unaudited condensed consolidated statements of operations and comprehensive income (loss).

Depreciation related to property, plant and equipment used in production is reported in cost of sales, and includes amortized amounts related to capital leases. The Company estimated that the residual value of the Company’s property and equipment ranges from 3% to 5%. Property, plant and equipment are depreciated over their estimated useful lives as follows:

Machinery and equipment		5-10 years
Building		30 years
Furniture and office equipment		3-5 years
Motor vehicles		5 years

12

Intangible Assets

Acquired intangible assets are recognized based on their cost to the Company, which generally includes the transaction costs of the asset acquisition, and no gain or loss is recognized unless the fair value of noncash assets given as consideration differs from the assets’ carrying amounts on the Company’s book. These assets are amortized over their useful lives if the assets are deemed to have a finite life and they are reviewed for impairment by testing for recoverability whenever events or changes in circumstances indicate that its carrying amount may not be recoverable. The fair value of an intangible asset is the amount that would be determined if the entity used the assumptions that market participants would use if they were pricing the intangible asset. The useful life of the Company’s intangible assets is ten years, which is determined by using the time period that an intangible is estimated to contribute directly or indirectly to a Company’s future cash flows.

Foreign Currency and Other Comprehensive Income (Loss)

The financial statements of the Company’s foreign subsidiaries are measured using the local currency as the functional currency; however, the reporting currency of the Company is the USD. Assets and liabilities of the Company’s foreign subsidiaries have been translated into USD using the exchange rate at the balance sheet dates, while equity accounts are translated using historical exchange rate.

The exchange rate the Company used to convert RMB to USD was 7.16:1 and 7.19:1 at the balance sheet dates of June 30, 2025 and December 31, 2024, respectively. The average exchange rate for the period has been used to translate revenues and expenses. The average exchange rates the Company used to convert RMB to USD were 7.18:1 and 7.11:1 for six months ended June 30, 2025 and 2024, respectively.

The exchange rate the Company used to convert HKD to USD was 7.85:1 and 7.76:1 at the balance sheet dates of June 30, 2025 and December 31, 2024. The average exchange rate for the period has been used to translate revenues and expenses. The average exchange rates the Company used to convert HKD to USD were 7.79:1 and 7.82:1 for six months ended June 30, 2025 and 2024, respectively.

Translation adjustments are reported separately and accumulated in a separate component of equity (cumulative translation adjustment).

Government subsidies

Government subsidies primarily consist of financial subsidies received from provincial and local governments for operating a business in their jurisdictions and compliance with specific policies promoted by the local governments. For certain government subsidies, there are no defined rules and regulations to govern the criteria necessary for companies to receive such benefits, and the amount of financial subsidy is determined at the discretion of the relevant government authorities. The government subsidies of operating nature with no further conditions to be met are recorded of operating expenses in “Other income” in the unaudited condensed consolidated statements of operations and comprehensive income (loss) when received.

The amendments in this update require disclosures about transactions with a government that have been accounted for by analogizing to a grant or contribution accounting model to increase transparency about (1) the types of transactions, (2) the accounting for the transactions, and (3) the effect of the transactions on an entity’s financial statements.

13

Income Taxes

The Company uses the asset and liability method of accounting for income taxes in accordance with ASC Topic 740, “Income Taxes.” Under this method, income tax expense is recognized for the amount of: (i) taxes payable or refundable for the current year and (ii) deferred tax consequences of temporary differences resulting from matters that have been recognized in an entity’s financial statements or tax returns. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the results of operations in the period that includes the enactment date. A valuation allowance is provided to reduce the deferred tax assets reported if based on the weight of the available positive and negative evidence, it is more likely than not some portion or all of the deferred tax assets will not be realized.

ASC Topic 740-10-30 clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements and prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. ASC Topic 740-10-25 provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. The Company has no material uncertain tax positions for any of the reporting periods presented.

Short-term investments

Short-term investments consist primarily of investments in fixed deposits with original maturities between three months and one year and certain investments in wealth management products and other investments that the Company has the intention to redeem within one year. Fair valued or carried at amortized costs. As of June 30, 2025 and December 31, 2024, the short-term investments amounted to $1,397 and $1,391, respectively.

Long-term investments

Long-term investments consist primarily of investments in debt investment with original maturities between three years and more. Fair valued or carried at amortized costs. As of June 30, 2025 and December 31, 2024, the long-term investments amounted to $1.05 million and $1.53 million, respectively. Due to the Company has received repayment $0.48 million (RMB3.5 million) debt investment, the Company did not recognize an impairment.

Lease

The Company adopted ASU No. 2016-02, Leases (Topic 842), or ASC 842, from January 1, 2020. The Company determines if an arrangement is a lease or contains a lease at lease inception. For operating leases, the Company recognizes a right-of-use (“ROU”) asset and a lease liability based on the present value of the lease payments over the lease term on the unaudited condensed consolidated balance sheets at commencement date. As most of the Company’s leases do not provide an implicit rate, the Company estimates the incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments. The incremental borrowing rate is estimated to approximate the interest rate on a collateralized basis with similar terms and payments, and in economic environments where the leased asset is located. The ROU assets also include any lease payments made, net of lease incentives. Lease expense is recorded on a straight-line basis over the lease term. the Company’s leases often include options to extend and lease terms include such extended terms when the Company is reasonably certain to exercise those options. Lease terms also include periods covered by options to terminate the leases when the Company is reasonably certain not to exercise those options.

14

Share-based compensation

The Company awards share options and other equity-based instruments to its employees, directors and consultants (collectively “share-based payments”). Compensation cost related to such awards is measured based on the fair value of the instrument on the grant date. The Company recognizes the compensation cost over the period the employee is required to provide service in exchange for the award, which generally is the vesting period. The amount of cost recognized is adjusted to reflect the expected forfeiture prior to vesting. When no future services are required to be performed by the employee in exchange for an award of equity instruments, and if such award does not contain a performance or market condition, the cost of the award is expensed on the grant date. The Company recognizes compensation cost for an award with only service conditions that has a graded vesting schedule on a straight-line basis over the requisite service period for the entire award, provided that the cumulative amount of compensation cost recognized at any date at least equals the portion of the grant-date value of such award that is vested at that date.

New Accounting Pronouncements

In November 2023, the FASB issued ASU No. 2023-07, “Segment Reporting (Topic 280) Improvements to Reportable Segment Disclosures.” This ASU expands required public entities’ segment disclosures, including disclosure of significant segment expenses that are regularly provided to the chief operating decision maker and included within each reported measure of segment profit or loss, an amount and description of its composition for other segment items and interim disclosures of a reportable segment’s profit or loss and assets. ASU 2023 07 is applied retrospectively to all periods presented in financial statements, unless it is impracticable. This ASU is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted. The Company adopted this guidance effective July 1, 2024 and the adoption of this ASU is not expected to have a material impact on its financial statements.

In December 2023, the FASB issued ASU No. 2023-09, “Income Taxes (Topic 740): Improvements to Income Tax Disclosures”. This ASU requires additional quantitative and qualitative income tax disclosures to enable financial statements users better assess how an entity’s operations and related tax risks and tax planning and operational opportunities affect its tax rate and prospects for future cash flows. The ASU is effective for annual reporting periods beginning after December 15, 2024, with early adoption permitted and can be applied on either a prospective or retroactive basis. The Company adopted this guidance effective July 1, 2025 and the Company is currently evaluating the impact of adopting this ASU on its financial statements.

Management does not believe that any other recently issued, but not yet effective accounting pronouncements, if adopted, would have a material impact on the accompanying unaudited condensed consolidated financial statements.

3. ACCOUNTS RECEIVABLE

Accounts receivable, net, consist of the following:

		June 30,				December 31,
		2025				2024
Supply Chain Financing/Trading		$	1,212,646			$	1,984,893
Trading Commission and Consulting service			423,834				104,069
Fast-Moving Consumer Goods			7,121				-
Total accounts receivable, net		$	1,643,601			$	2,088,962

15

The following table sets forth the Company’s concentration of accounts receivable, net of specific allowances for credit losses.

		June 30,				December 31,
		2025				2024
Debtor A			24.2	%			34.6	%
Debtor B			22.7	%			19.0	%
Debtor C			19.1	%			17.8	%
Total accounts receivable, net			66.0	%			71.4	%

4. OTHER RECEIVABLES

As of June 30, 2025, the balance of other receivables was $0.92 million deposit paid and prepayments to third parties.

As of December 31, 2024, the balance of other receivables was $1.49 million deposit paid and prepayments to third parties.

5. LOAN RECEIVABLES

As of June 30, 2025, the balance of loan receivables was $6.98 million, which were from third parties.

On July 14, 2022, Future Private Equity Fund Management (Hainan) Co., Limited entered into a “Loan Agreement” with a third party. Pursuant to the Loan Agreement, Future Private Equity Fund Management (Hainan) Co., Limited loaned an amount of $7.00 million (RMB50 million) to the third party at the annual interest rate of 8% from July 15, 2022 to December 31, 2025, guarantee by Junde Chen. To strengthen the liquidity, the Company negotiated with the borrower to early settle part of the loan. As of April 17, 2023, the Company has received repayment $4.87 million (RMB35 million). As of June 30, 2025, the balance of loan receivables was $2.09 million. The amount of $2.09 million (RMB15 million) will be repaid within 12 months.

On December 8, 2023, Future Private Equity Fund Management (Hainan) Co., Limited entered into a “Loan Agreement” with a third party. Pursuant to the Loan Agreement, Future Private Equity Fund Management (Hainan) Co., Limited loaned an amount of $4.88 million (RMB35 million) to the third party at the annual interest rate of 5% from December 8, 2022 to December 8, 2025. As of June 30, 2025, the balance of loan receivables was $4.89 million.

As of December 31, 2024, the balance of loan receivables was $7.09 million, which was from a third parties.

On July 14, 2022, Future Private Equity Fund Management (Hainan) Co., Limited entered into a “Loan Agreement” with a third party. Pursuant to the Loan Agreement, Future Private Equity Fund Management (Hainan) Co., Limited loaned an amount of $7.00 million (RMB50 million) to the third party at the annual interest rate of 8% from July 15, 2022 to July 14, 2025, guarantee by Junde Chen. To strengthen the liquidity, the Company negotiated with the borrower to early settle part of the loan. As of April 17, 2023, the Company has received repayment $4.87 million (RMB35 million). As of December 31, 2024, the balance of loan receivables was $2.09 million. The amount of $2.09 million (RMB15 million) will be repaid within 12 months.

On December 8, 2023, Future Private Equity Fund Management (Hainan) Co., Limited entered into a “Loan Agreement” with a third party. Pursuant to the Loan Agreement, Future Private Equity Fund Management (Hainan) Co., Limited loaned an amount of $4.86 million (RMB35 million) to the third party at the annual interest rate of 5% from December 8, 2022 to December 8, 2025. As of December 31, 2024, the balance of loan receivables was $4.85 million.

On August 29, 2024, Future Supply Chain (Xi’an) Co., Ltd entered into a “Loan Agreement” with a third party. Pursuant to the Loan Agreement, Future Supply Chain (Xi’an) Co., Ltd loaned an amount of $0.14 million (RMB1 million) to the third party at the annual interest rate of 12% from August 29, 2024 to November 30, 2025. As of December 31, 2024, the balance of loan receivables was $0.14 million. The loan was repaid on January 24, 2025.

16

6. ADVANCES TO SUPPLIERS AND OTHER CURRENT ASSETS

The amount of advances to suppliers and other current assets consisted of the followings:

		June 30,				December 31,
		2025				2024
Prepayments for Supply Chain Financing/Trading		$	3,986,296			$	4,351,414
Prepaid expenses			204,081				34,867
Others			746,584				557,547
Total		$	4,936,961			$	4,943,828

7. LEASES

The Company’s non-cancellable operating leases consist of leases for office space. The Company is the lessee under the terms of the operating leases. For the six months ended June 30, 2025, the operating lease cost was $0.09 million.

The Company’s operating leases have remaining lease terms of approximately 19 months. As of June 30, 2025, the weighted average remaining lease term and weighted average discount rate were 1.60 years and 4.88%, respectively.

Maturities of lease liabilities were as follows:

		Operating
As of June 30,		Lease
From July 1, 2025 to June 30, 2026		$	202,391
From July 1, 2026 to June 30, 2027			108,989
Total		$	311,380
Less: amounts representing interest		$	10,234
Present Value of future minimum lease payments			301,146
Less: Current obligations			193,562
Long term obligations		$	107,584

The Company leases office space and equipment under various short-term operating leases. As permitted by ASC 842, the Company has elected the practical expedient for short-term leases, whereby lease assets and lease liabilities are not recognized on the balance sheet. Short term leases cost was nil for the six months ended June 30, 2025.

8. PROPERTY AND EQUIPMENT

Property and equipment consist of the following:

		June 30,				December 31,
		2025				2024
Office equipment, fixtures and furniture		$	50,823			$	50,866
Vehicle			386,456				384,854
Building			62,598				62,339
Subtotal			499,877				498,059
Less: accumulated depreciation and amortization			(310,784	)			(258,767	)
Construction in progress			2,235,674				2,226,408
Impairment			(1,064	)			(1,059	)
Total		$	2,423,703			$	2,464,641

17

Depreciation expense included in general and administration expenses for the six months ended June 30, 2025 and 2024 was $50,971 and $60,300, respectively. Depreciation expense included in cost of sales for the six months ended June 30, 2025 and 2024 was $0 and $0, respectively.

9. INTANGIBLE ASSETS

Intangible assets consist of the following:

		June 30,				December 31,
		2025				2024
Trading rights of license plates		$	127,392			$	128,824
System and software			627,489				628,131
Subtotal			754,881				756,955
Less: accumulated depreciation and amortization			(252,008	)			(224,133	)
Total		$	502,873			$	532,822

Amortization expense included in general and administration expenses for the six months ended June 30, 2025 and 2024 was $28,518 and $28,518, respectively. Amortization expense included in cost of sales for the six months ended June 30, 2025 and 2024 was $0 and $0, respectively.

The estimated amortization is as follows:

As of June 30,		Estimated amortization expense
From July 1, 2025 to June 30, 2026		$	57,035
From July 1, 2026 to June 30, 2027			57,035
From July 1, 2027 to June 30, 2028			57,035
From July 1, 2028 to June 30, 2029			57,035
From July 1, 2029 to June 30, 2030			57,035
Thereafter			90,306
Total		$	375,481

Type 1 and Type 2 licenses by Hong Kong Securities and Futures Commission have no expiration date and do not require amortization, amount was $128,560 and $128,824.

10. ACCOUNT PAYABLES

The amount of account payables were consisted of the followings:

		June 30,				December 31,
		2025				2024
Trading Commission and Consulting service payment		$	3,952,354			$	1,872,298
Fast-Moving Consumer Goods payment			549,013				-
Supply Chain Financing/Trading payment			-				347,003
Total		$	4,501,367			$	2,219,301

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11. ACCRUED EXPENSES AND OTHER PAYABLES

The amount of accrued expenses and other payables consisted of the followings:

		June 30,				December 31,
		2025				2024
Legal fee and other professionals		$	2,275,859			$	64,488
Wages and employee reimbursement			583,785				228,722
Provision for legal case			-				8,625,308
Accruals			833,470				718,170
Total		$	3,693,114			$	9,636,688

In January 2021, FT Global Capital, Inc. (“FT Global”), a former placement agent of the Company filed a lawsuit against the Company in the Superior Court of Fulton County, Georgia. FT Global served the complaint upon the Company in January 2021. In the complaint, FT Global alleges claims, most of which attempt to hold the Company liable under legal theories that relate back to an alleged breach of an exclusive placement agent agreement between FT Global and the Company in July 2020 which had a term of three months. FT Global claims that the Company failed to compensate FT Global for securities purchase transactions between December 2020 and April 2021, pursuant to the terms of the expired exclusive placement agent agreement. On April 11, 2024, on which date the jury returned a verdict in favor of FT Global and the Court entered a judgment awarding FT Global $10,598,380. On June 17, 2025, the Company entered into a settlement and forbearance agreement with FT Global, pursuant to which the company is required to pay FT Global an aggregate amount of $4.0 million over an 18-month period. For the fiscal year ended December 31, 2024, and the six-month period ended June 30, 2025, the Company paid $1.97 million and $525,000, respectively, towards the accrued expenses and other payables.

12. CONVERTIBLE NOTES PAYABLE

The amount of convertible notes payable consisted of the followings:

		June 30,				December 31,
		2025				2024
Beginning		$	553,086			$	1,100,723
Addition			-				-
Interest expenses			13,650				77,363
Payment			-				-
Conversion			(140,658	)			(625,000	)
Balance		$	426,078			$	553,086

On December 27, 2023, the Company issued a coverable promissory note with principal amount of $1.10 million. Floor Price was $2.272 per share of Common Stock. The Note was unsecured. On the date thereof, Company shall reserve 500,000 shares of Common Stock from its authorized and unissued Common Stock to provide for all issuances of Common Stock under the Note (the “Share Reserve”). Lender elected to redeem a portion of the Note in redemption conversion shares. Lender redemption conversion shares were 237,543 shares, amount $62,500, at a price of $2.631 per share in 2024. Lender redemption conversion shares were 61,205 shares, amount $140,658, at a price of $2.276 per share in 2025.

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13. RELATED PARTY TRANSACTION 

As of June 30, 2025, the amounts due from the related parties were consisted of the followings:

Name		Amount (US$)				Relationship		Note
Hu Li			20,000			Chief Executive Officer of the Company		Prepaid expenses, interest free and payment on demand.
Kai Li			3,772			Corporate legal representative of a subsidiary of the Company		Prepaid expenses, interest free and payment on demand.
Ting Ouyang			550			Chief Financial Officer of the Company		Prepaid expenses, interest free and payment on demand.
Total		$	24,322

As of December 31, 2024, the amount due to the related parties was consisted of the followings:

Name		Amount				Relationship		Note
Ting Alina Oyang			8,871			Chief Financial Officer of the Company		Accrued expenses, interest free and payment on demand.
Total		$	8,871

As of December 31, 2024, the amount due from the related parties was consisted of the followings:

Name		Amount				Relationship		Note
Hu Li		$	20,000			Chief Executive Officer of the Company		Loan receivables*, interest free and payment on demand.
Total		$	20,000

* The related party transactions have been approved by the Company’s Audit Committee.

14. INCOME TAX

The Company is incorporated in the United States of America and is subject to United States federal taxation. The applicable tax rate is 21% in 2025 and 2024. No provisions for income taxes have been made, as the Company had no U.S. taxable income for the six months ended June 30, 2025 and 2024. For the six months ended June 30, 2025 and 2024, the Company had current income tax expenses of nil, respectively.

The Company evaluates the level of authority for each uncertain tax position (including the potential application of interest and penalties) based on the technical merits, and measures the unrecognized benefits associated with the tax positions. For the years ended June 30, 2025, the Company had no unrecognized tax benefits. Due to uncertainties surrounding future utilization, the Company estimates there will not be sufficient future income to realize the deferred tax assets for certain subsidiaries.

The amount of unrecognized deferred tax liabilities for temporary differences related to the dividend from foreign subsidiaries is not determined because such determination is not practical.

The Company has not provided deferred taxes on undistributed earnings attributable to its PRC subsidiaries as they are to be permanently reinvested.

The Company has not provided deferred taxes on undistributed earnings attributable to its PRC and Hong Kong subsidiaries as they are to be permanently reinvested.

20

The Company had no material adjustments to its liabilities for unrecognized income tax benefits according to the provisions of ASC Topic 740, Income Taxes. Since the Company intends to reinvest its earnings to further expand its businesses in mainland China, its PRC subsidiaries do not intend to declare dividends to their immediate foreign holding companies in the foreseeable future. Accordingly, the Company has not recorded any deferred taxes in relation to US tax on the cumulative amount of undistributed retained earnings since January 1, 2008.

Effective on January 1, 2008, the PRC Enterprise Income Tax Law, EIT Law, and Implementing Rules imposed a unified enterprise income tax rate of 25% on all domestic-invested enterprises and foreign-invested enterprises in the PRC, unless they qualify under certain limited exceptions. The tax rate for pre-tax profits below RMB 1 million is 2.5%; the tax rate for pre-tax profits between RMB1 million to RMB 3 million is 10%. E-Commerce Tianjin, Future Supply (Chengdu) Co., Ltd. and Future Big Data (Chengdu) Co., Ltd. were subject to an enterprise income tax rate of 2.5% and 10%. Other subsidiaries and VIE were subject to an enterprise income tax rate of 25%.

Future FinTech (HongKong) Limited is incorporated in Hong Kong and is 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. The applicable tax rate is 16.5% in Hong Kong.

Reconciliation of the differences between the statutory EIT rate applicable to profits of the consolidated entities and the income tax expenses of the Company:

		June 30, 2025				June 30, 2024
Loss before taxation		$	(29,093,624	)		$	(4,150,649	)
PRC statutory tax rate			25	%			25	%
Computed expected benefits			(7,273,406	)			(1,037,662	)
Others, primarily the differences in tax rates			(1,076,679	)			(103,042	)
Deferred tax assets losses not recognized			8,350,085				1,140,704
Total		$	-			$	-

15. SHARE BASED COMPENSATION

On March 10, 2025, the Compensation Committee of the Board of Directors of the Company granted 500,000 shares of common stock of the Company, par value $0.001, pursuant to the Company’s 2024 Omnibus Equity Plan, to certain officers and employees of the Company and its subsidiaries (the “Grantees”). As the closing price of the Company stock was $2.17 on March 10, 2025, the Company recorded an expense of $1.09 million in the first quarter of fiscal year 2025. As of March 10，2025, the Shares have been issued to the Grantees.

On October 4, 2024, the Compensation Committee of the Board of Directors of the Company granted 211,000 shares of common stock of the Company, par value $0.001, pursuant to the Company’s 2023 Omnibus Equity Plan, to certain officers and employees of the Company and its subsidiaries (the “Grantees”). As the closing price of the Company stock was $3.18 on October 9, 2023, the Company recorded an expense of $0.67 million in the third quarter of fiscal year 2024. As of October 9，2024, the Shares have been issued to the Grantees.

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16. COMMON STOCK

Securities Purchase Agreement

On December 24, 2020, the Company entered into a securities purchase agreement with certain purchasers, pursuant to which the Company sold to the purchasers in a registered direct offering, an aggregate of 421,053 units, each consisting of one share of the Company’s common stock and a warrant to purchase 1 share of the Company’s Common Stock, at a purchase price of $19 per unit, for aggregate gross proceeds to the Company of $8,000,007, before deducting fees to the placement agent and other offering expenses payable by the Company. On December 29, 2020, the Company issued Units consisting of an aggregate of 421,053 shares of the Company’s Common Stock and warrants to purchase up to an aggregate of 421,053 shares of the Company’s Common Stock at an exercise price of $21.5 per share (the “Investors’ Warrants”). The Investors’ Warrants have a term of five years and are exercisable by the holder at any time after the date of issuance. In connection with the offering, the Company also issued placement agent a warrant to purchase 42,108 shares of the Company’s Common Stock (the “Placement Agent Warrant”) on substantially the same terms as the Investors’ Warrants, except that the Placement Agent Warrant has an exercise price of $23.75 per share and are not exercisable until June 24, 2021. As of December 31, 2024 and June 30, 2025, outstanding warrant has 42,108 shares of the Company’s Common Stock. Warrants after 1-for -10 reverse stock split in 2025 was 4,211 shares with an exercise price of $118.75/share.

		Underlying				Weighted Average Exercise				Weighted Average Term
		Shares				Price				(Years)
Options outstanding at December 31, 2024			4,211			$	23.75				1.00
Granted			-				-				-
Forfeited			-				-				-
Cancelled			-				-				-
Options outstanding at June 30, 2025			4,211			$	23.75				1.00
Options exercisable at June 30, 2025			4,211			$	23.75				1.00

On January 5, 2024, the Company entered into a securities purchase agreement with certain purchasers , pursuant to which the Company sold to the purchasers in a private placement, an aggregate of 215,054 share of its common stock, par value $0.001 per share at a purchase price of $12 per share, for aggregate net proceeds to the Company of $258,064. On January 18, 2024, the Company issued 215,054 shares of common stock pursuant to this Agreement.

Common stocks issued in connection with the convertible notes

On December 27, 2023, the Company entered into a Securities Purchase Agreement with Streeterville Capital, LLC, a Utah limited liability company (the “Lender”), pursuant to which the Company sold and issued to the Lender a Convertible Promissory Note (the “Note”) in the principal amount of $1,100,000.

On July 3, 2024, that Lender elects to redeem a portion of the Note in redemption conversion shares. Lender redemption conversion shares 13,665, amount $50,000, at a price of $3.659 per share.

On July 18, 2024, that Lender elects to redeem a portion of the Note in redemption conversion shares. Lender redemption conversion shares 21,714, amount $75,000, at a price of $3.454 per share.

On August 26, 2024, that Lender elects to redeem a portion of the Note in redemption conversion shares. Lender redemption conversion shares 40,833, amount $100,000, at a price of $2.449 per share.

On October 24, 2024, that Lender elects to redeem a portion of the Note in redemption conversion shares. Lender redemption conversion shares 39,063, amount $100,000, at a price of $2.56 per share.

22

On November 11, 2024, that Lender elects to redeem a portion of the Note in redemption conversion shares. Lender redemption conversion shares 39,063, amount $100,000, at a price of $2.56 per share.

On November 14, 2024, that Lender elects to redeem a portion of the Note in redemption conversion shares. Lender redemption conversion shares 39,386, amount $100,000, at a price of $2.539 per share.

On December 18, 2024, that Lender elects to redeem a portion of the Note in redemption conversion shares. Lender redemption conversion shares 43,821, amount $100,000, at a price of $2.282 per share.

On January 7, 2025, that Lender elects to redeem a portion of the Note in redemption conversion shares. Lender redemption conversion shares 42,882, amount $100,000, at a price of $2.332 per share.

On January 24, 2025, that Lender elects to redeem a portion of the Note in redemption conversion shares. Lender redemption conversion shares 18,323, amount $40,658, at a price of $2.219 per share.

On March 27, 2025, the Company effected a 1-for-10 reverse stock split of the Company’s issued shares and its authorized shares of common stock from 60,000,000 shares to 6,000,000 shares.The share numbers and prices are post-reverse stock split effected on April 1, 2025.

17. STATUTORY RESERVES AND RESTRICTED NET ASSETS

PRC laws and regulations permit payments of dividends by the Company’s subsidiaries incorporated in the PRC only out of their retained earnings, if any, as determined in accordance with PRC accounting standards and regulations. In addition, the Company’s subsidiaries incorporated in the PRC are required to annually appropriate 10% of their net income to the statutory reserve prior to payment of any dividends, unless the reserve has reached 50% of their respective registered capital. Furthermore, registered share capital and capital reserve accounts are also restricted from distribution. As a result of the restrictions described above and elsewhere under PRC laws and regulations, the Company’s subsidiaries incorporated in the PRC are restricted in their ability to transfer a portion of their net assets to the Company in the form of dividends. The restriction amounted to $23.98 million (RMB176,096,482) as of June 30, 2025. Except for the above or disclosed elsewhere, there is no other restriction on the use of proceeds generated by the Company’s subsidiaries to satisfy any obligations of the Company.

18. DISCONTINUED OPERATIONS

On March 7, 2024, Chain Cloud Mall Network and Technology (Tianjin) Co., Limited was dissolved and deregistered.

On September 4, 2024, Tianjin Future Private Equity Fund Management Partnership (Ltd Partnership) was dissolved and deregistered. The loss on disposal was $22.46.

On October 18, 2024, Nice Talent Asset Management Limited (“NTAM”) was disposed of for a consideration of $ 0.31 million (HK$2.40 million). The loss on disposal was $2.32 million.

On December 6, 2024, FTFT Super Computing Inc. was disposed of for a consideration of US$1.97 million, of which (i) the assumption of the obligations of FTFT Super Computing totaling $973,072.24 and (ii) $1,000,000 was paid to an account at Olshan Frome Wolosky LLP to satisfy, in part, the right of payment held by FT Global Capital, Inc. arising from the judgment entered in favor of FT Global and against the Company registered in the Southern District of New York. The gain on disposal was $3.42 million.

On February 3, 2025, FTFT UK LIMITED, FTFT Finance UK Limited, Future Fintech Digital Number One US, LP, Future Fintech Digital Number One Offshore, LLC(Cayman), Future Fintech Digital Number One GP,LLC (USA), FTFT Digital Number One, Ltd.(Cayman), Future FinTech Labs Inc, Future Fintech Digital Capital, FTFT CAPITAL INVESTMENTS, DigiPay FinTech Limited, DCON DigiPay Limited-JPN and Global Key Shared Mall Ltd were disposed of for a consideration of US$25,000 after a court auction sale. The gain of disposal was $28.24 million.

23

Loss from discontinued operations for the six months ended June 30, 2025 and 2024 was as follows:

		For the three months ended June 30,								For the six months ended June 30,
		2025				2024				2025				2024
REVENUES		$	-			$	3,933,899			$	-			$	8,377,677
COST OF SALES			-				2,597,596				-				5,365,196
GROSS PROFIT			-				1,336,303				-				3,012,481
OPERATING EXPENSES:
General and administrative			-				1,963,481				-				4,194,238
Research and development expenses			-				1,729				-				2,374
Selling expenses			-				284				-				284
Bad debt provision							40,911								116,266
Total			-				2,006,405				-				4,313,162
OTHER INCOME (EXPENSE)
Interest income			-				15,273				-				29,207
Interest expense			-				-				-				(716	)
Other expense			-				(335,018	)			-				(345,933	)
Total			-				(319,745	)			-				(316,742	)
Loss from discontinued operations before income tax			-				(989,847	)			-				(1,617,423	)
Income tax provision			-				-				-				-
Loss from discontinued operation before noncontrolling interest		$	-			$	-			$	-			$	-
Gain on disposal of discontinued operations			-				-				28,238,122				645,437
Less: net income (loss) attributable to non-controlling interests			-				(38,033	)			1,866,066				(34,454	)
INCOME (LOSS) FROM DISCONTINUED OPERATION		$	-			$	(951,814	)		$	26,372,056			$	(937,532	)

The major components of assets and liabilities related to discontinued operations are summarized below:

		June 30, 2025				December 31, 2024
Cash and cash equivalents		$	-			$	76,876
Other receivables			-				200,269
Advances to suppliers and other current assets			-				30,449
Property, plant and equipment, net			-				134,553
Right of use assets - operation lease			-				154,810
Total assets related to discontinued operations		$	-			$	596,957
Accrued expenses and other payables		$	-			$	301,807
Amount due to related Party			-				29,036
Lease liability - operation lease			-				154,810
Total liabilities related to discontinued operations		$	-			$	485,653

24

19. SEGMENT REPORTING

In its operation of the business, management, including the Company’s chief operating decision maker, who is the Company’s Chief Executive Officer, reviews certain financial information, including segmented internal profit and loss statements prepared on a basis consistent with GAAP. The Company operates in three segments starting in fiscal 2021: “supply chain financing service and trading business” and “others”. As described in Note 17. DISCONTINUED OPERATIONS, certain subsidiaries were sold, dissolved or deregistered, resulting in material changes to the Company’s business operations. Consequently, the Company has reorganized its operations into the following three reportable segments: (1) Fast-Moving Consumer Goods (FMCG), (2) Trading Commission and Consulting service and (3) supply chain financing service and trading business.

The Company began to provide supply chain financing services during the second quarter of 2021. The Company began to provide sand and steel supply chain financing services during the first quarter of 2023. The Company began to provide brokerage services in October 2023. During the first quarter of fiscal year 2025, the Company commenced operations in the Fast-Moving Consumer Goods (FMCG) sector.  

Some of the Company’s operation might not individually meet the quantitative thresholds for determining reportable segments and the Company determines the reportable segments based on the discrete financial information provided to the chief operating decision maker. The chief operating decision maker evaluates the results of each segment in assessing performance and allocating resources among the segments. Since there is an overlap of services and products between different subsidiaries of the Company, the Company does not allocate operating expenses and assets based on the product segments. Therefore, operating expenses and asset information by segment are not presented. Segment profit represents the gross profit of each reportable segment.

Three months ended June 30, 2025

		Fast-Moving Consumer Goods				Trading Commission and Consulting service				Supply Chain Financing/ Trading				Total
Reportable segment revenue		$	387,684			$	217,598			$	-			$	605,282
Inter-segment loss			-				-				-				-
Revenue from external customers			387,684				217,598				-				605,282
Segment gross profit		$	10,327			$	176,445			$	-			$	186,772

Three months ended June 30, 2024 

		Fast-Moving Consumer Goods				Trading Commission and Consulting service				Supply Chain Financing/ Trading				Total
Reportable segment revenue		$	-			$	204,315			$	64,674			$	268,989
Inter-segment loss			-				-				-				-
Revenue from external customers			-				204,315				64,674				268,989
Segment gross profit		$	-			$	195,792			$	62,029			$	257,821

25

Six months ended June 30, 2025

		Fast-Moving Consumer Goods				Trading Commission and Consulting service				Supply Chain Financing/ Trading				Total
Reportable segment revenue		$	864,135			$	292,783			$	1,341			$	1,158,259
Inter-segment loss			-				-				-				-
Revenue from external customers			864,135				292,783				1,341				1,158,259
Segment gross profit		$	19,185			$	244,864			$	1,341			$	265,390

Six months ended June 30, 2024

		Fast-Moving Consumer Goods				Trading Commission and Consulting service				Supply Chain Financing/ Trading				Total
Reportable segment revenue		$	-			$	441,740			$	506,438			$	948,178
Inter-segment loss			-				-				-				-
Revenue from external customers			-				441,740				506,438				948,178
Segment gross profit		$	-			$	426,813			$	106,102			$	532,915

Income (loss) before Income Tax:

		Three Months Ended June 30,								Six Months Ended June 30,
		2025				2024				2025				2024
Supply Chain Financing/Trading		$	319			$	(184,097	)		$	(52	)		$	22,219
Fast-Moving Consumer Goods			98,358				-				(33,307	)			-
Trading Commission and Consulting service			326,381				821,259				1,364,054				1,465,221
Corporate and Unallocated			(2,090,066	)			429,818				28,028,319				3,196,224
Total operating expenses and other expenses			(1,665,008	)			1,066,980				29,359,014				4,683,564
Income (loss) before income tax		$	1,851,780			$	(809,159	)		$	(29,093,624	)		$	(4,150,649	)

Segment assets:

		June 30, 2025				December 31, 2024
Supply Chain Financing/Trading		$	1,898,231			$	5,717,949
Fast-Moving Consumer Goods			98,949				-
Trading Commission and Consulting service			7,274,264				5,066,369
Corporate and Unallocated			15,303,615				14,521,663
Assets related to discontinued operation			-				596,957
Total assets		$	24,575,059			$	25,902,938

20. DEBT RESTRUCTURING

During the six months ended June 30, 2025, the Company entered into troubled debt restructurings with FT Global (“the Creditor”) due to financial difficulties. On June 17, 2025, the Company entered into a settlement and forbearance agreement (“the Agreement”) with FT Global. Pursuant to the Agreement, the company was required to pay an aggregate settlement amount of $4.0 million and issue a total of 1,700,000 shares of common stock, among which, (i) $0.5 million was paid no later than June 20, 2025, (ii) $1.0 million, $1.3 million and $1.2 million shall be paid within six months, twelve months and eighteen months after signing of the Agreement, respectively, (iii) 60,000 shares and 340,000 shares of common stock were issued on June 30, 2025 and July 2, 2025, respectively, and (iv) 650,000 shares and 650,000 shares of common stock shall be issued no earlier than six months and twelve months following the agreement’s effective date, respectively.

26

The Company derecognized the amount previously due to FT Global, and recognized the present value of total settlement amount including the above-mentioned cash payments and common stocks in paid in capital and other payable on the unaudited condensed consolidated balance sheets. Upon the debt restructurings, the Company recognized a gain of $3.07 million which was recorded as gain on debt restructuring on the unaudited condensed consolidated statement of operations and comprehensive income (loss).

21. COMMITMENTS AND CONTINGENCIES

Legal case with FT Global Litigation

In January 2021, FT Global Capital, Inc. (“FT Global”), a former placement agent of the Company filed a lawsuit against the Company in the Superior Court of Fulton County, Georgia. FT Global served the complaint upon the Company in January 2021. In the complaint, FT Global alleges claims, most of which attempt to hold the Company liable under legal theories that relate back to an alleged breach of an exclusive placement agent agreement between FT Global and the Company in July 2020 which had a term of three months. FT Global claims that the Company failed to compensate FT Global for securities purchase transactions between December 2020 and April 2021, pursuant to the terms of the expired exclusive placement agent agreement. Allegedly, the exclusive placement agent agreement required the Company to pay FT Global for capital received during the term of the agreement and for the 12-month period following the termination of the agreement involving any investors that FT Global introduced and/or wall-crossed to the Company. However, the Company believes the securities purchase transactions at issue did not involve the one investor which FT Global introduced or wall-crossed to the Company during the term of the agreement. FT Global claims approximately $7,000,000 in damages and attorneys’ fees.

The Company timely removed the case to the United States District Court for the Northern District of Georgia (the (“Court”) on February 9, 2021 based on diversity of jurisdiction. On March 9, 2021, the Company filed a motion to dismiss based on FT Global’s failure to state a claim which is pending before the Court. On November 10, 2021, the Court entered an Order granting the Company’s motion to dismiss FT Global’s fraud claim and breach of contract claim as to the disclosure of its confidential and proprietary information. The Court denied the Company’s motion to dismiss FT Global’s i) breach of contract claim for failure to pay FT Global pursuant to the terms of the exclusive placement agent agreement; ii) claim for breach of the covenant of good faith and fair dealing; and iii) claim for attorney’s fees, and the court concluded that additional information can be obtained through discovery. The trial began on April 8, 2024 and ended on April 11, 2024, on which date the jury returned a verdict in favor of FT Global. On April 11, 2024, the Court entered a judgment awarding FT Global $8,875,265.31 and on April 16, 2024, the Court issued an amended judgment, awarding FT Global $10,598,379.93, which includes $7,895,265.31 in damages, $1,723,114.62 in prejudgment interest, and $980,000.00 in attorney’s fees. On May 9, 2024, the Company filed a post-trial motion to set aside the jury verdict and for a new trial and the Court denied the motion on March 3, 2025. The Company filed notice of appeal to appeal the judgement to the United States Court of Appeals for the Eleventh Circuit on April 2, 2025. The Company will seek to have the judgment overturned on appeal. The Company’s opening brief in the appeal is due on June 11, 2025.

FT Global has registered the Court’s judgment in the United States District Court for Southern District of New York (“NY Court”), where FT Global has brought a motion requiring the Company to turn over its stock in its subsidiary companies. On August 28, 2024, NY Court granted FT Global’s motion for turnover of Defendant’s shares in Defendant’s wholly-owned subsidiaries as Defendant 1) failed to satisfy the $10.8 million judgment rendered in the Northern District of Georgia and registered in the Southern District of New York, and 2) is in possession of money and property in which it has an interest. The NY Court ordered Defendant shall turn over the shares, membership, or limited partnership interests in all of its subsidiaries, and the corporate seals of its China and Hong Kong-based subsidiaries, to the U.S. Marshal for auction or sale until the judgment is satisfied. Pursuant to the order issued by the United States District Court for the Southern District of New York on August 28, 2024, the United States Marshal for the Southern District of New York (“U.S. Marshal”) sold the securities of the subsidiaries of the Company other than those in Hong Kong and China in auction of: (i) all of the membership interests in Future Fintech Digital Capital Management LLC; (ii) all of the outstanding shares of FTFT UK Limited; (iii) the corporate seal of DigiPay FinTech Limited; (iv) the corporate seal of GlobalKey SharedMall Limited; (iv) all of the outstanding shares of Future Fintech Labs Inc.; and (v) all of the outstanding shares of Future Fintech Digital Number One GP, LLC (USA) to Alec Orudjiev, the general counsel of FT Global for $25,000 on December 18, 2024. On December 6, 2024, the Company agreed to sell all issued and outstanding shares of FTFT SuperComputing Inc. a wholly owned subsidiary of the Company (“FTFT SuperComputing”) to DDMM Capital LLC (the “Buyer”) for a purchase price that equals to: (i) the assumption of the obligations of FTFT SuperComputing totaling $973,072.24 and (ii)$1,000,000, which was paid to an account at Olshan Frome Wolosky LLP to satisfy, in part, the right of payment held by FT Global Capital, Inc. arising from the judgment entered in favor of FT Global and against the Company registered in the Southern District of New York and all matters pertaining to such litigation. The Company has appealed the turnover order of the NY Court for the auction of securities of the subsidiaries of the Company in Hong Kong and China to the United States Court of Appeals for the Second Circuit and is waiting for the final decision of the Court of Appeals. On February 6, 2025, FT Global filed a motion (“Motion”) in the NY Court, amended on February 12, 2025, seeking a turnover order for 39,825,939 (before 1 for 10 reverse stock split effected by the Company on April 1, 2025) unissued shares of the Company’s common stock for sale to satisfy the judgement. On April 30, 2025, the Company received order from the NY Court to turn over its unissued shares to U.S. Marshal for auction. The transfer agent of the Company has issued 1,951,443 shares of common stock in the name of the United States Marshals Service.

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On June 17, 2025, the Company entered into a settlement and forbearance agreement with FT Global. (See Note 20. DEBT RESTRURING)

Shareholders Lawsuit (LaBelle and Janzen)

The LaBelle case is a putative securities class action filed in January 2024 and is pending in the District of New Jersey. Denise LaBelle (“Plaintiff”) alleges that the Company and certain of its officers violated Sections 10(b) and 20(a) of the Securities Exchange Act by making materially false or misleading statements in the company’s public filings and disclosures relating to the former Chief Executive Officer of the Company Mr. Shanchun Huang and charges filed by the SEC against Mr. Shanchun Huang with manipulative trading in the stock of the Company using an offshore account shortly before he became the Company’s CEO in 2020 and failing to disclose his beneficial ownership. Mr. Huang has denied the allegations of trading before he became CEO. Plaintiff claims that these alleged misstatements caused the Company’s stock to trade at artificially inflated prices, harming investors when the truth was revealed. The lead plaintiff and lead counsel were appointed in September 2024. The Company was served in September 2024, and the Plaintiff is currently seeking substituted service on the individual defendants. Once service is resolved, the Plaintiff is expected to file an amended complaint, which the Company and other defendants intend to move to dismiss.

The Janzen action is a consolidated shareholder derivative case filed by Jeff Janzen on May 31, 2024, also pending in the District of New Jersey, brought nominally on behalf of Future FinTech. Plaintiff alleges that certain current and former officers and directors breached fiduciary duties by allowing or failing to prevent the same alleged misconduct at issue in LaBelle, including mismanagement and misleading public disclosures. The derivative case has been stayed by stipulation, pending resolution of the anticipated motion to dismiss in LaBelle, but plaintiff has reserved the right to participate in mediation and settlement discussions relating to the class action.

22. RISKS AND UNCERTAINTIES

PRC Regulations

There are substantial uncertainties regarding the interpretation and application of PRC laws and regulations including, but not limited to, the laws and regulations governing the Company’s business and the enforcement and performance of the Company’s arrangements with customers in certain circumstances. The Company is considered foreign persons or foreign funded enterprises under PRC laws and, as a result, the Company is required to comply with PRC laws and regulations related to foreign persons and foreign funded enterprises. These laws and regulations are sometimes vague and may be subject to future changes, and their official interpretation and enforcement may involve substantial uncertainty. The effectiveness of newly enacted laws, regulations or amendments may be delayed, resulting in detrimental reliance. New laws and regulations that affect existing and proposed future businesses may also be applied retroactively. The Company cannot predict what effect the interpretation of existing or new PRC laws or regulations may have on the Company’s business.

Customer concentration risk

For the six months ended June 30, 2025, no customer accounted for more than 10% of the Company’s total revenue. For the six months ended June 30, 2024, one customer accounted for 53.37% of the Company’s total revenues.

Vendor concentration risk

For the six months ended June 30, 2025, two vendors accounted for 89.21% and 10.79% of the Company’s total purchases. For the six months ended June 30, 2024, one vendor accounted for 97.38% of the Company’s total purchases.

23. SUBSEQUENT EVENTS

On July 24, 2025, the Company entered into a Securities Purchase Agreement (the “Equity SPA”) with seven non-U.S. investors (collectively, the “Purchasers”). The Equity SPA contemplates the sale, in one or more closings, of up to 15,000,000 shares of our common stock at a cash purchase price of $2.00 per share, for gross proceeds of up to $30,000,000. The shares will be issued in reliance on Regulation S and will bear the customary restrictive legend.

The initial closing is capped at no more than 19.9% of the Company’s outstanding Common Stock as of the closing date (the “19.9% Limit”). Any Shares subject to the 19.9% Limit will not be outstanding on the Record Date for this Special Meeting and, therefore, will not vote on this Proposal. Following shareholder approval of this Proposal (if obtained), any remaining Shares may be issued in one or more subsequent closings, expected to occur within three business days after the Special Meeting. Net proceeds will be used for working capital, strategic investments and other general corporate purposes.

On July 28, 2025, the Company entered into a securities purchase agreement (the “Agreement”) with certain purchasers (the “Investors’), pursuant to which the Company shall issue and sell to the Investors an aggregate amount of up to $10,000,000, representing the Company’s common stock. On the closing date, investors shall pay the Purchase Price to Company via wire transfer of immediately available funds against delivery of Pre-Paid Purchase #1 in the original principal amount of $884,000.00. In addition, the Company agrees to pay $20,000.00 to Investor to cover Investor’s legal fees, accounting costs, due diligence, monitoring, and other transaction costs incurred in connection with the purchase and sale of the Securities. As of the date of this report, the Company has received proceeds of approximately $800,000 from the Investors pursuant to the Agreement.

The complete closing of the above-referenced transactions is each subject to the approval of the Company’s shareholders. A special shareholders meeting is scheduled to be held on September 2, 2025 to consider these transactions and to amend the Company’s articles of incorporation to increase the authorized shares of the Company’s common stock from 6,000,000 to 600,000,000 shares. See more details of the special shareholders meeting to be held on September 2, 2025 in the Definitive Schedule 14A filed with the SEC on August 8, 2025.

The Company has evaluated subsequent events through the date of the issuance of the unaudited condensed consolidated financial statements and did not identify any subsequent events except those disclosed above that would have required adjustment or disclosure in the financial statements.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

This quarterly report on Form 10-Q and other reports filed by the Company from time to time with the SEC (collectively the “Filings”) contain or may contain forward-looking statements and information that are based upon beliefs of, and information currently available to, Company’s management as well as estimates and assumptions made by Company’s management. Readers are cautioned not to place undue reliance on these forward-looking statements, which are only predictions and speak only as of the date hereof. When used in the filings, the words “may”, “will”, “should”, “would”, “anticipate”, “believe”, “estimate”, “expect”, “future”, “intend”, “plan”, or the negative of these terms and similar expressions as they relate to Company or Company’s management identify forward-looking statements. Such statements reflect the current view of Company with respect to future events and are subject to risks, uncertainties, assumptions, and other factors (including the statements in the section “results of operations” below), and any businesses that Company may acquire. Should one or more of these risks or uncertainties materialize, or should the underlying assumptions prove incorrect, actual results may differ significantly from those anticipated, believed, estimated, expected, intended, or planned. Factors that might cause or contribute to such a discrepancy include, but are not limited to, those listed under the heading “Risk Factors” and those listed in our Annual Report on Form 10-K for the year ended December 31, 2024 (the “2024 Form 10-K”) and in this Form 10-Q. The following discussion should be read in conjunction with our Financial Statements and related Notes thereto included elsewhere in this report and in our 2024 Form 10-K.

Although the Company believes the expectations reflected in the forward-looking statements are based on reasonable assumptions, the Company cannot guarantee future results, levels of activity, performance, or achievements. Except as required by applicable law, including the securities laws of the United States, the Company does not intend to update any of the forward-looking statements to conform these statements to actual results. Readers are urged to carefully review and consider the various disclosures made throughout the entirety of this report, which attempts to advise interested parties of the risks and factors that may affect our business, financial condition, results of operations, and prospects.

Overview of Our Business

Future FinTech Group Inc. is a Florida holding company with no material operations of its own. We conduct substantially all of our business through subsidiaries, and this structure involves unique risks for investors. We are not a Chinese operating company, although we have had significant operations in China and Hong Kong.

Historically, our business focused on fruit juice manufacturing and distribution in China. Due to rising production costs and stricter environmental laws, we shifted our operations toward supply chain financing and trading in China, asset management in Hong Kong, cross-border money transfer services in the United Kingdom, brokerage and investment banking in Hong Kong, and cryptocurrency mining in the United States. Most of these activities have since been reduced or exited.

Recent strategic changes include:

● Exit from Variable Interest Entity (VIE) operations in China – Our VIE, E-Commerce Tianjin, generated minimal revenue since 2021 and was deregistered on March 7, 2024.

● Disposal of Hong Kong asset management operations – In November 2024, we sold our remaining 42.86% interest in Nice Talent Asset Management Limited for approximately $300,000 and ceased asset management activities in Hong Kong.

● Sale of cryptocurrency mining operations – On December 9, 2024, we sold FTFT SuperComputing Inc., including the assumption of approximately $973,000 in liabilities and $1.0 million applied toward a litigation judgment.

● Disposition of multiple subsidiaries – On December 18, 2024, we sold Future Fintech Digital Capital Management LLC, FTFT UK Limited, DigiPay FinTech Limited, GlobalKey SharedMall Limited, Future Fintech Labs Inc., and Future Fintech Digital Number One GP, LLC through a court-ordered auction for $25,000.

● Closure of Paraguay cryptocurrency venture – FTFT Paraguay S.A., acquired in 2022, was dissolved in December 2023 after we were unable to develop planned operations.

As of June 30, 2025, our principal business operations consist of: sale of fast-moving consumer goods; commission-based trading and consulting services; and supply chain financing and trading.

We currently have one directly controlled subsidiary, Future FinTech (Hong Kong) Limited. 

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Supply Chain Financing Service and Trading in China

Since the second quarter of 2021, we started coal supply chain financing service and trading business. Since the third quarter of 2021, we started aluminum ingots supply chain financing service and trading business. Since the first quarter of 2023, we started sand and steel supply chain financing service and trading business.

Our supply chain finance business mainly serves the receivables and payables of industrial customers, obtains the creditor’s rights or commodity goods rights of large state-owned enterprises through trade execution, provides customers with working capital, accelerates capital turnover, and then expands the business scale and improves the industrial value.

Through our supply chain service ability and customer resources, we can tap into low-risk assets, flexibly carry out financial services around the actual financial needs of certain industries, and reduce the overall risk of the business by using the control of business flow, goods logistics and capital flow in the process of commodity circulation.

We focus on bulk commodity goods such as coal, aluminum ingots, sand and steel and take large state-owned or listed companies as the core service targets; We use our own funds as the operation basis, actively uses a variety of channels and products for financing, such as banks, commercial factoring companies, accounts receivable, asset-backed securities, and other innovative financing methods to obtain sufficient funds.

We sign purchase and sale agreements with suppliers and buyers. The suppliers are responsible for the supply and transportation of goods to the end users’ designated freight yard or transfer the title to us in certain warehouses. We also provide trading service as we don’t take control over the ownership of the goods but receive agent service fee for the transaction. For the sale of goods where we obtain control of the goods before transferring it to the customer, we recognize revenue based on the gross revenue amount billed to customers as sales of goods. We consider multiple factors when determining whether we obtain control of the goods, including evaluating if we can establish the price of the goods, retain inventory risk for tangible goods or have the responsibility for ensuring acceptability of the goods. We recognize net revenue as agent services for the sales of coals, aluminum ingots, and steel when no control obtained throughout the transactions. We select the customers and suppliers that have good credit and reputation.

FTFT International Securities and Futures Limited, a company we acquired in November 2023, provides brokerage and investment banking services in Hong Kong. FTFT International Securities and Futures Limited holds Type 1 “Securities Trading”, Type 2 “Futures Contract Trading” and Type 4 “Securities Consulting” financial licenses issued by the Hong Kong Securities and Futures Commission.

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Results of Operations

Comparison of Three Months ended June 30, 2025 and 2024:

Revenue

The following table sets forth the breakdown of our revenues for the three months ended June 30, 2025 and 2024, respectively:

		Three months ended June 30,
		2025				2024				Change
		Amount				Amount				Amount				%
Fast-Moving Consumer Goods (FMCG)		$	387,684			$	-			$	387,684				100.00	%
Trading Commission and Consulting service			217,598				204,315				13,283				6.50	%
Supply Chain Financing/Trading			-				64,674				(64,674	)			(100.00	)%
Total revenue		$	605,282			$	268,989			$	336,293				125.02	%

For the three months ended June 30, 2025 and 2024, revenue from sales of FMCG was $387,684 and nil, respectively, representing an increase of $387,684, or 100.00%. The increase was primarily attributable to the Company’s strategic expansion into the FMCG sector in September 2024, which significantly contributed to our revenue growth during the three months ended June 30, 2025.

For the three months ended June 30, 2025 and 2024, revenue from trading commission and consulting service was $217,598 and $204,315, respectively, representing an increase of $13,283, or 6.50%. The increase was mainly attributable to higher trading volume in U.S. equity markets and the completion of a secondary offering during the three months ended June 30, 2025.

For the three months ended June 30, 2025 and 2024, revenue from supply chain financing/trading was nil and $64,674, respectively, representing a decrease of $64,674, or 100.00%. The decrease was due to our management’s decision to temporarily suspend these operations resulting from lower coal prices and reduced market demand in China during the three months ended June 30, 2025.

Gross Profit

The following table sets forth the breakdown of the gross profit for the three months ended June 30, 2025 and 2024, respectively:

		Three months ended June 30,																Variance
		2025				%				2024				%				Amount				%
Fast-Moving Consumer Goods (FMCG)		$	10,327				5.53	%		$	-				-			$	10,327				100.00	%
Trading Commission and Consulting service			176,445				94.47	%			195,792				75.94	%			(19,347	)			(9.88	)%
Supply Chain Financing/Trading			-				-				62,029				24.06	%			(62,029	)			(100.00	)%
Total gross profit		$	186,772				100.00	%		$	257,821				100.00	%		$	(71,049	)			(27.56	)%

Overall gross profit decreased by $0.07 million, or 27.56%, to $0.19 million for the three months ended June 30, 2025 from $0.26 million for the same period last year. The decrease was primarily due to the decrease in gross profit from supply chain financing/trading which was in line with the decrease in revenue for this business segment during the three months ended June 30, 2025. Overall gross margin as a percentage of revenue was 30.86% for the three months ended June 30, 2025, representing a decrease of 64.99% from 95.85% for the same period last year, mainly due to the decrease in gross margin for debt recovery consulting service fee as well as U.S. dollar bond service. Additionally, the decrease in gross margin was due to the lower gross margin from FMCG, which accounted for a majority portion of total revenue during the three months ended June 30, 2025.

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Operating Expenses

The following table sets forth the breakdown of our operating expenses and operating expenses as a percentage of revenue for the three months ended June 30, 2025 and 2024, respectively: (in thousands)

		Three months ended June 30,
		2025								2024
		Amount				% of revenue				Amount				% of revenue
General and administrative expenses		$	854				141.07	%		$	1,424				423.41	%
Selling expenses			249				41.15	%			151				45.06	%
Bad debt provision (recovery)			393				69.94	%			(276	)			(82.04	)%
Total operating expenses		$	1,496				247.16	%		$	1,299				386.42	%

For the three months ended June 30, 2025, our general and administrative expenses were $0.85 million, representing a decrease of $0.57 million, or 40.03%, as compared to the same period last year. The decrease was mainly due to decreased professional service fees during the three months ended June 30, 2025.

For the three months ended June 30, 2025, our selling expenses were $0.25 million, representing an increase of $0.10 million, or 64.37%, as compared to the same period last year. The increase was mainly due to increased traveling costs and sales team performance incentives.

For the three months ended June 30, 2025, our bad debt provision was $0.39 million, representing an increase of $0.67 million, or 242.47%, as compared to the same period last year. The increase was primarily due to the management’s efforts in collection of long overdue receivables from our customers, causing net recovery of credit losses during the three months ended June 30, 2024.

Other Income, Net

For the three months ended June 30, 2025, our net other income was $3.16 million, representing an increase of $2.93 million, or 1,259.48%, as compared to the same period last year. The increase was primarily due to the gain of $3.1 million on debt restructuring during the three months ended June 30, 2025 as we entered into a settlement and forbearance agreement with FT Global.

Income Tax

Income tax provision was nil for the three months ended June 30, 2025, and 2024.

Net income (loss) from continuing operation

For the three months ended June 30, 2025, our net income from continuing operation were $1.85 million, representing an increase of $2.66 million, or 328.85%, as compared to the same period last year. The increase was primarily due to the increase in net other income, as discussed above.

Comparison of Six Months ended June 30, 2025 and 2024:

Revenue

The following table sets forth the breakdown of our revenues for the six months ended June 30, 2025 and 2024, respectively:

		Six months ended June 30,
		2025				2024				Change
		Amount				Amount				Amount				%
Fast-Moving Consumer Goods (FMCG)		$	864,135			$	-			$	864,135				100.00	%
Trading Commission and Consulting service			292,783				441,740				(148,957	)			(33.72	)%
Supply Chain Financing/Trading			1,341				506,438				(505,097	)			(99.74	)%
Total revenue		$	1,158,259			$	948,178			$	210,081				22.16	%

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For the six months ended June 30, 2025 and 2024, revenue from sales of FMCG was $864,135 and nil, respectively, representing an increase of $864,135, or 100.00%. The increase was primarily attributable to the Company’s strategic expansion into the FMCG sector in September 2024, which significantly contributed to revenue growth during the six months ended June 30,2025.

For the six months ended June 30, 2025 and 2024, revenue from trading commission and consulting service was $292,783 and $441,740, respectively, representing a decrease of $148,957, or 33.72%. The decrease was mainly due to lower revenue from both U.S. dollar bond trading service and consulting service during the six months ended June 30, 2025.

For the six months ended June 30, 2025 and 2024, revenue from supply chain financing/trading was $1,341 and $506,438, respectively, representing a decrease of $505,097, or 99.74%. The decrease was due to our management’s decision to temporarily suspend these operations resulting from lower coal prices and reduced market demand in China during the six months ended June 30, 2025.

Gross Profit

The following table sets forth the breakdown of the gross profit for the six months ended June 30, 2025 and 2024, respectively:

		Six months ended June 30,																Variance
		2025				%				2024				%				Amount				%
Fast-Moving Consumer Goods (FMCG)		$	19,185				7.23	%		$	-				-			$	19,185				100.00	%
Trading Commission and Consulting service			244,864				92.27	%			426,813				80.09	%			(181,949	)			(42.63	)%
Supply Chain Financing/Trading			1,341				0.50	%			106,102				19.91	%			(104,761	)			(98.74	)%
Total Amount		$	265,390				100.00	%		$	532,915				100.00	%		$	(267,525	)			(50.20	)%

Overall gross profit decreased by $0.27 million, or 50.20%, to $0.27 million for the six months ended June 30, 2025 from $0.53 million for the same period last year. The decrease was primarily due to the decrease in gross profit from trading commission and consulting service and supply chain financing/trading which were in line with the decrease in revenue for these two business segments during the six months ended June 30, 2025. Overall gross margin as a percentage of revenue was 22.91% for the six months ended June 30, 2025, representing a decrease of 33.29% from 56.20% for the same period last year, mainly due to the decrease in gross margin for debt recovery consulting service fee as well as U.S. dollar bond service. Additionally, the decrease in gross margin was due to the lower gross margin from FMCG, which accounted for a majority portion of total revenue during the six months ended June 30, 2025.

Operating Expenses

The following table sets forth the breakdown of our operating expenses and operating expenses as a percentage of revenue for the six months ended June 30, 2025 and 2024, respectively: (in thousands)

		Six months ended June 30,
		2025								2024
		Amount				% of revenue				Amount				% of revenue
General and administrative expense		$	2,433				210.06	%		$	2,615				275.75	%
Stock compensation expense			1,085				93.68	%			-				-
Selling expenses			441				38.05	%			418				44.11	%
Bad debt provision			28,762				2,483.26	%			443				46.73	%
Total operating expenses		$	32,721				2,825.04	%		$	3,476				366.59	%

For the six months ended June 30, 2025, our general and administrative expenses were $2.43 million, representing a decrease of $0.18 million, or 6.94%, as compared to the same period last year. The decrease was mainly due to the decreased professional service fees and traveling fees during the six months ended June 30, 2025.

For the six months ended June 30, 2025, our stock compensation expense was $1.09 million, representing an increase of $1.09 million, as compared to the same period last year. On March 10, 2025, the Compensation Committee of the Board of Directors of the Company granted 500,000 shares of common stock of the Company (“Shares”), par value $0.001, pursuant to the Company’s 2024 Omnibus Equity Plan, to certain officers and employees of the Company and its subsidiaries. As the closing price of the Company stock was $2.17 on March 10, 2025, the Company recorded an expense of $1.09 million in the first quarter of fiscal year 2025. The Shares were issued to the Grantees on March 10, 2025. The stock price and share numbers have been adjusted based on the one for ten reverse splits effected on April 1, 2025.

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For the six months ended June 30, 2025, our selling expenses were $0.44million, representing an increase of $0.02 million, or 5.37%, as compared to the same period last year.

For the six months ended June 30, 2025, our bad debt provision was $28.76 million, representing an increase of $28.32 million, or 6,391.30%, as compared to the same period last year. The increase was primarily due to provision for bad debts on related party receivables in connection with the disposal of a subsidiary during the six months ended June 30, 2025.

Other Income (Expense), Net

For the six months ended June 30, 2025, our net other income was $3.36 million, representing an increase of $4.57 million, or 378.41%, as compared to the same period last year. The increase was primarily due to the gain on debt restructuring during the six months ended June 30, 2025. On June 17, 2025, we entered into a settlement and forbearance agreement (“the Agreement”) with FT Global. Pursuant to the Agreement, we were required to pay an aggregate settlement amount of $2.0 million and issue a total of 1,700,000 shares of common stock. Upon the debt restructurings, we recognized a gain of $3.07 million which was recorded as gain on debt restructuring on the unaudited condensed consolidated statement of operations and comprehensive income (loss). The increase in net other income was also attributable to higher legal case fee of litigation with FT Global during the six months ended June 30, 2024.

Income Tax

Income tax provision was nil for the six months ended June 30, 2025, and June 30, 2024.

Net loss from continuing operation

For the six months ended June 30, 2025, our net loss from continuing operation were $29.09 million, representing an increase of $24.94 million, or 600.94%, as compared to the same period last year. The increase was primarily due to the increase in operating expenses, as discussed above.

Gain on disposal of discontinued operations

Gain on disposal of discontinued operation was $28.24 million for the six months ended June 30, 2025, which was related to the transfer of FTFT UK LIMITED, FTFT Finance UK Limited, Future Fintech Digital Number One US, LP, Future Fintech Digital Number One Offshore, LLC(Cayman), Future Fintech Digital Number One GP,LLC (USA), FTFT Digital Number One, Ltd.(Cayman), Future FinTech Labs Inc, Future Fintech Digital Capital, FTFT CAPITAL INVESTMENTS, DigiPay FinTech Limited, DCON DigiPay Limited-JPN and Global Key Shared Mall Ltd.

Earnings (loss) per Share

For the six months ended June 30, 2025, basic and diluted loss per share from continuing operations were both $10.27, as compared to loss per share of $2.08 per share (both basic and diluted) for the same period last year. For the six months ended June 30, 2025, basic and diluted earnings per share from discontinued operations was $9.31 and $9.30, respectively, as compared to loss per share of $0.47 per share (both basic and diluted) for the same period last year.

Liquidity and Capital Resources

As of June 30, 2025, we had cash and restricted cash of $5.79 million, representing an increase of $1.02 million from $4.77 million as of December 31, 2024.

Our working capital has historically been generated from our operating cash flows, advances from our customers and loans from bank facilities. Our working capital was $11.47 million as of June 30, 2025, an increase of $3.87 million from working capital of $7.60 million as of December 31, 2024, mainly due to the decrease in current liabilities. 

34

Net cash used in operating activities increased by $16.93 million to $27.73 million for the six months ended June 30, 2025 from $10.80 million for the same period last year. The increase in net cash used in operating activities was primarily due to the increase in net loss from continuing operation, the decrease in accrued expenses and other payables, as well as the decrease in other receivables. The increase was partially offset by the increase in bad debt provision, the increase in advances to suppliers and other current assets and the decrease in accounts payable.

Net cash provided by investing activities increased by $0.41 million to $0.62 million for the six months ended June 30, 2025 from $0.21 million for the same period last year. The increase was due to the increase in repayment for debt investment and loan receivables. The increase was partially offset by the decrease in repayment for short term investment.

Net cash used in financing activities for the six months ended June 30, 2025 was $0.01 million, representing a decrease of $2.46 million, as compared to net cash provided by financing activities of $2.45 million during the same period last year. The decrease in net cash provided by financing activities was mainly due to the decrease in proceeds from the issuance of common stock from a private placement, net of issuance costs.

Off-balance sheet arrangements

As of June 30, 2025, we did not have any off-balance sheet arrangements.

Item 3. Quantitative and Qualitative Disclosures about Market Risk

Not applicable.

Item 4. Controls and Procedures

Disclosure Controls and Procedures 

Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, our principal executive officer and principal interim financial officer, respectively, evaluated the effectiveness of our disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, as of the end of the period covered by this report. Disclosure controls and procedures include, without limitation, controls and procedures designed to provide reasonable assurance that information we are required to disclose in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. Based on this evaluation, our Chief Executive Officer and Chief Financial Officer concluded that, as of June 30, 2025, our disclosure controls and procedures were not effective due to a material weakness in our internal control over financial reporting. Specifically, we currently lack sufficient accounting personnel with the appropriate level of knowledge, experience and training in U.S. GAAP and SEC reporting requirements.

We have taken, and are taking, certain actions to remediate the material weakness related to our lack of U.S. GAAP experience. We have engaged an outside consultant with U.S. GAAP knowledge and experience to supplement our current internal accounting personnel and assist us in the preparation of our financial statements to ensure that our financial statements are prepared in accordance with U.S. GAAP. We have adopted and are continuously implementing policies, procedures and practices recommended in the report of the consultant and have arranged training of internal control for our employees and management on disclosure controls and procedures. We believe the measures described above will remediate the material weakness from the quarter identified above. The Company continues to make efforts to implementing its existing and newly adopted procedures to improve our disclosure controls and internal controls over financing reporting. As we continue to evaluate and work to improve our internal control over financial reporting, we may determine that additional measures.

Changes to Internal Control over Financial Reporting 

Other than discussed above, there were no changes in our internal control over financial reporting (as defined in Rule 13a-15(f) and 15d-15(f) of the Exchange Act) that occurred during the period covered by this report that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

35

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

Legal case with FT Global Litigation

In January 2021, FT Global Capital, Inc., a former placement agent of the Company, filed a lawsuit against the Company in the Superior Court of Fulton County, Georgia, and served the complaint that same month. The Company has previously reported developments related to this matter in its filings with the Securities EC, including without limitation, its Annual Report on Form 10-K for the fiscal year ended December 31, 2021, Form 10-K for the fiscal year ended December 31, 2022, Form 10-K for the fiscal year ended December 31, 2023, Form 10-K for the fiscal year ended December 31, 2024, Quarterly Report on Form 10-Q for the fiscal quarter ended on March 31, 2025.

On June 17, 2025, the Company entered into a Settlement and Forbearance Agreement with FT Global to resolve four federal court judgments totaling approximately $4.0 million in cash. In addition, the Company agreed to issue 340,000 shares of its common stock to FT Global and 60,000 shares to its legal counsel, and to issue rights entitling FT Global to receive up to 1.3 million additional shares of common stock, with 650,000 eligible no earlier than six months after signing (Series A Right) and 650,000 eligible no earlier than twelve months after signing (Series B Right). The Company has issued 400,000 shares of common stock in accordance with the foregoing. Under the agreement, FT Global agreed to suspend enforcement actions in exchange for a structured cash settlement and the issuance of shares.

The Company’s obligations include instalment payments over 18 months and the issuance of shares pursuant to a court order under Section 3(a)(10) of the Securities Act. The agreement also includes mutual releases and requires the Company to remain current in its SEC filings and maintain its listing on a national securities exchange. Additional details are included in the Company’s Current Report on Form 8-K filed on June 20, 2025.

Shareholders Lawsuit (LaBelle and Janzen) 

The LaBelle case is a putative securities class action filed in January 2024 and is pending in the District of New Jersey.  Denise LaBelle (“Plaintiff”) alleges that the Company and certain of its officers violated Sections 10(b) and 20(a) of the Securities Exchange Act by making materially false or misleading statements in the company’s public filings and disclosures relating to the former Chief Executive Officer of the Company Mr. Shanchun Huang and charges filed by the SEC against Mr. Shanchun Huang with manipulative trading in the stock of the Company using an offshore account shortly before he became the Company’s CEO in 2020 and failing to disclose his beneficial ownership.  Mr. Huang has denied the allegations of trading before he became CEO. Plaintiff claims that these alleged misstatements caused the Company’s stock to trade at artificially inflated prices, harming investors when the truth was revealed. The lead plaintiff and lead counsel were appointed in September 2024.  The Company was served in September 2024. On July 28, 2025, the Plaintiff filed an amended complaint, which the Company and other defendants intend to move to dismiss. 

The Janzen action is a consolidated shareholder derivative case filed by Jeff Janzen on May 31, 2024, also pending in the District of New Jersey, brought nominally on behalf of Future FinTech. Plaintiff alleges that certain current and former officers and directors breached fiduciary duties by allowing or failing to prevent the same alleged misconduct at issue in LaBelle, including mismanagement and misleading public disclosures. The derivative case has been stayed by stipulation, pending resolution of the anticipated motion to dismiss in LaBelle, but plaintiff has reserved the right to participate in mediation and settlement discussions relating to the class action.

36

Item 1A. Risk Factors

Not applicable.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

The Company did not make any sales of unregistered securities during the six months ended June 30, 2025 that were not previously disclosed in a quarterly report on Form 10-Q or a current report on Form 8-K. 

Item 3. Defaults upon Senior Securities

None.

Item 4. Mine Safety Disclosure

Not applicable.

Item 5. Other Information

None.

Item 6. Exhibits

Exhibit No.		Description
31.1		Certification of Principal Executive Officer pursuant to Rule 13a-14(a) and Rule15d-14(a) of the Securities Exchange Act of 1934, as amended*
31.2		Certification of Principal Financial Officer pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the Securities Exchange Act of 1934, as amended*
32.1		Certification of Principal Executive Officer, pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002+
32.2		Certification of Principal Financial Officer, pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002+
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)

* filed herewith

+ Furnished herewith

37

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	FUTURE FINTECH GROUP INC.
	By:	/s/ Hu Li
		Hu Li
		Chief Executive Officer
		(Principal Executive Officer)
		August 19, 2025
	By:	/s/ Ting Alina Oyang
		Ting Alina Oyang
		Chief Financial Officer
		(Principal Financial and Accounting Officer)
		August 19, 2025

38

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FAQ

What is FTFT's going-concern status in the 10-Q?

The company discloses that the combination of negative operating cash flows (about $27.73 million as of June 30, 2025) and legal and liquidity matters raises substantial doubt about its ability to continue as a going concern.

What material legal judgments affect FTFT?

A judgment was entered in favor of FT Global totaling approximately $10.6 million, with related enforcement actions including a court-ordered turnover of unissued shares and auction of subsidiaries.

Did FTFT record any significant gains this period?

Yes. The filing discloses a reported $28.24 million gain on a disposal and a $3.07 million gain on debt restructuring.

What settlement or payment obligations has FTFT agreed to?

FTFT entered a settlement and forbearance with FT Global requiring payment of $4.0 million over an 18-month period and has made partial payments including amounts of $1.97 million (fiscal year 2024) and $525,000 for the six months ended June 30, 2025.

Were there corporate actions affecting FTFT's shares?

Yes. The company effected a 1-for-10 reverse stock split effective April 1, 2025, reducing authorized shares to 6,000,000 and reporting 3,110,770 shares outstanding as of June 30, 2025.

Are there collection or credit risks disclosed?

The filing shows accounts receivable aged over 90 days of about $1.33 million as of June 30, 2025 and multiple loan receivable balances (e.g., $2.09 million and $4.89 million), indicating collection and counterparty risk.