Sharing Economy International (SEII) flags going concern, big share deal
Sharing Economy International Inc. (SEII) reported no revenue and a small net loss while facing severe liquidity and going‑concern risks for the quarter ended June 30, 2026. Revenue was zero for both the three‑ and six‑month periods in 2026 and 2025. Selling, general and administrative expenses rose to $166,419 for the first half of 2026, driving a six‑month net loss of $179,777. Basic and diluted loss per share rounded to $0.00 on 1,249,709,717 weighted‑average common shares.
Cash and cash equivalents fell to $3,583, with net cash used in operations of $235,145 and total current liabilities of $2,791,379, including a convertible note payable. Although total assets were $16,691,051, they were dominated by $16,682,117 of other receivables. Management states that existing capital resources are not adequate for 12 months and explicitly concludes there is substantial doubt about the company’s ability to continue as a going concern.
The company remains highly dependent on external financing, with multiple convertible promissory notes outstanding, including a $1,010,275 Pyram note in default and a $400,000 Light Across note. SEII also discloses that the SEC’s Division of Enforcement is seeking revocation of its registration in an administrative proceeding. After quarter‑end, SEII agreed to acquire Light Across, Inc. via a share exchange issuing 4,998,838,436 new common shares, which would significantly increase the share count.
Positive
- None.
Negative
- Substantial doubt about going concern: management states existing capital resources are not adequate for 12 months and highlights a six‑month net loss of $179,777 and operating cash outflow of $235,145.
- Minimal liquidity: cash and cash equivalents were only $3,583 at June 30, 2026, against current liabilities of $2,791,379, leaving the company reliant on new financing.
- Convertible debt default: the company is in default on Pyram notes with an outstanding balance of $1,010,275, increasing refinancing and legal risk.
- Regulatory risk to listing status: SEII is a respondent in an SEC administrative proceeding in which the Division of Enforcement seeks to revoke the company’s registration as a reporting issuer.
- Massive prospective dilution: subsequent to quarter‑end, SEII agreed to issue 4,998,838,436 new common shares in a share exchange for Light Across, Inc., greatly expanding the share count while current operations generate no revenue.
Filing Explained
The company reports that the August 2 share exchange offered, sold, and issued
Key Figures
Key Terms
going concern financial
convertible promissory note financial
Share Exchange Agreement financial
fair value hierarchy financial
smaller reporting company regulatory
embedded derivatives financial
Earnings Snapshot
FAQ
How much revenue did Sharing Economy International Inc. (SEII) generate in Q2 2026?
What was SEII’s net loss and earnings per share for the six months ended June 30, 2026?
What is Sharing Economy International Inc.’s (SEII) cash position and working capital as of June 30, 2026?
Does SEII face going concern risks according to the June 30, 2026 10-Q?
What major debt and defaults does Sharing Economy International Inc. (SEII) disclose?
What is the Light Across share exchange and how many SEII shares are being issued?
What SEC regulatory proceeding is SEII involved in as of the June 30, 2026 report?
AI-generated analysis. How Rhea-AI works. Not financial advice.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
(MARK ONE)
For the quarterly period ended
OR
For the transition period from ____________ to ___________
Commission File No.
(Exact name of registrant as specified in its charter) |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
(Address of principal executive offices, zip code)
(
(Registrant’s telephone number, including area code)
___________________________________________________________
(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 |
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Indicate by check mark whether the issuer (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.
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (check one):
Large accelerated filer | ☐ | 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 Exchange Act Rule 12b-2 of the Exchange Act): Yes
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PRECEDING FIVE YEARS:
Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court. Yes ☐ No ☐
APPLICABLE ONLY TO CORPORATE ISSUERS
As of August 11, 2026, there were
SHARING ECONOMY INTERNATIONAL INC.
QUARTERLY REPORT ON FORM 10-Q
FOR THE PERIOD ENDED JUNE 30, 2026
INDEX
Index | Page | |||
PART I. FINANCIAL INFORMATION | ||||
Item 1. | Financial Statements. | 4 | ||
Condensed Consolidated Balance Sheet as of June 30, 2026 (unaudited) and December 31, 2025. | 4 | |||
Condensed Consolidated Statement of Operations for the Three and Six Months ended June 30, 2026 and 2025 (unaudited) | 5 | |||
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Condensed Consolidated Statements of Changes Stockholders’ Equity for the Three and Six Months ended June 30, 2026 and 2025 (unaudited). | 6 | |||
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| Condensed Consolidated Statement of Cash Flows for the Six Months ended June 30, 2026 and 2025 (unaudited). |
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Notes to Condensed Consolidated Financial Statements (unaudited). | 8 | |||
Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations. | 23 | ||
Item 3. | Quantitative and Qualitative Disclosures About Market Risk. | 26 | ||
Item 4. | Controls and Procedures. | 26 | ||
PART II. OTHER INFORMATION | ||||
Item 1. | Legal Proceedings. | 27 | ||
Item 1A. | Risk Factors. | 27 | ||
Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds. | 27 | ||
Item 3. | Defaults Upon Senior Securities. | 27 | ||
Item 4. | Mine Safety Disclosures. | 27 | ||
Item 5. | Other Information. | 27 | ||
Item 6. | Exhibits. | 28 | ||
Signatures | 29 | |||
| 2 |
| Table of Contents |
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This Quarterly Report on Form 10-Q of Sharing Economy International Inc., a Nevada corporation (the “Company”), contains “forward-looking statements,” as defined in the United States Private Securities Litigation Reform Act of 1995. In some cases, you can identify forward-looking statements by terminology such as “may”, “will”, “should”, “could”, “expects”, “plans”, “intends”, “anticipates”, “believes”, “estimates”, “predicts”, “potential” or “continue” or the negative of such terms and other comparable terminology. These forward-looking statements include, without limitation, statements about our market opportunity, our strategies, competition, expected activities and expenditures as we pursue our business plan, and the adequacy of our available cash resources. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Actual results may differ materially from the predictions discussed in these forward-looking statements. The economic environment within which we operate could materially affect our actual results. Additional factors that could materially affect these forward-looking statements and/or predictions include, among other things to product demand, market and customer acceptance, competition, pricing, climate change, pandemics, political changes, and development difficulties, as well as general industry and market conditions and growth rates and general economic conditions; and other factors discussed in the Company’s filings with the Securities and Exchange Commission (“SEC”).
Our management has included projections and estimates in this Form 10-Q, which are based primarily on management’s experience in the industry, assessments of our results of operations, discussions and negotiations with third parties and a review of information filed by our competitors with the SEC or otherwise publicly available. We caution readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made. We disclaim any obligation subsequently to revise any forward-looking statements to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events.
| 3 |
| Table of Contents |
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS.
SHARING ECONOMY INTERNATIONAL INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
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Assets |
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Current Assets |
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Prepaid expenses |
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Total current assets |
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TOTAL ASSETS |
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Liabilities and shareholders’ equity |
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Current liabilities |
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Convertible note payable, net of unamortized debt discount |
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Accounts payable and accrued expenses |
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Accrued interests on promissory notes |
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Due to related parties |
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Total current liabilities |
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TOTAL LIABILITIES |
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Commitments and contingencies (note 7) |
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Shareholders’ equity |
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Preferred stock, Series A $ |
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Common stock $ |
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Additional paid-in capital |
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Accumulated deficit |
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Accumulated other comprehensive income |
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TOTAL SHAREHOLDERS’ EQUITY |
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TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY |
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See notes to unaudited condensed consolidated financial statements.
| 4 |
| Table of Contents |
SHARING ECONOMY INTERNATIONAL INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
(Unaudited)
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Revenue |
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Cost of revenue |
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Gross profit |
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Operating expenses |
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Selling, general and administrative expenses |
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Loss from operations |
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Other income (expense), net |
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Interest expense, net |
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Foreign exchange loss, net |
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Sundry income |
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Total other income (expense), net |
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Loss before income taxes |
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Provision for income taxes |
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Net Loss |
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Other comprehensive income: |
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Comprehensive loss |
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Comprehensive losses attributable to shareholders |
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Net loss per common share: |
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Net loss per common share – basic and diluted |
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Weighted average common shares outstanding |
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Basic and diluted |
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See notes to unaudited condensed consolidated financial statements.
| 5 |
| Table of Contents |
SHARING ECONOMY INTERNATIONAL INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY
(Unaudited)
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Balance as of January 1, 2026 |
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Balance as of March 31, 2026 |
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Issuance of shares for redemption of promissory note |
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Net loss for the period |
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Balance as of June 30, 2026 |
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Balance as of March 31, 2025 |
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Net loss for the period |
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Balance as of June 30, 2025 |
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| 6 |
| Table of Contents |
SHARING ECONOMY INTERNATIONAL INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
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Net loss |
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See notes to unaudited condensed consolidated financial statements.
| 7 |
| Table of Contents |
SHARING ECONOMY INTERNATIONAL INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2026
(Unaudited)
NOTE 1 – DESCRIPTION OF BUSINESS AND ORGANIZATION
Sharing Economy International Inc. (the “Company”) was incorporated in Delaware on
The Company’s latest business initiatives are focused on targeting the technology and global sharing economy markets, by developing online platforms and rental business partnerships that will drive the global development of sharing through economical rental business models.
Effective January 1, 2023, the Company approved and completed the internal corporate restructuring actions to streamline, right-size and optimize specific organizational structure by disposing of several subsidiaries.
NOTE 2 – GOING CONCERN UNCERTAINTIES
These condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business. As reflected in the accompanying condensed consolidated financial statements, the Company reported a loss of $
Management believes that these matters raise substantial doubt about the Company’s ability to continue as a going concern. The accompanying condensed consolidated financial statements do not include any adjustments related to the recoverability and classification of recorded asset amounts or classification of liabilities that might be necessary should the Company be unable to continue as a going concern.
| 8 |
| Table of Contents |
NOTE 3 – SIGIFICANT ACCOUNTING POLICIES
Basis of Presentation
The accompanying unaudited condensed consolidated financial statements have been prepared by management in accordance with both accounting principles generally accepted in the United States (“GAAP”), and the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Certain information and note disclosures normally included in audited financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to those rules and regulations, although the Company believes that the disclosures made are adequate to make the information not misleading.
In the opinion of management, the condensed consolidated balance sheet as of June 30, 2026 which has been derived from audited financial statements and these unaudited condensed consolidated financial statements reflect all normal and recurring adjustments considered necessary to state fairly the results for the periods presented. The results for the period ended June 30, 2026 are not necessarily indicative of the results to be expected for the entire fiscal year ending December 31, 2026 or for any future period.
These unaudited condensed consolidated financial statements and notes thereto should be read in conjunction with the Management’s Discussion and the audited financial statements and notes thereto included in the Annual Report on Form 10-K for the year ended December 31, 2025.
Principles of Consolidation
The Company’s condensed consolidated financial statements include the financial statements of its wholly-owned and majority owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation.
Name of Entity |
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Vantage Ultimate Limited (“Vantage”), a British Virgin Island (“BVI”) company |
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Sharing Economy Investment Limited (“Sharing Economy”), a BVI company |
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Use of estimates
The preparation of the condensed consolidated financial statements in conformity with accounting principles generally accepted in the U.S. requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, expenses, and the related disclosures at the date of the financial statements and during the reporting period. Actual results could materially differ from these estimates.
Cash and cash equivalents
For purposes of the condensed consolidated statements of cash flows, the Company considers all highly liquid instruments purchased with a maturity of three months or less and money market accounts to be cash equivalents. The Company maintains with various financial institutions mainly in Hong Kong. At June 30, 2026 and December 31, 2025, cash balances held in banks in Hong Kong of $
Revenue recognition
The Company adopted Accounting Standards Update (“ASU”) 2014-09, Revenue from Contracts with Customers (Topic 606) (“ASU 2014-09”). Under ASU 2014-09, the Company applies the following five steps in order to determine the appropriate amount of revenue to be recognized as it fulfills its obligations under each of its agreements:
| ● | identify the contract with a customer; |
| ● | identify the performance obligations in the contract; |
| ● | determine the transaction price; |
| ● | allocate the transaction price to performance obligations in the contract; and |
| ● | recognize revenue as the performance obligation is satisfied. |
The transaction price for each contract is determined based on the amount the Company expects to be entitled to receive in exchange for transferring the promised products or services to the customer. Collectability of revenue is reasonably assured based on historical evidence of collectability of fees the Company charges its customers. The transaction price in the contract is allocated to each distinct performance obligation in an amount that represents the relative amount of consideration expected to be received in exchange for satisfying each performance obligation. Revenue is recognized when performance obligations are satisfied. At contract inception, the Company determines whether it satisfies the performance obligation over time or at a point in time.
The majority of the Company’s contracts with customers only contain a single performance obligation. When the agreements involve with multiple performance obligations, the Company will account for individual performance obligations separately, if they are distinct.
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Income taxes
The Company is governed by the Income Tax Law under Hong Kong and the U.S. regimes. The Company accounts for income taxes using the asset/liability method prescribed by ASC 740, “Accounting for Income Taxes.” Under this method, deferred tax assets and liabilities are determined based on the difference between the financial reporting and tax bases of assets and liabilities using enacted tax rates that will be in effect in the period in which the differences are expected to reverse. The Company records a valuation allowance to offset deferred tax assets if, based on the weight of available evidence, it is more-likely-than-not that some portion, or all, of the deferred tax assets will not be realized. The effect on deferred taxes of a change in tax rates is recognized as income or loss in the period that includes the enactment date.
On December 22, 2017, the United States signed into law the Tax Cuts and Jobs Act (the “Act”), a tax reform bill which, among other items, reduces the current federal income tax rate in the United States to
The Act has caused the Company’s deferred income taxes to be revalued. As changes in tax laws or rates are enacted, deferred tax assets and liabilities are adjusted through income tax expense. Pursuant to the guidance within SEC Staff Accounting Bulletin No. 118 (“SAB 118”), as of June 30, 2026, the Company recognized the provisional effects of the enactment of the Act for which measurement could be reasonably estimated. Since the Company has provided a full valuation allowance against its deferred tax assets, the revaluation of the deferred tax assets did not have a material impact on any period presented. The ultimate impact of the Act may differ from these estimates due to the Company’s continued analysis or further regulatory guidance that may be issued as a result of the Act.
The Company applied the provisions of ASC 740-10-50, “Accounting for Uncertainty in Income Taxes,” which provides clarification related to the process associated with accounting for uncertain tax positions recognized in the Company’s financial statements. Audit periods remain open for review until the statute of limitations has passed. The completion of review or the expiration of the statute of limitations for a given audit period could result in an adjustment to the Company’s liability for income taxes. Any such adjustment could be material to the Company’s results of operations for any given quarterly or annual period based, in part, upon the results of operations for the given period. As of June 30, 2026 and December 31, 2025, the Company had no uncertain tax positions, and will continue to evaluate for uncertain positions in the future.
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Foreign Currency Translation
The reporting currency of the Company is the U.S. dollar. The functional currency of the parent company is the U.S. dollar and the functional currency of the Company’s operating subsidiaries is Hong Kong dollars (“HKD”). For the subsidiaries, whose functional currencies are HKD, results of operations and cash flows are translated at average exchange rates during the period, assets and liabilities are translated at the unified exchange rate at the end of the period, and equity is translated at historical exchange rates. As a result, amounts relating to assets and liabilities reported on the statements of cash flows may not necessarily agree with the changes in the corresponding balances on the balance sheets. Translation adjustments resulting from the process of translating the local currency financial statements into U.S. dollars are included in determining comprehensive loss.
The Company did not enter into any material transaction in foreign currencies. Transaction gains or losses have not had, and are not expected to have, a material effect on the results of operations of the Company.
Translation of amounts from HK$ into US$ has been made at the following exchange rates for the periods ended June 30, 2026 and 2025:
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Loss Per Share of Common Stock
ASC Topic 260 “Earnings per Share,” requires presentation of both basic and diluted earnings per share (“EPS”) with a reconciliation of the numerator and denominator of the basic EPS computation to the numerator and denominator of the diluted EPS computation. Basic EPS excludes dilution. Diluted EPS reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that then shared in the earnings of the entity.
Basic net loss per share is computed by dividing net loss available to common stockholders by the weighted average number of shares of common stock outstanding during the period. Diluted net loss per share is computed by dividing net loss by the weighted average number of shares of common stock, common stock equivalents and potentially dilutive securities outstanding during each period. The Company did not have any common stock equivalents or potentially dilutive common stock outstanding during the six months ended June 30, 2026 and 2025. In a period in which the Company has a net loss, all potentially dilutive securities are excluded from the computation of diluted shares outstanding as they would have had an anti-dilutive impact.
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Loss Per Share of Common Stock (cont.)
The following table presents a reconciliation of basic and diluted net loss per share:
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Comprehensive loss
Comprehensive loss is comprised of net loss and all changes to the statements of stockholders’ equity, except those due to investments by stockholders, changes in paid-in capital and distributions to stockholders. For the Company, comprehensive loss for the six months ended June 30, 2026 and 2025 included net loss and unrealized loss from foreign currency translation adjustments.
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Related parties
The Company follows the ASC Topic 850-10, “Related Party Disclosures” for the identification of related parties and disclosure of related party transactions.
Pursuant to section 850-10-20 the related parties include a) affiliates of the Company; b) entities for which investments in their equity securities would be required, absent the election of the fair value option under the Fair Value Option Subsection of section 825-10-15, to be accounted for by the equity method by the investing entity; c) trusts for the benefit of employees, such as pension and Income-sharing trusts that are managed by or under the trusteeship of management; d) principal owners of the Company; e) management of the Company; f) other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests; and g) other parties that can significantly influence the management or operating policies of the transacting parties or that have an ownership interest in one of the transacting parties and can significantly influence the other to an extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interests.
The condensed consolidated financial statements shall include disclosures of material related party transactions, other than compensation arrangements, expense allowances, and other similar items in the ordinary course of business. However, disclosure of transactions that are eliminated in the preparation of consolidated or combined financial statements is not required in those statements. The disclosures shall include: a) the nature of the relationship(s) involved; b) a description of the transactions, including transactions to which no amounts or nominal amounts were ascribed, for each of the periods for which income statements are presented, and such other information deemed necessary to an understanding of the effects of the transactions on the financial statements; c) the dollar amounts of transactions for each of the periods for which income statements are presented and the effects of any change in the method of establishing the terms from that used in the preceding period; and d) amount due from or to related parties as of the date of each balance sheet presented and, if not otherwise apparent, the terms and manner of settlement.
Commitments and contingencies
The Company follows ASC Topic 450-20, “Contingencies” to report accounting for contingencies. Certain conditions may exist as of the date the financial statements are issued, which may result in a loss to the Company but which will only be resolved when one or more future events occur or fail to occur. The Company assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company or un-asserted claims that may result in such proceedings, the Company evaluates the perceived merits of any legal proceedings or un-asserted claims as well as the perceived merits of the amount of relief sought or expected to be sought therein.
If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company’s consolidated financial statements. If the assessment indicates that a potentially material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, and an estimate of the range of possible losses, if determinable and material, would be disclosed.
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Commitments and contingencies (cont.)
Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the guarantees would be disclosed. Management does not believe, based upon information available at this time that these matters will have a material adverse effect on the Company’s financial position, results of operations or cash flows. However, there is no assurance that such matters will not materially and adversely affect the Company’s business, financial position, and results of operations or cash flows.
Fair Value of Financial Instruments
The Company adopted the guidance of ASC Topic 820 for fair value measurements which clarifies the definition of fair value, prescribes methods for measuring fair value, and establishes a fair value hierarchy to classify the inputs used in measuring fair value as follows:
Level 1 - Inputs are unadjusted quoted prices in active markets for identical assets or liabilities available at the measurement date.
Level 2 - Inputs are unadjusted quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, inputs other than quoted prices that are observable, and inputs derived from or corroborated by observable market data.
Level 3 - Inputs are unobservable inputs which reflect the reporting entity’s own assumptions on what assumptions the market participants would use in pricing the asset or liability based on the best available information.
The carrying amounts reported in the consolidated balance sheets for cash and cash equivalents, prepaid expenses and other receivables, due from related parties, convertible note payable, accounts payable and accrued liabilities, amount due to related party, approximate their fair market value based on the short-term maturity of these instruments.
ASC Topic 825-10 “Financial Instruments” allows entities to voluntarily choose to measure certain financial assets and liabilities at fair value (fair value option). The fair value option may be elected on an instrument-by-instrument basis and is irrevocable, unless a new election date occurs. If the fair value option is elected for an instrument, unrealized gains and losses for that instrument should be reported in earnings at each subsequent reporting date. The Company did not elect to apply the fair value option to any outstanding instruments.
As of June 30, 2026 and December 31, 2025, the Company did not have any nonfinancial assets and liabilities that are recognized or disclosed at fair value in the financial statements, at least annually, on a recurring basis, nor did the Company have any assets or liabilities measured at fair value on a non-recurring basis.
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Recent Accounting Pronouncements
In December 2023, the Financial Accounting Standards Board (“FASB”) issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures intended to enhance transparency and decision usefulness of income tax disclosures. This guidance is effective for public entities for annual periods beginning after December 15, 2024 and for annual periods beginning after December 15, 2025 for all other entities, and the guidance should be applied prospectively. The Company is permitted to early adopt and can choose to apply the guidance retrospectively. When adopted, The Company expects the guidance to have an impact on disclosures only and to not have a material effect on our financial position or results of operations. The Company is still considering if the Group will apply the standard prospectively or retrospectively.
In November 2023, the FASB issued Accounting Standards Updates (“ASU”) 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures intended to improve reportable segment disclosures and to enhance disclosures about significant reportable segment expenses. This guidance is effective for public entities fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, and is required to be applied retrospectively to all prior periods presented. Because the amendments do not change the methodology for the identification of operating segments, the aggregation of those operating segments or the application of the quantitative thresholds to determine reportable segments, the Company does not expect the guidance to have a material effect on its financial position or results of operations.
In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses (“ASU 2024-03”) and No. 2025-01, Income Statement— Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Clarifying the Effective Date, which will require additional disclosure of the nature of expenses included in the income statement in response to longstanding requests from investors for more information about an entity’s expenses. The new standard requires disclosures about specific types of expenses included in the expense captions presented on the face of the income statement as well as disclosures about selling expenses. The new standard will be effective for public companies for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027. The requirements will be applied prospectively with the option for retrospective application. Early adoption is permitted. The Company is currently evaluating the impact of adopting this guidance on the Company’s consolidated financial statements.
Except for the above-mentioned pronouncements, there are no new recently issued accounting standards that will have a material impact on the condensed and consolidated balance sheets, statements of operations and cash flows.
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NOTE 4 – CONVERTIBLE NOTE PAYABLE
Iliad Note
On May 2, 2018, pursuant to a securities purchase agreement, the Company closed a private placement of securities with Iliad Research and Trading, L.P. (the “Investor”) pursuant to which the Investor purchased a Convertible Promissory Note (the “Iliad Note”) in the original principal amount of $
On November 8, 2018, the Company converted an aggregate of $
On January 11, 2019, the Company converted an aggregate of $
On April 30, 2020, the Company converted an aggregate of $
During the year ended December 31, 2020, the Company converted an aggregate of $
During the year ended December 31, 2021, the Company converted an aggregate of $
During the year ended December 31, 2022, the Company converted an aggregate of $
During the year ended December 31, 2023, the Company converted an aggregate of $
The Investor has the right at any time after May 2, 2018 until the outstanding balance has been paid in full to convert all or any part of the outstanding balance into shares of common stock of the Company at conversion price of $
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Iliad Note (cont.)
This debt instrument includes embedded components including a put option. The Company evaluated these embedded components to determine whether they are embedded derivatives within the scope of ASC 815 that should be separately carried at fair value. ASC 815-15-25-1 provides guidance on when an embedded component should be separated from its host instrument and accounted for separately as a derivative. Based on this analysis, the Company believes that the put option is clearly and closely related to the debt instrument and does not meet the definition of a derivative. Accordingly, in connection with this Iliad Note, the Company recorded a debt discount for (a) the original issue discount of $
At June 30, 2026, the principal balance of Iliad Note was fully repaid by the conversion to the Company’s common stock. The Company accrued interest on this Iliad Note was $
1800 DIAGONAL LENDING, LLC
On July 7, 2022, pursuant to a securities purchase agreement, the Company closed a private placement of securities with 1800 DIAGONAL LENDING, LLC (“1800”) pursuant to which 1800 purchased the Convertible Promissory Note (“1800 Note”) in the original principal amount of $
On August 31, 2022, pursuant to a securities purchase agreement, the Company closed a private placement of securities with 1800 pursuant to which 1800 purchased the 1800 Note in the original principal amount of $
During the year ended December 31, 2023, the Company converted an aggregate of $
During the three months ended June 30, 2026, the Company converted an aggregate of $
As at June 30, 2026, the Company had the outstanding principal balance of $
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Pyram
On April 9, 2021, pursuant to a securities purchase agreement, the Company closed a private placement of securities with Pyram LC Architecture Limited. (“Pyram”) pursuant to which Pyram purchased the Convertible Promissory Note (the “Pyram Note”) in the original principal amount of $
On April 28, 2021, pursuant to a securities purchase agreement, the Company closed a private placement of securities with Pyram pursuant to which Pyram purchased the Pyram Note in the original principal amount of $
On May 13, 2021, pursuant to a securities purchase agreement, the Company closed a private placement of securities with Pyram pursuant to which Pyram purchased the Pyram Note in the original principal amount of $
On June 29, 2021, pursuant to a securities purchase agreement, the Company closed a private placement of securities with Pyram pursuant to which Pyram purchased the Pyram Note in the original principal amount of $
On July 29, 2021, the Company and Pyram entered into a Note Purchase Agreement, whereby the Company issued a note to Pyram (the “Pyram Note”) in the principal amount of $
On August 26, 2021, the Company and Pyram entered into a Note Purchase Agreement, whereby the Company issued a note to Pyram (the “Pyram Note”) in the principal amount of $
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Pyram (cont.)
On September 20, 2021, the Company and Pyram entered into a Note Purchase Agreement, whereby the Company issued a note to Pyram (the “Pyram Note”) in the principal amount of $
The Company is currently in default under Pyram Note with the outstanding balance of $
Light Across, Inc.
On December 10, 2025, pursuant to a Note Purchase Agreement, whereby the Company issued a note to Light Across, Inc. (“Light Across Note”) in the principal amount of $
As at June 30, 2026, the Company had the outstanding principal balance of $
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NOTE 5 – STOCKHOLDERS’ EQUITY (DEFICIT)
Preferred Stock
The Company has authorized
As of June 30, 2026 and December 31, 2025, the Company had
Common Stock
The Company has authorized
As of June 30, 2026 and December 31, 2025, the Company had
NOTE 6 – SEGMENT INFORMATION
ASC Topic 280, Segment Reporting, establishes standards for companies to report in their financial statement information about operating segments, products, services, geographic areas, and major customers. Operating segments are defined as components of an enterprise for which separate financial information is available that is regularly evaluated by the Company’s chief operating decision maker (“CODM”), or group, in deciding how to allocate resources and assess performance.
When evaluating the Company’s performance and making key decisions regarding resource allocation, the CODM reviews several key metrics, which includes selling, general and administrative expenses and included in the accompanying unaudited condensed consolidated statements of operations and comprehensive loss.
The key measures of segment profit or loss reviewed by the CODM is selling, general and administrative expenses. The CODM reviewed selling, general and administrative expenses to measure and monitor stockholder value. Selling, general and administrative expenses are reviewed and monitored by the CODM to manage and forecast cash to ensure enough capital is available to complete a business combination within the business combination period. The CODM also reviews the operating costs to manage, maintain and enforce all contractual agreements to ensure costs are aligned with all agreements and budget.
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NOTE 7 – COMMITMENT AND CONTINGENCIES
Litigation:
On April 25, 2019, ECPower (HK) Company Limited (“EC Power”), a subsidiary of SEII, filed a claim against The Dairy Farm Limited (“Dairy Farm”) in respect of the cooperation agreement between the two parties for the battery rental business at 7-Eleven outlets in Hong Kong during the period from September 2017 to February 2018. The claim is for a total compensation of HK$1,395,000 (approximately $
Legal proceedings:
The Company is currently respondent in administrative deregistration proceedings, Admin. Proc. File No. 3-22248, before the Securities and Exchange Commission (the “SEC”), pursuant to which the Division of Enforcement of the SEC seeks to revoke the registration of the Company as a “reporting issuer” under the Securities Exchange Act of 1934, as amended. On June 17, 2026, the SEC issued a Supplemental Briefing Order (the “Supplemental Briefing Order”, stating, “Since briefing on the Division’s motion concluded, it appears that Respondent [Sharing Economy International Inc.] has filed a number of delinquent periodic reports. Given these filings, the Commission would benefit from further briefing on whether revocation is necessary and appropriate for the protection of investors.” The Divion of Enforcement has filed its brief, and the Company has filed the response, and the Division of Enforcement filed its reply to our response on August 4, 2026.”
NOTE 8 – SUBSEQUENT EVENTS
On August 2, 2026, the Company entered into a Share Exchange Agreement (the “Share Exchange Agreement”), by and among the Company, Light Across, Inc., a Delaware corporation (“Light Across”), and the holders of common shares of Light Across. The holders of the common stock of Light Across consisted of 16 stockholders.
Under the terms and conditions of the Share Exchange Agreement, the Company offered, sold and issued
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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
The following information should be read in conjunction with (i) the financial statements of Sharing Economy International Inc., a Nevada corporation (the “Company”), and the notes thereto appearing elsewhere in this Form 10-Q together with (ii) the more detailed business information and the December 31, 2025 audited financial statements and related notes included in the Company’s Form 10-K (File No. 001-34591; the “Form 10-K”), as filed with the Securities and Exchange Commission on May 8, 2026. Statements in this section and elsewhere in this Form 10-Q that are not statements of historical or current fact constitute “forward-looking” statements.
OVERVIEW
The Company was incorporated in the State of Nevada on July 25, 2012, and established a fiscal year end of December 31.
Going Concern
Material hurdles remain before we can significantly increase sales of our products and services. We must complete the design and development of our technology platform and establish relationships with third parties for the manufacture or supply of electric vehicles, charging infrastructure, and related maintenance services.
We currently estimate that approximately $1.5 million of additional capital will be required to complete these activities, which we expect could take approximately 12 months, subject to the availability of sufficient funding and other factors. We expect to fund these activities through a combination of revenues generated from our services and additional equity financing, including potential sales of our common stock.
We currently have no committed financing arrangements, and there can be no assurance that we will be able to obtain sufficient financing on acceptable terms, or at all. Any equity financing could result in substantial dilution to our existing shareholders. If we are unable to obtain sufficient financing, we may be required to delay, reduce, or modify our planned development and expansion activities, which could materially adversely affect our business, financial condition, and results of operations.
The Company plans to raise additional funds through debt or equity offerings. There is no guarantee that the Company will be able to raise any capital through this or any other offerings.
CRITICAL ACCOUNTING POLICIES
The discussion and analysis of our financial condition and results of operations are based on our condensed consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States (“US GAAP”). The preparation of these condensed consolidated financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. On an ongoing basis, we evaluate our estimates based on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. We have identified the policies below as critical to our business operations and to the understanding of our financial results:
Basis of Accounting
The Company’s financial statements are prepared using the accrual method of accounting and are presented in United States Dollars.
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Basic Earnings (loss) per Share
The Company computes net income (loss) per share in accordance with ASC 260, Earnings per Share. ASC 260 specifies the computation, presentation and disclosure requirements for earnings (loss) per share for entities with publicly held common stock.
Basic net earnings (loss) per share amounts are computed by dividing the net earnings (loss) by the weighted average number of common shares outstanding. Diluted earnings (loss) per share are the same as basic earnings (loss) per share due to the lack of dilutive items in the Company.
Use of Estimates and Assumptions
The preparation of financial statements in conformity with generally accepted accounting principles 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 financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Due to the limited level of operations, the Company has not had to make material assumptions or estimates other than the assumption that the Company is a going concern.
Income Taxes
Income taxes are provided in accordance with ASC 740, Income Taxes. A deferred tax asset or liability is recorded for all temporary differences between financial and tax reporting and net operating loss carry forwards. Deferred tax expense (benefit) results from the net change during the year of deferred tax assets and liabilities.
Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment.
Foreign Currency Translation
The Company’s functional and reporting currency is the United States dollar. Occasional transactions may occur in Chinese Renminbi or Australian Dollars. Monetary assets and liabilities denominated in foreign currencies are translated using the exchange rate prevailing at the balance sheet date. Non-monetary assets and liabilities denominated in foreign currencies are translated at rates of exchange in effect at the date of the transaction. Average monthly rates are used to translate expenses. Gains and losses arising on translation or settlement of foreign currency denominated transactions or balances are included in the determination of net income (loss).
Fair Value of Financial Instruments
The carrying amount of cash and current liabilities approximates fair value due to the short maturity of these instruments. These fair value estimates are subjective in nature and involve uncertainties and matters of significant judgment and therefore cannot be determined with precision. Unless otherwise noted, it is management’s opinion the Company is not exposed to significant interest, currency or credit risks arising from these financial instruments.
Start-Up expenses
As a start-up company, the costs associated with start-up activities are expensed as incurred. Accordingly, start-up costs associated with the Company’s formation have been included in the Company’s general and administrative expenses.
Property and Equipment
Property and equipment are stated at cost. Major repairs and betterments are capitalized and normal maintenance and repairs are charged to expense as incurred. Depreciation is computed by the straight-line method over the estimated useful lives of the related assets. Upon retirement or sale of an asset, the cost and accumulated depreciation are removed from the accounts and any gain or loss is reflected in operations.
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Recent Accounting Pronouncements
The Company has implemented all new accounting pronouncements that are in effect and that may impact its financial statements and does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.
PLAN OF OPERATION
We are an early-stage corporation and have generated revenues of $0 and $0, respectively, during the six-month periods ended June 30, 2026 and 2025. Accordingly, our plan of operation for the 12 months following the filing of this Quarterly Report on Form 10-Q is make sales of our products.
The Company believes it can satisfy its cash requirements through the fiscal year end of December 31, 2026, from its cash of $3,583 as of June 30, 2026. As of June 30, 2026, we had a working capital balance of $13,899,672.
RESULTS OF OPERATIONS
Three and Six Months Ended June 30, 2026, as compared to Three and Six Months Ended March 31, 2025:
We recorded sales revenues of $0 and $0, respectively, during the six months ended June 30, 2026 and 2025.
For the three months ended June 30, 2026 and 2025, general and administrative expenses were $76,464 and $4,968, respectively.
For the six months ended June 30, 2026 and 2025, general and administrative expenses were $166,419 and $10,192, respectively.
We recorded net losses of $82,447 and $4,973, respectively, during the three months ended June 30, 2026 and 2025.
We recorded net losses of $179,777 and $10,197, respectively, during the six months ended June 30, 2026 and 2025.
Liquidity and Capital Resources
At June 30, 2026, we had a cash balance of $3,583, and total current liabilities of $2,791,379, consisting primarily of accounts payable and accrued expenses and a convertible note payable, net of unamortized debt discount. Our working capital balance at June 30, 2026, was $13,899,672. We have sufficient cash on hand to fund our ongoing operational expenses through December 31, 2026.
Material hurdles remain before we can significantly increase sales of our products and services. We must complete the design and development of our technology platform and establish relationships with third parties for the manufacture or supply of electric vehicles, charging infrastructure, and related maintenance services.
We currently estimate that approximately $1.5 million of additional capital will be required to complete these activities, which we expect could take approximately 12 months, subject to the availability of sufficient funding and other factors. We expect to fund these activities through a combination of revenues generated from our services and additional equity financing, including potential sales of our common stock.
We currently have no committed financing arrangements, and there can be no assurance that we will be able to obtain sufficient financing on acceptable terms, or at all. Any equity financing could result in substantial dilution to our existing shareholders. If we are unable to obtain sufficient financing, we may be required to delay, reduce, or modify our planned development and expansion activities, which could materially adversely affect our business, financial condition, and results of operations.
At June 30, 2026, our total assets were $16,691,051, consisting of cash of $3,583, and pre-paid expenses of $5,351.
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At June 30, 2026, our total liabilities were $2,791,379 and stockholders’ equity was $13,899,672.
Cash Flows from Operating Activities
We have not generated positive cash flows from operating activities. Net cash used in operations was $(235,145) and $(10,197) for the six months ended June 30, 2026 and 2025, respectively.
Cash Flows from Financing Activities
Net cash flows (used in) provided by financing activities was $(24,419) and $18,889, for the six months ended June 30, 2026 and 2025, respectively.
Off-Balance Sheet Arrangements
We had no off-balance sheet arrangements for the six months ended June 30, 2026.
Subsequent Events
On August 2, 2026, the Company entered into a Share Exchange Agreement (the “Share Exchange Agreement”), by and among the Company, Light Across, Inc., a Delaware corporation (“Light Across”), and the holders of common shares of Light Across. The holders of the common stock of Light Across consisted of 16 stockholders.
Under the terms and conditions of the Share Exchange Agreement, the Company offered, sold and issued 4,998,838,436 shares of common stock in consideration for all the issued and outstanding shares in Light Across.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
As a smaller reporting company (as defined in Rule 12b-2 of the Exchange Act), we are not required to provide the information called for by this Item 3.
ITEM 4. CONTROLS AND PROCEDURES.
Evaluation of disclosure controls and procedures
Our management, with the participation of our Chief Executive Officer and our Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures as defined in Rule 13a-15(e) under the Exchange Act as of the end of the period covered by this Quarterly Report on Form 10-Q. In designing and evaluating the disclosure controls and procedures, our management recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. In addition, the design of disclosure controls and procedures must reflect the fact that there are resource constraints and that management is required to apply its judgment in evaluating the benefits of possible controls and procedures relative to their costs. The design of any disclosure controls and procedures also is based in part upon certain assumptions about the likelihood of future events and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions.
Based on that evaluation, our Chief Executive Officer and our Chief Financial Officer concluded that, as of June 30, 2026, our disclosure controls and procedures were not effective to provide reasonable assurance that information we are required to disclose in reports that we file or submit under the Exchange Act is (i) recorded, processed, summarized and reported within the time periods specified in SEC rules, regulations and forms, and (ii) that such information is accumulated and communicated to our management, including our President and our Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.
Changes in internal control over financial reporting
Our management, with the participation of our Chief Executive Officer and our Chief Financial Officer, has concluded there were no significant changes in our internal controls over financial reporting that occurred during this quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
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PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS.
The Company is not currently subject to any legal proceedings. From time to time, the Company may become subject to litigation or proceedings in connection with its business, as either a plaintiff or defendant. There are no such pending legal proceedings to which the Company is a party that, in the opinion of management, is likely to have a material adverse effect on the Company’s business, financial condition or results of operations.
ITEM 1A. RISK FACTORS
As a smaller reporting company (as defined in Rule 12b-2 of the Exchange Act), we are not required to provide the information called for by this Item 1A.
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.
None.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES.
None.
ITEM 4. MINE SAFETY DISCLOSURES.
None.
ITEM 5. OTHER INFORMATION.
None.
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ITEM 6. EXHIBITS.
| (a) | Exhibits required by Item 601 of Regulation SK. |
Number |
| Description |
2.1 |
| Share Exchange Agreement, dated August 2, 2026, by and among Sharing Economy International Inc., Light Across, Inc., a Delaware corporation (“Light Across”), and the holders of common stock of Light Across. |
3.1.1 |
| Articles of Incorporation. |
3.1.2 |
| Certificate of Change, dated February 24, 2017. |
3.1.3 |
| Certificate of Designation for Series A Preferred Stock, dated September 7, 2018. |
3.1.4 |
| Certificate of Amendment to Articles of Incorporation, dated January 8, 2018. |
3.1.5 |
| Certificate of Amendment to Articles of Incorporation, dated January 31, 2020. |
3.2 |
| Bylaws. |
31.1 |
| Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
31.2 |
| Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
32.1* |
| Certification of Principal Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
32.2* |
| Certification of Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
101.INS |
| Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document). |
101.SCH |
| Inline XBRL Taxonomy Extension Schema Document. |
104 |
| Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101). |
_______________
*Furnished, not filed.
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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.
SHARING ECONOMY INTERNATIONAL INC. | |||
Date: August 14, 2026 | By: | /s/ Ximing Huang | |
Name: | Ximing Huang | ||
Title: | Chief Executive Officer (principal executive officer) | ||
Date: August 14, 2026 | By: | /s/ Johnny Chen | |
Name: | Johnny Chen | ||
Title: | Chief Financial Officer (principal financial officer and principal accounting officer) |
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