Quarterly Report for Quarter Ending December 31, 2025 (Form 10-Q)

Management's Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis of our Company's financial condition and results of operations should be read in conjunction with our unaudited condensed consolidated financial statements and the related notes included elsewhere in the report. This discussion contains forward-looking statements that involve risks and uncertainties. Actual results and the timing of selected events could differ materially from those anticipated in these forward-looking statements as a result of various factors. See "Cautionary Note Concerning Forward-Looking Statements" on page 9.

Unless otherwise noted, all currency figures quoted as "U.S. dollars", "dollars" or "$" refer to the legal currency of the United States. Throughout this report, assets and liabilities of the Company's subsidiaries are translated into U.S. dollars using the exchange rate on the balance sheet date. Revenue and expenses are translated at average rates prevailing during the period. The gains and losses resulting from translation of financial statements of foreign subsidiaries are recorded as a separate component of accumulated other comprehensive loss within the unaudited condensed consolidated statements of changes in shareholders' deficit.

Unless indicated otherwise, throughout this Quarterly Report on Form 10-Q, we refer to Zicix Corporation and its consolidated subsidiary, as "ZICX," "we," "us" and "our."

Numerical information in this report is presented on a rounded basis using actual amounts. Minor differences in totals and percentage calculations may exist due to rounding.

Description of Business

We are not required to obtain permission from the Chinese authorities to operate or to issue securities to foreign investors.

ZICX is a Nevada holding company that through its subsidiary provides technology driven digital marketing and advertising solutions. ZICX conducts its business through its wholly owned subsidiary, ASN Zone One Limited, a company registered in Hong Kong ("ASN"). ASN began operations in Hong Kong on September 2, 2022, and was engaged in the storage network business. It was dedicated to developing a platform that would enable businesses to optimize their logistics processes through a single platform. In attempting to develop its platform, ASN encountered market challenges that adversely affected the Hong Kong logistics business as a whole including limited cost-effective land supply for logistics uses, including modern well-located warehouses, government land reclamation and re-zoning efforts, inadequate infrastructure support, high land, labor, energy, and vehicle costs, disruption in US-China trade, and uncertain global trade policies, trade wars and tariffs. In light of these challenges, ASN elected to suspend development of its logistics platform and transitioned to developing a marketing and advertising platform in November 2024.

ASN's current core offering is an "AI-Enabled Global Network Marketing and Advertising Platform," which integrates cutting-edge hardware (e.g., naked eye 3D LED displays) with smart software systems to deliver end-to-end services for clients' global business expansion. ASN began operations in September 02, 2022, and operates in Hong Kong. ASN currently is speaking with potential clients such as media outlets in Hong Kong and China to convert some of the outdoor advertising from 2D to 3D. ASN intends to focus on extending its reach to the Middle East by the end of 2026. Thereafter as financing permits, ASN hopes to expand to North Africa, US, Europe, and Asia.

We are a development stage company.

We reported a net loss of $286,586 and $868,489 for the three and nine months ended December 31, 2025, respectively. We had current assets of $1,029,682 and current liabilities of $2,634,239 as of December 31, 2025.

Our financial statements for the nine months ended December 31, 2025, and the years ended March 31, 2025, and 2024 have been prepared assuming that we will continue as a going concern. Our continuation as a going concern is dependent upon improving our profitability and the continuing financial support from our stockholders and external fund-raising through private placements. Our sources of capital in the past have included the sale of equity securities, which include common stock sold in private transactions and public offerings, capital leases and short-term and long-term debts.

Results of Operations.

Three Months Ended December 31, 2025, as compared to Three Months Ended December 31, 2024

The following table sets forth selected financial information from our statements of comprehensive income for the three months ended December 31, 2025, and 2024:

		Three Months Ended December 31,
		2025				2024
Revenues		$	431,981			$	69,978
Cost of revenues			(409,714	)			(15,151	)
Gross profit			22,267				54,827
Operating expenses:
General and administrative expenses			(232,515	)			(241,817	)
Total operating expenses			(232,515	)			(241,817	)
Loss from operations			(210,248	)			(186,990	)
Interest expenses on bonds payable, convertible debts and promissory note			(104,111	)			(89,781	)
Interest on lease liabilities			(7,396	)			-
Change in fair value of convertible debts and promissory note			34,669				(68,104	)
Sundry income			500				2,055
Total other expenses, net			(76,338	)			(155,830	)
Loss before income taxes from continuing operations			(286,586	)			(342,820	)
Income tax expense			-				-
Net loss from continuing operations			(286,586	)			(342,820	)
Discontinued operations
Net loss from discontinued operations, net of tax			-				-
Net loss		$	(286,586	)		$	(342,820	)

Revenues

The Company currently generates following source of revenue:

				For the three months ended December 31,
Type of revenue sources		Time of recognition		2025				2024
Product sales		At a point in time		$	-			$	69,978
Cloud services		Over time			431,981				-
				$	431,981			$	-

The Company generates most of its revenue from direct product sales and cloud services. Revenue from direct trading sales is recognized when the customer obtains control of the product, which occurs at a point in time. Delivery occurs when the goods have been delivery to the specific location upon the agreed shipment terms Shipping term under Free On Board ("FOB"), the Company transferred the ownership of goods to customer and who is liable for goods damaged during shipping. The Company bills the invoices to customers together with the delivery and collects the receivables in a credit term of 30 days. Revenues from cloud services are recognized over time (typically, on a monthly basis) as service is provided.

Generally, the Company enters into purchase orders with its customers which specify the rights of the parties, including product specifications, shipment terms and payment terms and sales prices to the customers are fixed with rebate and incentives to certain customers. The performance obligations in a given transaction are determined by the individual purchase orders with revenue recognized at the time that the performance obligations have been satisfied. Sales taxes and other similar taxes that the Company collects concurrently with revenue-producing activities are excluded from revenue. Variable considerations such as sales rebates, sales discounts, and sales returns are treated as a reduction of revenue in the same period the related revenue is recognized.

For the three months ended December 31, 2025, our total revenue increased to $431,981 from $69,978 in the corresponding period of 2024, representing a growth of approximately 517%. The increase was entirely driven by the launch of our new cloud services segment, which contributed $431,981 in revenue recognized over time, compared to nil in the prior period.

For the three months ended December 31, 2025, the Company has one customer, who accounted for 100% of its total revenues.

Cost of revenues

For the three months ended December 31, 2025, cost of sales increased significantly to $415,315 from $15,151 in the corresponding period of 2024, representing an increase of approximately 2,642%. This substantial rise was almost entirely driven by the new cloud services segment, where cost of sales attributable to cloud services amounted to $409,714, compared to $15,151 in the prior-year period which was entirely attributable to product sales in 2024.

Gross Profit

We achieved a gross profit of $22,267 and $54,827 for the three months ended December 31, 2025, and 2024, respectively. The decrease in gross profit is attributable to low profit margin generated from cloud service business compared to a higher profit margin from product sales compared to 2024.

For the three months ended December 31, 2025, the Company has one vendor, who accounted for 100% of its total cost of revenue.

Operating Expenses

General and Administrative Expenses ("G&A"): General and administrative expenses of $232,515 and $241,817 for the three months ended December 31, 2025, and 2024, respectively. These expenses primarily include payroll, office operating costs, as well as professional fees.

Income Tax Expense

There was no income tax expense for the three months ended December 31, 2025, and 2024.

Nine months ended December 31, 2025, as compared to Nine months ended December 31, 2024

The following table sets forth selected financial information from our statements of comprehensive income for the nine months ended December 31, 2025, and 2024:

		Nine Months Ended December 31,
		2025				2024
Revenues		$	732,850			$	69,978
Cost of revenues			(415,315	)			(15,151	)
Gross profit			317,535				54,827
Operating expenses:
General and administrative expenses			(678,293	)			(732,293	)
Total operating expenses			(678,293	)			(732,293	)
Loss from operations			(360,758	)			(677,466	)
Interest expenses on bonds payable, convertible debts and promissory note			(332,822	)			(143,855	)
Interest on lease liabilities			(25,038	)			-
Impairment loss on goodwill			-				(1,376,083	)
Change in fair value of convertible debts and promissory note			(140,290	)			(31,352	)
Sundry income			11,419				3,891
Total other expenses, net			(495,731	)			(1,547,399	)
Loss before income taxes from continuing operations			(856,489	)			(2,224,865	)
Income tax expense			-				-
Net loss from continuing operations			(856,489	)			(2,224,865	)
Discontinued operations
Net loss from discontinued operations, net of tax			-				(847,234	)
Net loss		$	(856,489	)		$	(3,072,099	)

Revenues

The Company currently generates following source of revenue:

				For the nine months ended December 31,
Type of revenue sources		Time of recognition		2025				2024
Product sales		At a point in time		$	300,869			$	69,978
Cloud services		Over time			431,981				-
				$	732,850			$	69,978

The Company generates most of its revenue from direct product sales and cloud services. Revenue from direct trading sales is recognized when the customer obtains control of the product, which occurs at a point in time. Delivery occurs when the goods have been delivery to the specific location upon the agreed shipment terms Shipping term under Free On Board ("FOB"), the Company transferred the ownership of goods to customer and who is liable for goods damaged during shipping. The Company bills the invoices to customers together with the delivery and collects the receivables in a credit term of 30 days. Revenues from cloud services are recognized over time (typically, on a monthly basis) as service is provided.

Generally, the Company enters into purchase orders with its customers which specify the rights of the parties, including product specifications, shipment terms and payment terms and sales prices to the customers are fixed with rebate and incentives to certain customers. The performance obligations in a given transaction are determined by the individual purchase orders with revenue recognized at the time that the performance obligations have been satisfied. Sales taxes and other similar taxes that the Company collects concurrently with revenue-producing activities are excluded from revenue. Variable considerations such as sales rebates, sales discounts, and sales returns are treated as a reduction of revenue in the same period the related revenue is recognized.

For the nine months ended December 31, 2025, total revenue increased significantly to $732,850 from $69,978 in the corresponding period of 2024, representing growth of approximately 948%. This substantial increase was primarily attributable to the successful launch and ramp-up of our new cloud services segment, which generated $431,981 in revenue recognized over time, compared to nil in the prior year.

For the nine months ended December 31, 2025, the Company has two customers, who accounted for 100% of its total revenues.

Cost of revenues

For the nine months ended December 31, 2025, cost of sales increased significantly to $415,315 from $15,151 in the corresponding period of 2024, representing an increase of approximately 2,641%. This sharp rise was predominantly driven by the new cloud services segment, where cost of sales attributable to cloud services totaled $409,714, compared to nil in 2024. The remaining $5,601 of cost of sales in 2025 related to product sales which was lower than the $15,151 entirely attributable to product sales in 2024, reflecting the Company's strategic shift away from traditional product sales toward higher-margin, recurring cloud services.

For the nine months ended December 31, 2025, the Company has two vendors, who accounted for 100% of its total cost of revenue.

Gross Profit

We achieved a gross profit of $317,535 and $54,827 for the nine months ended December 31, 2025, and 2024, respectively. The increase in gross profit is attributable to an increase in new business in rendering logistics and warehousing services.

Operating Expenses

General and Administrative Expenses ("G&A"): General and administrative expenses of $678,293 and $732,293 for the nine months ended December 31, 2025, and 2024, respectively. These expenses primarily include payroll, office operating costs, as well as professional fees.

Income Tax Expense

There was no income tax expense for the nine months ended December 31, 2025, and 2024.

Liquidity and Capital Resources

Working Capital

As of December 31, 2025, we had cash and cash equivalents of $20,922, inventories of $72,877, rental deposit of $89,825, amount due from a related party of $380,466, trade receivables of $431,662 and prepayments and other current assets of $33,930.

As of March 31, 2025, we had cash and cash equivalents of $89,980, inventories of $72,914, rental deposit of $89,871, amount due from a related party of $484,505 and prepayments and other current assets of $59,934.

As of December 31, 2025, and March 31, 2025, we had working capital deficit of $1,604,557 and $723,203, respectively.

Going Concern

The Company has funded its operations and capital expenditure primarily through its stockholders. The continuation of the Company as a going concern is dependent upon improving profitability and the continued financial support from its stockholders or external fund-raising through private placements. Management believes the existing stockholders will provide additional cash to meet with the Company's obligations as they become due. However, there is no assurance that the Company will be successful in securing sufficient funds to sustain the operations.

These raise substantial doubt about the Company's ability to continue as a going concern. These condensed consolidated financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets and liabilities that may result in the Company not being able to continue as a going concern.

Cash Flows

The following summarizes the key component of our cash flows for the nine months ended December 31, 2025 and 2024:

		Nine months ended December 31,
		2025				2024
Net cash used in operating activities - continuing operations		$	(19,194	)		$	(531,925	)
Net cash used in operating activities - discontinued operations		$	-			$	(313,839	)
Net cash used in investing activities - continuing operations		$	(4,971	)		$	(15,221	)
Net cash provided by investing activities - discontinued operations		$	-			$	31,490
Net cash (used in) provided by financing activities - continuing operations		$	(34,995	)		$	816,664
Net cash provided by financing activities - discontinued operations		$	-			$	-

Net Cash Used in Operating Activities - Continuing operations

For the nine months ended December 31, 2025, net cash used in operating activities in continuing operations was $19,194, which consisted primarily of net loss of $856,489, a decrease of lease liabilities of $195,427, an increase in trade receivables of $431,662 and offset by a decrease in prepayments and other current assets of $26,004, an increase in trade payables of $409,411 and an increase in accrued liabilities and other payables of $352,789, and adjusted for non-cash items of depreciation for plant and equipment of $17,342, amortization of right-of-use assets of $151,688, amortization of debt discount of $332,822, fair value change of convertible debts and promissory note of $149,290, and interest expenses on lease liabilities of $25,038.

For the nine months ended December 31, 2024, net cash used in operating activities in continuing operations was $529,925, which consisted primarily of net loss of $2,224,865, an increase in rental deposit of $90,027, an increase in inventories of $108,376, and adjusted for non-cash items of fair value change of convertible debts and promissory note, offset by an increase in accrued liabilities and other payables of $276,866, decrease in prepayments and other current assets of $110,291 and adjusted for non-cash items of depreciation for plant and equipment of $13,948, amortization of debt discount of $82,803, fair value change of convertible debts and promissory note of $31,352, and impairment loss on goodwill of $1,376,083.

Net Cash Used in Operating Activities - Discontinued operations

There was no cash flow from operating activities for discontinued operations for the nine months ended December 31, 2025.

For the nine months ended December 31, 2024, net cash used in operating activities for discontinued operations was $313,839, which consisted primarily of net loss of $847,234, current liabilities of discontinued operations of $393,924 and offset by current assets of discontinued operations of $927,319.

Net Cash Used In Investing Activities - Continuing operations

For the nine months ended December 31, 2025, and 2024, net cash used in investing activities of $4,971 and $15,221, respectively, represents purchase of plant and equipment during the period.

Net Cash Provided by Investing Activities - Discontinued operations

There was no cash flow from investing activities for discontinued operations for the nine months ended December 31, 2025.

For the nine months ended December 31, 2024, net cash provided by investing activities for discontinued operations was $31,490, which consisted primarily of decrease in current liabilities of discontinued operations of $2,078,705 and offset by decrease in current assets of discontinued operations of $2,047,215.

Net Cash Provided by Financing Activities - Continuing operations

For the nine months ended December 31, 2025, net cash used in financing activities for continuing operations was $34,995 which consisted primarily of subscription proceeds from private placement of $430,000 and advance from a related party $104,039 and offset by repayment of bonds payable and convertible debts of $413,805 and repayment to a shareholder of $155,229.

For the nine months ended December 31, 2024, net cash provided by financing activities for continuing operations was $583,241 which consisted primarily of proceeds from convertible promissory note of $200,000, advance from a shareholder of $8,883 and subscription proceeds from private placement of $680,000, offset by repayment of bonds payable and convertible debts of $33,900 and advance to a related party of $38,319.

Net Cash Provided by Financing Activities - Discontinued operations

There was no cash flow from financing activities for discontinued operations for the nine months ended December 31, 2025, and 2024.

All advances are repayable on demand and interest-free.

Material Cash Requirements

As of December 31, 2025, we had an accumulated deficit of $5,170,562. Our material cash requirements are highly dependent upon the additional financial support from our stockholders in the next 12 - 18 months.

We are not party to any off-balance sheet transactions. We have no guarantees or obligations other than those which arise out of normal business operations.

Contractual Obligations and Commercial Commitments

Pursuant to the Stock Purchase Agreement dated July 25, 2024, the Company is required to issue to the Seller (Lo Yiu Kwok) to an aggregate of 63,000 shares of the Company's common stock, at a par value of $0.00001 upon the achievement of certain milestones by its subsidiary, ASN, during the three-years' period following July 25, 2024 ("Performance Period") as set forth below:

Annual revenue milestones (US$) during Performance Period		Number of shares issuable to the Seller
Equal or above $500,000 and less than $1,000,000			12,600
Equal or above $1,000,000 and less than $2,000,000			37,800
Equal or above $2,000,000			63,000

We are limited to issue a maximum of 63,000 shares of the Company's common stock as earnout shares. The earnout shares, if issued, classified as equity in accordance with ASC 480 and ASC 815.

Subsequently, the Company's subsidiary, ASN, did not meet with the minimum annual revenue of $500,000 as the performance milestone for the first year from July 26, 2024 to July 25, 2025, under the Performance Period, therefore no earnout shares were issued.

Except as noted above, we had no other contractual obligations and material commercial commitments as of December 31, 2025.

Critical Accounting Policies and Estimates

The preparation of condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States requires our management to make assumptions, estimates and judgments that affect the amounts reported, including the notes thereto, and related disclosures of commitments and contingencies, if any. We have identified certain accounting policies that are significant to the preparation of our condensed consolidated financial statements. These accounting policies are important for an understanding of our financial condition and results of operations. Critical accounting policies are those that are most important to the presentation of our financial condition and results of operations and require management's subjective or complex judgment, often as a result of the need to make estimates about the effect of matters that are inherently uncertain and may change in subsequent periods. Certain accounting estimates are particularly sensitive because of their significance to condensed consolidated financial statements and because of the possibility that future events affecting the estimate may differ significantly from management's current judgments. We believe the following accounting policies are critical in the preparation of our condensed consolidated financial statements.