AMCI

AMC Robotics Corp. 10-Q Summary (Period Ended June 30, 2026)

Business Context and Reporting Period

This is a Quarterly Report on Form 10-Q for AMC Robotics Corporation for the period ended June 30, 2026. The Company, a Delaware corporation, operates as a publicly traded holding company following a reverse recapitalization with AlphaVest Acquisition Corp. in December 2025. AMC Robotics designs and sells residential and small-business security camera products and generates recurring revenue through cloud-based services, AI service sharing, and revenue-sharing arrangements with related parties, primarily Kami Vision Incorporated. The Company is classified as a smaller reporting company and an emerging growth company.

Key Financial Metrics

Material Changes vs. Prior Period

• Revenue Decline, Margin Expansion: Total revenue decreased 33% year-over-year (YoY) for both the three and six-month periods, driven by an 87% drop in product revenue. However, gross profit increased 135% YoY for the six months ended June 30, 2026, and gross margin expanded from 24% to 83%. This shift reflects a strategic pivot from inventory-intensive product sales to high-margin revenue-sharing and service-based arrangements.
• Operating Efficiency: Operating loss improved significantly, narrowing from $(1.48M) to $(28k) for the six-month period. Sales and marketing expenses dropped 94% YoY, while General and Administrative (G&A) expenses increased 9% due to public company compliance costs.
• Cash Flow: Net cash used in operating activities was $(1.48M) for the six months ended June 30, 2026, compared to cash provided of $675k in the prior year. This was primarily due to a $1.2M increase in related-party accounts receivable and a $1.1M increase in advances to related-party suppliers.
• Investment Activity: The Company invested $1.0 million in Etronium AI Inc. via Simple Agreements for Future Equity (SAFEs) during the second quarter of 2026.

Guidance, Outlook, and Risks

• Strategic Outlook: Management is focused on expanding recurring service-based revenue (cloud, AI, and information services) to reduce working capital requirements and improve profitability. The Company plans to maintain disciplined inventory management.
• Liquidity: As of June 30, 2026, the Company held $4.5 million in cash. Management believes this, combined with anticipated operating cash flows, is sufficient to fund operations for at least the next 12 months. No committed credit facilities exist.
• Related Party Concentration: A significant concentration risk exists with Kami Vision Incorporated, which accounted for 81% of total revenue for the six months ended June 30, 2026. Related-party accounts receivable totaled $3.25 million.
• Internal Controls: The Company disclosed that its disclosure controls and procedures were not effective as of June 30, 2026, due to material weaknesses including a lack of experienced accounting staff, insufficient segregation of duties, inadequate inventory management controls, and a lack of formal approval processes for related-party transactions.
• Accounting Revisions: The Company revised its December 31, 2025, comparative balance sheet to correct immaterial errors related to accrued professional fees, increasing accrued liabilities and accumulated deficit by approximately $109,000.

Investor Verification Checklist

• Related Party Dependence: Verify the sustainability of revenue-sharing agreements with Kami Vision, which represents over 80% of revenue, and assess the collectability of the $3.25 million related-party receivable.
• Internal Control Remediation: Monitor the progress of the remediation plan for material weaknesses in internal controls, specifically regarding inventory management and related-party transaction approvals.
• Working Capital Trends: Track the growth in "Advances to suppliers - related party" (increased to $1.08M) and "Accounts receivable - related party" to ensure these do not signal liquidity strain or non-arm's-length financing.
• Investment Valuation: Review the terms and potential dilution impact of the $1.0 million SAFE investment in Etronium AI Inc.
• Revenue Recognition: Confirm the principal vs. agent assessment for revenue-sharing arrangements, as this significantly impacts reported revenue and gross margins.