Agape ATP Corp (ATPC) - Q2 2026 Filing Summary
Business Context and Reporting Period
This Form 10-Q covers the quarterly period ended June 30, 2026. Agape ATP Corp is a Nevada corporation operating primarily in the health and wellness industry through network marketing and product sales in Malaysia, with a strategic pivot toward renewable energy. The company is classified as a non-accelerated filer and a smaller reporting company. As of June 30, 2026, there were 1,000,626 shares of common stock outstanding.
Key Financial Metrics
| Metric | Q2 2026 (3 Months) | YTD 2026 (6 Months) | YTD 2025 (6 Months) |
|---|---|---|---|
| Revenue | $13,693 | $35,281 | $243,820 |
| Net Income (Loss) | $149,437 | $(191,469) | $(1,336,165) |
| Net Income (Loss) from Continuing Ops | $83,591 | $(224,097) | $(1,285,819) |
| Gross Margin | 86.0% | 79.5% | 35.7% |
| Cash and Cash Equivalents | $45,480 | $45,480 | $89,651 (Dec 31, 2025) |
| Total Assets | $25,025,420 | $25,025,420 | $24,591,278 (Dec 31, 2025) |
| Accumulated Deficit | $(11,972,452) | $(11,972,452) | $(11,797,836) (Dec 31, 2025) |
Material Changes vs. Prior Period
- Revenue Decline: Revenue for the six months ended June 30, 2026, dropped 85.5% to $35,281 from $243,820 in the prior year. This was driven by a 100% drop in Green Energy revenue (no new projects secured) and a 76.7% decline in wellness services revenue.
- Profitability Shift: The company reported a net income of $149,437 for Q2 2026, a reversal from the net loss of $623,246 in Q2 2025. This improvement is primarily attributable to a non-operating foreign currency exchange gain of $645,027 in Q2 and $967,485 YTD 2026.
- Discontinued Operations: On June 11, 2026, the company disposed of its 60% interest in DSY Wellness International Sdn. Bhd. This resulted in a gain on disposal of $74,760, which is classified as discontinued operations.
- Asset Composition: While total assets increased slightly, 98% of current assets ($24.5 million) consist of a deposit held by Bi Cheng Investment Management Limited for future investment opportunities that have not yet been identified.
Outlook, Risks, and Contingencies
- Going Concern: Management has raised substantial doubt about the company's ability to continue as a going concern. This is due to accumulated deficits of nearly $12 million and the fact that the majority of liquid assets are tied up in a non-refundable deposit with a third-party investment manager with no identified investment targets.
- Internal Control Weaknesses: The company disclosed material weaknesses in internal controls over financial reporting, citing insufficient accounting personnel, lack of an internal audit function, and inadequate credit risk assessment procedures regarding the third-party investment manager.
- Concentration Risk: The company faces significant credit risk as approximately $24.5 million (98% of total assets) is held by Bi Cheng Investment Management Limited in the PRC. Repatriation of these funds is subject to legal and regulatory uncertainties.
- Future Strategy: The company plans to improve liquidity by increasing revenue, controlling costs, and obtaining additional financing. It continues to pursue renewable energy projects and digital wellness platforms.
Investor Verification Checklist
- Investment Deposit Status: Verify the current status of the $24.5 million deposit with Bi Cheng Investment Management Limited and the timeline for identifying specific investment opportunities.
- Revenue Sustainability: Assess the viability of the core network marketing business given the 50%+ decline in revenue and the complete halt in Green Energy project revenue.
- Internal Controls: Review the remediation plan for the identified material weaknesses in financial reporting and internal audit functions.
- Related Party Transactions: Examine the significant increase in "Other payable – related parties" to $2.06 million, largely owed to the CEO, Mr. How Kok Choong.
- Cash Burn Rate: Monitor the cash burn rate from operating activities ($505k used YTD) against the remaining liquid cash of $45k to determine immediate financing needs.