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Agape ATP Corp

ATPC
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Business Summary

Agape ATP Corporation operates primarily in the Health and Wellness Industry, supplying high-quality health and wellness products and advisory services in the Malaysian market, and has recently diversified into the renewable energy sector . The company's mission is to help people create health and wealth by providing a financially rewarding business opportunity to distributors and quality products to customers seeking a healthy lifestyle . The company believes its product quality and effective distribution network are key to its success and future expansion .

The core business model revolves around a direct-selling channel for health and wellness products, which is supported by ongoing personal contact between retail consumers and independent distributors . Distributors profit from selling products and earning bonuses based on their network group's performance and recruitment . Top-performing distributors with physical stores can become stockists, maintaining inventory and accounting for sales through a centralized tracking system . The company also offers a membership program where customers pay a one-time fee to enjoy discounts, with accumulated purchases potentially leading to distributor status . For the green energy segment, the company provides advanced solar power and energy efficiency solutions to commercial, industrial, and governmental clients, integrating cutting-edge technologies with sustainability knowledge .

The company's product and service lines are segmented into "Skin care, Health and Wellness" and "Green Energy" . The Skin care, Health and Wellness segment includes the ATP Zeta Health Program, designed to promote health and prevent diseases through modern health supplements, proper nutrition, and dietician advice, focusing on cellular ATP production and nutrient absorption . This segment also includes the Easy and Tasty Series (E.A.T.S) for convenient nutritious living , complementary health therapies based on 33 proprietary formulas for non-communicable diseases , and skin care and healthcare products provided by CEDAR, along with training courses . The Green Energy segment offers products, technical knowledge, and solutions for sustainability, energy savings, and environmental stewardship, aiming for energy efficiency and carbon neutrality .

For the fiscal year ended December 31, 2025, Agape ATP Corporation reported total revenue of $1,524,262 . Gross profit for the period was $838,270 , resulting in a gross margin of approximately 55.0% . The company incurred a net loss of $2,307,607 , with a net loss attributable to Agape ATP Corporation of $2,279,791 . Basic and diluted loss per share was $(2.85) . As of December 31, 2025, the company had cash and cash equivalents of $140,072 , total assets of $24,591,278 , and total liabilities of $2,165,177 . Working capital stood at $22,236,994 . Net cash used in operating activities was $(2,413,422) , while net cash used in investing activities was $(23,001,049) , and net cash provided by financing activities was $23,498,646 .

Comparing fiscal year 2025 to 2024, total revenue increased by $201,515, or approximately 15.2% . Revenue from the network marketing business decreased by $65,774, or approximately 48.0% , while revenue from complementary health therapies decreased by $39,305, or approximately 3.5% . Conversely, revenue from wellness and wellbeing lifestyle operations surged by $209,630, or approximately 948.9% , and green energy operations revenue increased by $96,964, or approximately 226.7% . The overall gross profit margin decreased from approximately 57.4% in 2024 to approximately 55.0% in 2025 , primarily due to the low gross profit margin in the green energy segment . Net loss decreased by $178,437, or approximately 7.2% .

During the reported period, the company strategically shifted its business focus from network marketing to wellness and wellbeing lifestyle and the green energy industry to restore growth and diversify income streams . This included launching a digital advertisement campaign and marketing activities to promote skin care and healthcare products . The company also made a significant advance for investment of $23,000,000 to Bi Cheng Investment Management Limited to identify and manage investment opportunities . In financing activities, the company issued 46,000,000 shares of common stock for net cash proceeds of $23,000,000 .

Business Outlook

The company is positioning itself for sustainable growth by diversifying its operations into the domain of renewable energy, an initiative founded upon its commitment to environmental responsibility, long-term value creation, and proactive adaptation to global energy trends . A significant growth area is the development of a comprehensive digital wellness platform by ATPC Technology Private Limited in China, which intends to integrate e-commerce, online consultations, chronic disease management, and robust supply chain services catering to the ASEAN market . This platform aims to collaborate with local IT expertise to achieve its objectives .

Another key growth area is the expansion of its green energy segment, which delivers innovative solutions for sustainability, energy savings, and promoting environmental stewardship to achieve energy efficiency and carbon neutrality . This segment serves commercial, industrial, and governmental clients, offering a comprehensive suite of services from solar energy generation and storage to energy management systems and sustainability consulting . The company integrates cutting-edge technologies with deep knowledge of sustainability to deliver impactful solutions, reduce energy consumption, and optimize performance .

Operationally, the company plans to improve its internal controls by preparing written policies and procedures for accounting and financial reporting in accordance with US GAAP and SEC guidelines, and establishing a formal process for monthly book closures on an accrual basis . To further strengthen internal controls, the company plans to engage a consulting firm specializing in compliance and internal controls as a temporary solution and to initiate a comprehensive training program for existing accounting staff on internal control and US GAAP financial statements . These initiatives are anticipated to be at least partially, if not fully, implemented by the end of fiscal year 2026 .

Regarding capital allocation, the company received net cash proceeds of $23,000,000 from the issuance of common stock in February 2025 . A significant portion of its liquid assets, approximately $23,816,398, has been entrusted to Bi Cheng Investment Management Limited for identifying and managing investment opportunities . The company does not currently have any equity compensation plan in place and has no plans to pay dividends in the foreseeable future, intending to retain all future earnings to finance business growth and development .

The company explicitly flags several structural headwinds and execution risks. It is exposed to concentration risk due to heavy reliance on its two largest suppliers, with purchases of $365,840, $133,406, and $73,163 from three major suppliers, representing approximately 55.6%, 20.3%, and 11.1% of total purchases, respectively, for the year ended December 31, 2025 . The absence of long-term supply agreements with these suppliers and potential disruptions from labor disputes, natural disasters, or changes in supplier strategy could materially and adversely affect the business . Furthermore, the company's historical growth rates may not be indicative of future growth, and it may not be able to generate similar growth rates due to changes in consumer preferences, regulations, competition, and economic conditions .

Geographic, regulatory, and macro factors also pose constraints. The company's operations are primarily focused in Malaysia, making its results dependent on demand in this market . Adverse developments in Malaysia's social, political, regulatory, and economic environment, including changes in interest rates, capital controls, and taxation methods, could have a material adverse impact . The company is also subject to foreign exchange control policies in Malaysia, which could restrict its ability to repatriate dividends or other payments from subsidiaries, affecting liquidity . Fluctuations in foreign currency exchange rates, particularly the strengthening of the U.S. dollar against the Malaysian Ringgit, Hong Kong Dollar, and Chinese Yuan, could materially affect financial results .

Risk Factors

The company faces significant concentration risk due to its heavy reliance on a limited number of suppliers, with three major vendors accounting for approximately 55.6%, 20.3%, and 11.1% of total purchases for the year ended December 31, 2025 , and a single sales distributor accounting for approximately 39.9% of total commission expense in the same period . This reliance, coupled with the absence of long-term supply agreements, exposes the company to potential disruptions, increased costs, and adverse impacts on profit margins if suppliers change strategies or fail to deliver . Operational risks include the potential for product liability claims, recalls, or adverse publicity related to product safety and quality, which could damage reputation and financial performance, especially given the lack of third-party liability insurance . The company also operates in a heavily regulated industry, primarily in Malaysia, where compliance with food and health regulations is critical, and any failure to obtain necessary authorizations or adapt to regulatory changes could lead to fines, penalties, or prosecution . Furthermore, the company has identified material weaknesses in its internal control over financial reporting, including insufficient accounting personnel, lack of a functional internal audit department, and inadequate procedures for assessing credit risk of third-party managers, which could lead to unreliable financial reporting . A substantial credit risk exists with approximately $23,816,398 of liquid assets entrusted to Bi Cheng Investment Management Limited in the PRC, with uncertainties in legal, regulatory, and foreign exchange frameworks potentially affecting fund recoverability . The company is also subject to delisting risk from Nasdaq due to not meeting the minimum bid price requirement, having received a notification on January 27, 2026, for failing to maintain a $1.00 bid price for 30 consecutive business days , and an additional notification on February 2, 2026, for a closing bid price of $0.10 or less for ten consecutive trading days .

Management Priorities

Management's message to shareholders emphasizes a strategic shift towards sustainable growth through diversification into renewable energy and an enhanced focus on wellness and wellbeing lifestyle operations, aiming to restore growth and diversify income streams . The company is committed to leveraging its quality products and established direct-selling network for continued success and future business expansion . Key strategic priorities include the development of a comprehensive digital wellness platform in China to integrate e-commerce, online consultations, chronic disease management, and robust supply chain services for the ASEAN market , and the delivery of innovative solar power and energy efficiency solutions to commercial, industrial, and governmental clients . Management also highlights ongoing efforts to strengthen internal controls and financial reporting, including plans to hire additional accounting personnel, engage compliance consulting firms, and implement comprehensive training programs to address identified material weaknesses by the end of fiscal year 2026 . The company does not anticipate paying dividends in the foreseeable future, intending to retain all earnings for business growth and development .

View Source Annual Report on SEC.gov ↗

References

  1. [1] Item 1, Business — Organization and Business Background
  2. [2] Item 1, Business — Business Overview
  3. [3] Item 1, Business — Business Overview
  4. [4] Item 1, Business — Our Business Model
  5. [5] Item 1, Business — Our Business Model
  6. [6] Item 1, Business — Our Business Model
  7. [7] Item 1, Business — Structure of the membership program
  8. [8] Item 1, Business — Business Overview
  9. [9] Item 21, Segment Reporting
  10. [10] Item 1, Business — Our Products
  11. [11] Item 1, Business — Our Products
  12. [12] Item 1, Business — Business Overview
  13. [13] Item 1, Business — Our Products
  14. [14] Item 1, Business — Business Overview
  15. [15] Item 7, MD&A — Revenue
  16. [16] Item 7, MD&A — Gross Profit
  17. [17] Item 7, MD&A — Gross Profit
  18. [18] Item 7, MD&A — Net Loss
  19. [19] Item 6, Selected Financial Data
  20. [20] Item 6, Selected Financial Data
  21. [21] Item 7, MD&A — Liquidity and Capital Resources
  22. [22] Item 6, Selected Financial Data
  23. [23] Item 6, Selected Financial Data
  24. [24] Item 7, MD&A — Liquidity and Capital Resources
  25. [25] Item 7, MD&A — Liquidity and Capital Resources
  26. [26] Item 7, MD&A — Liquidity and Capital Resources
  27. [27] Item 7, MD&A — Liquidity and Capital Resources
  28. [28] Item 7, MD&A — Revenue
  29. [29] Item 7, MD&A — Revenue
  30. [30] Item 7, MD&A — Revenue
  31. [31] Item 7, MD&A — Revenue
  32. [32] Item 7, MD&A — Revenue
  33. [33] Item 7, MD&A — Gross Profit
  34. [34] Item 7, MD&A — Gross Profit
  35. [35] Item 7, MD&A — Net Loss
  36. [36] Item 7, MD&A — Revenue
  37. [37] Item 7, MD&A — Revenue
  38. [38] Item 7, MD&A — Investing activities
  39. [39] Item 7, MD&A — Financing activities
  40. [40] Item 1, Business — Organization and Business Background
  41. [41] Item 1, Business — Organization and Business Background
  42. [42] Item 1, Business — Business Overview
  43. [43] Item 1, Business — Business Overview
  44. [44] Item 1, Business — Our Business Model
  45. [45] Item 1, Business — Our Business Model
  46. [46] Item 9A, Controls and Procedures — Management’s Remediation Initiatives
  47. [47] Item 9A, Controls and Procedures — Management’s Remediation Initiatives
  48. [48] Item 9A, Controls and Procedures — Management’s Remediation Initiatives
  49. [49] Item 7, MD&A — Financing activities
  50. [50] Item 7, MD&A — Liquidity and Capital Resources
  51. [51] Item 5, Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities — Equity Compensation Plan Information
  52. [52] Item 5, Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities — Dividend Policy
  53. [53] Item 1A, Risk Factors — We are exposed to concentration risk of heavy reliance on our two largest suppliers for the supply of our products, and any shortage of, or delay in, the supply may significantly impact on our business and results of operation.
  54. [54] Item 1A, Risk Factors — We are exposed to concentration risk of heavy reliance on our two largest suppliers for the supply of our products, and any shortage of, or delay in, the supply may significantly impact on our business and results of operation.
  55. [55] Item 1A, Risk Factors — Our historical growth rates may not be indicative of our future growth. If we are unable to manage the growth and increased complexity of our business, fail to control our costs and expenses, or fail to execute our strategies effectively, our business and business prospects may be materially and adversely affected.
  56. [56] Item 1A, Risk Factors — Adverse developments in our existing areas of operation could adversely impact our results of business, results of operations and financial condition.
  57. [57] Item 1A, Risk Factors — Developments in the social, political, regulatory and economic environment in Malaysia may have a material adverse impact on us.
  58. [58] Item 1A, Risk Factors — We are subject to foreign exchange control policies in Malaysia.
  59. [59] Item 1A, Risk Factors — Fluctuations in foreign currency exchange rates could have a material adverse effect on our financial results.
  60. [60] Item 18, Concentrations of Risks — Major vendors
  61. [61] Item 18, Concentrations of Risks — Commission Expenses to Sales Distributors and Stockists
  62. [62] Item 1A, Risk Factors — We are exposed to concentration risk of heavy reliance on our two largest suppliers for the supply of our products, and any shortage of, or delay in, the supply may significantly impact on our business and results of operation.
  63. [63] Item 1A, Risk Factors — We may incur losses resulting from product liability claims or product recalls or adverse publicity relating to our products.
  64. [64] Item 1A, Risk Factors — We operate in a heavily regulated industry.
  65. [65] Item 1A, Risk Factors — Our internal controls may be inadequate, which could cause our financial reporting to be unreliable and lead to misinformation being disseminated to the public.
  66. [66] Item 18, Concentrations of Risks — Credit risk
  67. [67] Item 1A, Risk Factors — If we fail to meet applicable listing requirements, Nasdaq may delist our ordinary shares from trading, in which case the liquidity and market price of our ordinary shares could decline.
  68. [68] Item 1A, Risk Factors — If we fail to meet applicable listing requirements, Nasdaq may delist our ordinary shares from trading, in which case the liquidity and market price of our ordinary shares could decline.
  69. [69] Item 7, MD&A — Revenue
  70. [70] Item 1, Business — Business Overview
  71. [71] Item 1, Business — Business Overview
  72. [72] Item 1, Business — Business Overview
  73. [73] Item 9A, Controls and Procedures — Management’s Remediation Initiatives
  74. [74] Item 5, Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities — Dividend Policy

Analysis on 5/22/2026