Company: QSJC
Filing Date: 2025-11-14
Form Type: 10-Q
Source: 0001683168-25-008383
Chunk: 23

Company: TANCHENG GROUP CO., LTD.
Filing Date: 2025-11-14
Form: 10-Q
Item: Part I, Item 1
Chunk 23
---
    $(71,696) 
    $(53,941) 
    $(17,755)

Revenue

We generated $52,198 in revenue for the three months
ended September 30, 2025 compared to $145,764 for the three months ended September 30, 2024, representing decrease in revenue of $93,566
or 64.2% compared to the three months ended September 30, 2024. The decrease was mainly due to the decrease in the quantity of ornament
and adornment products sold during the three months ended September 30, 2025. Since 2024, we have been experiencing intensified competition,
resulting in increased price sensitivity among our customers. We are redefining and adjusting our business strategy to gain a competitive
advantage in the market.

Cost of Revenue

Cost of revenue was $38,774 for the three months ended
September 30, 2025 compared to $105,123 for the three months ended September 30, 2024. Cost of revenue mainly consists of the cost of
products sold and labor costs. The decrease in cost of revenue by $66,349 or 63.1% was mainly due to an decrease in the volume of products
sold, as reflected in the decrease in revenue.

Gross profit

Gross profit for the three months ended September
30, 2025 was $13,424 compared with $40,641 for the three months ended September 30, 2024. As a percentage of revenue, our gross margin
decreased from a gross profit of 27.9% for the three months ended September 30, 2024 to a gross profit of 25.7% for the three months ended
September 30, 2025, primarily because the decrease in revenue was unable to cover the fixed overhead costs included in cost of revenue.

Operating Expenses

General and administrative expenses

By far the most significant component of our operating
expenses for both the three months ended September 30, 2025 and 2024 was general and administrative expenses in the amount of $78,245
and $87,558, respectively. The decrease of $9,313 or 10.6% was mainly due to our success in maintaining our cost structure.

 19 

Net Loss

We reported a net loss of $71,696 for the three months
ended September 30, 2025 compared to a net loss of $53,941 for