Company: XTKG
Filing Date: 2025-04-25
Form Type: 20-F
Source: 0001213900-25-035626
Chunk: 234

Company: X3 Holdings Co., Ltd.
Filing Date: 2025-04-25
Form: 20-F
Item: Item 19
Chunk 234
---
ifiable from other promises in the contract and it is distinct performance obligation within the context of the contract. Accordingly,
the revenue from the related IT equipment based on its relative standalone selling price is recognized upon customer acceptance after
delivery.

F-16

X3 HOLDINGS CO., LTD.

Note 2 - Summary of significant accounting
policies(continued)

(2) Revenue from consulting
and technical support services

Revenue from consulting and
technical support services is primarily comprised of fixed-fee contracts, which require the Group to provide professional consulting and
technical support services over contract terms beginning on the commencement date of each contract, which is the date its service is made
available to customers. Billings to the customers are generally on a monthly or quarterly basis over the contract term, which is typically
12 to 24 months. The consulting and technical support services contracts typically include a single performance obligation. The revenue
from consulting and technical support services is recognized over the contract term on a straight-line basis as customers receive and
consume benefits of such services.

(3) Revenue from subscription
services

Revenue from subscription
services is comprised of subscription fees from customers accessing the Group’s software-as-a-service applications for a subscribed
period. The Group’s monthly or quarterly billing to customer is on the basis of number of uses or the actual usage by the customers.
The subscription arrangements are considered service contracts because customers do not have the right to take possession of the software
and can only benefit from the software when provided the right to access the software. Accordingly, the subscription services contracts
typically include a single performance obligation. The revenue from subscription services is recognized over the contract term on a straight-line
basis or based on the actual usage as customers receive and consume benefits of such services.

(4) Trading revenue

The Group started trading
business for the year ended December 31, 2021 and recognized revenue at a point in time when control of such products transfers to the
customer, which generally occurs upon shipment or delivery depending on the terms of the contracts with the customer. Product sale contracts
typically include a single performance obligation and there are no rights of return. The transaction price is based on the fixed contractual
price with the customer. Billings to the customer for the sale of products occur at the time the products are transferred to the customer.

(5) Others revenue

In April 2023, the Group
started regional authorization membership program to engage independent merchant to assist in developing specified geographical regions.
The program grants non-exclusive geographical territory business development