Company: HYSR
Filing Date: 2025-11-10
Form Type: 10-Q
Source: 0001213900-25-108125
Chunk: 25

Company: SUNHYDROGEN, INC.
Filing Date: 2025-11-10
Form: 10-Q
Item: Part I, Item 8
Chunk 25
---
 had a large increase in operating expenses in the current period compared to the prior period due to increased
efforts in operations.

Liquidity and Capital Resources

Liquidity is the ability of
a company to generate funds to support its current and future operations, satisfy its obligations, and otherwise operate on an ongoing
basis. Significant factors in the management of liquidity are funds generated by operations, levels of accounts receivable and accounts
payable and capital expenditures.

As of September 30, 2025,
we had a working capital surplus of $34,778,471, compared to a working capital surplus of $37,048,679 as of June 30, 2025. This decrease
in working capital of $2,270,208 was primarily due to a decrease in cash and short-term investments offset by an increase in current liabilities.

Cash used in operating activities
was $1,186,098 for the three months ended September 30, 2025, compared to $704,064 for the three months ended September 30, 2024. The
net increase of $482,034 in cash used in operating activities was due to a $487,060 decrease in the net loss, change of $31,121 in prepaid
expenses, $227,596 change in accounts payable and accrued expenses offset by $1,221,011 change in non-cash net expenses, $1,250 change
in accounts receivable, related party, and $5,550 change in other receivables. In addition, the Company had revenues in the current period
compared to none in the prior period.

Cash provided by investing
activities during the three months ended September 30, 2025 and September 30, 2024 was $1,022,632 and $0, respectively. The net increase
of $1,022,632 in cash provided by investing activities was due to the redemption of short-term investments in corporate securities offset
by the purchase of short-term investments in corporate securities during the three months ended September 30, 2025 with no similar transactions
in the three months ended September 30, 2024.

Cash provided by (used in)
financing activities during the three months ended September 30, 2025 and September 30, 2024 was $(1,000,000) and $2,165,303, respectively.
The net decrease of $3,165,303 in cash provided by (used in) financing activities was due