Company: ZCARW
Filing Date: 2025-08-14
Form Type: 10-Q
Source: 0001213900-25-076590
Chunk: 14

Company: Zoomcar Holdings, Inc.
Filing Date: 2025-08-14
Form: 10-Q
Item: Part I, Item 1
Chunk 14
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, the Company evaluated the presentation of revenue on a gross versus net basis based on factors
given under ASC 606 whether or not it is the principal (gross) or the agent (net) in the transaction and concluded that it is acting in
an agent capacity, and revenue is presented net reflecting the facilitation fees received from the Marketplace service. The customer simultaneously
receives and consumes the benefits provided by the entity’s performance as the entity performs. Revenue is recognized ratably over
the trip period on straight line basis using the output method as its performance obligation is satisfied over time.

10

ZOOMCAR HOLDINGS, INC.NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

The Company offers various incentive
programs to hosts. The incentives are recorded in accordance with ASC 606- 10-32-25 and ASC 606-10-32-27 as a reduction to revenue and
in cases where the amount of incentive paid to the Host are above the facilitation fees earned from that Host on cumulative basis, the
excess of the revenue amount is recorded as a marketing expense in the Condensed Consolidated Statements of Operations. These incentives
are offered as part of overall marketing strategy of the Company and incentivize the hosts to refer the platform.

Loyalty program

The Company offers loyalty program,
Z-Points, wherein customers are eligible to earn loyalty points that are redeemable for payment towards facilitation fees. Under ASC 606,
each transaction that generates loyalty points results in the deferral of revenue equivalent to the retail value at the date the points
are earned. The associated revenue is recognized when the customer redeems the loyalty points. The retail value of points is estimated
based on the current retail value measured as of the date the loyalty points are earned, less an estimated amount representing loyalty
points that are not expected to be redeemed (“breakage”). Breakage is reviewed on an annual basis and includes significant
assumptions such as historical breakage trends, internal Company forecasts and extended redemption period, if any.

Vouchers

During the quarter ended June
30, 2025, the Company sold vouchers of certain redemption value that are utilized for payment towards facilitation fees. Vouchers may
be sold for less than their redemption value and in such cases, the transaction price is limited to the amount received, unless additional
consideration is expected. The sale of such vouchers results in the deferral of revenue equivalent to the amount received on the date
of