# EDGAR Filing Document

**Accession Number:** 0001969401
**File Stem:** 0001213900-25-061482
**Filing Date:** 2025-7
**Character Count:** 199996
**Document Hash:** fdb155edb90d1d4b5af0af033b6f9f4b
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001213900-25-061482.hdr.sgml**: 20250703

**ACCESSION NUMBER**: 0001213900-25-061482

**CONFORMED SUBMISSION TYPE**: 6-K

**PUBLIC DOCUMENT COUNT**: 114

**CONFORMED PERIOD OF REPORT**: 20250331

**FILED AS OF DATE**: 20250703

**DATE AS OF CHANGE**: 20250703

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** Linkage Global Inc
- **CENTRAL INDEX KEY:** 0001969401
- **STANDARD INDUSTRIAL CLASSIFICATION:** RETAIL-CATALOG & MAIL-ORDER HOUSES [5961]
- **ORGANIZATION NAME:** 07 Trade & Services
- **EIN:** 000000000
- **STATE OF INCORPORATION:** M0

**FILING VALUES:**
- **FORM TYPE:** 6-K
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 001-41887
- **FILM NUMBER:** 251105591

**BUSINESS ADDRESS:**
- **STREET 1:** 2-23-3 MINAMI-IKEBUKURO, TOSHIMA-KU
- **CITY:** TOKYO
- **STATE:** M0
- **ZIP:** 171-0022
- **BUSINESS PHONE:** 8618695783100

**MAIL ADDRESS:**
- **STREET 1:** 2-23-3 MINAMI-IKEBUKURO, TOSHIMA-KU
- **CITY:** TOKYO
- **STATE:** M0
- **ZIP:** 171-0022

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** Linkage Global Inc.
- **DATE OF NAME CHANGE:** 20230314

?xml version='1.0' encoding='ASCII'?

**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION**

**Washington, D.C. 20549**

**FORM 6-K**

**REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16 UNDER THE SECURITIES EXCHANGE ACT OF 1934**

**For the month of July 2025**

**Commission File Number: 001-41887**

**Linkage Global Inc**

**2-23-3 Minami-Ikebukuro, Toshima-ku Tokyo, Japan 171-0022**

**(Address of principal executive office)**

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:

Form 20-F ☒ &nbsp;&nbsp;&nbsp;&nbsp; Form 40-F ☐

**Explanatory Note**

Linkage Global Inc, a Cayman Islands exempted company, is furnishing its unaudited interim condensed consolidated financial statements and footnotes for the six months ended March 31, 2025 and 2024. The financial statements and notes are attached as Exhibit 99.1 to this report of foreign private issuer on Form 6-K, and Management's Discussion and Analysis of Financial Condition and Results of Operations for the six months ended March 31, 2025, is attached as Exhibit 99.2 to this report of foreign private issuer on Form 6-K.

On July 3, 2025, the Company issued a press release announcing its unaudited interim financial results for the six months ended March 31, 2025 and 2024, a copy of which is attached as Exhibit 99.3 to this report of foreign private issuer on Form 6-K.

**EXHIBIT INDEX**

---

| | |
|:---|:---|
| **Exhibit No.** | **Description** |
| 99.1 | [Unaudited Interim Condensed Consolidated Financial Statements and Notes of Linkage Global Inc. for the Six Months Ended March 31, 2025 and 2024](ea024781401ex99-1_linkage.htm) |
| 99.2 | [Management's Discussion and Analysis of Financial Condition and Results of Operations](ea024781401ex99-2_linkage.htm) |
| 99.3 | [Press Release, dated July 3, 2025](ea024781401ex99-3_linkage.htm) |
| 101.INS | Inline XBRL Instance Document. |
| 101.SCH | Inline XBRL Taxonomy Extension Schema Document. |
| 101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document. |
| 101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document. |
| 101.LAB | Inline XBRL Taxonomy Extension Label Linkbase Document. |
| 101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document. |
| 104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101). |

---

**SIGNATURES**

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

---

| | | |
|:---|:---|:---|
|  | **Linkage Global Inc** | **Linkage Global Inc** |
| Date: July 3, 2025 | By: | /s/ Yang (Angela) Wang |
|  | Name: | Yang (Angela) Wang |
|  | Title: | Chief Executive Officer |

---

---

| | | |
|:---|:---|:---|
| Date: July 3, 2025 | By: | /s/ Hanson Ji |
|  | Name: | Hanson Ji |
|  | Title: | Chief Financial Officer |

---

## Exhibit 99.1

?xml version='1.0' encoding='ASCII'?

**Exhibit 99.1**

**Linkage Global Inc UNAUDITED INTERIM CONDENSED CONSOLIDATED BALANCE SHEETS AS OF MARCH 31, 2025 AND SEPTEMBER 30, 2024 (In U.S. dollars, except for share and per share data, or otherwise noted)**

---

| | | |
|:---|:---|:---|
|  | **As of**<br> **March 31,**<br> **2025** | **As of**<br> **September 30,**<br> **2024** |
|  | **USD** | **USD** |
| **ASSETS** | | |
| **Current assets** | | |
| Cash and cash equivalents | 328081 | 2000732 |
| Accounts receivable, net | 6405486 | 6302696 |
| Inventories, net | 35675 | 66331 |
| Deposits paid to media platforms |  | 482650 |
| Prepaid expenses and other current assets, net | 1625517 | 2689581 |
| Amount due from related parties | 1243450 |  |
| Short-term loan to third party | 8993306 | 410000 |
| Interest receivable from loan to third party | 386261 |  |
| **Total current assets** | **19017776** | **11951990** |
| **Non-current assets** |  |  |
| Property and equipment, net | 50594 | 85807 |
| Right-of-use assets, net | 516167 | 653730 |
| Total non-current assets | 566761 | 739537 |
| **TOTAL ASSETS** | **19584537** | **12691527** |
| **LIABILITIES AND SHAREHOLDERS' EQUITY** |  |  |
| **Current liabilities** |  |  |
| Accounts payable | 324069 | 624723 |
| Accrued expenses and other current liabilities | 303413 | 236813 |
| Short-term debts |  | 32810 |
| Current portion of long-term debts | 243557 | 428702 |
| Contract liabilities | 208483 | 533625 |
| Amounts due to related parties |  | 314544 |
| Lease liabilities - current | 203600 | 231978 |
| Convertible notes | 7884325 | 964865 |
| Interest payable of convertible notes | 1555689 |  |
| Income tax payable | 850866 | 1017619 |
| **Total current liabilities** | **11574002** | **4385679** |
| **Non-current liabilities** |  |  |
| Long-term debts | 734023 | 839560 |
| Lease liabilities – non-current | 334973 | 441504 |
| **Total non-current liabilities** | **1068996** | **1281064** |
| **Total liabilities** | **12642998** | **5666743** |
| **Commitments and contingencies (Note 21)** |  |  |
| **Shareholders' equity** |  |  |
| Class A ordinary shares (par value of US$0.0025 per share; 998,000,000 ordinary shares authorized, 3,080,000 and 2,150,000 ordinary shares issued and outstanding as of March 31, 2025 and September 30, 2024, respectively) \* | 7700 | 5375 |
| Class B ordinary shares (par value of US$0.0025 per share; 2,000,000 ordinary shares authorized, 700,000 and nil ordinary shares issued and outstanding as of March 31, 2025 and September 30, 2024, respectively) \* | 1750 |  |
| Additional paid in capital | 8564021 | 5591596 |
| Treasury Shares | (500) |  |
| Statutory reserve | 11348 | 11348 |
| Retained earnings | (1474142) | 1613217 |
| Accumulated other comprehensive loss | (168638) | (196752) |
| **Total shareholders' equity** | **6941539** | **7024784** |
| **TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY** | **19584537** | **12691527** |

---

\* The shares and per share information are presented on a retroactive basis to reflect the reorganization completed on February 17, 2023, share split occurred on March 20, 2023, and share consolidation occurred on April 7, 2025 (Note 16).

The accompanying notes are an integral part of these unaudited interim condensed consolidated financial statements.

**Linkage Global Inc UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME**

**FOR THE SIX MONTHS ENDED MARCH 31, 2025 AND 2024 (In U.S. dollars, except for share and per share data, or otherwise noted)**

---

| | | |
|:---|:---|:---|
|  | **For the six months ended <br> March 31,** | **For the six months ended <br> March 31,** |
|  | **2025** | **2024** |
|  | **USD** | **USD** |
| Revenues | 3501947 | 4798363 |
| Cost of revenues | (804142) | (4089486) |
| **Gross profit** | 2697805 | 708877 |
| **Operating expenses** |  |  |
| General and administrative expenses | (3904027) | (1743309) |
| Selling and marketing expenses | (157637) | (228956) |
| Research and development expenses | (274371) | (297811) |
| **Total operating expenses** | (4336035) | (2270076) |
| **Operating loss** | **(1638230)** | **(1561199)** |
| **Other expenses** |  |  |
| Interest expenses, net | (1496504) | (60726) |
| Other non-operating income | 387816 | 998 |
| **Total other expenses** | (1108688) | (59728) |
| **Loss before income taxes** | (2746918) | (1620927) |
| Income tax (provision)/ benefit | (340441) | 215161 |
| **Net loss** | **(3087359)** | **(1405766)** |
| **Net loss attributable to the Company's ordinary shareholders** | **(3087359)** |  |
| Other comprehensive income/(loss) |  |  |
| Foreign currency translation adjustment | 28114 | (10107) |
| **Total comprehensive loss attributable to the Company's ordinary shareholders** | **(3059245)** | **(1415873)** |
| **Loss per ordinary share attributable to ordinary shareholders** |  |  |
| &nbsp;&nbsp;&nbsp;Basic and Diluted\* | (0.90) | (0.67) |
| **Weighted average number of ordinary shares outstanding** |  |  |
| &nbsp;&nbsp;&nbsp;Basic and Diluted\* | 3415533 | 2084890 |

---

\* The shares and per share information are presented on a retroactive basis to reflect the reorganization completed on February 17, 2023, share split occurred on March 20, 2023, and share consolidation occurred on April 7, 2025 (Note 16).

The accompanying notes are an integral part of these unaudited interim condensed consolidated financial statements.

**Linkage Global Inc**

**UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY**

**FOR THE SIX MONTHS ENDED MARCH 31, 2025 AND 2024**

**(In U.S. dollars, except for share and per share data, or otherwise noted)**

**For the six months ended March 31, 2025**

---

| | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Ordinary shares\*** | **Ordinary shares\*** | **Ordinary shares\*** | **Ordinary shares\*** | | | | | | |
|  | **Class A** | **Class A** | **Class B** | **Class B** | | | | | | |
|  | **Shares\*** | **Amount** | **Shares\*** | **Amount** |<br>**Treasury**<br> **Shares** | **Additional**<br>**paid-in**<br>**capital** |<br>**Retained**<br>**earnings** |<br>**Statutory**<br>**reserve** | **Accumulated other**<br>**comprehensive**<br>**income(loss)** | **Total**<br>**Shareholders'**<br>**Equity** |
| **Balance as of September 30, 2024** | 2150000 | 5375 |  |  |  | 5591596 | 1613217 | 11348 | (196752) | 7024784 |
| Net loss |  |  |  |  |  |  | (3087359) |  |  | (3087359) |
| Pre-delivery shares related to the issuance of convertible notes | 930000 | 2325 |  |  |  | 1764675 |  |  |  | 1767000 |
| Stock-based compensation (Class B) |  |  | 500000 | 1250 |  | 1207750 |  |  |  | 1209000 |
| Repurchase of Class A Shares by issuing Class B Shares |  |  | 200000 | 500 | (500) |  |  |  |  |  |
| Foreign currency translation adjustment |  |  |  |  |  |  |  |  | 28114 | 28114 |
| **Balance as of March 31, 2025** | 3080000 | 7700 | 700000 | 1750 | (500) | 8564021 | (1474142) | 11348 | (168638) | 6941539 |

---

**For the six months ended March 31, 2024**

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Ordinary shares\*** | **Ordinary shares\*** | | | | | |
|  | **Share** | **Amount** | **Additional <br> paid-in**<br>**capital** | **Retained**<br>**earnings** | **Statutory**<br>**reserve** | **Accumulated <br> other <br> comprehensive**<br>**income(loss)** | **Total <br> Shareholders'**<br>**Equity** |
| **Balance as of September 30, 2023** | 2000000 | 5000 | 1549913 | 2052553 | 11348 | (121901) | 3496913 |
| Net loss |  |  |  | (1405766) |  |  | (1405766) |
| Net Proceeds from the initial public offering | 150000 | 375 | 4164364 |  |  |  | 4164739 |
| Foreign currency translation adjustment |  |  |  |  |  | (10107) | (10107) |
| **Balance as of March 31, 2024** | **2150000** | **5375** | **5714277** | **646787** | **11348** | **(132008)** | **6245779** |

---

\* The shares and per share information are presented on a retroactive basis to reflect the reorganization completed on February 17, 2023, share split occurred on March 20, 2023, and share consolidation occurred on April 7, 2025 (Note 16).

The accompanying notes are an integral part of these unaudited interim condensed consolidated financial statements.

**Linkage Global Inc UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS**

**FOR THE SIX MONTHS ENDED MARCH 31, 2025 AND 2024 (In U.S. dollars, except for share and per share data, or otherwise noted)**

---

| | | |
|:---|:---|:---|
|  | **For the six months ended <br> March 31,** | **For the six months ended <br> March 31,** |
|  | **2025** | **2024** |
|  | **USD** | **USD** |
| **CASH FLOWS FROM OPERATING ACTIVITIES:** |  |  |
| Net loss | (3087359) | (1405766) |
| *Adjustments to reconcile net loss to net cash used in operating activities:* |  |  |
| Effect of exchange rate changes | 202551 | 1184 |
| Allowance for credit loss | 1344218 | 568229 |
| Interest payable of convertible notes | 1555689 |  |
| Interest receivable from loan to third party | (386261) |  |
| Stock-Based Compensation | 1209000 |  |
| Depreciation | 22205 | 40959 |
| Amortization of lease right-of-use assets | 114791 | 110229 |
| Inventory provision | 4328 | 2203 |
| Deferred tax benefits |  | (216713) |
| *Changes in operating assets and liabilities:* |  |  |
| Accounts receivable, net | (1649559) | (725166) |
| Prepaid expenses and other current assets, net | (261232) | (3233957) |
| Inventories, net | 26328 | 539517 |
| Accounts payable | (300654) | (320628) |
| Contract liabilities | (325142) | 25350 |
| Accrued expenses and other current liabilities | 66600 | (5188) |
| Amounts due from related parties | 341426 |  |
| Amounts due to related parties | (314238) | (16189) |
| Tax payable | (166753) | 928135 |
| Operating lease liabilities | (134909) | (103326) |
| **Net cash used in operating activities** | **(1738971)** | **(3811127)** |
| **Cash flow from investing activities** |  |  |
| Repayments of loan to a related party | (99876) |  |
| Loan to third party | (8640000) |  |
| **Net cash used in investing activities** | (8739876) |  |
| **Cash flow from financing activities** |  |  |
| Proceeds from issuance of Class A ordinary shares upon the completion of IPO |  | 5356792 |
| Proceeds from Issuance of convertible notes | 9002368 |  |
| Proceeds from short-term debts |  | 132258 |
| Repayments of short-term debts | (32810) | (33726) |
| Repayments of long-term debts | (124959) | (179420) |
| Repayments of other long-term debts | (108037) | (878962) |
| Payments of listing expenses |  | (150606) |
| **Net cash provided by financing activities** | **8736562** | **4246336** |
| Effect of exchange rate changes | 69634 | (58969) |
| **Net change in cash and cash equivalents** | **(1672651)** | **376240** |
| **Cash and cash equivalents, beginning of the period** | **2000732** | **1107480** |
| **Cash and cash equivalents, end of the period** | **328081** | **1483720** |
| Supplemental disclosures of cash flow information: |  |  |
| Income tax paid |  | 150124 |
| Interest expense paid | 33056 | 65901 |
| Supplemental disclosures of non-cash activities: |  |  |
| Obtaining right-of-use assets in exchange for operating lease liabilities | 155160 | 147083 |

---

The accompanying notes are an integral part of these unaudited interim condensed consolidated financial statements.

**Linkage Global Inc**

**NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**(Expressed in U.S. Dollars, except for the number of shares)**

**1. ORGANIZATION AND PRINCIPAL ACTIVITIES**

Linkage Global Inc ("Linkage Cayman", or the "Company") was incorporated as an exempted limited liability company under the laws of the Cayman Islands on March 24, 2022. The Company, through its wholly-owned subsidiaries (collectively, the "Group"), primarily engages in cross-border product sales and integrated e-commerce services (including digital marketing services, training and consulting services) for e-commerce sellers in Japan, Hong Kong and the People's Republic of China (the "PRC" or "China").

As of the date of the financial statement, the Company's major subsidiaries are as follows:

---

| | | | |
|:---|:---|:---|:---|
| **Name** | **Date of <br> Incorporation** | **Percentage of effective ownership** | **Principal Activities** |
| **Wholly owned subsidiaries** |  | |  |
| Linkage Holding (Hong Kong) Limited ("Linkage Holding")\* | April 13, 2022 | 100% | Investing holding company |
| Extend Co., Limited ("EXTEND") | June 23, 2011 | 100% | Cross-border sales |
| Linkage Electronic Commerce Limited ("Linkage Electronic") | March 11, 2022 | 100% | Cross-border sales |
| HQT Network Co., Limited ("HQT NETWORK") | December 8, 2016 | 100% | Integrated E-commerce training services |
| Linkage (Fujian) Network Technology Limited ("Linkage Tech" or "WFOE") | November 24, 2022 | 100% | Investing holding company |
| Fujian Chuancheng Internet Technology Limited (formerly known as "Fujian Haishi Cross border Education Technology Limited") | March 2, 2021 | 100% | Integrated E-commerce training services |
| Fujian Chuancheng Digital Technology Limited | June 1, 2021 | 100% | Cross-border sales |

---

 ****

***\**** ***Linkage Holding began operations since 2023 as an investing holding company.***

 ****

***History of the Group and Reorganization***

The Group carried out cross-border sales and integrated e-commerce services since June 2011 and December 2016, respectively. In anticipation of an initial public offering ("IPO") of the Company's equity securities in the United States capital market, Linkage Holding was incorporated by the Company in Hong Kong and Linkage Network was incorporated by Linkage Holding in Fujian, the PRC, as the Company's direct and indirect wholly owned subsidiaries, on April 13, 2022 and November 24, 2022, respectively.

In connection with the IPO, the Group undertook a reorganization of its corporate structure (the "Reorganization") in the following steps:

● On April 30, 2022, Linkage Cayman acquired 100% of the equity interests in EXTEND from its original shareholder;

● On October 31, 2022, Linkage Holding acquired 100% of the equity interests in HQT NETWORK from its original shareholder;

● On September 28, 2022, Linkage Holding acquired 100% of the equity interests in Linkage Electronic from its original shareholder; and

● On February 17, 2023, Linkage Network acquired 100% of the equity interests in Chuancheng Digital from its original shareholders.

**Linkage Global Inc NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

 **(Expressed in U.S. Dollars, except for the number of shares)**

**1. ORGANIZATION AND PRINCIPAL ACTIVITIES** (cont.)

Consequently, the Company, through a restructuring which is accounted for as a reorganization of entities under common control, became the ultimate holding company of all other entities mentioned above. The Company and its wholly-owned subsidiaries were effectively controlled by the same controlling shareholder immediately before and after the reorganization, and therefore the reorganization was accounted for as a recapitalization.

As a result, the Group's unaudited interim condensed consolidated financial statements have been prepared as if the current corporate structure has been in existence throughout the periods presented.

**2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES**

 ****

***Basis of presentation***

The unaudited interim condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") and pursuant to the rules and regulations of the Securities Exchange Commission ("SEC"). In the opinion of management, all adjustments (which include normal recurring adjustments) necessary to present a fair presentation of the Company's financial position, its results of operations and its cash flows, as applicable, have been made. Interim results are not necessarily indicative of results to be expected for the full year. Accordingly, these statements should be read in conjunction with the Company's audited financial statements and note thereto as of and for the years ended September 30, 2024 and 2023.

 ****

***Principles of consolidation***

The unaudited interim condensed consolidated financial statements include the financial statements of the Company and its subsidiaries.

All intercompany transactions and balances among the Company and its subsidiaries have been eliminated upon consolidation.

 ****

***Use of estimates***

The preparation of the unaudited interim condensed consolidated financial statements in accordance with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, related disclosures of contingent assets and liabilities at the balance sheet date, and the reported revenues and expenses during the reported periods in the unaudited interim condensed consolidated financial statements and accompanying notes. Significant accounting estimates include, but not limited to, the allowance for credit losses, inventory provision, depreciable lives and recoverability of property and equipment, and the realization of deferred income tax assets, and valuation of stock-based compensation expense. Changes in facts and circumstances may result in revised estimates. Actual results could differ from those estimates, and as such, differences may be material to the unaudited interim condensed consolidated financial statements.

 ****

***Foreign currency transactions and translations***

The Group's reporting currency is the United States dollars ("US$"). The functional currency of the Company and one of its subsidiaries incorporated in HK is Hong Kong dollars ("HKD"). The functional currency of the other two subsidiaries incorporated in HK is United States dollars ("US$"). The functional currency of the subsidiary which operates mainly in Japan uses Japanese Yen ("JPY"). The functional currency of the other subsidiaries which operate in China is Renminbi ("RMB"). The results of operations and the consolidated statements of cash flows denominated in foreign currency are translated at the average rate of exchange during the reporting period. Assets and liabilities denominated in foreign currencies at the balance sheet date are translated at the applicable rates of exchange in effect at that date. The equity denominated in the functional currency is translated at the historical rate of exchange at the time of capital contribution. Because cash flows are translated based on the average translation rate, amounts related to assets and liabilities reported on the consolidated statements of cash flows will not necessarily agree with changes in the corresponding balances on the consolidated balance sheets. Translation adjustments arising from the use of different exchange rates from period to period are included as a separate component of accumulated other comprehensive income (loss) included in consolidated statements of changes in shareholders' equity. Gains and losses from foreign currency transactions are included in the results of operations.

**Linkage Global Inc NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Expressed in U.S. Dollars, except for the number of shares)**

**2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES** (cont.)

The value of RMB, HKD and JPY against US$ may fluctuate and is affected by, among other things, changes in the political and economic conditions. Any significant revaluation of RMB, HKD or JPY may materially affect the Company's financial condition in terms of US$ reporting. The following table outlines the currency exchange rates that were used in creating the unaudited interim condensed consolidated financial statements:

Balance sheet items, except for equity accounts:

---

| | | |
|:---|:---|:---|
|  | **As of<br> March 31, 2025** | **As of<br> September 30, 2024** |
| RMB to US | US$1=RMB7.2567 | US$1=RMB7.0176 |
| JPY to US | US$1=JPY149.9000 | US$1=JPY143.2500 |
| HKD to US | US$1=HKD7.7799 | US$1=HKD7.7693 |

---

Items in the statements of operations and comprehensive income, and statements of cash flows:

---

| | | |
|:---|:---|:---|
|  | **For the six months ended <br> March 31, 2025** | **For the six months ended <br> March 31, 2024** |
| RMB to US | US$1=RMB7.2308 | US$1=RMB7.2064 |
| JPY to US | US$1=JPY152.3937 | US$1=JPY148.1735 |
| HKD to US | US$1=HKD7.7771 | US$1=HKD7.8172 |

---

 ****

***Cash and cash equivalents***

Cash and cash equivalents consist of cash on hand, the Group's demand deposit placed with financial institutions, which have original maturities of less than three months and unrestricted as to withdrawal and use.

 ****

***Accounts Receivable, net***

Accounts receivable represents the Company's right to consideration in exchange for goods and services that the Company has transferred to the customers before payment is due. Accounts receivable is stated at the historical carrying amount, net of an estimated allowance for uncollectible accounts. The group has adopted ASU 2016-13 on a modified retrospective basis since October 1, 2023, and the impact on opening balance is $863,328. The allowance for credit losses for accounts receivable is based upon the current expected credit losses ("CECL") model. The CECL model requires an estimate of the credit losses expected over the life of accounts receivable since initial recognition, and accounts receivable with similar risk characteristics are grouped together when estimating CECL. In assessing the CECL, the Company applies a roll rate-based method that considers historical collectability based on past due status, the age of the balances, credit quality of the Company's customers based on ongoing credit evaluations, current economic conditions, reasonable and supportable forecasts of future economic conditions, and other factors that may affect the Company's ability to collect from customers. The Company's management continues to evaluate the reasonableness of the valuation allowance policy and updates it if necessary. Additionally, the Company evaluates individual customer's financial condition, credit history, and the current economic conditions to make specific provision of credit loss when it is considered necessary, based on (i)the Company's specific assessment of the collectability of all significant accounts, and (ii) any specific knowledge the Company has acquired that might indicate that an account is uncollectible. The fact and circumstance of each account may require the Company to use substantial judgment in assessing its collectability, The allowance is based on management's best estimate of specific losses on individual exposures, as well as a provision on historical trends of collections. Account balances are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. The Company's management continues to evaluate the reasonableness of the valuation allowance policy and updates it if necessary. The allowance for credit losses, as of March 31, 2025 and September 30, 2024 were $1,679,731 and $1,112,315, respectively.

*Specific allowance for credit losses*

 

The Group identify specific allowance for clients of fully managed e-commerce operation services business based on the credit term. There are 4 clients with account receivables of $5,802,785 as of March 31, 2025. The group provided credit terms from seven to nine months based on the company's experience. Online stores usually invest a relatively large portion of their profits in advertising and promotions in the early stage. Generally, it will take seven to nine months before there is a certain amount of surplus funds. The accounts receivable of $1,670,361 that had reached the credit period on March 31, 2025 had been collected in June 2025. The company conducted due diligence on clients in the early stage and it is expected that there is no risk of credit loss, so no credit loss had been accrued for amounts that have not yet reached the credit period.

**Linkage Global Inc NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Expressed in U.S. Dollars, except for the number of shares)**

**2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES** (cont.)

For purposes of this section only, the term "Customers" shall mean (i) cross-border e-commerce sellers (both enterprises and individuals) that purchase products, e-commerce operation training, and software support services, (ii) media that pay the Company's subsidiaries commissions. (iii) the owners of online store in fully managed e-commerce operation services business.

 ****

***Inventories, net***

Inventories, primarily consisting of finished goods, are stated at the lower of cost or net realizable value, with net realized value represented by estimated selling prices in the ordinary course of business, less reasonably predictable costs of disposal and transportation. Cost of inventory is determined using the weighted average cost method. The Group records inventory valuation allowance for obsolete inventories based upon assumptions on current and future demand forecast. The Group reviews inventory to determine whether the carrying value exceeds the estimated net realizable value. If the inventory on hand is in excess of the estimated net realizable value, inventory valuation allowance is estimated and recorded by lowering the cost of inventory to the estimated net realizable value for slow-moving merchandise and damaged products, which is dependent upon factors such as historical and forecasted consumer demand. Once inventory valuation allowance is recorded, a new, lower cost basis for that inventory is established and subsequent changes in facts and circumstances do not result in the restoration or increase in that newly established cost basis. Inventory valuation allowance balance as of March 31, 2025 and September 30, 2024 were $80,618 and $93,037, respectively.

***Property and equipment, net***

Property and equipment, other than freehold land, are stated at cost less accumulated depreciation and impairment, if any, and depreciated on a straight-line basis over the estimated useful lives of the assets. Leasehold improvements are amortized over the shorter of the lease term or the estimated useful lives of the related assets. Cost represents the purchase price of the asset and other costs incurred to bring the asset into its intended use. Estimated useful lives are as follows:

---

| | |
|:---|:---|
| **Category** | **Estimated useful lives** |
| Vehicle | 4 – 6 years |
| Office equipment | 3 – 5 years |
| Leasehold improvements | Shorter of the lease term or the estimated useful life of the assets |

---

Repair and maintenance costs are charged to expenses as incurred, whereas the cost of renewals and betterment that extends the useful lives of property and equipment are capitalized as additions to the related assets. Retirements, sales and disposals of assets are recorded by removing the costs, accumulated depreciation and impairment with any resulting gain or loss recognized in the consolidated statements of income.

 ****

***Impairment of long-lived assets***

The Group reviews its long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may no longer be recoverable. When these events occur, the Group measures impairment by comparing the carrying value of the long-lived assets to the estimated undiscounted future cash flows expected to result from the use of the assets and their eventual disposition. If the sum of the expected undiscounted cash flow is less than the carrying amount of the assets, the Group would recognize an impairment loss, which is the excess of carrying amount over the fair value of the assets, using the expected future discounted cash flows. No impairments of long-lived assets were recognized as of March 31, 2025 and September 30, 2024, respectively.

 ****

**Linkage Global Inc NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Expressed in U.S. Dollars, except for the number of shares)**

**2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES** (cont.)

***Short-term loans to third parties***

 ****

The Company provides short-term loans to third parties with maturities of less than one year, which are classified as current assets on the balance sheet. These short-term loans are initially recognized at the principal amount lent to the borrower.

Interest Recognition: For loans to third parties with maturities of less than one year, the Company has elected not to apply the effective interest method as permitted under US GAAP for short-term receivables. Instead, interest income is recognized on a straight-line basis over the loan term, which approximates the effective interest method given the short-term nature of these loans.

Impairment: The Company assesses these short-term loans for impairment at each reporting date. If there is objective evidence of impairment, a loss allowance is recognized immediately in the income statement. The allowance is measured as the difference between the loan's carrying amount and the present value of estimated future cash flows, discounted at the loan's original effective interest rate.

***Stock-Based Compensation***

The Company accounts for stock-based compensation under ASC 718 "*Compensation - Stock Compensation*" using the fair value-based method. Under this method, compensation cost is measured at the grant date based on the value of the award and is recognized over the shorter of the service period or the vesting period of the stock-based compensation. This guidance establishes standards for the accounting for transactions in which an entity exchanges its equity instruments for goods or services. It also addresses transactions in which an entity incurs liabilities in exchange for goods or services that are based on the fair value of the entity's equity instruments or that may be settled by the issuance of those equity instruments.

The Company estimates the fair value of each stock option at the grant date by using the Black-Scholes option pricing model. Determining the fair value of stock-based compensation at the grant date under this model requires judgment, including estimating volatility, employee stock option exercise behaviors and forfeiture rates. The assumptions used in calculating the fair value of stock-based compensation represent the Company's best estimates, but these estimates involve inherent uncertainties and the application of management judgment.

When determining fair value of stock options, the Company considers the following assumptions in the Black-Scholes model:

● Exercise price,

● Expected dividends,

● Expected volatility,

● Risk-free interest rate; and

● Expe cted life of option

 **

***Convertible notes***

 **

In August 2020, the FASB issued ASU 2020-06, Debt-Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging -Contracts in Entity's Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity's Own Equity, which simplifies the accounting for convertible instruments by reducing the number of accounting models available for convertible debt instruments. For share-settled convertible debt and convertible preferred stock, the if-converted method is typically used to account for diluted earnings per share. For public companies, the guidance is effective for fiscal years beginning after December 15, 2021, and interim periods within those fiscal years. Early adoption is permitted. The company adopted this standard beginning October 1, 2023. Following the adoption of ASU 2020-06 Convertible notes are recorded and disclosed as convertible notes payable, net of unamortized discount.

On September 18, 2024, the Company entered into a securities purchase agreement ("SPA") with certain institutional investors, pursuant to which, the Company issued to the investors (the "Holders"), (i) convertible promissory notes in the aggregate principal amount of US$10,830,000 (the "Par value"), bearing interest at a rate of 8% per annum and having a term of one year from issuance date, issued with an aggregate original issue discount of US$800,000, and (ii) 9,300,000 Class A Ordinary Shares ("Pre-delivery Shares") of the Company in aggregate at the purchase price equal to par value of US$0.00025 per share, which is for pre-delivery and subject to the Company's repurchase right upon repayment of the notes. The Holders have the right at any time upon issuance until the Outstanding Balance (the principal amount plus accrued but unpaid interest of being repaid, collection and enforcements costs incurred by lender, transfer, stamp, issuance and similar taxes and fees related to conversions, and any other fees or charges incurred under this convertible note as of any date of determination) has been paid in full, at their election, to convert all or any portion of the Outstanding Balance into shares at the price of the lower of (i) $1.20, or (ii) 70% of the lowest closing price of the Company's ordinary shares during the 60-trading day period immediately preceding the date on which a conversion notice is provided to the Company.

**Linkage Global Inc NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Expressed in U.S. Dollars, except for the number of shares)**

**2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES** (cont.)

In addition, pursuant to the securities purchase agreement, the Company has the option to prepay the notes with payment of an amount equal to 120% of the Outstanding Balance. In the event that the Company receives a delisting notice from the Nasdaq Stock Market LLC, the Holders have rights to request redemption of the notes by the Company. In the event that the Company has redeemed an amount equal to half of original principal amount in cash, any subsequent redemption in cash is subject to a twenty-five percent (25%) premium. The securities purchase agreement and the notes contain certain other representations and warranties, covenants and events of default customary for similar transactions.

On October 16, 2024 (the "Closing Date"), the Company completed its issuance and sale of the note and issuance of Class A Ordinary Shares pursuant to the securities purchase agreement. The gross proceeds from the sale of the notes were $10,000,000, prior to deducting transaction fees and estimated expenses. The Company intended to use the proceeds for working capital and general corporate purposes.

On December 18, 2024, the Company and the Holders entered into an amendment to SPA, pursuant to which, (i) the parties mutually agreed to add a conversion floor price of $0.24 per share to the convertible promissory notes, and (ii) the parties mutually agreed to add the maximum number of the conversion shares that each Note Investor may receive and the Company shall issue under the securities purchase agreement and applicable the convertible notes.

The Company has identified and evaluated the embedded features of the convertible notes, and concluded that (i) the Company call option, contingent interest features for event of default, and event of delisting put option are clearly and closely related to the debt host instrument and, therefore, are not required to be bifurcated under ASC 815, (ii) the conversion right is eligible for a scope exception from derivative accounting and is not required to be bifurcated under ASC 815. Consequently, the Company accounts for the convertible notes as a liability following the respective guidance of ASC 815 and ASC 470.

As Pre-delivery shares can be separately exercised, i.e. each can continue to exist unchanged when the other is exercised, the Company concluded that they were freestanding. The Pre-delivery Shares are considered a form of stock borrowing facility and are accounted for as own-share lending arrangement. The Company did not receive any proceeds or pay any consideration related to the Pre-delivery Shares, except that the Company received a one-time nominal fee of US$2,325 upon the issuance of the Pre-delivery Shares and will pay the same amount to the investors upon the return of Pre-delivery Shares, respectively. The Pre-delivery Shares were issued on October 16, 2024. The Company accounted for the share lending arrangement as an issuance cost and recorded at fair value upon issuance date against additional paid-in capital. Although legally issued, the Pre-delivery Shares were not considered outstanding and therefore excluded from basic and diluted earnings (loss) per share unless default of the share lending arrangement occurs, at which time the Pre-delivery Shares would be included in the basic and diluted earnings (loss) per share calculation.

***Fair value measurement***

Accounting guidance defines fair value as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required or permitted to be recorded at fair value, the Group considers the principal or most advantageous market in which it would transact and it considers assumptions that market participants would use when pricing the asset or liability.

**Linkage Global Inc NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Expressed in U.S. Dollars, except for the number of shares)**

**2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES** (cont.)

Accounting guidance establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. A financial instrument's categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The three levels of inputs are:

● Level 1 — Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets.

● Level 2 — Include other inputs that are directly or indirectly observable in the marketplace.

● Level 3 — Unobservable inputs which are supported by little or no market activity.

Accounting guidance also describes three main approaches to measuring the fair value of assets and liabilities: (1) market approach; (2) income approach and (3) cost approach. The market approach uses prices and other relevant information generated from market transactions involving identical or comparable assets or liabilities. The income approach uses valuation techniques to convert future amounts to a single present value amount. The measurement is based on the value indicated by current market expectations about those future amounts. The cost approach is based on the amount that would currently be required to replace an asset.

Financial assets and liabilities of the Group primarily consist of cash and cash equivalents, accounts receivable, amounts due from related parties, loan to third party, other receivables included in prepayments and other current assets, short-term debts, long-term debts, accounts payable, amounts due to related parties, and other payables included in accrued expenses and other current liabilities. The carrying amounts of these short-term financial instruments approximates their fair value due to their short-term nature. The long-term debts approximate their fair values, because the bearing interest rate approximates market interest rate, and market interest rates have not fluctuated significantly since the commencement of loan contracts signed.

The Group's non-financial assets, such as property and equipment, would be measured at fair value only if they were determined to be impaired.

***Treasury shares***

The Company accounts for treasury shares using the cost method. Under this method, the cost incurred to purchase the shares is recorded in the treasury shares account on the consolidated balance sheets. At retirement of the treasury shares, the ordinary shares account is charged only for the aggregate par value of the shares. The excess of the acquisition cost of treasury shares over the aggregate par value is allocated between additional paid-in capital and retained earnings.

***Commitments and contingencies***

In the normal course of business, the Group is subject to commitments and contingencies, including operating lease commitments, legal proceedings and claims arising out of its business that relate to a wide range of matters, such as government investigations and tax matters. The Group recognizes a liability for such contingency if it determines it is probable that a loss has occurred and a reasonable estimate of the loss can be made. The Group may consider many factors in making these assessments on liability for contingencies, including historical and the specific facts and circumstances of each matter.

 ****

***Revenue recognition***

The Group's revenues are mainly generated from (i) cross-border sales, (ii) integrated e-commerce services, (iii) fully managed e-commerce operation services.

**Linkage Global Inc NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Expressed in U.S. Dollars, except for the number of shares)**

**2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES** (cont.)

The Group recognizes revenue pursuant to ASC 606, Revenue from Contracts with Customers ("ASC 606"). In accordance with ASC 606, revenues from contracts with Customers are recognized when control of the promised goods or services is transferred to the Group's Customers, in an amount that reflects the consideration the Group expects to be entitled to in exchange for those goods or services, reduced by estimates for return allowances, promotional discounts, rebates and business tax and Value Added Tax ("VAT"). To achieve the core principle of this standard, the Group applied the following five steps:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. Identification of the contract, or contracts, with the Customer;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. Identification of the performance obligations in the contract;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. Determination of the transaction price;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. Allocation of the transaction price to the performance obligations in the contract; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. Recognition of the revenue when, or as, a performance obligation is satisfied.

Each of our significant performance obligations and our application of ASC 606 to our revenue arrangements are discussed in further detail below.

 ****

***<u>Cross-border sales</u>***

The Group engages in the sale of food, beauty products, health products and other consumer products in Asia, by exploiting its advantages in global supply chain services and networks. The Group fulfils its performance obligation by transferring products to the designated location. In accordance with the Group's customary business practices, for international sales, the delivery term is "Cost and Freight" ("CFR", formerly known as "C&F", which the seller bears the freight costs) and "Free on Board" ("FOB", which the buyer bears the freight costs) shipping point. The majority of transactions were based on FOB. Under both delivery terms, once the products are loaded on board, control of products has transferred. Since shipping activities are performed after customers obtain control of the products, the Group elects to account for shipping as activities to fulfill the promise to transfer the goods, in accordance with ASC 606-10-25-18B. Therefore, freight costs are accrued when products are delivered to the designated location, before shipping activities occur. For the remaining domestic sales, the control of products has transferred upon the time when the products are delivered to the place designated by customers. Shipping activities are performed before customers obtain control of the goods, and hence, should not be considered a separate performance obligation. As a result, both cost of goods and freight costs are recognized at the same time when products are delivered to the designated location, after shipping activities are completed. Revenue generated from cross-border sales is recognized based on the product value specified in the contract at a point in time when the control of products has transferred for both international sales and domestic sales.

The Company has two logistics methods. For the products exported from mainland China, the suppliers will directly deliver them to customers. For the products purchased directly from suppliers in Japan, the Company has its own warehouse in Japan. The products will be first sent to the company's warehouse and then delivered to the customers.

For products shipped directly from suppliers to customers, pursuant to ASC 606-10-55-37A(a), the Group concludes that it obtains control of the products as the Group is primarily responsible for the contract and has pricing discretion. The Group is primarily responsible for the contract as it has the supplier discretion when executing orders and it is the only party that has a contractual relationship with customers. The Group establishes and obtains substantially all of the benefits from transactions, i.e. considerations paid by customers. Therefore, the Group considers itself to be the principal in the transactions on the basis that it is primary responsible to fulfill the promise and has the price discretion, pursuant to ASC 606-10-55-39.

For products shipped from the Group to customers, the Group considers itself the principal because it is in control of establishing the transaction price, arranging the whole process of transactions and bearing inventory risk. Therefore, such revenues are reported on a gross basis.

***<u>Integrated e-commerce services</u>***

The Group partners with premium social media platforms and provides digital marketing solutions to meet the needs of Customers and other cross-border e-commerce sellers and suppliers (the "Merchants").

For digital marketing services, the Group acts as an authorized agent advocating Merchants to display ads on social media platforms. In return, the Group receives commission from social media platforms. Over the contract period, the Group continues to receive commissions from social media platforms over the contractual period when Merchants placed ads on the social media platforms. Revenue from digital marketing services is recognized over the contractual period for actual qualifying ads placed calculated by social media platforms. The Group has adopted "right to invoice" practical expedient and recognizes revenues based on quarterly billing reports received from social media platforms. The Group considers itself the agent because it is not primarily responsible for fulfilling the promise to render digital marketing services. Therefore, such revenues are reported on a net basis. During the reporting period, all the revenue of the digital marketing services was generated from the Group acting as an authorized agent on behalf of social media platforms.

**Linkage Global Inc NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Expressed in U.S. Dollars, except for the number of shares)**

**2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES** (cont.)

***<u>Fully managed e-commerce operation services</u>***

The Group provides fully managed e-commerce operation services for sellers on Japanese cross-border e-commerce platforms.

Usually, our clients have their own factories and products, and they open online stores on Japanese e-commerce platforms and then entrust the daily management and marketing of the stores to the group for full handling. The services mainly included:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. Online shop setup: 1) store page design and decoration, 2) payment Settings, 3) products listing.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. Online shop promotion: design marketing plans and product combinations to attract customers.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. Customer service: post-sales customer service.

The clients only need to be responsible for the delivery of goods. The Group charges 10% of the GMV(Gross Merchandise Volume) of the online shop as a service commission. The Group considers itself the agent because the online shops and inventories are owned by clients, the group only provides services and does not have the control right over the stores and inventories, neither bears the inventory risks. Therefore, such revenues are reported on a net basis.

For other integrated e-commerce services revenue is generated from e-commerce related training/consulting services and running TikTok anchors agent. For training/consulting services, the Group fulfils its performance obligation by providing e-commerce related training/consulting services, and revenue is recognized over the service period. For running TikTok anchors agent, the group charges management fee and commission monthly based on the live stream income from TikTok platform.

**Contract Balances**

Timing of revenue recognition may differ from the timing of invoicing to Customers. Accounts receivable represent revenue recognized for the amounts invoiced and/or prior to invoicing when the Group has satisfied its performance obligation and has unconditional right to the payment. Contract assets represent the Group's right to consideration in exchange for goods or services that the Group has transferred to a customer. The Group has no contract assets as of March 31, 2025 and September 30, 2024.

The contract liabilities consist of deferred revenue, which represent the billings or cash received for services in advance of revenue recognition and is recognized as revenue when all of the Group's revenue recognition criteria are met. The Group's deferred revenue which primarily arises from cross-border sales amounted to $208,483 and $533,625 as of March 31, 2025 and September 30, 2024, respectively. Revenue recognized in the current reporting period that was included in the contract liabilities at the beginning of the reporting period was $181,337 and $210,930 for the six months ended March 31, 2025 and 2024. The Group expects to recognize this balance as revenue over the next 12 months.

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***Cost of revenues***

Cost of revenues consists primarily of (i) cost of goods sold for cross-border sales; (ii) commission costs for digital marketing services; and (iii) the salaries of the staff in the e-commerce operation department for fully managed e-commerce operation services.

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***Research and development expenses***

Research and development expenses consist primarily of (i) payroll and related expenses for research and development professionals; and (ii) technology services fee. Research and development expenses are expensed as incurred.

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***Selling and marketing expenses***

Selling and marketing expenses mainly consist of (i) salary and social welfare expenses; (ii) freight; and (iii) the advertising costs and market promotion expenses. The advertising costs were $758 and $25,183 for the six months ended March 31, 2025 and 2024, respectively. The advertising costs and market promotion expenses are expensed as incurred. The freight for sales of goods was included in selling and marketing expenses. The freight costs are expenses when incurred. The freight costs were $7,453 and $25,637 for the six months ended March 31, 2025 and 2024, respectively. ****

***General and administrative expenses***

General and administrative expenses mainly consist of (i) salary and social welfare expenses; (ii) rental cost for offices; (iii) depreciation expenses; (iv) consulting fees; and (v) allowance for credit loss.

**Linkage Global Inc NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Expressed in U.S. Dollars, except for the number of shares)**

**2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES** (cont.)

***Employee benefits***

The Company's subsidiaries participate in a government mandated, multiemployer, defined contribution plan, pursuant to which certain retirement, medical, housing and other welfare benefits are provided to employees. PRC labor laws require the entities incorporated in the PRC to pay to the local labor bureau a monthly contribution calculated at a stated contribution rate on the monthly basic compensation of qualified employees. The Group has no further commitments beyond its monthly contribution. Employee social benefits included in research and development expenses, selling and marketing expenses and general and administrative expenses in the accompanying consolidated statements of comprehensive income amounted to $31,048 and $26,557 for the six months ended March 31, 2025 and 2024, respectively.

***Leases***

On October 1, 2022, the Company adopted Accounting Standards Update ("ASU") 2016-02, Lease (FASB ASC Topic 842), using the non-comparative transition option pursuant to ASU 2018-11. Therefore, the Company has not restated comparative period financial information for the effects of ASC 842, and will not make the new required lease disclosures for comparative periods beginning before October 1, 2022. The adoption of Topic 842 resulted in the presentation of operating lease right-of-use ("ROU") assets and operating lease liabilities on the consolidated balance sheet. The Company has elected the package of practical expedients, which allows the Company not to reassess (1) whether any expired or existing contracts as of the adoption date are or contain a lease; (2) lease classification for any expired or existing leases as of the adoption date; and (3) initial direct costs for any expired or existing leases as of the adoption date. Lastly, the Company elected the short-term lease exemption for all contracts with lease terms of 12 months or less. The Company recognizes lease expense for short-term leases on a straight-line basis over the lease term.

Right-of-use assets represent the Company's right to use an underlying asset for the lease term and lease liabilities represent the Company's obligation to make lease payments arising from the lease. Right-of-use assets and lease liabilities are recognized at the commencement date based on the present value of the remaining future minimum lease payments. As the interest rate implicit in the Company's leases is not readily determinable, the Company utilizes its incremental borrowing rate, determined by class of underlying asset, to discount the lease payments. The operating lease right-of-use assets also include lease payments made before commencement and exclude lease incentives. Some of the Company's lease agreements contained renewal options; however, the Company did not recognize right-of-use assets or lease liabilities for renewal periods unless it was determined that the Company was reasonably certain of renewing the lease at inception or when a triggering event occurred. Lease expense for lease payments is recognized on a straight-line basis over the lease term. The Company's lease agreements did not contain any material residual value guarantees or material restrictive covenants.

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***Income taxes***

Current income tax assets and liabilities for the current and prior periods are measured at the amount expected to be recovered from, or paid to, the tax authorities. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted at the end of the reporting period.

The Group accounts for income taxes under ASC 740, Income taxes ("ASC 740"). Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the consolidated financial statement carrying amounts of existing assets and liabilities and their respective tax bases ("Temporary differences").

Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those Temporary Differences are expected to be recovered or settled. Deferred tax is calculated at the tax rates that are expected to apply in the periods in which the asset or liability will be settled, based on rates enacted or substantively enacted at the end of the reporting period. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized.

The provisions of ASC 740-10-25, "Accounting for Uncertainty in Income Taxes," prescribe a more-likely-than-not threshold for consolidated financial statement recognition and measurement of a tax position taken (or expected to be taken) in a tax return. This interpretation also provides guidance on the recognition of income tax assets and liabilities, classification of current and deferred income tax assets and liabilities, accounting for interest and penalties associated with tax positions, and related disclosures.

**Linkage Global Inc NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Expressed in U.S. Dollars, except for the number of shares)**

**2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES** (cont.)

Guidance was also provided on derecognition of income tax assets and liabilities, classification of current and deferred income tax assets and liabilities, accounting for interest and penalties associated with tax positions, accounting for income taxes in interim periods, and income tax disclosures. Significant judgment is required in evaluating uncertain tax positions and determining provision for income taxes. The Group did not recognize any significant interest and penalties associated with uncertain tax positions for the six months ended March 31, 2025 and 2024, respectively. As of March 31, 2025 and September 30, 2024, the Group did not have any significant unrecognized uncertain tax positions. The Group does not expect that its assessment regarding unrecognized tax positions will materially change over the next 12 months.

 ****

***VAT***

The Company's PRC subsidiaries are subject to VAT and related surcharges on revenue generated from sales of products, facilitation services and platform services. The Group records revenue net of VAT. This VAT may be offset by qualified input VAT paid by the Group to suppliers. Net VAT balance between input VAT and output VAT is recorded in the line item of other current assets on the consolidated balance sheets.

The VAT rate is 13% for taxpayers selling consumer products, and 16% prior to April 1, 2019. For revenue generated from services, the VAT rate is 6% depending on whether the entity is a general tax payer, and related surcharges on revenue generated from providing services. Entities that are VAT general taxpayers are allowed to offset qualified input VAT, paid to suppliers against their output VAT liabilities.

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***Consumption tax***

The Japanese subsidiary is subject to consumption tax. The Consumption Tax Act (Act No. 108 of December 30, 1988, as amended) provides for a multi-step, broad-based tax imposed on most transactions in goods and services in Japan. Consumption tax is assessed at each stage of the manufacturing, importing, wholesale, and retail process. The current consumption tax rate is generally 10%, with an 8% rate applying to a limited number of exceptions.

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***Government subsidies***

Government subsidies consist of cash subsidies received by the Group from the PRC local governments. Grants received as incentives for conducting business in certain local districts with no performance obligation or other restriction as to the use are recognized when cash is received. Grants received with government specified performance obligations are recognized when all the obligations have been fulfilled. Government grants received related to the purchases of long-term assets are used to net the cost of the respective assets.

The Group recorded government subsidies of $13,830 and $30 for the six months ended March 31, 2025 and 2024, respectively. ****

***Statutory reserves***

In accordance with the Companies Law of the People's Republic of China, the Company's PRC subsidiaries must make appropriations from their after-tax profits as determined under the generally accepted accounting principles in the PRC ("PRC GAAP") to non-distributable reserve funds including statutory surplus fund and discretionary surplus fund. The appropriation to the statutory surplus fund must be 10% of the after-tax profits as determined under PRC GAAP. Appropriation is not required if the statutory surplus fund has reached 50% of the registered capital of the PRC companies. Appropriation to the discretionary surplus fund is made at the discretion of the PRC companies.

The statutory surplus fund and discretionary surplus fund are restricted for use. They may only be applied to offset losses or increase the registered capital of the respective companies. These reserves are not allowed to be transferred to the Company by way of cash dividends, loans or advances, nor can they be distributed except for liquidation.

For the six months ended March 31, 2025 and 2024, nil and nil appropriation were made to the statutory surplus fund and discretionary surplus fund by one of the Company's PRC subsidiaries.

 ****

***Earnings per share***

The Company computes earnings per share ("EPS") in accordance with ASC 260, Earnings per Share ("ASC 260"). ASC 260 requires companies with complex capital structures to present basic and diluted EPS.

*Two-class method* 

 

Based on the ASC 260, a reporting entity may have two classes of common stock that have identical rights and privileges, except for voting rights. Generally, the two classes can be combined and presented as one class for EPS purposes when the only difference is related to voting rights, but the classes otherwise share equally in dividends and residual net assets on a per share basis. In this situation, a reporting entity should clearly indicate that the earnings per share amounts reflect both classes of common stock and should appropriately disclose the facts and circumstances in the footnotes.

Basic EPS are computed by dividing income available to ordinary shareholders of the Company by the weighted average ordinary shares outstanding during the period. Diluted EPS takes into account the potential dilution that could occur if securities or other contracts to issue ordinary shares were exercised and converted into ordinary shares. As of March 31, 2025 and September 30, 2024, there was no dilution impact.

**Linkage Global Inc NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Expressed in U.S. Dollars, except for the number of shares)**

**2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES** (cont.)

***Discontinued operation***

A discontinued operation may include a component of an entity or a group of components of an entity, or a business or nonprofit activity. A disposal of a component of an entity or a group of components of an entity is required to be reported in discontinued operations if the disposal represents a strategic shift that has (or will have) a major effect on an entity's operations and financial results when any of the following occurs:

(1) the component of an entity or group of components of an entity meets the criteria to be classified as held for sale;

(2) the component of an entity or group of components of an entity is disposed of by sale;

(3) the component of an entity or group of components of an entity is disposed of other than by sale (for example, by abandonment or in a distribution to owners in a spinoff).

The Company assesses whether a deregistered subsidiary is required to be presented as discontinued operation in its consolidated financial statements on the deconsolidation date. This assessment is based on whether or not the deconsolidation represents a strategic shift that has or will have a major effect on the Company's operations or financial results.

The revenue contributed by HQT was USD 76,907 and USD 312,180 for the six months ended March 31, 2025 and for the year ended September 30, 2024, accounting for only 2% and 3% of the group's total revenue for the six months ended March 31, 2025 and for the year ended September 30, 2024, respectively. The total asset of HQT was Nil as of March 31, 2025. Besides, the deregistration of HQT did not represent a strategic shift as the Digital Marketing Services provided by HQT was no longer a material part of the Company's business since 2024. Hence, the deregistration of HQT did not meet the criteria for presentation as a discontinued operation.

***Segment reporting***

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. The new FASB guidance requires incremental disclosures in annual and interim periods related to a public entity's reportable segments (particularly on segment expenses) but does not change the definition of a segment, the method for determining segments, or the criteria for aggregating operating segments into reportable segments. The new guidance is effective for annual financial statements of public entities for fiscal years beginning after December 15, 2023 and in interim periods within fiscal years beginning after December 15 2024 and should be adopted retrospectively unless impracticable.

Operating segments are defined as components of an enterprise engaging in businesses activities for which separate financial information is available that is regularly evaluated by the Group's chief operating decision makers ("CODM") in deciding how to allocate resources and assess performance. The Group's chief operating decision maker, CEO, reviews segment results when making decisions about allocating resources and assessing performance of the Group.

As a result of the assessment made by CODM, the Group has two operating segments: EXTEND, and other subsidiaries. The Group considers a "management approach" concept as the basis for identifying reportable segments. The management approach considers the internal organization and reporting used by the Company's chief operating decision maker for making operating decisions and assessing performance as the source for determining the Company's reportable segments. The Group's reportable segments are business units operate in different countries. EXTEND operates in Japan, which is subject to different regulatory environment than other subsidiaries which operate in the PRC and Hong Kong.

 ****

***Recent accounting pronouncements***

In June 2016, the FASB issued ASU No. 2016-13, "Financial Instruments — Credit Losses", which will require the measurement of all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. Subsequently, the FASB issued ASU No. 2018-19, Codification Improvements to Topic 326, to clarify that receivables arising from operating leases are within the scope of lease accounting standards. Further, the FASB issued ASU No. 2019-04, ASU 2019-05, ASU 2019-10, ASU 2019-11 and ASU 2020-02 to provide additional guidance on the credit losses standard. For all other entities, the amendments for ASU 2016-13 are effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years, with early adoption permitted. The Group has adopted ASU 2016-13 on a modified retrospective basis since October 1, 2023. The Group evaluated that the impact of the adoption of this ASU on the Group's unaudited interim condensed consolidated financial statements was immaterial.

Other accounting standards that have been issued by FASB that do not require adoption until a future date are not expected to have a material impact on the unaudited interim condensed consolidated financial statements upon adoption. The Group does not discuss recent standards that are not anticipated to have an impact on or are unrelated to its consolidated financial condition, results of operations, cash flows or disclosures.

**Linkage Global Inc NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Expressed in U.S. Dollars, except for the number of shares)**

**3. SEGMENT INFORMATION**

The CODMs review financial information of operating segments based on internal management report when making decisions about allocating resources and assessing the performance of the Group. As a result of the assessment made by CODMs, the Group has two reportable segments, including EXTEND from Japan, and other subsidiaries from Hong Kong and PRC. The Group's CODMs evaluate performance based on the operating segment's revenue and their operating results. The revenue and operating results by segments were as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **For the six months ended <br> March 31, 2025** | **For the six months ended <br> March 31, 2025** | **For the six months ended <br> March 31, 2025** |
|  | **EXTEND** | **Other <br> subsidiaries** | **Consolidated** |
| Revenues from external Customers | $431599 | $3070348 | $3501947 |
| Segment losses before tax | $(111181) | $(2976178) | $(3087359) |

---

---

| | | | |
|:---|:---|:---|:---|
|  | **For the six months ended <br> March 31, 2024** | **For the six months ended <br> March 31, 2024** | **For the six months ended <br> March 31, 2024** |
|  | **EXTEND** | **Other <br> subsidiaries** | **Consolidated** |
| Revenues from external Customers | $3496662 | $1301701 | $4798363 |
| Segment losses before tax | $(501337) | $(1119590) | $(1620927) |

---

The total assets from continuing operations by segments as of March 31, 2025 and September 30, 2024 were as follows:

---

| | | |
|:---|:---|:---|
|  | **As of <br> March 31, <br> 2025** | **As of <br> September 30, <br> 2024** |
| Segment assets |  |  |
| EXTEND | $893397 | $1381124 |
| Other subsidiaries | 18691140 | 11310403 |
| Total segment assets | $19584537 | $12691527 |

---

The property and equipment, net from continuing operations by segments as of March 31, 2025 and September 30, 2024 were as follows:

---

| | | |
|:---|:---|:---|
|  | **As of <br> March 31, <br> 2025** | **As of <br> September 30, <br> 2024** |
| Property and equipment, net |  |  |
| EXTEND | $— | $577 |
| Other subsidiaries | 50594 | 85230 |
| Total property and equipment, net | $50594 | $85807 |

---

The right-of-use assets, net from continuing operations by segments as of March 31, 2025 and September 30, 2024 were as follows:

---

| | | |
|:---|:---|:---|
|  | **As of <br> March 31, <br> 2025** | **As of <br> September 30, <br> 2024** |
| Right-of-use assets, net |  |  |
| EXTEND | $57315 | $91458 |
| Other subsidiaries | 458852 | 562272 |
| Total right-of-use assets, net | $516167 | $653730 |

---

**Linkage Global Inc NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Expressed in U.S. Dollars, except for the number of shares)**

**4. REVENUE**

The following table disaggregates the Group's revenue for the six months ended March 31, 2025 and 2024:

---

| | | |
|:---|:---|:---|
|  | **For the Six Months Ended <br> March 31,** | **For the Six Months Ended <br> March 31,** |
|  | **2025** | **2024** |
| By revenue streams |  |  |
| Cross-border sales | $800751 | $4536131 |
| Integrated e-commerce services |  |  |
| Fully managed e-commerce operation services | 2591308 |  |
| &nbsp;&nbsp;&nbsp;Digital marketing services | 76907 | 128993 |
| &nbsp;&nbsp;&nbsp;Others | 32981 | 133239 |
| Total | $3501947 | $4798363 |

---

**5. INVENTORIES, NET**

Inventories consisted of the following:

---

| | | |
|:---|:---|:---|
|  | **As of<br> March 31, <br> 2025** | **As of <br> September 30, <br> 2024** |
| Finished goods | $116293 | $131408 |
| Goods in transit |  | 27960 |
| Inventory valuation allowance | (80618) | (93037) |
| Inventories, net | $35675 | $66331 |

---

Movement of inventory valuation allowance is as follows:

---

| | | |
|:---|:---|:---|
|  | **As of <br> March 31,<br> 2025** | **As of <br> September 30, <br> 2024** |
| Balance at the beginning of the year | $93037 | $83889 |
| Addition | 4328 | 11858 |
| Write-offs | (12483) | (6589) |
| Foreign currency translation adjustment | (4264) | 3879 |
| Balance at the end of the year | $80618 | $93037 |

---

**6. ACCOUNT RECEIVABLE, NET**

Accounts receivable, net consists of the following:

---

| | | |
|:---|:---|:---|
|  | **As of <br> March 31,<br> 2025** | **As of September 30,<br> 2024** |
| Accounts receivable | $8085217 | $7415011 |
| Allowance for credit loss | (1679731) | (1112315) |
| Total accounts receivable, net | $6405486 | $6302696 |

---

Movements of allowance for credit loss are as follows:

---

| | | |
|:---|:---|:---|
|  | **As of <br> March 31,<br> 2025** | **As of September 30,<br> 2024** |
| Beginning balance | $1112315 | $109214 |
| Adoption ASU 2016-13 | 1353029 | 985102 |
| Recovery of provision | (8811) | (26518) |
| Write off | (716097) |  |
| Exchange rate effect | (60705) | 44517 |
| Ending balance | $1679731 | $1112315 |

---

**Linkage Global Inc NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Expressed in U.S. Dollars, except for the number of shares)**

**7. PREPAID EXPENSES AND OTHER CURRENT ASSETS, NET**

Prepayments and other current assets, net consist of the following:

---

| | | |
|:---|:---|:---|
|  | **As of <br> March 31, <br> 2025** | **As of <br> September 30, <br> 2024** |
| Tax refunds<sup>(1)</sup> | $364087 | $402048 |
| Deposits | 188971 | 436450 |
| Advance to suppliers<sup>(2)</sup> | 1063963 | 35128 |
| Prepaid expenses<sup>(3)</sup> | 3859 | 1808887 |
| Others | 4637 | 7068 |
| Prepayments and other current assets, net | $1625517 | 2689581 |

---

(1) Tax
refunds consist of consumption tax and VAT refund for export business. The Group is eligible for consumption tax and VAT refund for cross-border
products sales in Japan and China.

(2) Due to the company's plan to launch a TikTok business in Japan
in the second half year of 2025, it signed a procurement agreement with a Hong Kong trading company and made an advance payment of $1
million for the purchase of 3C electronic products such as headphones.

(3) The prepaid expenses on September 30, 2024 mainly represent
the prepaid consulting fee to Hermann Limited. The company signed a service agreement with consulting management company Hermann Limited
in December 2023, providing corporate management and investment and financing consulting services for the company for three years,
with contract amount of $2,060,000. For the year ended September 30, 2024, the amortized expense amount is $572,222, and the remaining
amount is $1,487,778. Since Hermann Limited obtained a portion of the company's mortgaged shares through the issuance of convertible
notes, and became a shareholder of the company with a 7.1% shareholding ratio. Therefore, it was reclassified into amount due from related
parties on March 31, 2025 (note 19).

**8. SHORT TERM LOAN TO THIRD PARTY**

The Company signed a loan agreement with a third party Short Selling Capital Group Limited to provide short term loans on September 26, 2024. As of March 31, 2025 and September 30, 2024, the short-term loan to third party consists of the following:

---

| | | | | |
|:---|:---|:---|:---|:---|
| **Borrower** | **Annual <br> Interest <br> Rate** | **Maturity** | **Maturity** | **As of<br> March 31,<br> 2025,** |
| Short Selling Capital Group Limited | 9.00% | 09/26/2024 | 09/25/2025 | $8993306 |
| Interest receivable from loan to third party |  |  |  | 386261 |
| Total |  |  |  | $9379567 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| **Borrower** | **Annual <br> Interest <br> Rate** | **Maturity** | **Maturity** | **As of September 30,<br> 2024,** |
| Short Selling Capital Group Limited | 9.00% | 09/26/2024 | 09/25/2025 | $410000 |
|  |  |  |  | $410000 |

---

The interest receivable from loan to third party was $386,261 and nil for the six months ended March 31, 2025 and 2024.

**Linkage Global Inc NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Expressed in U.S. Dollars, except for the number of shares)**

**9. PROPERTY AND EQUIPMENT, NET**

Property and equipment, net, consists of the following:

---

| | | |
|:---|:---|:---|
|  | **As of <br> March 31, <br> 2025** | **As of <br> September 30, <br> 2024** |
| Cost |  |  |
| Office equipment | $29646 | $30672 |
| Vehicle | 308053 | 319574 |
| Leasehold improvement | 9924 | 10385 |
|  | 347623 | 360631 |
| Less: accumulated depreciation and amortization | (297029) | (274824) |
| Property and equipment, net | $50594 | $85807 |

---

&nbsp;&nbsp;&nbsp;&nbsp;(1) Depreciation expense was $22,205 and $40,959 for the six months ended March 31, 2025 and 2024, respectively.

(2) No impairment loss was recognized for the six months ended March 31, 2025 and 2024, respectively.

(3) As of March 31, 2025 and September 30, 2024, a vehicle, owned by Chuancheng Digital, for which the carrying value was $24,988 and $77,550, was pledged to secure a long-term loan from a financial institution.

**10. LEASING**

The Group has operating leases for offices and warehouses. The balances for the operating leases where the Group is the lessee are presented as follows within the consolidated balance sheets:

---

| | | |
|:---|:---|:---|
|  | **As of <br> March 31, <br> 2025** | **As of <br> September 30, <br> 2024** |
| Operating lease right-of-use assets, net | $516167 | $653730 |
| Operating lease liabilities-current | 203600 | 231978 |
| Operating lease liabilities-non-current | 334973 | 441504 |
| Total operating lease liabilities | $538573 | $673482 |

---

The components of lease expenses were as follows:

---

| | | |
|:---|:---|:---|
|  | **For the <br> six months <br> ended <br> March 31, <br> 2025** | **For the <br> six months <br> ended <br> March 31,<br> 2024** |
| Lease cost |  |  |
| Amortization of right-of-use assets | $114791 | $110229 |
| Interest of operating lease liabilities | 11730 | 12921 |
| Total lease cost | $126521 | $123150 |

---

The weighted average remaining lease term was approximately 2.85 years as of March 31, 2025, and the weighted average discount rate was 3.94% for the six months ended March 31, 2025.

**Linkage Global Inc NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Expressed in U.S. Dollars, except for the number of shares)**

**10. LEASING** (Cont.)

The maturities of lease liabilities in accordance with Leases (ASC 842) in each of the next five years as of March 31, 2025 were as follows:

---

| | |
|:---|:---|
|  | **USD** |
| 2025 | 121734 |
| 2026 | 175038 |
| 2027 | 155336 |
| 2028 | 109180 |
| 2029 | 12577 |
| Total minimum lease payments | **573865** |
| Less: Interest | (35292) |
| Present value of lease obligations | **538573** |
| Less: Current portion | 203600 |
| Non - current portion of lease obligations | **334973** |

---

**11. SHORT-TERM DEBTS**

As of March 31, 2025 and September 30, 2024, the short-term debts were for working capital purposes. Short-term debts consist of the following:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **Bank** | **Annual <br> Interest <br> Rate** | **Maturity** | **Maturity** | **As of<br> March 31, 2025** | **As of September 30, 2024** |
| Higashi-Nippon Bank | 1.55% | 12/29/2023 | 12/25/2024 | $— | $32810 |
|  |  |  |  | $— | $32810 |

---

**12. LONG-TERM DEBTS**

As of March 31, 2025 and September 30, 2024, long-term debts consist of the following:

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| | | | | **As of<br> March 31,<br> 2025** | **As of<br> March 31,<br> 2025** | **As of September 30,<br> 2024** | **As of September 30,<br> 2024** | |
| <br>**Bank and other financial institution** |<br>**Annual<br> Interest<br> Rate** |<br>**Start** |<br>**End** | **Long-<br> term** | **Long-<br> term<br> (current<br> portions)** | **Long-<br> term** | **Long-<br> term<br> (current<br> portions)** |<br>**Pledge** |
|  | | | | **USD** | **USD** | **USD** | **USD** | |
| The Shoko Chukin Bank | 1.11% | 05/26/2020 | 04/25/2030 | 82456 | 20174 | 96838 | 21110 |  |
| The Shoko Chukin Bank | 1.50% | 02/04/2022 | 01/27/2025 |  |  |  | 21780 |  |
| Mizuho Bank | 0.83% | 03/25/2020 | 03/25/2025 |  |  |  | 6855 |  |
| Mizuho Bank | 2.00% | 06/01/2021 | 06/01/2031 | 105070 | 20013 | 120419 | 20942 |  |
| Japan Finance Corporation | 1.11% | 07/16/2020 | 06/30/2030 | 140227 | 36424 | 164328 | 38115 |  |
| Musashino Bank | 1.50% | 05/31/2022 | 06/02/2025 |  | 10967 |  | 46408 |  |
| Japan Finance Corporation | 0.46% | 06/09/2020 | 04/20/2030 | 85390 | 20494 | 98290 | 21445 |  |
| Japan Finance Corporation | 0.38% | 04/23/2021 | 03/20/2031 | 34022 | 7372 | 38569 | 7714 |  |
| Kiraboshi Bank | 0.50% | 06/27/2023 | 05/30/2032 | 286858 | 43362 | 321116 | 45376 |  |
| Zhongli International Financial Leasing Co. LTD | 14.56% | 08/11/2022 | 08/15/2025 |  | 57420 |  | 130625 |  |
| Zhongli International Financial Leasing Co. LTD | 13.63% | 07/26/2022 | 07/26/2025 |  | 27331 |  | 68332 | Vehicle |
|  |  |  |  | 734023 | 243557 | 839560 | 428702 |  |

---

**Linkage Global Inc NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Expressed in U.S. Dollars, except for the number of shares)**

**12. LONG-TERM DEBTS** (cont.)

The long-term debts as of March 31, 2025 were primarily obtained from five banks and one financial institution, with interest rates ranging from 0.38% to 14.56% per annum. The long-term debts as of September 30, 2024 were primarily obtained from five banks and one financial institution, with interest rates ranging from 0.38% to 14.56% per annum. The interest expenses were $33,020 and $47,115 for the six months ended March 31, 2025 and 2024, respectively.

The weighted average interest rates of long-term debts outstanding were 2.21% and 3.02% per annum as of March 31, 2025 and September 30, 2024, respectively.

As of March 31, 2025 and September 30, 2024, there was no event of default on long-term debts occurred. As of March 31, 2025 and September 30, 2024, no long-term debts were guaranteed by the Company or its subsidiaries. As of March 31, 2025 and September 30, 2024, a vehicle with carrying value of $24,988 and $77,550 was pledged against one long-term debt.

On January 17, 2022, the Group bought a vehicle and paid in full. On July 26, 2022, the Group entered into a loan agreement with Zhongli International Financial Leasing Co. LTD (the "Lessor") to pledge the same vehicle and to receive RMB1,500,000 ($210,867) from the Lessor. The transaction is classified as "failed" sale and leaseback transactions, as the control of the vehicle does not transfer to the lessor. Consequently, the received consideration from the lessor is accounted for as a liability. As of March 31, 2025 and September 30, 2024, the current portion of the liability recorded in short-term debt were $27,331 and $68,332.

The Group was not subject to any financial covenants as of March 31, 2025 and September 30, 2024.

**Debt Maturities**

The contractual maturities of the Group's long-term debts as of March 31, 2025 were as follows:

---

| | |
|:---|:---|
|  | **Principle<br> amount** |
| Within 1 year | $243557 |
| 1 – 2 years | 141134 |
| 2 – 3 years | 141134 |
| 3 – 4 years | 141134 |
| 4 – 5 years | 141134 |
| Over 5 years | 169487 |
| Total | $977580 |

---

**13. ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES**

Accrued expenses and other current liabilities consist of the following:

---

| | | |
|:---|:---|:---|
|  | **As of <br> March 31, <br> 2025** | **As of <br> September 30, <br> 2024** |
| Accrued payroll and welfare | $137344 | $171479 |
| Tax Payable | 60236 | 56018 |
| Accrued service fee | 105762 |  |
| Others | 71 | 9316 |
|  | $303413 | $236813 |

---

**Linkage Global Inc NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Expressed in U.S. Dollars, except for the number of shares)**

**14. CONVERTIBLE NOTES**

On September 18, 2024, the Company entered into a securities purchase agreement ("SPA") with certain institutional investors, pursuant to which, the Company issued to the investors (the "Holders"), (i) convertible promissory notes in the aggregate principal amount of US$10,830,000 (the "Par value"), bearing interest at a rate of 8% per annum and having a term of one year from issuance date, issued with an aggregate original issue discount of US$800,000, and (ii) 9,300,000 Class A Ordinary Shares ("Pre-delivery Shares") of the Company in aggregate at the purchase price equal to par value of US$0.00025 per share, which is for pre-delivery and subject to the Company's repurchase right upon repayment of the notes. The Holders have the right at any time upon issuance until the Outstanding Balance (the principal amount plus accrued but unpaid interest of being repaid, collection and enforcements costs incurred by lender, transfer, stamp, issuance and similar taxes and fees related to conversions, and any other fees or charges incurred under this convertible note as of any date of determination) has been paid in full, at their election, to convert all or any portion of the Outstanding Balance into shares at the price of the lower of (i) $1.20, or (ii) 70% of the lowest closing price of the Company's ordinary shares during the 60-trading day period immediately preceding the date on which a conversion notice is provided to the Company.

In addition, pursuant to the securities purchase agreement, the Company has the option to prepay the notes with payment of an amount equal to 120% of the Outstanding Balance. In the event that the Company receives a delisting notice from the Nasdaq Stock Market LLC, the Holders have rights to request redemption of the notes by the Company. In the event that the Company has redeemed an amount equal to half of original principal amount in cash, any subsequent redemption in cash is subject to a twenty-five percent (25%) premium. The securities purchase agreement and the notes contain certain other representations and warranties, covenants and events of default customary for similar transactions.

On October 16, 2024 (the "Closing Date"), the Company completed its issuance and sale of the note and issuance of Class A Ordinary Shares pursuant to the securities purchase agreement. The gross proceeds from the sale of the notes were $10,000,000, prior to deducting transaction fees and estimated expenses. The Company intended to use the proceeds for working capital and general corporate purposes.

On December 18, 2024, the Company and the Holders entered into an amendment to SPA, pursuant to which, (i) the parties mutually agreed to add a conversion floor price of $0.24 per share to the convertible promissory notes, and (ii) the parties mutually agreed to add the maximum number of the conversion shares that each Note Investor may receive and the Company shall issue under the securities purchase agreement and applicable the convertible notes.

The Company has identified and evaluated the embedded features of the convertible notes, and concluded that (i) the Company call option, contingent interest features for event of default, and event of delisting put option are clearly and closely related to the debt host instrument and, therefore, are not required to be bifurcated under ASC 815, (ii) the conversion right is eligible for a scope exception from derivative accounting and is not required to be bifurcated under ASC 815. Consequently, the Company accounts for the convertible notes as a liability following the respective guidance of ASC 815 and ASC 470.

As Pre-delivery shares can be separately exercised, i.e. each can continue to exist unchanged when the other is exercised, the Company concluded that they were freestanding. The Pre-delivery Shares are considered a form of stock borrowing facility and are accounted for as own-share lending arrangement. The Company did not receive any proceeds or pay any consideration related to the Pre-delivery Shares, except that the Company received a one-time nominal fee of US$2,325 upon the issuance of the Pre-delivery Shares and will pay the same amount to the investors upon the return of Pre-delivery Shares, respectively. The Pre-delivery Shares were issued on October 16, 2024. The Company accounted for the share lending arrangement as an issuance cost and recorded at fair value upon issuance date against additional paid-in capital. Although legally issued, the Pre-delivery Shares were not considered outstanding and therefore excluded from basic and diluted earnings (loss) per share unless default of the share lending arrangement occurs, at which time the Pre-delivery Shares would be included in the basic and diluted earnings (loss) per share calculation.

The amortized cost of the convertible notes as of March 31, 2025 consisted of the following:

---

| | |
|:---|:---|
|  | **As of<br> March 31,**<br>**2025** |
| Convertible notes- Issued in September, 2024 | $10000000 |
| Less debt discount and debt issuance cost | (351000) |
| Fair value adjustment for Pre-Delivery Shares related to the issuance of convertible notes | (1764675) |
| Convertible Notes | 7884325 |
| Interest payable of convertible notes (including amortization of issuance cost) | 1555689 |
| Total convertible notes and interest payable of convertible notes | $9440014 |

---

Based on the calculation model, the internal rate of return of the convertible notes is 42.52%.

**Linkage Global Inc NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Expressed in U.S. Dollars, except for the number of shares)**

**15. INCOME TAXES**

 ****

***Cayman Islands***

Under the current laws of the Cayman Islands, the Company is not subject to income or capital gains taxes. In addition, dividend payments are not subject to withholdings tax in the Cayman Islands.

 ****

***Hong Kong***

According to Tax (Amendment) (No. 3) Ordinance 2018 published by Hong Kong government, from April 1, 2018, under the two-tiered profits tax rates regime, the profits tax rate for the first HKD2 million of assessable profits will be lowered to 8.25% (half of the rate specified in Schedule 8 to the Inland Revenue Ordinance (IRO)) for qualified corporations, and assessable profits above HK$2,000,000 will be taxed at 16.5%. The assessable profits of corporations which is not qualifying for the two-tiered profits tax rates regime, will continue to be taxed at a flat rate of 16.5%.

 ****

***PRC***

Under the Enterprise Income Tax Laws of the PRC, or the EIT Laws, domestic enterprises and Foreign Investment Enterprises, or the FIEs, are usually subject to a unified 25% enterprise income tax rate, while preferential tax rates, tax holidays and tax exemption may be granted on case-by-case basis.

 ****

***Japan***

Japan has a progressive tax system, of which its corporate income tax is calculated on the estimated assessable profits for the six months ended March 31, 2025 and 2024 times applicable tax rates. EXTEND is subject to national corporate income tax, inhabitant tax, and enterprise tax in Japan, which in the aggregate, resulted in the statutory income tax rate of approximately 36.8% and 36.8% for the six months ended March 31, 2025 and 2024, respectively.

The effective income tax rate was approximately -12.39% and 13.27% for the six months ended March 31, 2025 and 2024, respectively.

The income tax expenses consist of the following components:

---

| | | |
|:---|:---|:---|
|  | **For the six months ended <br> March 31,** | **For the six months ended <br> March 31,** |
|  | **2025** | **2024** |
| Current income tax expenses | $340441 |  |
| Deferred income tax benefit |  | (215161) |
| Total income tax expenses/(benefit) | $340441 | $(215161) |

---

A reconciliation between the Group's actual provision for income taxes and the provision at Japan statutory rate is as follows:

---

| | | |
|:---|:---|:---|
|  | **For the six months ended <br> March 31,** | **For the six months ended <br> March 31,** |
|  | **2015** | **2024** |
| Loss before income tax expenses | $(2746918) | $(1620927) |
| Computed income tax benefit with statutory tax rate | (1011597) | (596937) |
| Effect of preferential tax rate | (21205) | 3967 |
| Impact of different tax rates in other jurisdictions | 821728 | 220869 |
| Non-deductible expenses | 2988 | 1366 |
| Utilized tax gain |  | 2059 |
| Changes in valuation allowance | 548527 | 153515 |
| Income tax expenses /(benefit) | $340441 | $(215161) |

---

(1) Since
the company's main place of business is in Japan, the Japanese tax rate has been chosen as the statutory tax rate.

**Linkage Global Inc NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Expressed in U.S. Dollars, except for the number of shares)**

**15. INCOME TAXES** (cont.)

As of March 31, 2025 and September 30, 2024, the significant components of the deferred tax assets are summarized below:

---

| | | |
|:---|:---|:---|
|  | **As of <br> March 31, <br> 2025** | **As of <br> September 30, <br> 2024** |
| Deferred tax assets: |  |  |
| Allowance for credit loss | $1297689 | $1031183 |
| Net operating loss carried forward | 620662 | 233840 |
| Unrealized foreign exchange loss | (61051) | 45440 |
| Total deferred tax assets | 1857300 | 1310463 |
| Valuation allowance | (1857300) | (1310463) |
| Deferred tax assets, net of valuation allowance | $— | $— |

---

The Group operates through subsidiaries and valuation allowance is considered for each of the entities on an individual basis. The Group recorded valuation allowance against deferred tax assets of those entities that are in a cumulative financial loss position and are not forecasting profits in the near future as of March 31, 2025 and September 30, 2024. In making such determination, the Group also evaluates a variety of factors including the Group's operating history, accumulated deficit, existence of taxable temporary differences and reversal periods. The Group has recognized a valuation allowance of $1,857,300 and $1,310,463 as of March 31, 2025 and September 30, 2024, respectively.

Changes in valuation allowance are as follows:

---

| | | |
|:---|:---|:---|
|  | **As of March 31, 2025** | **As of September 30, 2024** |
| Valuation allowance: |  |  |
| Balance at beginning of the year | $1310463 | $468938 |
| Additions | 526157 | 790396 |
| Loss utilized |  |  |
| Exchange difference | 20680 | 51129 |
| Balance at end of the year | $1857300 | $1310463 |

---

As of March 31, 2025 net operating loss carryforwards will expire, if unused, in the following amounts:

---

| | |
|:---|:---|
| 2025 | $— |
| 2026 | 141738 |
| 2027 | 498343 |
| 2028 | 1592302 |
| 2029 | 1676253 |
| Total | $3908636 |

---

**16. EQUITY**

**Ordinary Shares**

The Company's authorized 200,000,000 ordinary shares of par value US$0.00025. On March 24, 2022, the Company issued 20,000,000 ordinary shares. The shares and per share information are presented on a retroactive basis for the periods presented, to reflect the reorganization completed on February 17, 2023.

On March 20, 2023, a resolution of the shareholders of the Company was adopted to subdivide all of the Company's ordinary shares on the basis of 1:4000. As a result of the share-split, the authorized share capital of the Company was $50,000 divided into 200,000,000 shares of a par value of $0.00025 each.

**Linkage Global Inc NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Expressed in U.S. Dollars, except for the number of shares)**

**16. EQUITY** (cont.)

On December 17, 2023, the Company closed its initial public offering of 1,500,000 Class A ordinary shares at a public offering price of $4.00 per Class A ordinary share for a total of $6,000,000 in gross proceeds. The Company raised total net proceeds of $5,356,417 after deducting underwriting discounts and commissions and offering expenses.

On October 11, 2024, a resolution of the shareholders of the Company was adopted to authorize share capital be re-designated and re-classified as follows with immediate effect (the "Share Capital Reorganization"):

(a) each share in issue immediately following the Share Capital Reorganization, which is 21,500,000 shares of par value US$0.00025 each (the "Shares"), each be re-designated and re-classified into one Class A ordinary share of par value US$0.00025 each (the "Class A Shares"); (b) 5,000,000 of the remaining authorized but unissued Shares each be re-designated and re-classified into one Class B ordinary share of par value US$0.00025 each (the "Class B Shares"); and (c) each of the remaining authorized but unissued Shares, which is 173,500,000 Shares of par value US$0.00025 each, each be re-designated and re-classified into one Class A Share of par value US$0.00025 each, such that the Company's authorized share capital be amended from US$50,000 divided into 200,000,000 Shares of a par value of US$0.00025 each to US$50,000 divided into 195,000,000 Class A ordinary shares of par value US$0.00025 each and 5,000,000 Class B ordinary shares of par value US$0.00025 each.

On October 16, 2024, the Company completed transactions contemplated under that certain securities purchase agreement (the "SPA") with certain institutional investors (the "Investors"), pursuant to which, the Company issued to the Investors, (i) convertible promissory notes in the aggregate principal amount of US$10,830,000, bearing interest at a rate of 8% per annum and having a term of one year from issuance date, issued with an aggregate original issue discount of US$800,000, and (ii) 9,300,000 class A ordinary shares of the Company in aggregate at the purchase price equal to par value US$0.00025 per share, which is for pre-delivery and subject to the Company's repurchase right upon repayment of the notes.

On November 7, 2024, a resolution of the directors of the Company was adopted to issue 5,000,000 Class B ordinary shares of par value US$0.00025 each (the New Shares) to WU Zhihua, at a subscription price of US$0.00025 per share (the New Share Issuance), for the purpose of compensation.

On January 27, 2025, a resolution of the shareholders of the Company was adopted to approve that, the authorized share capital of the Company be immediately increased from US$50,000 divided into 195,000,000 Class A ordinary shares with a par value of US$0.00025 each and 5,000,000 Class B ordinary shares of par value US$0.00025 each to US$2,500,000 divided into 9,980,000,000 Class A ordinary shares with a par value of US$0.00025 each and 20,000,000 Class B ordinary shares with a par value of US$0.00025 each (the "Share Capital Increase").

On March 13, 2025, the Company repurchased 2,000,000 Class A ordinary shares of par value US$0.00025 each (the Class A Ordinary Shares) from Smart Bloom Global Limited at par value (the Class A Share Repurchase), and (ii) the Company issue 2,000,000 Class B ordinary shares of par value US$0.00025 each (Class B Ordinary Shares) to WU Zhihua, the controlling shareholder of Smart Bloom Global Limited (the Class B Share Issuance) in accordance with the terms of the share application letter from WU Zhihua (the Share Application Letter). The Company proposes to allocate the proceeds from the Class B Share Issuance to pay for the Class A Share Repurchase.

On April 7, 2025, the Company consolidated each 10 shares into 1 share. After the Share Consolidation, the authorized share capital of the Company be immediately decreased from US$2,500,000 divided into 9,980,000,000 Class A ordinary shares with a par value of US$0.00025 each and 20,000,000 Class B ordinary shares with a par value of US$0.0025 each into US$2,500,000 divided into 998,000,000 Class A ordinary shares with a par value of US$0.0025 each and 2,000,000 Class B ordinary shares with a par value of US$0.0025 each.

**Linkage Global Inc NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Expressed in U.S. Dollars, except for the number of shares)**

**16. EQUITY** (cont.)

**Treasury Shares**

Repurchasing of treasury shares resolved at the Board of Directors meeting held on January 19, 2025. The Company repurchase 2,000,000 Class A ordinary shares of par value US$0.00025 each (the Class A Ordinary Shares) from Smart Bloom Global Limited at par value (the Class A Share Repurchase), and (ii) the Company issue 2,000,000 Class B ordinary shares of par value US$0.00025 each (Class B Ordinary Shares) to WU Zhihua, the controlling shareholder of Smart Bloom Global Limited (the Class B Share Issuance) in accordance with the terms of the share application letter from WU Zhihua (the Share Application Letter). The Company proposes to allocate the proceeds from the Class B Share Issuance to pay for the Class A Share Repurchase.

**Details of matters relating to repurchase**

---

| | |
|:---|:---|
| Number of Class A ordinary shares repurchased (Shares consolidated each 10 shares into 1 share) | 200000 |
| Total purchase price for repurchase of shares | $500.00 |

---

**Statutory Reserve**

A portion of the Company's operations are conducted through its PRC (excluding Hong Kong) subsidiaries, and the Company's ability to pay dividends is primarily dependent on receiving distributions of funds from subsidiaries. Relevant PRC statutory laws and regulations permit payments of dividends by subsidiaries only out of their retained earnings, if any, as determined in accordance with PRC accounting standards and regulations, and after it has met the PRC requirements for appropriation to statutory reserves. The Company's PRC subsidiaries are required to make appropriations to certain reserve funds, comprising the statutory surplus reserve and the discretionary surplus reserve, based on after-tax net income determined in accordance with the PRC GAAP. Appropriations to the statutory surplus reserve are required to be at least 10% of the after-tax net income determined in accordance with PRC GAAP until the reserve is equal to 50% of the entity's registered capital. Appropriations to the surplus reserve are made at the discretion of the Company's Board of Directors. Paid-in capital of subsidiaries included in the Company's consolidated net assets are also non-distributable for dividend purposes.

As a result of these PRC laws and regulations, the Company's PRC subsidiaries are restricted in their ability to transfer a portion of their net assets to the Company. As of March 31, 2025 and September 30, 2024, net assets restricted in the aggregate, which include paid-in capital, additional paid-in capital and statutory reserve funds of the Company's subsidiaries, that are included in the Company's consolidated net assets were approximately $1,206,886 and $1,206,886, respectively.

**17. OTHER NON-OPERATING INCOME**

Others, non-operating income consisted of the following:

---

| | | |
|:---|:---|:---|
|  | **For the six months ended <br> March 31,** | **For the six months ended <br> March 31,** |
|  | **2025** | **2024** |
| Rental income<sup>(1)</sup> | $22573 | $— |
| Tax subsidies and deductions | 2119 | 73 |
| Government subsidies | 13830 | 30 |
| Others income<sup>(2)</sup> | 349294 | 895 |
| Total | $387816 | $998 |

---

(1) Rental
income for the six months ended March 31, 2025 was generated from the operating lease of part of warehouse located in Saitama, Japan.
Due to the decline in business, the company has leased out part of its warehouse to others.

(2) Others
income obtained the gain of $347,278 from cleaning up the current accounts due to the deregistration of HQT.

**Linkage Global Inc NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Expressed in U.S. Dollars, except for the number of shares)**

**18. EARNINGS PER SHARE**

The following table sets forth the basic and diluted earnings per share computation and provides a reconciliation of the numerator and denominator for the years presented:

---

| | | |
|:---|:---|:---|
|  | **For the six months ended <br> March 31,** | **For the six months ended <br> March 31,** |
|  | **2025** | **2024** |
| **Numerator:** |  |  |
| Net loss attributable to Linkage Global Inc | $(3087359) | $(1405766) |
| **Denominator:** |  |  |
| Weighted average number of ordinary shares\* | 3415533 | 2084890 |
| **Net loss per ordinary share** |  |  |
| – Basic and diluted | $(0.90) | $(0.67) |

---

\* The number of ordinary shares is the weighted average number based on both Class A ordinary shares and Class B ordinary shares, with each Class B ordinary share representing 100 voting rights.

**19. RELATED PARTY TRANSACTIONS**

 ****

***Related parties***

The following is a list of related parties which the Group has transactions with:

---

| | | |
|:---|:---|:---|
| **No.** | **Name of Related Parties** | **Relationship** |
| 1 | Mrs. Qi Xiaoyu | Shareholder of the Company |
| 2 | Mr. Fuyunishiki Ryo | Director and shareholder of the Company |
| 3 | Mr. Wu Zhihua | Director, former CEO, chairman of the Board and shareholder of the Company |
| 4 | Ms. Wu Shunyu | Department head of Digital Marketing Sales |
| 5 | Hermann Limited | Shareholder of the Company |
| 6 | Smart Bloom Global Limited | Shareholder of the Company, owned by Wu Zhihua |

---

***Amount due from related parties***

Amount due from related parties consisted of the following for the periods indicated:

---

| | | | |
|:---|:---|:---|:---|
|  |  | **As of <br> March 31,<br> 2025** | **As of <br> September 30, <br> 2024** |
| Hermman Limited<sup>(1)</sup> | Prepayment for service provided by related parties | $1142885 | $&nbsp;&nbsp;&nbsp;&nbsp; — |
| Mrs. Qi Xiaoyu<sup>(2)</sup> | Interest bearing loan to related parties | 100565 |  |
| Total |  | $1243450 | $— |

---

(1) The Company signed service agreement with Hermann Limited in
December 2023, providing corporate management and investment and financing consulting services for the Company for three years,
with contract amount of $2,060,000. Since Hermann Limited obtained a portion of the Company's mortgaged shares through the issuance of
convertible notes, and became a shareholder of the Company with a 7.1% shareholding ratio. Therefore, it was reclassified into amount due
from related parties on March 31, 2025. For the six months ended March 31, 2025, the amortized expense amount is $342,988, and the remaining
amount is $1,142,885.

(2) The loan had been returned in April 2025.

 ****

***Amounts due to related parties***

Amount due to related parties consisted of the following for the periods indicated:

---

| | | | |
|:---|:---|:---|:---|
|  |  | **As of <br> March 31,<br> 2025** | **As of <br> September 30, <br> 2024** |
| Mr. Fuyunishiki Ryo | Expenses paid on behalf of the Group | $— | $208943 |
| Ms. Wu Shunyu | Expenses paid on behalf of the Group |  | 105601 |
| Total |  | $— | $314544 |

---

 ****

**Linkage Global Inc NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Expressed in U.S. Dollars, except for the number of shares)**

**19. RELATED PARTY TRANSACTIONS** (Cont.)

***Related party transactions***

 ****

---

| | | |
|:---|:---|:---|
| | **For the six months ended March 31,** | **For the six months ended March 31,** |
| <br>**Nature** | **2025** | **2024** |
| ***Expenses paid on behalf of the Group by related parties*** |  |  |
| Mr. Fuyunishiki Ryo | $— | $65538 |
| Mrs. Qi Xiaoyu |  | 241147 |
| Ms. Wu Shunyu |  | 6130 |
| **Total** | $— | $312815 |

---

 ****

---

| | | |
|:---|:---|:---|
| | **For the six months ended March 31,** | **For the six months ended March 31,** |
| <br>**Nature** | **2025** | **2024** |
| ***Repayment to related parties*** |  | $ |
| Ms. Wu Shunyu | $105601 |  |
| Mr. Fuyunishiki Ryo | 208637 | 75849 |
| Mrs. Qi Xiaoyu |  | 253155 |
| **Total** | $314238 | $329004 |

---

---

| | | |
|:---|:---|:---|
| | **For the six months ended March 31,** | **For the six months ended March 31,** |
| <br>**Nature** | **2025** | **2024** |
| ***Interest bearing loan to related parties with an annual interest rate of 4%*** |  |  |
| Mrs. Qi Xiaoyu | $99876 | $— |
| **Total** | $99876 | $— |

---

---

| | | |
|:---|:---|:---|
| | **For the six months ended March 31,** | **For the six months ended March 31,** |
| <br>**Nature** | **2025** | **2024** |
| ***Service provided by related parties*** |  |  |
| Hermann Limited<sup>(1)</sup> | $342988 | $— |
| **Total** | $342988 | $— |

---

(1) The company signed service agreement with Hermann Limited in
December 2023, providing corporate management and investment and financing consulting services for the company for three years,
with contract amount of $2,060,000. Since Hermann Limited obtained a portion of the company's mortgaged shares through the issuance of
convertible notes, and became a shareholder of the company with a 7.1% shareholding ratio. Therefore, it was reclassified into amount due
from related parties on March 31, 2025. For the six months ended March 31, 2025, the amortized expense amount is $342,988, and the remaining
amount is $1,142,885.

---

| | | |
|:---|:---|:---|
| | **For the six months ended March 31,** | **For the six months ended March 31,** |
| <br>**Nature** | **2025** | **2024** |
| ******Stock-based compensation***<sup>(1)</sup>*** |  |  |
| Wu Zhihua | $1209000 | $— |
| **Total** | $1209000 | $— |

---

(1) On November 7, 2024, a resolution of the directors of the Company
was adopted to issue 5,000,000 Class B ordinary shares of par value US$0.00025 each (the New Shares) to WU Zhihua. Due to the fact that
Class B shares are not tradable and the voting rights are different from those of Class A shares, the price per share of $0.2418 is based
on the valuation report issued by appraisers.

**Linkage Global Inc NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Expressed in U.S. Dollars, except for the number of shares)**

**19. RELATED PARTY TRANSACTIONS (**Cont.)

---

| | | |
|:---|:---|:---|
| | **For the six months ended March 31,** | **For the six months ended March 31,** |
| <br>**Nature** | **2025** | **2024** |
| ***Repurchase of Class A Shares by issuing Class B Shares*** |  |  |
| Smart Bloom Global Limited (Wu Zhihua) | $500 | $— |
| **Total** | $500 | $— |

---

**20. CONCENTRATION OF CREDIT RISK**

Financial instruments that potentially expose the Group to concentrations of credit risk consist primarily of accounts receivable. The Group conducts credit evaluations of its Customers, and generally does not require collateral or other security from them. The allowance for credit losses for accounts receivable is based upon the current expected credit losses ("CECL") model. The CECL model requires an estimate of the credit losses expected over the life of accounts receivable since initial recognition, and accounts receivable with similar risk characteristics are grouped together when estimating CECL. The Group conducts periodic reviews of the financial condition and payment practices of its Customers to minimize collection risk on accounts receivable.

The following table sets forth a summary of single Customers who represent 10% or more of the Group's total revenue.

---

| | | |
|:---|:---|:---|
|  | **For the six months ended <br> March 31,** | **For the six months ended <br> March 31,** |
|  | **2025** | **2024** |
| Percentage of the Group's total revenue |  |  |
| Customer N | 25.37% | \* |
| Customer L | 24.09% | \* |
| Customer M | 12.43% | \* |
| Customer O | 12.10% | \* |
| Customer E | \* | 15.14% |
| Customer H | \* | 12.60% |
| Customer G | \* | 10.66% |

---

The following table sets forth a summary of single Customers who represent 10% or more of the Group's total accounts receivable:

---

| | | |
|:---|:---|:---|
|  | **As of <br> March 31, <br> 2025** | **As of <br> September 30, <br> 2024** |
| Percentage of the Group's accounts receivable |  |  |
| Customer K | 30.30% | 17.66% |
| Customer L | 25.54% | 14.17% |
| Customer M | 18.38% | 13.29% |
| Customer N | 16.52% | 10.51% |
| Customer E | \* | 42.10% |

---

The following table sets forth a summary of single Customers who represent 10% or more of the Group's total contract liabilities:

---

| | | |
|:---|:---|:---|
|  | **As of <br> March 31, <br> 2025** | **As of <br> September 30, <br> 2024** |
| Percentage of the Group's contract liabilities |  |  |
| Customer O | 44.16% | 22.79% |
| Customer J | 32.43% | 13.26% |
| Customer G | 22.25% | 17.41% |
| Customer P | \* | 13.08% |
| Customer Q | \* | 11.06% |

---

**Linkage Global Inc NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Expressed in U.S. Dollars, except for the number of shares)**

**20. CONCENTRATION OF CREDIT RISK** (cont.)

The following table sets forth a summary of single suppliers who represent 10% or more of the Group's total purchases:

---

| | | |
|:---|:---|:---|
|  | **For the six months ended March 31,** | **For the six months ended March 31,** |
|  | **2025** | **2024** |
| Percentage of the Group's purchase |  |  |
| Supplier S | 19.43% | \* |
| Supplier B | 17.61% | 13.15% |
| Supplier O | 14.81% | \* |
| Supplier F | 10.74% | \* |
| Supplier J | \* | 25.68% |
| Supplier H | \* | 10.85% |
| Supplier I | \* | 10.41% |

---

The following table sets forth a summary of single suppliers who represent 10% or more of the Group's total account payable to suppliers:

---

| | | |
|:---|:---|:---|
|  | **As of<br> March 31, <br> 2025** | **As of <br> September 30, <br> 2024** |
| Percentage of the Group's account payable |  |  |
| Supplier C | 60.92% | 33.07% |
| Supplier I | 11.91% | \* |
| Supplier O | \* | 20.05% |

---

The following table sets forth a summary of single suppliers who represent 10% or more of the Group's total advance to suppliers:

---

| | | |
|:---|:---|:---|
|  | **As of <br> March 31, <br> 2025** | **As of <br> September 30, <br> 2024** |
| Percentage of the Group's advance to |  |  |
| Supplier T | 95.61% | \* |
| Supplier P | \* | 46.85% |
| Supplier Q | \* | 27.22% |

---

\* represent percentage less than 10%

**21. COMMITMENTS AND CONTINGENCIES**

 ****

***Lease Commitments***

The total future minimum lease payments under the non-cancellable short-term operating lease which are not included in operating lease right-of-use assets and lease liabilities, with respect to the office and the warehouse as of March 31, 2025 are payable as follows:

 ****

---

| | |
|:---|:---|
|  | **Lease<br> Commitment** |
| Within 1 year | $— |

---

 ****

***Contingencies***

In the ordinary course of business, the Group may be subject to legal proceedings regarding contractual and employment relationships and a variety of other matters. The Group records contingent liabilities resulting from such claims, when a loss is assessed to be probable and the amount of the loss is reasonably estimable. In the opinion of management, there were no pending or threatened claims and litigation as of March 31, 2025 and through the issuance date of these unaudited interim condensed consolidated financial statements.

**Linkage Global Inc NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Expressed in U.S. Dollars, except for the number of shares)**

**22. SUBSEQUENT EVENTS**

*Deregistration of HQT Network Co., Limited*

 

HQT Network Co., Limited started the deregistration process on April 1, 2025. According to the Accounting Policy, the deregistration of HQT did not meet the criteria for presentation as a discontinued operation.

 

*Share Consolidation*

On April 7, 2025, the Company consolidated each 10 shares into 1 share. After the Share Consolidation, the authorized share capital of the Company be immediately decreased from US$2,500,000 divided into 9,980,000,000 Class A ordinary shares with a par value of US$0.00025 each and 20,000,000 Class B ordinary shares with a par value of US$0.0025 each into US$2,500,000 divided into 998,000,000 Class A ordinary shares with a par value of US$0.0025 each and 2,000,000 Class B ordinary shares with a par value of US$0.0025 each.

 

*Appoint a new CEO*

 

 

*Establish a new company Linkage Global U.S. Inc. in the USA*

On April 22, 2025 Linkage Global U.S. Inc. was established in 31 Hudson Yards OFC 51 New York.

 

*Shareholders repay loans.*

 

Mrs. Qi Xiaoyu had returned the whole amount of the loan of USD 100,565 in April 2025.

*Change of Independent Directors*

 

Ms. Hui Li a member of the board of director of the Company has resigned from the Board of Directors of the Company and as a member of the Company's audit committee, compensation committee and nominating and corporate governance committee effective as of April 30, 2025. On April 30, 2025, the Board of Directors of the Company (the "Board") appointed Yang Wang, the Company's Chief Executive Officer and Hong Chen to the Board.

 

*Entry into Securities Purchase Agreement*

 

On May 14, 2025, the Company entered into a Securities Purchase Agreement (the "Purchase Agreement") with 4 non-U.S. investors (the "Purchasers"), pursuant to which the Company agreed to issue and sell in a private placement offering (the "Private Placement") an aggregate of 4,000,000 ordinary shares (the "Shares"), par value $0.025 per share, at a purchase price per share of $0.50, for gross proceeds of $2,000,000, of which proceeds will be used for working capital and other general corporate purposes. The Private Placement closed on June 6, 2025.

The Group has evaluated subsequent events through the date these unaudited interim condensed consolidated financial statements are issued on July 3, 2025. The Group did not identify any subsequent events with a material financial impact on the Group's unaudited interim condensed consolidated financial statements.

## Exhibit 99.2

**Exhibit 99.2**

**MANAGEMENT'S DISCUSSION AND ANALYSIS OF<br> FINANCIAL CONDITION AND RESULTS OF OPERATIONS**

**OVERVIEW**

We, together with the Operating Entities in Japan, Hong Kong and mainland China, are a cross-border e-commerce integrated services provider based in Japan. There are two lines of businesses complementary to each other, including (i) cross-border sales and (ii) integrated e-commerce services. Our mission is to make cross-border transactions easier.

**Key Factors that Affect Operating Results**

We believe the key factors affecting our financial condition and results of operations include the following:

 ****

***Changes in global and local economic conditions***

Factors that could affect consumers' willingness to make discretionary purchases include general business conditions, levels of employment, interest rates and tax rates, the availability of consumer credit, and consumer confidence in future economic conditions. Events leading to uncertainty of global and local economic conditions, such as trade wars and occasional regional armed conflicts, could adversely impact consumer purchases of discretionary items such as beauty and health products. In the event of an economic downturn, consumer spending habits could be adversely affected and we could experience lower than expected net sales, which could force us to delay or slow down the implementation of our growth strategy and have a material adverse effect on our business, financial condition, profitability, and cash flows.

 ****

***Our ability to maintain our major Customers***

Approximately 83.85% and 53.72% of our total revenues were generated by our five largest Customers for the six months ended March 31, 2025 and 2024, respectively. For the six months ended March 31, 2025, 4 Customers accounted for approximately 25.37%, 24.09%, 12.43% and 12.10%, of which are greater than 10% of our total revenues in terms of monetary value, respectively. For the six months ended March 31, 2024, 3 Customers accounted for approximately 15.14%, 12.60% and 10.66%, of which are greater than 10% of our total revenues in terms of monetary value, respectively. For the fiscal year ended September 30, 2024, two Customers accounted for approximately 23.08%, and 10.11% of which are greater than 10% of our revenues in terms of monetary value, respectively. For the fiscal year ended September 30, 2023, three Customers accounted for approximately 11.99%, 10.76%, and 9.85% of which are greater than 10% of our revenues in terms of monetary value, respectively. While certain sales contracts and service contracts contain options of renewal, there is no assurance that our major Customers will continue their business relationships with us, or the revenue generated from transactions with them will be maintained or increased in the future. If we are unable to enter into new sales contracts or service contracts with our Customers upon the expiry of the current contracts, or there is a reduction or cessation of demands from these Customers for whatever reasons and we are unable to enter into sales contracts or service contracts of comparable size and terms in substitution, our business, financial conditions and results of operation may be materially and adversely affected.

***Our ability to compete successfully***

Over the years, we have been devoted to developing the integrated ERP system ("Linkage ERP System") for e-commerce sellers, and exploiting our advantages in supply chain services and networks. Through continuously upgrading, Linkage ERP System enables us to meet the ever-changing needs of e-commerce markets for various functions across sectors. At the platform level, the Company is equipped with digital capabilities, and takes both horizontal integration across different industries and vertical integration for various functions from the very beginning of opening an online store to the very end of analyzing the best-selling products. On the sales side, we are building a matrix based on a cross-regional and cross-ecommerce platform sales network. On the supply side, we rely on a large and high-quality supplier ecosystem, global warehousing and logistics network, and empower production through the self-developed private label smart electronics supply-chain system, to build efficient supply capabilities.

Our current or future competitors may have longer operating histories, greater brand recognition, better supplier relationships, larger customer bases, more cost-effective fulfillment capabilities, or greater financial, technical, or marketing resources than we do. Competitors may leverage their brand recognition, experience, and resources to compete with us in a variety of ways, including investing more heavily in research and development and making acquisitions for the expansion of their products. Some of our competitors may be able to secure more favorable terms from suppliers, devote greater resources to marketing and promotional campaigns, and adopt more aggressive pricing or inventory policies. In addition, new and enhanced technologies may increase the competition in the online retail market. There can be no assurance that we will be able to compete successfully against current or future competitors, and such competitive pressures may have a material adverse effect on our business, financial condition, and results of operations.

 ****

***Regulatory Environment***

The Operating Entities' business is subject to complex and evolving laws and regulations in Japan, Hong Kong and mainland China. Our ability to anticipate and respond to potential changes in government policies and regulations will have a significant impact on our business operations in such countries and our overall results of operations may likewise be impacted. Many of these laws and regulations are relatively new and subject to changes and uncertain interpretation, and could result in claims, changes to the Operating Entities' business practices, monetary penalties, increased cost of operations, declines in user growth or engagement, or other harm to their businesses. Although we have not experienced significant losses from potential changes in government policies and regulations and the Operating Entities are in compliance with existing laws and regulations, such experience may not be indicative of future results.

**Key Components of Our Results of Operations**

 ****

***Revenues***

We generate revenues from cross-border product sales and integrated e-commerce services.

Our breakdown of revenues by revenue streams for the six months ended March 31, 2025 and 2024 is summarized below:

---

| | | |
|:---|:---|:---|
|  | **For the six months ended <br> March 31,** | **For the six months ended <br> March 31,** |
|  | **2025** | **2024** |
|  | **USD** | **USD** |
| **Cross-border Sales** | **800751** | **4536131** |
| **Integrated E-commerce Services** | **2701196** | **262232** |
| &nbsp;&nbsp;&nbsp;Fully managed e-commerce operation services | 2591308 |  |
| &nbsp;&nbsp;&nbsp;Digital Marketing Services | 76907 | 128993 |
| &nbsp;&nbsp;&nbsp;Others | 32981 | 133239 |
| **Total revenues** | **3501947** | **4798363** |

---

Our breakdown of revenues by geographic areas for the six months ended March 31, 2025 and 2024 is summarized below:

---

| | | |
|:---|:---|:---|
|  | **For the six months ended <br> March 31,** | **For the six months ended <br> March 31,** |
|  | **2025** | **2024** |
|  | **USD** | **USD** |
| Hong Kong | 2668215 | 434294 |
| Japan | 431599 | 3496662 |
| Mainland China | 402133 | 867407 |
| **Total revenues** | **3501947** | **4798363** |

---

***Cost of Revenues***

Cost of revenues represents costs and expenses incurred in order to generate revenue. Our cost of revenues primarily consists of (i) cost of goods, (ii) commissions, and (iii) labor costs.

Our breakdown of cost of revenues for the six months ended March 31, 2025 and 2024 is summarized below:

---

| | | |
|:---|:---|:---|
|  | **For the Six Months Ended <br> March 31,** | **For the Six Months Ended <br> March 31,** |
|  | **2025** | **2024** |
|  | **USD** | **USD** |
| **Cross-border Sales** | **630079** | **3960119** |
| **Integrated E-commerce Services** | **174063** | **129367** |
| &nbsp;&nbsp;&nbsp;Fully managed e-commerce operation services | 126479 |  |
| &nbsp;&nbsp;&nbsp;Digital marketing services | 40620 | 116657 |
| &nbsp;&nbsp;&nbsp;Others | 6964 | 12710 |
| **Total cost of revenues** | **804142** | **4089486** |

---

***Gross Profit***

Our gross profit equals our revenue less our cost of revenues. Our gross profit is primarily affected by our ability to generate revenue and the fluctuation of our cost.

Our breakdown of gross profit by revenue stream for the six months ended March 31, 2025 and 2024 is set forth below:

---

| | | |
|:---|:---|:---|
|  | **For the six months ended <br> March 31,** | **For the six months ended <br> March 31,** |
|  | **2025** | **2024** |
|  | **USD** | **USD** |
| **Cross-border Sales** |  |  |
| &nbsp;&nbsp;&nbsp;Gross profit | 170672 | 576012 |
| &nbsp;&nbsp;&nbsp;Gross margin | 21.31% | 12.70% |
| **Integrated E-commerce Services** |  |  |
| &nbsp;&nbsp;&nbsp;Gross profit | 2527133 | 132865 |
| &nbsp;&nbsp;&nbsp;Gross margin | 93.56% | 50.67% |
| **Total** |  |  |
| &nbsp;&nbsp;&nbsp;Gross profit | 2697805 | 708877 |
| &nbsp;&nbsp;&nbsp;Gross margin | 77.04% | 14.77% |

---

***Operating expenses***

Operating expenses include general and administrative expenses, selling expenses, research and development expenses and disposal gain from property and equipment. General and administrative expenses mainly consist of (i) salary and social welfare expenses; (ii) rental cost for offices; and (iii) depreciation expenses; (iv) consulting fees; and (v) Allowance for credit loss. Selling expenses mainly consist of (i) salary and social welfare expenses; (ii) freight costs; and (iii) advertising costs and market promotion expenses. Research and development expenses mainly consist of (i) payroll and related expenses for research and development professionals; and (ii) technology services fees.

The following table sets forth our operating expenses, both in absolute amounts and as a percentage of the total operating expenses, for the six months ended March 31, 2025 and 2024:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **For the six months ended March 31,** | **For the six months ended March 31,** | **For the six months ended March 31,** | **For the six months ended March 31,** |
|  | **2025** | **2025** | **2024** | **2024** |
|  | **USD** | **%** | **USD** | **%** |
| General and administrative expenses | 3904027 | 90.04% | 1743309 | 76.8% |
| Selling and marketing expenses | 157637 | 3.64% | 228956 | 10.1% |
| Research and development expenses | 274371 | 6.32% | 297811 | 13.1% |
| **Total operating expenses** | **4336035** | **100.00%** | **2270076** | **100.00%** |

---

***Other expense, net***

Other expense, net mainly consists of (i) other non-operating income/(expenses) net; and (ii) Interest expenses, net.

**Results of Operations**

The following table sets forth a summary of our consolidated results of operations for the periods indicated. This information should be read together with our unaudited interim condensed consolidated financial statement for the six months ended March 31, 2025 and related notes included.The operating results in any period are not necessarily indicative of the results that may be expected for any future period.

***Six months ended March 31, 2025 Compared to Six months ended March 31, 2024***

 ****

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **For the six months ended <br> March 31,** | **For the six months ended <br> March 31,** | **Variance** | **Variance** |
|  | **2025** | **2024** | **Amount** | **%** |
|  | **USD** | **USD** | **USD** | |
| Revenues | 3501947 | 4798363 | (1296416) | (27.02)% |
| Cost of revenues | (804142) | (4089486) | 3285344 | (80.34)% |
| **Gross profit** | **2697805** | **708877** | **1988928** | **280.57%** |
| **Operating expenses:** |  |  |  |  |
| General and administrative expenses | (3904027) | (1743309) | (2160718) | 123.94% |
| Selling and marketing expenses | (157637) | (228956) | 71319 | (31.15)% |
| Research and development expenses | (274371) | (297811) | 23440 | (7.87)% |
| **Total operating expenses** | **(4336035)** | **(2270076)** | **(2065959)** | **91.01%** |
| **Operating loss** | **(1638230)** | **(1561199)** | **(77031)** | **4.93%** |
| **Other expenses:** |  |  |  |  |
| Interest expenses, net | (1496504) | (60726) | (1435778) | 2364.35% |
| Others non-operating income | 387816 | 998 | 386818 | 38759.32% |
| **Total other expenses, net** | **(1108688)** | **(59728)** | **(1048960)** | **1756.23%** |
| **Loss before income taxes** | **(2746918)** | **(1620927)** | **(1125991)** | **69.47%** |
| **Income tax (provision)/ benefit** | (340441) | 215161 | (555602) | (258.23)% |
| **Net loss** | **(3087359)** | **(1405766)** | **(1681593)** | **119.62%** |

---

 ****

 ****

***Revenues***

Total revenues decreased by approximately USD1.30 million, or 27.02%, from approximately USD4.80 million for the six months ended March 31, 2024 to approximately USD3.50 million for the six months ended March 31, 2025, primarily attributable to the decrease of cross-border sales.

Revenues from cross-border sales decreased by approximately USD3.74 million, or 82.35%, from approximately USD4.54 million for the six months ended March 31, 2024 to approximately USD0.80 million for the six months ended March 31, 2025. EXTEND, one of our subsidiaries in Japan, contributing approximately USD0.43 million, or 12.32% of total revenues, decreased 87.66% for the six months ended March 31, 2025 compared to the six months ended March 31, 2024. The decrease in cross-border sales was mainly due to the following reasons that, due to the poor performance of Japan's own cross-border sales product portfolio strategy, the previously 3C electronic products were not favored by the market, leading to a significant decline in sales. The company has now changed its development strategy, shifting its focus to Fully managed e-commerce operation services business with higher profit margins, and employees have also been transferred from the original cross-border trade business to the store agency operation business. For the cross-border sales business, the company is also reselecting products and exploring the possibility of launching Japanese TikTok stores and live-streaming sales.

Revenues from integrated e-commerce services increased by approximately USD2.44 million, or 930.08%, from approximately USD0.26 million for the six months ended March 31, 2024 to approximately USD2.70 million for the six months ended March 31, 2025, which was mainly contributed by the new business fully managed e-commerce operation services that were initiated in fiscal year ended March 31, 2025. The new business contributed revenue of USD2.59 million and gross profit of USD2.46 million. In this new business model, the company takes on a wide range of responsibilities and operations on behalf of the merchants, from product listing, marketing, customer service, sales, and financial settlement for online shops. The company charged service fee based on GMV (Gross Merchandise Volume) of the online store. The revenue from digital marketing services decreased from USD0.13 million for the six months ended March 31, 2024 to USD0.08 million for the six months ended March 31, 2025, because the company finished its business agreement with Google in January 2025, ceasing all related operations, and initiated the deregistration process in April 2025. Revenues generated from training and consulting services, and TikTok anchors agent services decreased USD0.10 million, or 75.25%, from approximately USD0.13 million for the six months ended March 31, 2024 to approximately USD0.03 million for the six months ended March 31, 2025.

 ****

***Cost of Revenues***

Our cost of revenues decreased by 80.34% from approximately USD4.09 million for the six months ended March 31, 2024 to approximately USD0.80 million for the six months ended March 31, 2025.

Our cost of revenues for cross-border sales decreased by approximately USD3.33 million, or 84.09%, from approximately USD3.96 million for the six months ended March 31, 2024 to approximately USD0.63 million for the six months ended March 31, 2025. The decrease was primarily attributable to the decrease of procurement costs, which is in line with the decrease of sales.

Our cost of revenues for integrated e-commerce services increased by approximately USD0.04 million, or 34.55%, from approximately USD0.13 million for the six months ended March 31, 2024 to approximately USD0.17 million for the six months ended March 31, 2025. Cost of revenues for new business fully managed e-commerce operation services was USD0.13 million, which mainly consist of the salaries of online store operation personnels. Cost of revenues for integrated e-commerce services were essentially the commissions paid to third-party agents for introducing new Merchants. The decrease in cost of commission costs was caused by the termination of the business.

***Gross Profit***

Our gross profit increased by approximately USD1.99 million, or 280.57%, from USD0.71 million for the six months ended March 31, 2024 to USD2.70 million for the six months ended March 31, 2025. The increase was primarily attributable by the new business fully managed e-commerce operation services with gross profit of USD2.46 million and gross profit margin of 95.12%. The high gross profit margin is mainly due to the low cost, which was mainly composed of the salaries of the operation personnel. The ERP system used for e-commerce operations has been developed, and the related research and development expenses were all recognized as expenses in previous years. Therefore, the system development expenses were not reflected in the current period's costs, resulting in a high gross profit margin for this business.

Gross profit margin of cross-border sales increased from 12.70% for the six months ended March 31, 2024 to 21.31% for the six months ended March 31, 2025. The increase was mainly due to that the product mix has changed, with an increase in high-margin products.

Gross profit margin of integrated e-commerce related services increased from 50.67% for the six months ended March 31, 2024 to 93.56% for the six months ended March 31, 2025. The increase was primarily attributable by the new business fully managed e-commerce operation services with gross profit of USD2.46 million and gross profit margin of 95.12%.

***Operating Expenses***

Our operating expenses, increased from USD2.27 million for the six months ended March 31, 2024 to USD4.34 million for the six months ended March 31, 2025, representing an increase of 91.01%. This increase was primarily attributable to the increases in our general and administrative expenses, offsetting the decrease in selling and marketing expenses and research and development expenses.

**<u>General and administrative expenses</u>**

General and administrative expenses mainly consist of (i) salary and social welfare expenses; (ii) rental costs for offices; (iii) depreciation expenses; (iv) consulting fees; and (v) Allowance for credit loss.

Our general and administrative expenses increased by 123.94% from USD1.74 million for the six months ended March 31, 2024 to USD3.90 million for the six months ended March 31, 2025, which was primarily attributable to the allowance for credit loss, the stock based compensation and the financial and legal related consulting services after the IPO proceeds. The allowance for credit loss increased from USD0.57 million for the six months ended March 31, 2024 to USD1.34 million for the six months ended March 31, 2025. For the stock based compensation of USD 1.21 million, on November 7, 2024, a resolution of the directors of the Company was adopted to issue 5,000,000 Class B ordinary shares of par value US$0.00025 each (the New Shares) to WU Zhihua. Due to the fact that Class B shares are not tradable and the voting rights are different from those of Class A shares, the price per share of $0.2418 is based on the valuation report issued by appraisers.

**<u>Selling and marketing expenses</u>**

Selling and marketing expenses mainly consist of (i) salary and social welfare expenses; (ii) freight; and (iii) advertising costs and marketing and promotion expenses.

Our selling expenses decreased by 31.15% from USD0.23 million for the six months ended March 31, 2024 to USD0.16 million for the six months ended March 31, 2025, which was primarily attributable to a decrease of freight expenses and advertising costs and marketing and promotion expenses due to the decrease in sales.

**<u>Research and development expenses</u>**

Research and development expenses consist primarily of (i) payroll and related expenses for research and development professionals; and (ii) technology services fees. Research and development expenses are expensed as incurred.

Research and development expenses decreased by 7.87% from USD0.30 million for the six months ended March 31, 2024 to USD0.27 million for the six months ended March 31, 2025. The drop in research and development expenses was due to the personnel who participated in the development and testing of the ERP system in previous years are engaged in the fully managed e-commerce operation services in the current year, and their salaries were included in the costs of the business. Our research project was mainly related to the development of a one-stop e-commerce platform, and we continuously improve the functions and efficiency of the platform.

 ****

***Other expenses, net***

Other expense, net mainly consists of (i) other non-operating income/(expenses) net; and (ii) Interest expenses, net.

Other non-operating income increased from USD998 for the six months ended March 31, 2024 to USD0.39 million for the six months ended March 31, 2025. The increase was mainly contributed by the deregistration of the subsidiary HQT. In April 2025, HQT began the deregistration process. The liquidation of current accounts generated a gain of USD0.35million.

Interest expenses, net increased from USD0.06 million for the six months ended March 31, 2024 to USD1.50 million for the six months ended March 31, 2025. The reason for the increase in interest expense was that the company issued USD10 million convertible notes with an actual interest rate of 42.52% in October 2024, generating interest expenses of USD1.56 million in the current period.

 ****

***Income tax (provision) /benefit***

Our income tax (provision) /benefit decreased by USD0.56 million, from USD0.02 million of tax benefit for the six months ended March 31, 2024 to USD0.34 million of tax expenses for the six months ended March 31, 2025. This decrease was primarily attributable to net profit for the Fully managed e-commerce operation services with a tax rate of 16.5%.

 ****

***Net loss***

As a result of the foregoing, our net loss increased by USD1.68 million, or 119.62%, from USD1.41 million for the six months ended March 31, 2024 to USD3.09 million for the six months ended March 31, 2025.

**Liquidity and Capital Resources**

In assessing our liquidity, we monitor and analyze our cash on-hand and our operating and capital expenditure commitments. As of the date of this report, we have financed our working capital requirements from cash flow from operations, debt and equity financings and capital contributions from our existing shareholders.

As of March 31, 2025, we had cash of USD0.33 million on hand. Our working capital was approximately USD7.44 million as of March 31, 2025.

In December 2023, we completed our initial public offering and our Ordinary Shares have been listed on the Nasdaq Capital Market under the symbol "LGCB". 1,500,000 Ordinary Shares were issued at a price of $4.00 per share, resulting in net proceeds of approximately $5.4 million, after deducting underwriting discounts, commissions and other offering expenses totaling $0.6 million. See "Item 14 MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS—Use of Proceeds."

Currently, we plan to use our own cash to support our short-term business growth goal. We believe our current working capital is sufficient to support our operations for the next twelve months. We may, however, need additional cash resources in the future if we experience changes in business conditions or other developments, or if we find and wish to pursue opportunities for investment, acquisition, capital expenditure or similar actions. If we determine that our cash requirements exceed the amount of cash and cash equivalents we have on hand at the time, we may seek to issue equity or debt securities or obtain credit facilities. The issuance and sale of additional equity would result in further dilution to our shareholders. The incurrence of indebtedness would result in increased fixed obligations. Our obligation to bear credit risk for certain financing transactions we facilitate may also strain our operating cash flow. We cannot assure you that financing will be available in amounts or on terms acceptable to us, if at all.

Current foreign exchange and other regulations in the PRC may restrict the PRC subsidiaries in their ability to transfer their net assets to us and the subsidiaries in Hong Kong. However, as of the date of this report, these restrictions have no impact on the ability of these PRC entities to transfer funds to us, as we do not anticipate declaring or paying any dividends in the foreseeable future, and plan to retain our retained earnings to continue to grow our business. In addition, these restrictions have no impact on the ability for us to meet our cash obligations.

There are no foreign exchange or other regulations in Japan or Hong Kong that restrict EXTEND and the Hong Kong subsidiaries in their ability to transfer their net assets to us

**Cash Flows**

 ****

***Cash Flows for the six months ended March 31, 2025, compared to the six months ended March 31, 2024***

The table below sets forth our cash flows for the six months ended March 31, 2025 and 2024.

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **For the six months ended <br> March 31,** | **For the six months ended <br> March 31,** | **Change** | **Change** |
|  | **2025** | **2024** | **Amount** | **%** |
|  | **USD** | **USD** | **USD** | |
| Net cash used in operating activities | (1738971) | (3811127) | 2072156 | (54.37)% |
| Net cash used in investing activities | (8739876) |  | (8739876) | 100.00% |
| Net cash provided by financing activities | 8736562 | 4246336 | 4490226 | 105.74% |
| Effects of exchange rate changes on cash | 69634 | (58969) | 128603 | (218.09)% |
| **Net (decrease)/increase in cash** | (1672651) | 376240 | (2048891) | (544.57)% |
| Cash at the beginning of the periods presented | 2000732 | 1107480 | 893252 | 80.66% |
| **Cash at the end of the periods presented** | 328081 | 1483720 | (1155639) | (77.89)% |

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***Operating activities***

For the six months ended March 31, 2025, our net cash used in operating activities was USD1.74 million, which was primarily attributable to net loss of USD1.88 million, adjusted for cash outflow of (i) an increase of accounts receivable, net of USD1.65 million due to the long credit terms of 7 to 9 months given to the clients of fully managed e-commerce operation services business; (ii)a decrease of account payable of USD0.3 million; (iii) Effect of exchange rate changes of USD0.2 million contributed by the fully managed e-commerce operation services business; (iv) a decrease of contract liabilities by USD0.33 million, offset by cash inflow of (i) Unpaid interests for convertible notes of USD1.56 million (ii) Allowance for credit loss of USD1.34 million, (iii) Amount due from related parties of USD 0.3 million.

For the six months ended March 31, 2024, our net cash used in operating activities was $3.8 million, primarily attributable to net loss of $1.4 million, as adjusted by non-cash and non-operating items, which primarily comprised effect of payment for prepaid expenses.

 ****

***Investing activities***

For the six months ended March 31, 2025, our net cash used in investing activities was approximately USD8.74 million, which was due to lending interest-bearing loan to third party of USD8.67 million and interest-bearing loan to related party of USD0.10 million.

For the six months ended March 31, 2024, our net cash provided by investing activities was nil.

 ****

***Financing activities***

For the six months ended March 31, 2025, our net cash provided by financing activities was approximately USD8.74 million, which was primarily due to proceeds from the issuance of convertible notes of USD9.00 million, offset by repayments for short- term and long-term borrowings of USD0.27 million.

For the six months ended March 31, 2024, our net cash provided by financing activities was approximately USD4.2 million, which was primarily due to proceeds from IPO.

As of March 31, 2025 and September 30, 2024, the short-term debts were for working capital purposes. Short-term debts consist of the following:

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **Bank** | **Annual <br> Interest <br> Rate** | **Maturity** | **Maturity** | **As of<br> March 31,<br> 2025** | **As of<br> September 30,<br> 2024** |
|  | |  |  | **USD** | **USD** |
| Higashi-Nippon Bank | 1.55% | 12/29/2023 | 12/25/2024 |  | 32810 |
|  |  |  |  |  | 32810 |

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As of March 31, 2025 and September 30, 2024, long-term debts consist of the following:

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| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| | | | | **As of <br> March 31,<br> 2025** | **As of <br> March 31,<br> 2025** | **As of <br> September 30,<br> 2024** | **As of <br> September 30,<br> 2024** | |
| <br>**Bank and other financial institution** |<br>**Annual<br> Interest<br> Rate** | <br>**Start** | <br>**End** | **Long-term** | **Long-term<br> (current<br> portions)** | **Long- term** | **Long-term<br> (current<br> portions)** | <br>**Pledge** |
|  | |  |  | **USD** | **USD** | **USD** | **USD** |  |
| The Shoko Chukin Bank | 1.11% | 05/26/2020 | 04/25/2030 | 82456 | 20174 | 96838 | 21110 |  |
| The Shoko Chukin Bank | 1.50% | 02/04/2022 | 01/27/2025 |  |  |  | 21780 |  |
| Mizuho Bank | 0.83% | 03/25/2020 | 03/25/2025 |  |  |  | 6855 |  |
| Mizuho Bank | 2.00% | 06/01/2021 | 06/01/2031 | 105070 | 20013 | 120419 | 20942 |  |
| Japan Finance Corporation | 1.11% | 07/16/2020 | 06/30/2030 | 140227 | 36424 | 164328 | 38115 |  |
| Musashino Bank | 1.50% | 05/31/2022 | 06/02/2025 |  | 10967 |  | 46408 |  |
| Japan Finance Corporation | 0.46% | 06/09/2020 | 04/20/2030 | 85390 | 20494 | 98290 | 21445 |  |
| Japan Finance Corporation | 0.38% | 04/23/2021 | 03/20/2031 | 34022 | 7372 | 38569 | 7714 |  |
| Kiraboshi Bank | 0.50% | 06/27/2023 | 05/30/2032 | 286858 | 43362 | 321116 | 45376 |  |
| Zhongli International Financial Leasing Co. LTD | 14.56% | 08/11/2022 | 08/15/2025 |  | 57420 |  | 130625 |  |
| Zhongli International Financial Leasing Co. LTD | 13.63% | 07/26/2022 | 07/26/2025 |  | 27331 |  | 68332 | Vehicle |
|  |  |  |  | 734023 | 243557 | 839560 | 428702 |  |

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**Contingencies**

From time to time, we may become involved in litigation relating to claims arising in the ordinary course of the business. There are no claims or actions pending or threatened against us that, if adversely determined, would in our judgment have a material adverse effect on us.

**Off-balance Sheet Commitments and Arrangements**

We have not entered into any off-balance sheet financial guarantees or other off-balance sheet commitments to guarantee the payment obligations of any third parties. We have not entered into any derivative contracts that are indexed to our shares and classified as shareholder's equity or that are not reflected in our consolidated financial statements. Furthermore, we do not have any retained or contingent interest in assets transferred to an unconsolidated entity that serves as credit, liquidity or market risk support to such entity. We do not have any variable interest in any unconsolidated entity that provides financing, liquidity, market risk or credit support to us or engages in leasing, hedging or product development services with us.

**Contractual Obligations**

The total future minimum lease payments under the non-cancellable short-term operating lease which are not included in operating lease right-of-use assets and lease liabilities, with respect to the office and the warehouse as of March 31, 2025 are payable as follows:

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| | |
|:---|:---|
|  | **Lease<br> Commitment** |
| Within 1 year | $— |

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See "Item 4. Information on the Company—B. Business Overview—Properties" in the Company's annual report on Form 20-F for the year ended September 30, 2024 for commitments under long-term operating lease for more information. Other than that, we did not have any undisclosed significant capital and other commitments, long-term obligations, or guarantees as of March 31, 2025.

**Inflation**

Inflation in Japan and the PRC does not materially affect our results of operations.

**Seasonality**

The Operating Entities have experienced, and expect to continuously experience, seasonal fluctuations in their results of operations, due to seasonal changes in sales volume, as well as seasonality in our advertising services. For example, the Operating Entities generally experience lower sales volume in the first quarter of each year primarily due to Chinese New Year holiday season and higher sales volume in the third quarter of each year primarily due to their special seasonable promotion events held in September and November each year. In addition, the business hours of the Operating Entities' logistics and fulfillment service will be impacted by the holidays Moreover, the Operating Entities' results of operations may fluctuate due to changes in production cycle and launch of new styles or events.

**Taxation**

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***Cayman Islands***

Under the current laws of the Cayman Islands, the Company is not subject to income or capital gains taxes. In addition, dividend payments are not subject to withholdings tax in the Cayman Islands.

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***Hong Kong***

According to Tax (Amendment) (No. 3) Ordinance 2018 published by Hong Kong government, from April 1, 2018, under the two-tiered profits tax rates regime, the profits tax rate for the first HKD2 million of assessable profits will be lowered to 8.25% (half of the rate specified in Schedule 8 to the Inland Revenue Ordinance (IRO)) for qualified corporations, and assessable profits above HK$2,000,000 will be taxed at 16.5%. The assessable profits of corporations which is not qualifying for the two-tiered profits tax rates regime, will continue to be taxed at a flat rate of 16.5%.

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***PRC***

Under the Enterprise Income Tax Laws of the PRC, or the EIT Laws, domestic enterprises and Foreign Investment Enterprises, or the FIEs, are usually subject to a unified 25% enterprise income tax rate, while preferential tax rates, tax holidays and tax exemption may be granted on case-by-case basis.

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***Japan***

Japan has a progressive tax system, of which its corporate income tax is calculated on the estimated assessable profits for the six months ended March 31, 2025 and 2024 times applicable tax rates. EXTEND is subject to national corporate income tax, inhabitant tax, and enterprise tax in Japan, which in the aggregate, resulted in the statutory income tax rate of approximately 36.8% and 36.8% for the six months ended March 31, 2025 and 2024, respectively.

The effective income tax rate was approximately -12.39% and 13.27% for the six months ended March 31, 2025 and 2024, respectively.

**Critical Accounting Policies and Estimates**

We consider an accounting estimate to be critical if: (i) the accounting estimate requires us to make assumptions about matters that were highly uncertain at the time the accounting estimate was made, and (ii) changes in the estimate that are reasonably likely to occur from period to period or use of different estimates that we reasonably could have used in the current period, would have a material impact on our financial condition or results of operations. When reading our consolidated financial statements, you should consider our selection of critical accounting policies, the judgment and other uncertainties affecting the application of such policies and the sensitivity of reported results to changes in conditions and assumptions. For a detailed discussion of critical accounting estimate of (i) revenue recognition; (ii) allowance for doubtful accounts; (iii) accounting for deferred income taxes and valuation allowance for deferred tax assets; (iv) and valuation of stock-based compensation expense.

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***Accounts receivable, net***

Accounts receivable represents the Company's right to consideration in exchange for goods and services that the Company has transferred to the customers before payment is due. Accounts receivable is stated at the historical carrying amount, net of an estimated allowance for uncollectible accounts. The group has adopted ASU 2016-13 on a modified retrospective basis since October 1, 2023, and the impact on opening balance is $863,328. The allowance for credit losses for accounts receivable is based upon the current expected credit losses ("CECL") model. The CECL model requires an estimate of the credit losses expected over the life of accounts receivable since initial recognition, and accounts receivable with similar risk characteristics are grouped together when estimating CECL. In assessing the CECL, the Company applies a roll rate-based method that considers historical collectability based on past due status, the age of the balances, credit quality of the Company's customers based on ongoing credit evaluations, current economic conditions, reasonable and supportable forecasts of future economic conditions, and other factors that may affect the Company's ability to collect from customers. The Company's management continues to evaluate the reasonableness of the valuation allowance policy and updates it if necessary. Additionally, the Company evaluates individual customer's financial condition, credit history, and the current economic conditions to make specific provision of credit loss when it is considered necessary, based on (i)the Company's specific assessment of the collectability of all significant accounts, and (ii) any specific knowledge the Company has acquired that might indicate that an account is uncollectible. The fact and circumstance of each account may require the Company to use substantial judgment in assessing its collectability, The allowance is based on management's best estimate of specific losses on individual exposures, as well as a provision on historical trends of collections. Account balances are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. The Company's management continues to evaluate the reasonableness of the valuation allowance policy and updates it if necessary.

*Specific allowance for credit losses*

 

The Group identify specific allowance for clients of fully managed e-commerce operation services business based on the credit term. There are 4 clients with account receivables of USD5,802,785 as of March 31, 2025. The group provided credit terms from seven to nine months based on the company's experience. Online stores usually invest a relatively large portion of their profits in advertising and promotions in the early stage. Generally, it will take seven to nine months before there is a certain amount of surplus funds. The accounts receivable of USD1,670,361 that had reached the credit period on March 31, 2025 had been collected in June 2025. The company conducted due diligence on clients in the early stage and it is expected that there is no risk of credit loss, so no credit loss had been accrued for amounts that have not yet reached the credit period.

For purposes of this section only, the term "Customers" shall mean (i) cross-border e-commerce sellers (both enterprises and individuals) that purchase products, e-commerce operation training, and software support services, (ii) media that pay the Company's subsidiaries commissions. (iii) the owners of online store in fully managed e-commerce operation services business.

**Revenue Recognition**

Our revenues are mainly generated from 1) cross-border sales, 2) integrated e-commerce services.

We recognize revenue pursuant to ASC 606, Revenue from Contracts with Customers ("ASC 606"). In accordance with ASC 606, revenues from contracts with customers are recognized when control of the promised goods or services is transferred to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services, reduced by estimates for return allowances, promotional discounts, commissions and business tax and Value Added Tax ("VAT"). To achieve the core principle of this standard, we applied the following five steps:

&nbsp;&nbsp;&nbsp;&nbsp;1. Identification
of the contract, or contracts, with the Customer;

&nbsp;&nbsp;&nbsp;&nbsp;2. Identification
of the performance obligations in the contract;

&nbsp;&nbsp;&nbsp;&nbsp;3. Determination
of the transaction price;

&nbsp;&nbsp;&nbsp;&nbsp;4. Allocation
of the transaction price to the performance obligations in the contract; and

&nbsp;&nbsp;&nbsp;&nbsp;5. Recognition
of the revenue when, or as, a performance obligation is satisfied.

Each of our significant performance obligations and our application of ASC 606 to our revenue arrangements are discussed in further detail below.

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***<u>Cross-border sales</u>***

We engage in the sale of food, beauty and personal care products, health products, private label smart electronics and other consumer products in Asia, by exploiting our advantages in global supply chain services and networks. We fulfil our performance obligations by transferring products to the designated location. In accordance with the customary business practices, for international sales, the delivery term is "Cost and Freight" ("CFR", formerly known as "C&F", which the seller bears the freight costs) and "Free on Board" ("FOB", which the buyer bears the freight costs) shipping point. The majority of transactions were based on FOB. Under both delivery terms, once the products are loaded on board, control of products has transferred. Since shipping activities are performed after customers obtain control of the products, we elect to account for shipping as activities to fulfill the promise to transfer the good, in accordance with ASC 606-10-25-18B. Therefore, freight costs are accrued when products are delivered to the designated location, before shipping activities occur. For the remaining domestic sales, the control of products has transferred upon the time when the products are delivered to the place designated by customers. Shipping activities are performed before customers obtain control of the good, and hence, should not be considered a separate performance obligation. As a result, both cost of goods and freight costs are recognized at the same time when products are delivered to the designated location, after shipping activities are completed. Revenue generated from cross-border sales is recognized based on the product value specified in the contract at a point in time when the control of products has transferred for both international sales and domestic sales.

The Company has two logistics methods. For the products exported from mainland China, the suppliers will directly deliver them to customers. For the products purchased directly from suppliers in Japan, the Company has its own warehouse in Japan. The products will be first sent to the company's warehouse and then delivered to the customers.

For products shipped directly from suppliers to customers, pursuant to ASC 606-10-55-37A(a), we obtain control the of the products as we are primarily responsible for the contract and have pricing discretion. We are primarily responsible for the contract, as we have the supplier discretion when executing orders and we are the only party that has a contractual relationship with customers. We establish and obtain substantially all of the benefits from transactions, i.e. consideration paid by customers. Therefore, we consider ourselves to be the principal in the transactions on the basis that we are primarily responsible to fulfill the promise and have the price discretion, pursuant to ASC 606-10-55-39.

For products shipped from us to customers, we consider ourselves the principal because we are in control of establishing the transaction price, arranging the whole process of transactions and bearing inventory risk. Therefore, such revenues are reported on a gross basis.

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***<u>Integrated e-commerce services</u>***

We partner with premium social media platforms and provides digital marketing services to meet the needs of the Merchants.

For digital marketing services, we act as an authorized agent persuading Merchants to display ads on social media platforms. In return, we receive commissions from social media platforms. We receive commissions from social media platforms when Merchants place ads on such platforms over the periods when we maintain contractual relationship with them. Revenue from digital marketing services is recognized over the contractual period for actual qualifying ads placed calculated by social media platforms. We have adopted "right to invoice" practical expedient and recognize revenues based on quarterly billing reports received from social media platforms. We consider ourselves the agent because we are not primarily responsible for fulfilling the promise to render digital marketing services. Therefore, such revenues are reported on a net basis. During the reporting periods, all revenue of the digital marketing services was generated from us acting as an authorized agent on behalf of the social media platforms.

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***<u>Fully managed e-commerce operation services</u>***

We have been providing fully managed e-commerce operation services to sellers on Japanese cross-border e-commerce platforms since April 2024. Usually, our clients have their own factories and products, and they open online stores on Japanese e-commerce platforms and then entrust the daily management and marketing of the stores to us for handling throughout full operational cycle. The services mainly include:

● Online shop setup: 1) store page design and decoration, 2) payment settings, and 3) products listing;

● Online shop promotion: design marketing plans and product combinations to attract customers; and

● Customer service: post-sales customer service.

Clients are only responsible for the delivery of goods. We charge a service commission based on GMV (Gross Merchandise Volume) of the online shop. We consider ourself an agent because clients own the online shops and inventories. We only provide services and has no control right over the stores or inventories, nor does it bear the inventory risks. Therefore, such revenues are reported on a net basis.

For other integrated e-commerce services, revenue is generated from e-commerce related training/consulting services. We fulfil our performance obligation by providing e-commerce related training/consulting services, and revenue is recognized over the service period.

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***Income taxes***

Current income tax assets and liabilities for the current and prior periods are measured at the amount expected to be recovered from, or paid to, the tax authorities. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted at the end of the reporting period.

We account for income taxes under ASC 740. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the consolidated financial statement carrying amounts of existing assets and liabilities and their respective tax bases ("Temporary differences").

Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those Temporary differences are expected to be recovered or settled. Deferred tax is calculated at the tax rates that are expected to apply in the periods in which the asset or liability will be settled, based on rates enacted or substantively enacted at the end of the reporting period. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized.

The provisions of ASC 740-10-25, "Accounting for Uncertainty in Income Taxes," prescribe a more-likely- than-not threshold for consolidated financial statement recognition and measurement of a tax position taken (or expected to be taken) in a tax return. This interpretation also provides guidance on the recognition of income tax assets and liabilities, classification of current and deferred income tax assets and liabilities, accounting for interest and penalties associated with tax positions, and related disclosures.

Guidance was also provided on derecognition of income tax assets and liabilities, classification of current and deferred income tax assets and liabilities, accounting for interest and penalties associated with tax positions, accounting for income taxes in interim periods, and income tax disclosures. Significant judgment is required in evaluating our uncertain tax positions and determining provision for income taxes. We did not recognize any significant interest and penalties associated with uncertain tax positions for the six months ended March 31, 2025 and 2024, we did not have any significant unrecognized uncertain tax positions. We do not expect that its assessment regarding unrecognized tax positions will materially change over the next 12 months.

***Stock-Based Compensation***

The Company accounts for stock-based compensation under ASC 718 "*Compensation - Stock Compensation*" using the fair value-based method. Under this method, compensation cost is measured at the grant date based on the value of the award and is recognized over the shorter of the service period or the vesting period of the stock-based compensation. This guidance establishes standards for the accounting for transactions in which an entity exchanges its equity instruments for goods or services. It also addresses transactions in which an entity incurs liabilities in exchange for goods or services that are based on the fair value of the entity's equity instruments or that may be settled by the issuance of those equity instruments.

The Company estimates the fair value of each stock option at the grant date by using the Black-Scholes option pricing model. Determining the fair value of stock-based compensation at the grant date under this model requires judgment, including estimating volatility, employee stock option exercise behaviors and forfeiture rates. The assumptions used in calculating the fair value of stock-based compensation represent the Company's best estimates, but these estimates involve inherent uncertainties and the application of management judgment.

When determining fair value of stock options, the Company considers the following assumptions in the Black-Scholes model:

● Exercise price,

● Expected dividends,

● Expected volatility,

● Risk-free interest rate; and

● Expected life of option

**Internal Control Over Financial Reporting**

Prior to this offering, we have been a private company with limited accounting personnel and other resources to address our internal controls and procedures. Our independent registered public accounting firm had not conducted an audit of our internal control over financial reporting. However, in connection with the reviews of our condensed consolidated financial statements for the six months ended March 31, 2024 and 2023, and the audits of our consolidated financial statements for the years ended September 30, 2023 and 2022, we and our independent registered public accounting firm identified the following "material weaknesses" in our internal control over financial reporting, as defined in the standards established by the PCAOB, and other control deficiencies. A "material weakness" is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis.

The two material weaknesses that have been identified related to:

● Our lack of formal internal control policies and internal independent supervision functions to establish formal risk assessment process and internal control framework; and

● Our lack of accounting staff and resources with appropriate knowledge of generally accepted U.S. GAAP and SEC reporting and compliance requirements to design and implement formal period-end financial reporting policies and procedures to address complex U.S. GAAP technical accounting issue in accordance with U.S. GAAP and the SEC requirements.

In response to the material weaknesses identified prior to this offering, we are in the process of implementing a number of measures, which will include:

● the hiring of additional qualified accounting and financial personnel with appropriate knowledge and experience in U.S. GAAP accounting and SEC reporting, and

● the organization of regular training for our accounting staffs, especially training related to U.S. GAAP and SEC reporting requirements.

We plan to adopt additional measures to improve our internal control over financial reporting, including, among others, creating U.S. GAAP accounting policies and procedures manual, which will be maintained, reviewed and updated, on a regular basis, to the latest US GAAP accounting standards, and establishing an audit committee and strengthening corporate governance.

However, we cannot assure you that we will remediate our material weaknesses in a timely manner. See "Risk Factors - Risks Relating to Our Business and Industry - If we fail to implement and maintain an effective system of internal controls or fail to remediate the material weaknesses in our internal control over financial reporting that have been identified, we may fail to meet our reporting obligations or be unable to accurately report our results of operations or prevent fraud, and investor confidence and the market price of our Ordinary Shares may be materially and adversely affected."

As a company with less than US$1.235 billion in revenues for our last fiscal year, we qualify as an "emerging growth company" pursuant to the Jumpstart Our Business Startups Act ("JOBS Act"). An emerging growth company may take advantage of specified reduced reporting and other requirements that are otherwise applicable generally to public companies. These provisions include exemption from the auditor attestation requirement under Section 404 of the Sarbanes-Oxley Act of 2002, in the assessment of the emerging growth company's internal control over financial reporting.

**Quantitative and Qualitative Disclosure of Market Risk**

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***Foreign Exchange Risk***

Our business is mainly conducted in Japan, and our books and records are maintained in JPY. The PRC subsidiaries apply RMB as their functional currency. The reporting currency of consolidated financial statements that we file with the SEC and provide to our shareholders are presented in U.S. dollars. Changes in the exchange rates between the JPY and the U.S. dollar, and RMB and the U.S. dollar, affect the value of our assets and results of operations, when presented in U.S. dollars.

The value of the JPY against the U.S. dollar, the RMB against the U.S. and other currencies may fluctuate and is affected by, among other things, changes in the Japanese political and economic conditions and perceived changes in the economy of Japan, the PRC and the United States. Any significant revaluation of the JPY and RMB may materially and adversely affect our cash flows, revenue, and financial condition.

We do not believe that it currently has any significant direct foreign exchange risk and has not used derivative financial instruments to hedge exposure to such risk. While we may decide to enter into more hedging transactions in the future, the availability and effectiveness of these hedges may be limited and we may not be able to adequately hedge our exposure or at all. As a result, fluctuations in exchange rates may have a material adverse effect on your investment.

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***Credit Risk***

Financial instruments that potentially expose us to concentrations of credit risk consist primarily of accounts receivable. We conduct credit evaluations of our customers, and generally do not require collateral or other security from them. We evaluate our collection experience and long outstanding balances to determine the need for an allowance for doubtful accounts. We conduct periodic reviews of the financial condition and payment practices of our customers to minimize collection risk on accounts receivable.

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***Inflation Risk***

In recent years, inflation has not had a material impact on our results of operations. According to the Statistics Bureau of Japan, the inflation rate in Japan is expected to be/was approximately 2.4% and 2.7% in 2025 and 2024, respectively. According to the Statistics Bureau of the PRC, the inflation rate in the PRC is expected to be/was approximately 3% and 2.8% in 2025 and 2024, respectively. Although we have not in the past been materially affected by inflation since our inception, we can provide no assurance that we will not be affected in the future by higher rates of inflation in Japan. If inflation rises, it may materially and adversely affect our business.

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***Change in Registrant's Certifying Accountant***

On June 25, 2024, the audit committee of the board of directors of Linkage Global Inc (the "Company") approved the dismissal of TPS, an independent registered public accounting firm, and approved and ratified the engagement of HTL International, LLC ("HTL") on June 14, 2024 to serve as the independent registered public accounting firm of the Company for the fiscal year ending September 30, 2024.

TPS's report on the Company's financial statements for the fiscal years ended September 30, 2023 and 2022 did not contain an adverse opinion or disclaimer of opinion, nor were they qualified or modified as to uncertainty, audit scope, or accounting principles. Furthermore, during the Company's two most recent fiscal years and through June 14, 2024, there were no disagreements with TPS on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which disagreements, if not resolved to TPS's satisfaction, would have caused TPS to make reference to the subject matter of the disagreement in connection with its report on the Company's financial statements for such periods. During the Company's two most recent fiscal years and through June 14, 2024, there were no "reportable events" as that term is described in Item 16F(a)(1)(v) of Form 20-F, other than the material weaknesses reported by management under Item 15 of the Company's annual report on Form 20-F for the fiscal year ended September 30, 2023, as filed with the SEC on April 12, 2024.

The Company has provided TPS with a copy of the above disclosure and requested that TPS furnish a letter addressed to the Commission stating whether or not it agrees with the above statements. A copy of TPS's letter dated June 25, 2024 is attached as Exhibit 16.1 to the Form 6-K filed with the SEC on June 25, 2024.

During the two most recent fiscal years and any subsequent interim periods prior to the engagement of HTL, neither the Company, nor someone on behalf of the Company, has consulted HTL regarding either the application of accounting principles to a specified transaction, whether completed or proposed, or the type of audit opinion that might be rendered on the Company's consolidated financial statements. Neither a written report was provided to the Company nor was any oral advice provided that HTL concluded was an important factor considered by the Company in reaching a decision as to the accounting, auditing, or financial reporting issue. Additionally, neither the Company, nor anyone on behalf of it, has consulted HTL regarding any matter that was the subject of a disagreement as defined in Item 16F(a)(1)(iv) of Form 20-F and related instructions to Item 16F of Form 20-F, or any reportable events as described in Item 16F(a)(1)(v) of Form 20-F.

## Exhibit 99.3

**Exhibit 99.3**

**Linkage Global Inc Announces First Half 2025 Financial Results**

TOKYO, July 3, 2025 (GLOBE NEWSWIRE) -- Linkage Global Inc ("Linkage Cayman", or the "Company"), a cross-border e-commerce integrated services provider headquartered in Japan, today announced its unaudited financial results for the six months ended March 31, 2025.

**First Half 2025 Selected Financial Metrics**

● Total revenues decreased by approximately $1.30 million to approximately $3.50 million for the six months ended March 31, 2025, compared to approximately $4.80 million for the same period of 2024.

● Gross profit increased by approximately $1.99 million to $2.70 million for the six months ended March 31, 2025, from approximately $0.71 million for the same period of 2024. Cross-border sales margin improved from 12.70% to 21.31%, while integrated e-commerce services margin rose from 50.67% to 93.56% during the same period.

● Net loss increased from approximately $1.41 million for the six months ended March 31, 2024 to approximately $3.09 million for the six months ended March 31, 2025.

**First Half 2025 Financial Results**

***Revenues***

Total revenues declined by approximately $1.30 million, or 27.02%, from approximately $4.80 million for the six months ended March 31, 2024, to approximately $3.50 million for the same period of 2025, mainly due to a sharp drop in cross-border sales.

Revenues from cross-border sales fell by approximately $3.74 million, or 82.35%, from approximately $4.54 million for the six months ended March 31, 2024 to approximately $0.80 million for the six months ended March 31, 2025. EXTEND, our Japanese subsidiary, contributed $0.43 million or 12.32% of total revenue, down 87.66% year-over-year. This decline was driven by poor market response to its 3C electronics product strategy. In response, the Company shifted focus to higher-margin, fully managed e-commerce services and reallocated staff accordingly. The cross-border business is now being restructured, with new product selections and the Company plans to explore TikTok store and livestream sales in Japan.

Revenues from Integrated e-commerce services surged by $2.44 million, or 930.08%, from approximately $0.26 million to $2.70 million for the six months ended March 31, 2025, largely due to the launch of fully managed e-commerce operations in 2025. This new model, contributing $2.59 million in revenue and $2.46 million in gross profit, involves end-to-end store management for merchants, with fees based on gross merchandize volume (GMV).

Revenues from digital marketing dropped from approximately $0.13 million for the six months ended March 31, 2024 to approximately $0.08 million for the six months ended March 31, 2025, after ending the Google partnership in January 2025 and beginning deregistration in April. Revenues from training and consulting, TikTok agent services declined by $0.10 million, or 75.25%, from $0.13 million to $0.03 million.

***Cost of Revenues***

Cost of revenues fell 80.34%, from approximately $4.09 million for the six months ended March 31, 2024, to approximately $0.80 million for the same period in 2025. This was mainly due to a sharp drop in cross-border sales costs, which declined $3.33 million, or 84.09%, from $3.96 million to $0.63 million, reflecting reduced procurement in line with lower sales. In contrast, costs for integrated e-commerce services rose $0.04 million, or 34.55%, from $0.13 million to $0.17 million. Of this, $0.13 million was related to the new fully managed e-commerce business, primarily covering staff salaries. Commission costs declined due to the termination of related services.

***Gross Profit***

Gross profit increased by approximately $1.99 million, or 280.57%, from approximately $0.71 million to approximately $2.70 million, mainly driven by the new fully managed e-commerce business, which contributed $2.46 million in profit with a 95.12% margin. The high margin was due to low operating costs, mostly staff salaries, with no enterprise resource planning development expenses in the current period as they were previously recognized. Cross-border sales margin improved from 12.70% to 21.31% due to a shift toward higher-margin products. Integrated e-commerce services margin rose from 50.67% to 93.56%, also driven by the new business model.

***Operating Expenses***

Operating expenses rose by 91.01%, from approximately $2.27 million to approximately $4.34 million, mainly due to higher general and administrative expenses, which increased 123.94%, from $1.74 million to $3.90 million for the six months ended March 31, 2025, which was primarily attributable to the allowance for credit loss, stock-based compensation and post-IPO financial and legal consulting fees.

Selling and marketing expenses dropped 31.15%, from approximately $0.23 million to approximately $0.16 million, due to lower freight and advertising costs, as well as lower marketing and promotion expenses.

Research and development expenses declined 7.87%, from approximately $0.30 million to approximately $0.27 million, as ERP development staff shifted to operational roles and their salaries were reclassified under business costs.

***Other Expenses***

Other expenses mainly include non-operating income and interest expenses, net. Non-operating income rose from $998 to approximately $0.39 million. Net interest expenses increased significantly from approximately $0.06 million to approximately $1.50 million, mainly due to the issuance of $10 million in convertible bonds in October 2024, with an actual interest rate of 42.52%, generating $1.56 million in interest expenses during the reporting period.

***Income Tax (Provision)/Benefit***

Income tax (provision) /benefit decreased by approximately $0.56 million, from approximately $0.02 million of tax benefit for the six months ended March 31, 2024 to approximately $0.34 million of tax expenses for the six months ended March 31, 2025. This decrease was primarily attributable to net profit for the fully managed e-commerce operation services with a tax rate of 16.5%.

***Net Loss***

As a result, net loss increased by approximately $1.68 million, or 119.62%, from approximately $1.41 million to approximately $3.09 million.

**About Linkage Global Inc**

Linkage Global Inc is a holding company incorporated in the Cayman Islands with no operations of its own. Linkage Cayman conducts its operations through its operating subsidiaries in Japan, Hong Kong, and mainland China. As a cross-border e-commerce integrated services provider headquartered in Japan, through its operating subsidiaries, the Company has developed a comprehensive service system comprised of two lines of business complementary to each other, including (i) cross-border sales and (ii) integrated e-commerce services. For more information, please visit www.linkagecc.com.

**Safe Harbor Statement**

Certain statements in this announcement are forward-looking statements. These forward-looking statements involve known and unknown risks and uncertainties and are based on the Company's current expectations and projections about future events that the Company believes may affect its financial condition, results of operations, business strategy and financial needs. Investors can identify these forward-looking statements by words or phrases such as "approximates," "assesses," "believes," "hopes," "expects," "anticipates," "estimates," "projects," "intends," "plans," "will," "would," "should," "could," "may" or similar expressions. The Company undertakes no obligation to update or revise publicly any forward-looking statements to reflect subsequent occurring events or circumstances, or changes in its expectations, except as may be required by law. Although the Company believes that the expectations expressed in these forward-looking statements are reasonable, it cannot assure you that such expectations will turn out to be correct, and the Company cautions investors that actual results may differ materially from the anticipated results and encourages investors to review other factors that may affect its future results in the Company's annual reports on Form 20-F and other filings with the U.S. Securities and Exchange Commission.

**For more information, please contact:**

**Investor Relations**

WFS Investor Relations Inc.

Connie Kang, Partner

Email: ckang@wealthfsllc.com

Tel: +86 1381 185 7742

**Linkage Global Inc<br> UNAUDITED INTERIM CONDENSED CONSOLIDATED BALANCE SHEETS<br> AS OF MARCH 31, 2025 AND SEPTEMBER 30, 2024<br> (In U.S. dollars, except for share and per share data, or otherwise noted)**

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| | | |
|:---|:---|:---|
|  | **As of<br> March 31,<br> 2025** | **As of<br> September 30,<br> 2024** |
|  | **USD** | **USD** |
| **ASSETS** | | |
| **Current assets** | | |
| Cash and cash equivalents | 328081 | 2000732 |
| Accounts receivable, net | 6405486 | 6302696 |
| Inventories, net | 35675 | 66331 |
| Deposits paid to media platforms |  | 482650 |
| Prepaid expenses and other current assets, net | 1625517 | 2689581 |
| Amount due from related parties | 1243450 |  |
| Short-term loan to third party | 8993306 | 410000 |
| Interest receivable from loan to third party | 386261 |  |
| **Total current assets** | **19017776** | **11951990** |
| **Non-current assets** |  |  |
| Property and equipment, net | 50594 | 85807 |
| Right-of-use assets, net | 516167 | 653730 |
| Total non-current assets | 566761 | 739537 |
| **TOTAL ASSETS** | **19584537** | **12691527** |
| **LIABILITIES AND SHAREHOLDERS' EQUITY** |  |  |
| **Current liabilities** |  |  |
| Accounts payable | 324069 | 624723 |
| Accrued expenses and other current liabilities | 303413 | 236813 |
| Short-term debts |  | 32810 |
| Current portion of long-term debts | 243557 | 428702 |
| Contract liabilities | 208483 | 533625 |
| Amounts due to related parties |  | 314544 |
| Lease liabilities - current | 203600 | 231978 |
| Convertible notes | 7884325 | 964865 |
| Interest payable of convertible notes | 1555689 |  |
| Income tax payable | 850866 | 1017619 |
| **Total current liabilities** | **11574002** | **4385679** |
| **Non-current liabilities** |  |  |
| Long-term debts | 734023 | 839560 |
| Lease liabilities – non-current | 334973 | 441504 |
| **Total non-current liabilities** | **1068996** | **1281064** |
| **Total liabilities** | **12642998** | **5666743** |
| **Commitments and contingencies (Note 21)** |  |  |
| **Shareholders' equity** |  |  |
| Class A ordinary shares (par value of US$0.0025 per share; 998,000,000 ordinary shares authorized, 3,080,000 and 2,150,000 ordinary shares issued and outstanding as of March 31, 2025 and September 30, 2024, respectively) \* | 7700 | 5375 |
| Class B ordinary shares (par value of US$0.0025 per share; 2,000,000 ordinary shares authorized, 700,000 and nil ordinary shares issued and outstanding as of March 31, 2025 and September 30, 2024, respectively) \* | 1750 |  |
| Additional paid in capital | 8564021 | 5591596 |
| Treasury Shares | (500) |  |
| Statutory reserve | 11348 | 11348 |
| Retained earnings | (1474142) | 1613217 |
| Accumulated other comprehensive loss | (168638) | (196752) |
| **Total shareholders' equity** | **6941539** | **7024784** |
| **TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY** | **19584537** | **12691527** |

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**Linkage Global Inc<br> UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME**

**FOR THE SIX MONTHS ENDED MARCH 31, 2025 AND 2024<br> (In U.S. dollars, except for share and per share data, or otherwise noted)**

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| | | |
|:---|:---|:---|
|  | **For the six months<br> ended <br> March 31,** | **For the six months<br> ended <br> March 31,** |
|  | **2025** | **2024** |
|  | **USD** | **USD** |
| Revenues | 3501947 | 4798363 |
| Cost of revenues | (804142) | (4089486) |
| **Gross profit** | 2697805 | 708877 |
| **Operating expenses** |  |  |
| General and administrative expenses | (3904027) | (1743309) |
| Selling and marketing expenses | (157637) | (228956) |
| Research and development expenses | (274371) | (297811) |
| **Total operating expenses** | (4336035) | (2270076) |
| **Operating loss** | **(1638230)** | **(1561199)** |
| **Other expenses** |  |  |
| Interest expenses, net | (1496504) | (60726) |
| Other non-operating income | 387816 | 998 |
| **Total other expenses** | (1108688) | (59728) |
| **Loss before income taxes** | (2746918) | (1620927) |
| Income tax (provision)/ benefit | (340441) | 215161 |
| **Net loss** | **(3087359)** | **(1405766)** |
| **Net loss attributable to the Company's ordinary shareholders** | **(3087359)** |  |
| Other comprehensive income/(loss) |  |  |
| Foreign currency translation adjustment | 28114 | (10107) |
| **Total comprehensive loss attributable to the Company's ordinary shareholders** | **(3059245)** | **(1415873)** |
| **Loss per ordinary share attributable to ordinary shareholders** |  |  |
| Basic and Diluted\* | (0.90) | (0.67) |
| **Weighted average number of ordinary shares outstanding** |  |  |
| Basic and Diluted\* | 3415533 | 2084890 |

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**Linkage Global Inc<br> UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS**

**FOR THE SIX MONTHS ENDED MARCH 31, 2025 AND 2024<br> (In U.S. dollars, except for share and per share data, or otherwise noted)**

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| | | |
|:---|:---|:---|
|  | **For the six months<br> ended <br> March 31,** | **For the six months<br> ended <br> March 31,** |
|  | **2025** | **2024** |
|  | **USD** | **USD** |
| **CASH FLOWS FROM OPERATING ACTIVITIES:** |  |  |
| Net loss | (3087359) | (1405766) |
| *Adjustments to reconcile net loss to net cash used in operating activities:* |  |  |
| Effect of exchange rate changes | 202551 | 1184 |
| Allowance for credit loss | 1344218 | 568229 |
| Interest payable of convertible notes | 1555689 |  |
| Interest receivable from loan to third party | (386261) |  |
| Stock-Based Compensation | 1209000 |  |
| Depreciation | 22205 | 40959 |
| Amortization of lease right-of-use assets | 114791 | 110229 |
| Inventory provision | 4328 | 2203 |
| Deferred tax benefits |  | (216713) |
| *Changes in operating assets and liabilities:* |  |  |
| Accounts receivable, net | (1649559) | (725166) |
| Prepaid expenses and other current assets, net | (261232) | (3233957) |
| Inventories, net | 26328 | 539517 |
| Accounts payable | (300654) | (320628) |
| Contract liabilities | (325142) | 25350 |
| Accrued expenses and other current liabilities | 66600 | (5188) |
| Amounts due from related parties | 341426 |  |
| Amounts due to related parties | (314238) | (16189) |
| Tax payable | (166753) | 928135 |
| Operating lease liabilities | (134909) | (103326) |
| **Net cash used in operating activities** | **(1738971)** | **(3811127)** |
| **Cash flow from investing activities** |  |  |
| Repayments of loan to a related party | (99876) |  |
| Loan to third party | (8640000) |  |
| **Net cash used in investing activities** | (8739876) |  |
| **Cash flow from financing activities** |  |  |
| Proceeds from issuance of Class A ordinary shares upon the completion of IPO |  | 5356792 |
| Proceeds from Issuance of convertible notes | 9002368 |  |
| Proceeds from short-term debts |  | 132258 |
| Repayments of short-term debts | (32810) | (33726) |
| Repayments of long-term debts | (124959) | (179420) |
| Repayments of other long-term debts | (108037) | (878962) |
| Payments of listing expenses |  | (150606) |
| **Net cash provided by financing activities** | **8736562** | **4246336** |
| Effect of exchange rate changes | 69634 | (58969) |
| **Net change in cash and cash equivalents** | **(1672651)** | **376240** |
| **Cash and cash equivalents, beginning of the period** | **2000732** | **1107480** |
| **Cash and cash equivalents, end of the period** | **328081** | **1483720** |
| Supplemental disclosures of cash flow information: |  |  |
| Income tax paid |  | 150124 |
| Interest expense paid | 33056 | 65901 |
| Supplemental disclosures of non-cash activities: |  |  |
| Obtaining right-of-use assets in exchange for operating lease liabilities | 155160 | 147083 |

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