{"url_path":"/sec/sos/10-k/2026/item-5","section_key":"item-5","section_title":"Item 5 OPERATING AND FINANCIAL REVIEW AND PROSPECTS**","topic":"sec","document":{"doc_type":"20-F","doc_date":"2026-05-15","source_url":"https://www.sec.gov/Archives/edgar/data/1346610/0001213900-26-057725-index.html","accession_number":"0001213900-26-057725","cik":"0001346610","ticker":"SOS","issuer_name":"SOS Ltd","edgar_url":"https://www.sec.gov/Archives/edgar/data/1346610/0001213900-26-057725-index.html","primary_entity_key":"0001346610","primary_entity_name":"SOS Ltd"},"word_count":6307,"has_tables":true,"body_markdown":"**ITEM\n5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS**\n\n \n\n**Overview**\n\n \n\nSOS Limited is primarily a commodities trading\ncompany, operating through its subsidiaries SOS International Trading Co. Ltd, Shuyun International Trading Co. Ltd and Weigou International\nTrading Co. Ltd, facilitating the trading of commodities including but not limited to mineral resin, soy bean, wheat, sesame, liquid sulfur\nand latex. The Company also operates as an emerging blockchain-based and big data-driven marketing solution provider and is engaged in\nblockchain and cryptocurrency operations, which currently include providing hosting services to third-party cryptocurrency miners.\n\n \n\nFor the fiscal year ended December 31, 2025, our\ncommodities trading segment generated the substantial majority of our total revenues, with hosting services accounting for the remaining\nportion of our revenues. Cryptocurrency mining revenues were nil in fiscal year 2025.\n\n \n\nWe temporarily shut down mining operations during 2025, as our mining rigs were no longer cost-effective to operate. We have transitioned our cryptocurrency-related operations\nto a hosting services model, under which we earn fees from customers who locate and operate mining equipment on our premises.\n\n \n\nAs of December 31, 2025, we held approximately\n802.77 BTC with a fair value of approximately $70.3 million and 2,949.79 ETH with a fair value of approximately $8.8 million. We account\nfor our digital asset holdings at fair value, with changes recognized in earnings each period.\n\n \n\nOur results of operations are primarily driven by (i) the volume and\nmargin of commodities trading transactions, (ii) hosting services revenue derived from third-party miners operating on our premises, and\n(iii) fair value changes in our digital asset holdings. The following discussion and analysis should be read in conjunction with our audited\nconsolidated financial statements and related notes included elsewhere in this annual report.\n\n \n\nTotal\nassets and liabilities presented on the Company’s consolidated balance sheets and revenue, expense, net income presented on\nconsolidated statement of operations and comprehensive income as well as the cash flow from operating, investing and financing\nactivities presented on the consolidated statement of cash flows are substantially the financial position, operation and cash flow\nof the Company’s former VIE and the former VIE’s subsidiaries. As of December 31, 2025, 2024 and 2023 $3.3 million,\n$11.9 million, and $47.4 million and of cash and cash equivalents were denominated in RMB, respectively. The following table sets\nforth the assets, liabilities, results of operations and changes in cash, cash equivalents the former VIE and its subsidiaries taken\nas a whole, which were included in the Company’s consolidated balance sheets and statements of comprehensive income and\nstatements of cash flows with intercompany transactions eliminated.\n\n \n\n45\n\n \n\n \n\nThe\nfollowing financial information of SOS, China SOS, Qingdao SOS Investment (one of WFOEs), Subsidiaries outside China and Subsidiaries\noutside China was recorded in the accompanying consolidated financial statements:\n\n \n\nCondensed\nConsolidated Balance Sheet\n\n(US$ thousands,\nexcept share data and per share data, or otherwise noted)\n\n \n\n  \n31-Dec-25 \n\n  \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \nSubsidiaries  \nSubsidiaries  \n  \n\n  \n   \nChina\n\nSOS  \n   \nSubsidiaries\n\nOutside  \nSubsidiaries\n\n**Inside**  \nSOS\nLtd.  \nChina SOS\nLtd.  \nWOFE  \nVIE  \nInter-company  \nOutside\n\nChina  \nInside\n\nChina  \nSOS\nLtd.\n**Consolidated** \n\n  \nSOS\nLtd.  \nLtd.  \nWOFE  \nChina  \nChina  \nAdjustement(a)  \nAdjustement(b)  \nAdjustement(c)  \nAdjustement(d)  \nAdjustement(e)  \nAdjustement(f)  \nAdjustment  \nAdjustment  \nAdjustment  \nelimination(g)  \nAdjustment  \nAdjustment  \ntotal \n\n  \nUS$  \nUS$  \nUS$  \nUS$  \nUS$  \nUS$  \n   \nUS$  \n   \n   \n   \nUS$  \nUS$  \nUS$  \nUS$  \n   \nUS$  \nUS$ \n\nASSETS \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \n  \n\nCurrent assets: \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \n  \n\nCash\nand cash equivlaents \n 128  \n 42  \n 135  \n 1,606  \n 1,321  \n    \n       \n       \n       \n       \n        \n    \n        \n        \n        \n        \n        \n 3,232 \n\nTrading\nFinancial Assets \n 200  \n    \n    \n    \n 1,982  \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n 2,182 \n\nAccounts\nreceivable,net \n    \n    \n    \n -  \n 3,158  \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n 3,158 \n\nOther\nreceivables - net \n 230,210  \n 325  \n -  \n 2,300  \n 226,838  \n    \n    \n    \n    \n    \n    \n (149,280) \n    \n    \n -  \n    \n    \n 310,393 \n\nAmount\ndue from related parties \n -  \n 900  \n -  \n 8,100  \n 30,474  \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n 39,474 \n\nInter-company\nreceivable \n -46,516  \n 178,585  \n 291,181  \n (126,034) \n (332,936) \n 35,720  \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n - \n\nInventory \n    \n    \n    \n    \n 23,982  \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n 23,982 \n\nIntangible\nassets \n -  \n 6,289  \n -  \n 72,810  \n -  \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n 79,099 \n\nTax\nrecoverable \n 15  \n -  \n -  \n    \n 1,856  \n -  \n    \n    \n    \n    \n    \n    \n    \n    \n    \n -  \n -  \n 1,871 \n\nTotal\ncurrent assets \n 184,037  \n 186,141  \n 291,316  \n (41,218) \n (43,325) \n 35,720  \n -  \n -  \n -  \n -  \n -  \n (149,280) \n -  \n -  \n -  \n -  \n -  \n 463,391 \n\nNon-current\nassets: \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n   \n\nOperating\nlease, right-of-use assets \n    \n    \n    \n 2  \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n 2 \n\nProperty\nequipment and software,net \n -  \n -  \n -  \n 1,579  \n 11  \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n 1,590 \n\nGoodwill \n    \n    \n    \n    \n 72  \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n 72 \n\n  \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n   \n\nLong-term\ninvestments \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n - \n\nInvestment\nin subsidiaries outside China \n -  \n    \n    \n    \n    \n -  \n    \n    \n    \n -  \n    \n    \n    \n    \n    \n    \n    \n - \n\nInvestment\nin WFOE \n    \n 314,335  \n -314,335  \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n - \n\nInvestment\nin China SOS \n    \n -64,794  \n    \n 64,794  \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n - \n\nTotal\nnon-current assets \n -  \n 249,541  \n (314,335) \n 66,375  \n 83  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n 1,664 \n\nTotal\nassets \n 184,037  \n 435,682  \n (23,019) \n 25,157  \n (43,242) \n 35,720  \n -  \n -  \n -  \n -  \n -  \n (149,280) \n -  \n -  \n -  \n -  \n -  \n 465,055 \n\nLIABILITIES\nAND EQUITY \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n   \n\nCurrent\nliabilities: \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n   \n\nAccounts\npayable \n -  \n 11,359  \n -  \n -  \n 7,988  \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n 19,347 \n\nAmount\ndue to related parties \n 1,015  \n -  \n -  \n 19  \n 608  \n    \n    \n    \n -  \n    \n    \n    \n    \n    \n    \n    \n -  \n 1,642 \n\nOperating\nlease liability-current \n    \n    \n    \n 2  \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n 2 \n\nAdvance\nfrom customers \n    \n    \n    \n -  \n 16,824  \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n 16,824 \n\nTax\npayable \n -  \n -  \n    \n -  \n 182  \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n 182 \n\nOther\npayables \n 9  \n 154,026  \n -43  \n 2,696  \n 1,228  \n    \n    \n    \n    \n    \n    \n -153,976  \n    \n    \n -  \n    \n    \n 3,940 \n\nTotal\ncurrent liabilities \n 1,024  \n 165,385  \n (43) \n 2,717  \n 26,830  \n -  \n -  \n -  \n -  \n -  \n -  \n (153,976) \n -  \n -  \n -  \n -  \n -  \n 41,937 \n\nOperating\nlease liabilty-noncurrent \n    \n    \n    \n -  \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n - \n\nTotal\nnon-current liability \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n - \n\nTotal\nliabilities \n 1,024  \n 165,385  \n (43) \n 2,717  \n 26,830  \n -  \n -  \n -  \n -  \n -  \n -  \n (153,976) \n -  \n -  \n -  \n -  \n -  \n 41,937 \n\nNon-controlling\ninterest \n    \n    \n    \n (21) \n -  \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n (21)\n\nShareholder’s\nequity \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n   \n\nPaid\nup capital \n 73,160  \n 387,283  \n -  \n 70,951  \n (526,352) \n 13  \n    \n    \n    \n    \n    \n -  \n    \n    \n    \n    \n    \n 5,055 \n\nAdditional\npaid-in capital \n 214,418  \n    \n    \n    \n 527,901  \n 39,165  \n    \n    \n    \n    \n -  \n -  \n    \n    \n    \n    \n    \n 781,484 \n\nStatutory\nReserve \n    \n    \n    \n    \n 161  \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n 161 \n\nRetained\nearnings \n (104,565) \n (116,986) \n (1) \n (48,490) \n (67,828) \n    \n    \n    \n    \n    \n -  \n    \n -  \n    \n    \n    \n    \n (337,870)\n\nAccumulated\nother comprehensive income (loss) \n    \n    \n (22,975) \n -  \n (3,954) \n (3,458) \n    \n    \n    \n    \n    \n 4,696  \n    \n    \n    \n    \n    \n (25,691)\n\nTotal\nShareholders’ equity \n 183,013  \n 270,297  \n (22,976) \n 22,461  \n (70,072) \n 35,720  \n -  \n -  \n -  \n -  \n -  \n 4,696  \n -  \n -  \n -  \n -  \n -  \n 423,139 \n\nTotal\nLiabilities and shareholders’ equity \n 184,037  \n 435,682  \n (23,019) \n 25,157  \n (43,242) \n 35,720  \n -  \n -  \n -  \n -  \n -  \n (149,280) \n -  \n -  \n -  \n -  \n -  \n 465,055 \n\n \n\n46\n\n \n\n \n\nCondensed\nConsolidated Balance Sheet\n\n(US$ thousands,\nexcept share data and per share data, or otherwise noted)\n\n \n\n  \n31-Dec-24 \n\n  \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \nSubsidiaries  \nSubsidiaries  \n  \n\n  \n   \nChina  \n   \nSubsidiaries\n\nOutside  \nSubsidiaries\n\n**Inside**  \nSOS\nLtd.  \nChina\nSOS Ltd.  \nWOFE  \nVIE  \nInter-company  \nOutside\n\nChina  \nInside\n\nChina  \nSOS\nLtd.\n**Consolidated** \n\n  \nSOS Ltd.  \nSOS Ltd.  \nWOFE  \nChina  \nChina  \nAdjustement(a)  \nAdjustement(b)  \nAdjustement(c)  \nAdjustement(d)  \nAdjustement(e)  \nAdjustement(f)  \nAdjustment  \nAdjustment  \nAdjustment  \nelimination(g)  \nAdjustment  \nAdjustment  \ntotal \n\n  \nUS$  \nUS$  \nUS$  \nUS$  \nUS$  \nUS$  \n   \nUS$  \n   \n   \n   \nUS$  \nUS$  \nUS$  \nUS$  \n   \nUS$  \nUS$ \n\nASSETS \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \n  \n\nCurrent assets: \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \n  \n\nCash\nand cash equivalents \n 19,885  \n 157,252  \n 825  \n 47,593  \n 11,929  \n    \n        \n        \n        \n        \n        \n    \n        \n        \n        \n        \n        \n 237,484 \n\nTrading\nFinancial Assets \n 200  \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n 200 \n\nAccounts\nreceivable,net \n    \n    \n    \n 256  \n 2,374  \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n 2,630 \n\nOther\nreceivables - net \n 5,958  \n 973  \n -  \n -700  \n 287,068  \n    \n    \n    \n    \n    \n    \n -143,018  \n    \n    \n -  \n    \n    \n 150,281 \n\nAmount\ndue from related parties \n -  \n 900  \n -  \n 8,100  \n 837  \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n 9,837 \n\nInter-company\nreceivable \n 152,575  \n 21,737  \n 278,380  \n (168,299) \n (318,614) \n 34,221  \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n - \n\nInventory \n    \n    \n    \n    \n 33,011  \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n 33,011 \n\nIntangible\nassets \n -  \n 6,289  \n -  \n 23,584  \n -  \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n 29,873 \n\nTax\nrecoverable \n 15  \n -  \n -  \n    \n 1,808  \n -  \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n 1,823 \n\nTotal\ncurrent assets \n 178,633  \n 187,151  \n 279,205  \n (89,466) \n 18,413  \n 34,221  \n -  \n -  \n -  \n -  \n -  \n (143,018) \n -  \n -  \n    \n    \n    \n 465,139 \n\nNon-current\nassets: \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n   \n\nOperating\nlease, right-of-use assets \n    \n    \n    \n -  \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n - \n\nProperty\nequipment and software,net \n -  \n 1,025  \n -  \n 16,079  \n 39  \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n 17,143 \n\nGoodwill \n    \n    \n    \n    \n 72  \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n 72 \n\n  \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n   \n\nLong-term\ninvestments \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n - \n\nInvestment\nin subsidiaries outside China \n -  \n    \n    \n    \n    \n -  \n    \n    \n    \n -  \n    \n    \n    \n    \n    \n    \n    \n - \n\nInvestment\nin WFOE \n    \n 314,335  \n -314,335  \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n - \n\nInvestment\nin China SOS \n    \n -64,794  \n    \n 64,794  \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n - \n\nPrepaid\nexpense \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n - \n\nTotal\nnon-current assets \n -  \n 250,566  \n -314,335  \n 80,873  \n 111  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n 17,215 \n\nTotal\nassets \n 178,633  \n 437,717  \n (35,130) \n (8,593) \n 18,524  \n 34,221  \n -  \n -  \n -  \n -  \n -  \n (143,018) \n -  \n -  \n -  \n -  \n -  \n 482,354 \n\nLIABILITIES\nAND EQUITY \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n   \n\nCurrent\nliabilities: \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n   \n\nLiabilities: \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n   \n\nAccounts\npayable \n -  \n 11,359  \n -  \n -  \n 1,152  \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n 12,511 \n\nAmount\ndue to related parties \n 15  \n -  \n -  \n 19  \n 608  \n    \n    \n    \n -  \n    \n    \n    \n    \n    \n    \n    \n -  \n 642 \n\nOperating\nlease liability-current \n    \n    \n    \n -  \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n - \n\nAdvance\nfrom customers \n    \n    \n    \n -  \n 21,498  \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n 21,498 \n\nTax\npayable \n -  \n -  \n    \n -  \n 169  \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n 169 \n\nOther\npayables \n 1,241  \n 153,976  \n -  \n 1,460  \n 9,143  \n    \n    \n    \n    \n    \n    \n -153,976  \n    \n    \n -  \n    \n    \n 11,844 \n\nTotal\ncurrent liabilities \n 1,256  \n 165,335  \n -  \n 1,479  \n 32,570  \n -  \n -  \n -  \n -  \n -  \n -  \n (153,976) \n -  \n -  \n -  \n -  \n -  \n 46,664 \n\nOperating\nlease liabilty-noncurrent \n    \n    \n    \n -  \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n - \n\nTotal\nnon-current liability \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n    \n    \n -  \n -  \n -  \n -  \n -  \n -  \n - \n\nTotal\nliabilities \n 1,256  \n 165,335  \n -  \n 1,479  \n 32,570  \n -  \n -  \n -  \n -  \n -  \n    \n (153,976) \n -  \n -  \n -  \n -  \n -  \n 46,664 \n\nNon-controlling\ninterest \n    \n    \n    \n (6,235) \n -  \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n (6,235)\n\nShareholder’s\nequity \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n   \n\nPaid\nup capital \n 64,849  \n 387,283  \n -  \n 70,951  \n (520,905) \n 13  \n    \n    \n    \n    \n    \n -  \n    \n    \n    \n    \n    \n 2,191 \n\nAdditional\npaid-in capital \n 200,684  \n    \n    \n    \n 521,542  \n 39,165  \n    \n    \n    \n    \n -  \n -  \n    \n    \n    \n    \n    \n 761,391 \n\nStatutory\nReserve \n    \n    \n    \n    \n 161  \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n 161 \n\nRetained\nearnings \n (88,156) \n (114,901) \n -  \n (74,788) \n (12,416) \n    \n    \n    \n    \n    \n -  \n    \n -  \n    \n    \n    \n    \n (390,261)\n\nAccumulated\nother comprehensive income (loss) \n    \n    \n (35,130) \n -  \n (2,428) \n (4,957) \n    \n    \n    \n    \n    \n 10,958  \n    \n    \n    \n    \n    \n (31,557)\n\nTotal\nShareholders’ equity \n 177,377  \n 272,382  \n (35,130) \n (3,837) \n (14,046) \n 34,221  \n -  \n -  \n -  \n -  \n -  \n 10,958  \n -  \n -  \n -  \n -  \n -  \n 441,925 \n\nTotal\nLiabilities and shareholders’ equity \n 178,633  \n 437,717  \n -35,130  \n (8,593) \n 18,524  \n 34,221  \n -  \n -  \n -  \n -  \n -  \n -143,018  \n -  \n -  \n -  \n -  \n -  \n 482,354 \n\n \n\n47\n\n \n\n \n\nCondensed\nConsolidated Balance Sheet\n\n(US$ thousands,\nexcept share data and per share data, or otherwise noted)\n\n \n\n  \n31-Dec-23  \n  \n\n  \n   \nChina  \n   \nSubsidiaries  \nSubsidiaries  \nSOS\nLtd.  \nChina SOS  \n   \n   \n  \n\n  \nSOS\n\nLtd.  \nSOS\n\nLtd.  \nWOFE  \nOutside\n\nChina  \nInside\n\nChina  \nAdjustment\n(a)  \nAdjustment\n(b)  \nAdjustment\n(c)  \nAdjustment\n(d)  \nAdjustment\n(e)  \nAdjustment\n(f)  \nLtd.\n\nAdjustment  \nWOFE\nAdjustment  \nVIE\nAdjustment  \nConsolidated\ntotal \n\n  \nUS$  \nUS$  \nUS$  \nUS$  \nUS$  \nUS$  \nUS$  \nUS$  \nUS$  \nUS$  \nUS$  \nUS$  \nUS$  \nUS$  \nUS$ \n\nASSETS \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \n  \n\nCurrent assets: \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \n   \n  \n\nCash\nand cash equivalents \n 19,447  \n 156,811  \n 859  \n 54,990  \n 47,070  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n 279,177 \n\nInvestment\nsecurities \n -  \n -  \n -  \n -  \n 307  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n 307 \n\nAccounts\nreceivable, net \n -  \n -  \n -  \n 231  \n 578  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n 809 \n\nOther\nreceivables - net \n 7,203  \n 490  \n -  \n 2,270  \n 217,042  \n -  \n -  \n -  \n -  \n -  \n -  \n -147,035  \n -  \n -  \n 79,970 \n\nAmount\ndue from related parties \n -  \n 900  \n -  \n 8,100  \n 30,582  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n 39,582 \n\nInter-company\nreceivable \n 128,413  \n 22,213  \n 286,198  \n (146,707) \n (325,302) \n 35,185  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n - \n\nInventory \n -  \n -  \n -  \n    \n 32,875  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n 32,875 \n\nIntangible\nassets \n -  \n 6,289  \n -  \n 15,107  \n -  \n    \n    \n    \n    \n    \n    \n    \n    \n    \n 21,396 \n\nTax\nrecoverable \n 16  \n -  \n -  \n 1  \n 1,262  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n 1,279 \n\nTotal\ncurrent assets \n 155,079  \n 186,703  \n 287,057  \n (66,008) \n 4,414  \n 35,185  \n -  \n -  \n -  \n -  \n -  \n (147,035) \n -  \n -  \n 455,395 \n\nNon-current\nassets: \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n - \n\nOperating\nlease, right-of-use assets \n -  \n -  \n -  \n 377  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n 377 \n\nProperty\nequipment and software, net \n -  \n 3,425  \n -  \n 24,557  \n 66  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n 28,048 \n\nGoodwill \n -  \n -  \n -  \n -  \n 72  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n 72 \n\n  \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n   \n\nLong-term\ninvestments \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n   \n\nInvestment\nin subsidiaries outside China \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n - \n\nInvestment\nin WFOE \n -  \n 314,335  \n 314,335  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n - \n\nInvestment\nin China SOS \n -  \n -64,794  \n -  \n 64,794  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n - \n\nPrepaid\nexpense \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n - \n\nTotal\nnon-current assets \n -  \n 252,966  \n -314,335  \n 89,728  \n 138  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n 28,497 \n\nTotal\nassets \n 155,079  \n 439,669  \n (27,278) \n 23,720  \n 4,552  \n 35,185  \n -  \n -  \n -  \n -  \n -  \n (147,035) \n -  \n -  \n 483,892 \n\nLIABILITIES\nAND EQUITY \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n   \n\nCurrent\nliabilities: \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n   \n\nLiabilities: \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n   \n\nAccounts\npayable \n -  \n 11,359  \n -  \n 24,327  \n 1,054  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n 36,740 \n\nAmount\ndue to related parties \n 1,015  \n -  \n -  \n 19  \n 607  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n 1,641 \n\nOperating\nlease liability-current \n -  \n -  \n -  \n 377  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n 377 \n\nAdvance\nfrom customers \n -  \n -  \n -  \n -  \n 15,192  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n 15,192 \n\nTax\npayable \n -  \n -  \n -  \n 2  \n 75  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n 77 \n\nOther\npayables \n 241  \n 153,976  \n -  \n 7,161  \n 90  \n -  \n -  \n -  \n -  \n -  \n -  \n 153,976  \n -  \n -  \n 7,492 \n\nTotal\ncurrent liabilities \n 1,256  \n 165,335  \n -  \n 31,886  \n 17,018  \n -  \n -  \n -  \n -  \n -  \n -  \n (153,976) \n -  \n -  \n 61,519 \n\nOperating\nlease liability-noncurrent \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n - \n\nTotal\nnon-current liability \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n - \n\nTotal\nliabilities \n 1,256  \n 165,335  \n -  \n 31,886  \n 17,018  \n -  \n -  \n -  \n -  \n -  \n    \n (153,976) \n -  \n -  \n 61,519 \n\nNon-controlling\ninterest \n -  \n -  \n -  \n (3,619) \n 5  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n (3,614)\n\nShareholder’s\nequity \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n   \n\nPaid\nup capital \n 54,301  \n 387,283  \n -  \n 70,951  \n (511,886) \n 16  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n 665 \n\nAdditional\npaid-in capital \n 177,227  \n -  \n -  \n -  \n 513,953  \n 39,165  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n 730,345 \n\nStatutory\nReserve \n -  \n -  \n -  \n -  \n 161  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n 161 \n\nRetained\nearnings \n (77,705) \n (112,949) \n -  \n (75,498) \n (10,520) \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n (276,672)\n\nAccumulated\nother comprehensive income (loss) \n -  \n -  \n (27,278) \n -  \n (4,179) \n (3,996) \n -  \n -  \n -  \n -  \n -  \n 6,941  \n -  \n -  \n (28,512)\n\nTotal\nShareholders’ equity \n 153,823  \n 274,334  \n (27,278) \n (4,547) \n (12,471) \n 35,185  \n -  \n -  \n -  \n -  \n -  \n 6,941  \n -  \n -  \n 425,987 \n\nTotal\nLiabilities and shareholders’ equity \n 155,079  \n 439,669  \n -27,278  \n 23,720  \n 4,552  \n 35,185  \n -  \n -  \n -  \n -  \n -  \n -147,035  \n -  \n -  \n 483,892 \n\n \n\n48\n\n \n\n \n\nNotes\n\n \n\n(a)\nSOS placed\nprivate equity from a number of investors, SOSINT received it on behalf of SOS. This entry represents that SOS is to pick it up by\nincreasing paid-up & additional paid-up capital by going through inter-company account;\n\n \n\n(b)\nThis entry\nis to eliminate China SOS’s investment in WFOE against WFOE’s paid-up capital, additional paid-up capital and retained\nearning if any;\n\n \n\n(c)\nThis entry\nis to eliminate SOS’s investment in China SOS against China SOS’s paid-up capital, additional paid-up capital and retained\nearning if any;\n\n \n\n(d)\nChina\nSOS received F3 financing net of issuance expenses on behalf of SOS. This entry is to increase SOS’s paid-up capital &\nadditional paid-up capital by going through inter-company account to offset other receivables and other payable;\n\n \n\n(e)\nThis entry\nis to re-classify paid-up capital to additional capital by Register of members reconciliation table and re-classify between retained\nearnings and additional paid-up capital;\n\n \n\n(f)\nThis entry\nis to eliminate SOSNY’s investment in China SOS against China SOS’s paid-up capital, additional paid-up capital and retained\nearning if any;\n\n \n\n(g)\nThis entry\nrepresents an inter-company elimination entry between SOS and SOSNY.\n\n \n\n**A.\nOperating Results**\n\n \n\n**Revenue**\n\n \n\nThe\nfollowing table presents our revenues by revenue source and by proportion for the periods indicated (in thousands, except percentages):\n\n \n\n  \nFY\n2025  \nFY\n2024  \nFY\n2023 \n\n  \nAmount  \nPercentage  \nAmount  \nPercentage  \nAmount  \nPercentage \n\nCommodity trading \n 144,974  \n 93.9% \n 214,340  \n 92.6% \n 68,409  \n 74.0%\n\nCryptocurrency Mining \n -  \n -% \n 9,258  \n 4.0% \n 18,898  \n 20.4%\n\nHosting service \n 7,501  \n 4.9% \n 6,506  \n 2.8% \n 2,365  \n 2.6%\n\nOther \n 1,815  \n 1.2% \n 1,320  \n 0.6% \n 2,744  \n 3.0%\n\nTotal \n 154,290  \n 100.0% \n 231,424  \n 100.0% \n 92,416  \n 100.0%\n\n  \n\n49\n\n \n\n \n\nThe\ncompany reported a significant decrease in commodity trading revenue, which dropped to $145.0 million FY 2025, accounting for 93.9% of\ntotal revenue—up from 92.6% in FY 2024. This decline was due to sluggish demand based on the market conditions.\n\n \n\nCryptocurrency\nmining revenue declined to $0 million from $9.3 million in FY 2024. During 2025, the Company did not engage in cryptocurrency\nmining activities due to economic factors and the lack of suitable mining equipment. Accordingly, no mining revenue was recognized\nduring the year. Instead, the Company shifted to attracting customers to mine on its premises, earning hosting fees. As a\nresult, hosting service revenue increased from $6.5 million in FY 2024 to $7.5 million in FY 2025 representing a 15.3% year on\nyear.\n\n \n\nRevenue\nfrom other segments, primarily the auto insurance business, remained stable, reflecting $0.5 million increase from $1.3 million\nin FY 2024 to $1.8 million in FY2025.\n\n \n\nAs\nof December 31, 2025, SOS has focused on four product lines and services, including commodity trading, cryptocurrency mining, hosting\nservice and others, constitute 93.9%, 0%, 4.9% and 1.2% of the total revenues, respectively.\n\n \n\nThe\nChinese government’s ban on certain types of cryptocurrency mining in mainland China at the end of June 2021 caused the Company\nto lose BTC and ETH production capacity. As a result of being unable to continue currency mining business in China, the Company began\ntransitioning the crypto-mining business to Wisconsin, USA.\n\n \n\nThe\nCompany bought and sold commodity products such as sesame, sulfur, rubber, mung bean, asphalt and circuit modular units. The company\nrecognizes revenue when the product has been delivered, title to the good and risk associated with it has been transferred to the customer.\nRevenue generated from commodity trading amounts to $14.3 million during the year of 2025 representing 94.0% of the total sales.\n\n \n\n**Bitcoin\nProduction**\n\n \n\nThe following\ntable presents our bitcoin mining activities for the year ended December 31, 2025.\n\n \n\n  \n**Number\nof bitcoins (1)**  \n**Amount (2)  ** \n\n  \n   \n  \n\nBalance as of December 31, 2024 \n 802.77  \n$26,347,993 \n\nReceipt of BTC from mining services and investment\nincome \n -  \n - \n\nCumulative effect upon adoption of ASU 2023-08 \n -  \n 49,562,099 \n\nFair value loss of BTC \n -  \n (5,577,245)\n\nBalance as of December\n31, 2025 \n 802.77  \n 70,332,847 \n\n  \n\n(1)\nIncludes bitcoins and bitcoin\nequivalents.\n\n \n\n(2)\n\nEffective\nfor fiscal years beginning after December 15, 2024, the Company adopted ASU 2023-08, which requires\ncertain crypto assets to be measured at fair value each reporting period, with changes in fair value\nrecognized in net income; cumulative effect to opening retained earning. No production was generated\nfrom BTC pool during FY 2025; there are 802.77 units of BTC as at December 31, 2025 which were carried\nover from FY 2024\n\n \n\n50\n\n \n\n \n\nThe following\ntable presents our Ethereum mining activities for the year ended December 31, 2025.\n\n \n\n  \n**Number\nof Ethereum (1)**  \n**Amount (2)** \n\n  \n   \n  \n\nBalance as of December 31, 2024 \n 2,949.79  \n$3,525,001 \n\nReceipt of ETH from mining services and investment\nincome \n -  \n - \n\nCumulative effect upon adoption of ASU 2023-08 \n -  \n 6,386,706 \n\nFair value loss \n -  \n (1,145,846)\n\nBalance as of December\n31, 2025 \n 2,949.79  \n 8,765,861 \n\n \n\n(1)\nIncludes\nEthereum and Ethereum equivalents.\n\n \n\n(2)\nEffective\nfor fiscal years beginning after December 15, 2024, the Company adopted ASU 2023-08, which requires certain crypto assets to be measured\nat fair value each reporting period, with changes in fair value recognized in net income; cumulative effect to opening retained earning.\nNo production was generated from ETH pool during FY 2025; there are 2,949.79 units of ETH as at December 31, 2025 which were carried\nover from FY 2024\n\n \n\nRealized\ngain on exchange of digital assets\n\n \n\nWe\nrecord digital assets at cost and any gains or losses from sales of digital assets are recorded as “Realized gain (loss) on exchange\nof “digital assets” in the consolidated statements of operations. For the year ended December 31, 2024-2025, we did not record\nthe realized gain on exchange of digital assets.\n\n \n\n**Cost\nof Revenues**\n\n** **\n\nRevenue\ncosts increased from $78.2 million in 2023 to $224.4 million in 2024, increase of $146.2 million. Revenue costs decreased from $224.4\nmillion in 2024 to $152.0 million in 2025, decrease of $72.3 million. It includes the cost of goods sold for commodity trading, maintenance\nexpenses and power supply, salaries & benefits for on-site staffs, software amortization and hardware depreciation for cryptocurrency\nmining rigs.\n\n \n\n**Operating\nExpenses**\n\n \n\nThe\nfollowing table presents our operating expenses by nature and by proportion for the periods indicated (in thousands, except percentages):\n\n \n\n  \nFY\n2025  \nFY\n2024  \nFY\n2023 \n\nSelling \n$5,278  \n 5% \n$2,774  \n 10% \n$ 672  \n 4%\n\nGeneral and administrative \n 88,407  \n 88% \n 18,136  \n 63% \n 11,058  \n 58%\n\nShare-based compensation \n 7,170  \n 17% \n 7,735  \n 27% \n 7,264  \n 38%\n\n  \n$ 100,855  \n    \n$ 28,645  \n    \n$ 18,994  \n   \n\n \n\nOperating\nexpenses increased from $19.0 million in 2023 to $28.6 million in 2024, representing an increase of $72.2 million to $100.9 million in\n2025.\n\n \n\n51\n\n \n\n \n\n*Selling\nexpenses*\n\n \n\nSelling\nexpenses were $5.3 million for 2025, compared to $2.8 million and $0.7 million, respectively, for 2024 and 2023.\n\n \n\nIn\nboth 2025 and 2024, the year-on-year increase was primarily driven by a $1.4 million rise in transportation expenses for coal, with the\ntotal increase amounting to $2.5 million (up 90%) in 2025 and $2.1 million (down 300%) in 2024. \n\n \n\n*General\nand administrative expenses*\n\n* *\n\nGeneral\nand administrative expenses were $88.4 million for 2025, compared to $18.1 million and $11.1 million, respectively, for 2024\nand 2023.\n\n \n\nThe\nyear-on-year increase for 2025 was $70.2 million, representing a year-on-year increase of 387.5%. The increase mainly\nattributable to $11.6 million increase in impairment for mining machine, $1.0 million increase in impairment for fixed assets, $2.2 million\nincrease in professional services fee, $6.7 million in impairment of cryptocurrencies, and $1.5 million and $51.2 million in allowance\nfor credit losses in Account receivables and Other account receivables respectively.\n\n \n\nIn\n2024, G&A expenses for the year-on-year basis increased by $7.1 million, reflecting an overall of 64% increase, mainly attributable\nto the increase in depreciation of the Company’s mining rigs of $5.9 million.\n\n  \n\n*Share-based\ncompensation expenses*\n\n \n\nShare-based\ncompensation expenses decreased from $7.7 million in 2024 to $7.2 million in 2025.\n\n \n\n**Operating\nLoss**\n\n \n\nThe\nCompany had an operating loss of $98.6 million for 2025, compared to an operating loss of $21.6 million and an operating loss of\n$4.8 million, respectively, for 2024 and 2023.\n\n \n\n**Other\nIncome / (Expense)**\n\n \n\nOther\nexpense was $1.3 million for 2025, compared to $5.6 million and $1.0 million, respectively, for 2024 and 2023.\n\n \n\n**Income\nTax Expense**\n\n \n\nThe\ncompany incurred $1k in corporate income tax mainly from mainland Chinese business of commodity trading segments for the current period\ncompared to $0.2 million last year.\n\n \n\n**Net\nLoss**\n\n \n\nAs\na result of the foregoing, we had net loss from continuing operations of $97.3 million and $16.2 million for 2025 and 2024, respectively,\ncompared to a net loss of $6.4 million, for 2023.\n\n \n\n52\n\n \n\n \n\n**B.\nLiquidity and Capital Resources**\n\n \n\nOur\nprincipal sources of liquidity are cash and cash equivalents and cash flows generated from our operations.\n\n \n\nAs\nof December 31, 2025, we had cash and cash equivalents of approximately $3.2 million, compared to $228.1 million for the period\nended December 31, 2024. The net decrease in cash flow was mainly due to decrease in operating cash inflow generated from decrease in\ngross margin of commodity trading revenue and increase in cash outflow of other receivable of $213.8 million.\n\n \n\nThe\nCompany believes that its cash resources are adequate to fund its current operations and short-term growth initiatives, current liquidity\nand capital resources are sufficient to meet anticipated working capital needs (net cash used in operating activities), commitments,\ncapital expenditures and for at least the next twelve months. The Company may, however, require additional cash resources due to changes\nin business conditions and other future developments, or changes in general economic conditions.\n\n \n\n**Cash Flows\nand Working Capital**\n\n \n\n  \nYear ended\n\nDecember 31,  \nYear ended\n\nDecember 31  \nYear ended\n\nDecember 31, \n\n  \n2025  \n2024  \n2023 \n\nNet cash (used in)/generated from\noperating activities \n (246,484) \n (63,558) \n 9,708 \n\nNet cash used in investing activities \n (38) \n -  \n - \n\nNet cash generated from financing activities \n 15,790  \n 24,550  \n 17,596 \n\nEffect of exchange rates on cash \n 5,833  \n (2,685) \n (7,619)\n\n \n\n**Net\nCash Provided by/(Used in) Operating Activities**\n\n** **\n\n**The\nYears Ended December 31, 2025 and 2024**\n\n \n\nNet\ncash used in operating activities was $63.6 million for the year ended December 31, 2024, which increased to $246.5 million which is\nused in 2025. The decrease was primarily due to the following major changes in our working capital and non-cash items:\n\n \n\n \n●\nA cash outflow of $211.3\nmillion from changes in other receivables for the year ended December 31, 2025, compared with a cash outflow of $69.3 million for\nthe previous year.\n\n \n \n \n\n \n●\nA cash outflow of $2.1\nmillion in accounts receivable for the year ended December 31, 2025, compared with a cash inflow of $2.9 million for the previous\nyear.\n\n \n\n**The\nYears Ended December 31, 2024 and 2023**\n\n \n\nNet\ncash generated from operating activities was $9.7 million for the year ended December 31, 2023, which decreased to $63.6 million which\nis used in 2024. The decrease was primarily due to the following major changes in our working capital and non-cash items:\n\n \n\n \n●\nA cash outflow of\n$5.3 million from change in inventory for the year ended December 31, 2024, compared with a cash inflow of $13.2 million for the\nprevious year.\n\n \n \n \n\n \n●\nA cash outflow of $69.3\nmillion from changes in other receivables for the year ended December 31, 2024, compared with a cash outflow of $25.2 million for\nthe previous year.\n\n \n \n \n\n \n●\nA cash outflow of $2.0\nmillion in accounts receivable for the year ended December 31, 2024, compared with a cash inflow of $1.2 million for the previous\nyear.\n\n \n\n**Net\nCash Used in Investing Activities**\n\n** **\n\n**Years\nEnded December 31, 2025 and 2024**\n\n \n\nThe\nnet cash used in investing activities was $38k and nil for the year ended December 31, 2025 and 2024.\n\n \n\n**Years\nEnded December 31, 2024 and 2023**\n\n \n\nThe\nnet cash used in investing activities was nil for the year ended December 31, 2024 and 2023.\n\n \n\n53\n\n \n\n \n\n**Net\nCash Generated from Financing Activities**\n\n** **\n\n**Years\nEnded December 31, 2025 and 2024**\n\n \n\nThe\nnet cash generated from financing activities was $15.8 million for the year ended December 31, 2025, a decrease of $8.8 million compared\nto the same period of 2024. During the year ended December 31, 2025, the Company received aggregate net proceeds of $15.8 million from\nPIPE and warrant exercises in 2025 compared to $24.6 million in the same period of 2024.\n\n \n\n**Years\nEnded December 31, 2024 and 2023**\n\n \n\nThe\nnet cash generated from financing activities was $24.6 million for the year ended December 31, 2024, an increase of $10.0 million compared\nto the same period of 2023. During the year ended December 31, 2024, the Company received aggregate net proceeds of $24.9 million from\nregistered direct offerings in 2023 compared to $17.9 million in the same period of 2023.\n\n \n\nWe\nhave financed our operations primarily through cash flows from operations, working capital from our shareholders, and equity financing\nthrough public and private offerings of our securities. We plan to support our future operations primarily from cash generated from our\noperations and equity financing.\n\n \n\n**Private\nPlacements**\n\n \n\nOn\nJuly 31, 2025, the Company raised gross proceeds of approximately $7.5 million through private placements with certain non-U.S. investors.\n\n \n\n**GAAP\nOperating Loss and EPS**\n\n \n\nThe\nCompany had an operating loss of $98.6 million for 2025, compared to an operating loss of $21.6 million, for 2024.\n\n \n\nGAAP\nEPS Basic (Diluted EPS is the same as EPS Basic) was $(6.0184) per share for the period ended December 31, 2025, as compared to $(4.4850)\nper share for the period ended December 31, 2024.\n\n \n\n**C. Research\nand Development, Patents and Licenses, etc.**\n\n \n\nResearch\nand development, patents and licenses, etc.\n\n \n\nAs\nof December 31, 2025, SOS Institution of Research& Development in Qingdao has achieved the following registered IPs in decentralized\nblock-chain technology system, including:\n\n \n\n*SOS-Qingdao\nResearch Institute (2021)*\n\n* *\n\nIn\nline with the Company development direction, the R&D department of SOS-Qingdao Research Institute has achieved gratifying achievements\nin 2021. Major R&D achievements attained include the following platforms:\n\n* *\n\n \n●\nSOS cloud blockchain firewall\nsystem (software copyright certified)\n\n* *\n\n \n●\nSOS cloud blockchain personal\nbioinformation storage system (software copyright certified)\n\n* *\n\n \n●\nSOS cloud blockchain decentralized\nantivirus system (software copyright certified)\n\n* *\n\n \n1.\nBlockchain Inventory Management\nsystem for international trade (in operation). SOS Inventory Management System is a decentralized intelligent product track-and-trace\nplatform that leverages blockchain technology. It provides reliable and comprehensive solution to traceability issues in value chain.\nThe intelligent digital trading platform uses blockchain technology to digitize the commodity information across the full value chain,\nfrom product origin, manufacturers, channels, retailers, promoters to consumers. The information of each participant can be viewed\nin the blockchain. The structure of blockchain ensures that each step in the production is accountable and traceable.\n\n* *\n\n \n2.\nBlockchain supercomputing\ncenter management system (in operation): The R&D department of SOS-Qingdao Research Institute cooperates with Fish Pond, the\nworld’s largest Bitcoin mining pool and Litecoin mining pool service provider, to develop its own backend management system\nto assist the overseas business expansion of SOS Supercomputing Center.\n\n \n\n54\n\n \n\n  \n\n*Insurance\npromotion industry research and development*\n\n \n\nSOS\nis committed to the development of insurance product promotion projects, including:\n\n \n\n \n●\nSOS Cloud Alliance System:\nIntegration of resources across industries to jointly promote the transformation, upgrade, development and integration of the insurance\nmarket to create an open platform, mainly for the accurate promotion of insurance products.\n\n \n\n \n●\nYuge CRS agent distribution\nsystem: for insurance agents, brokers tailor-made development of a set of high-tech intelligent system for insurance business tracking\nand promotion of orders, through which the system can be managed, viewed, modified, quantified, inquired and other management operations,\nso that the process is standardized, improving work efficiency.\n\n \n\n \n●\nAI Smart and Artificial\nElectronic Marketing System: Developed automatic external voice robot for screening effective customer resources and manual tracking\nthrough manual electronic marketing system to improve the efficiency of ordering.\n\n \n\n \n●\nSOS Big Data Platform:\nBig Data Integration, Ledger Management Platform, can organize, match, process customer resources, high-performance data sharing\nservices and provide compliance basis for relevant departments.\n\n \n\nThe\nforegoing R&D is being conducted through the cooperation of more than 60 high-tech talents and a number of project leaders. The R&D\nproject is mainly being developed through, Java, .Net, PHP, Android and IOS, and continuous system upgrades, and functional expansions.\n\n \n\n*Cryptocurrency\nmining industry research and development*\n\n \n\n \n●\nSecure wallet\n\n \n\n \n■\nPrivate key local secure\nsave, support for a variety of wallet types, nation code backups for anti-loss, multi-signature anti-theft system, ease of import\nand export for wallet.\n\n \n\n \n■\nAdd digital assets with\none click, track trading trends in real time, and view asset balance changes.\n\n \n\n \n■\nFollow the world’s\nmajor exchange prices and price alerts, seize investment opportunities with built-in trading exchange services.\n\n \n\n \n■\nIntegrate third-party DAP\ninteractions with push industry information, technology advances, and multi-dimensional data information to discover investment opportunities.\n\n \n\n \n●\nPrivate mine pool\n\n \n\n \n■\nSupport for multi-currency\nmining (tentative support for ETH, BTC)\n\n \n\n \n■\nIntuitive revenue calculator,\nto fill in one’s own mining machine’s calculation power, so that each time one opens the wallet, he or she may intuitively\nsee which currency is currently being mined with a higher yield, to help create mining strategies.\n\n \n\n \n■\nInformation-rich monitoring\ninterface computing power, estimated daily revenue, temperature, power consumption, electricity charges, fans, graphics card serial\nnumber, graphics card name, PCI socket, etc.\n\n \n\nThe\nforegoing R&D is being conducted through the cooperation of more than 39 high-tech talent and a number of system analysis management\npersonnel. The R&D project is mainly being developed through C++, Python, Go, Java, .Net, PHP, Android, and IOS, with constant system\nupgrades and feature expansions.\n\n \n\n55\n\n \n\n \n\n**D. Trend\nInformation**\n\n \n\nOther\nthan as disclosed elsewhere in this annual report, we are not aware of any trends, uncertainties, demands, commitments or events for\nthe year ended December 31, 2022 that are reasonably likely to have a material adverse effect on our revenues, net income, profitability,\nliquidity or capital resources, or that would cause reported financial information not necessarily to be indicative of future operating\nresults or financial conditions.\n\n \n\n**E.\nCritical Accounting Estimates**\n\n \n\n**Critical\nAccounting Estimates**\n\n \n\nOur\ndiscussion and analysis of our financial condition and results of operations relates to our consolidated financial statements, which\nhave been prepared in accordance with United States of America generally accepted accounting principles (“U.S. GAAP”). The\npreparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities,\nrevenues, costs and expenses, and related disclosures.\n\n \n\nFor\na detailed discussion of our significant accounting policies and related judgments, please see “Note 2—Summary of Significant\nAccounting Policies”. You should read the following description of critical accounting estimates in conjunction with our consolidated\nfinancial statements and other disclosures included in this annual report.\n\n \n\nDiscontinued\nOperations\n\n \n\nOn\nDecember 5, 2023, the entity was deregistered following a period of dormancy with limited operational activity.\n\n \n\nOn\nOctober 4, 2022, the Company’s Board of Directors and the Special Committee passed a resolution to sell the operation of S\nInternational Group Limited and SOS Information Technology Co., Ltd to S International Holdings Limited (“Purchaser”), a\nCayman Islands exempt company in cash consideration of $17,000,000. The Company does not believe that the disposition will have a significant,\nmaterial impact on the Company’s consolidated financial statements. Mr. Yandai Wang, Chief Executive Officer and Chairman of the\nBoard of Directors of the Company, holds 45% of the Purchaser’s equity interests, and Ms. Yilin Wang, original shareholder of the\nVIE and legal representative of SOS Information Technology Co., Ltd., a subsidiary of the VIE, holds 40% of the Purchaser’s equity\ninterests. As a result, the disposition is a related party transaction. In accordance with ASC 205-20, the Company presented the operating\nresults from these operations as a discontinued operation.\n\n \n\nSegment\nInformation Reclassification\n\n \n\nThe Company’s chief operating decision maker has been identified\nas the Chief Executive Officer, who reviews consolidated results when making decisions about allocating resources and assessing performance\nof the Company. The Company considers itself to be operating within single reportable segment.\n\n \n\n**Impact\nof Recently Issued Accounting Pronouncements**\n\n \n\nThe\nCompany continually assesses any new accounting pronouncements to determine their applicability. When it is determined that a new accounting\npronouncement affects the Company’s financial reporting, the Company undertakes a study to determine the consequences of the change\nto its condensed consolidated financial statements and assures that there are proper controls in place to ascertain that the Company’s\ncondensed consolidated financial statements properly reflect the change.\n\n \n\nIn\nNovember 2024, the FASB issued ASU 2024-03, *Income Statement—Reporting Comprehensive Income—Expense Disaggregation\nDisclosures (Subtopic 220-40*) (“ASU 2024-03”). ASU 2024-03 requires, in the notes to the financial statements, disclosures\nof specified information about certain costs and expenses specified in the updated guidance. ASU 2024-03 is effective for annual reporting\nperiods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. Early adoption is permitted.\nThe Company is evaluating the impact the updated guidance will have on its disclosures.\n\n \n\nIn\nMay 2025, FASB issued ASU 2025-03, *Business Combinations* (Topic 805) and Consolidation (Topic 810): Determining the\nAccounting Acquirer in the Acquisition of a Variable Interest Entity, which amends the guidance for identifying the accounting acquirer\nin transactions involving the acquisition of a variable interest entity that meets the definition of a business. The new standard is\neffective for the Company for its annual periods beginning January 1, 2027, with early adoption permitted. The Company is currently evaluating\nthe impact of adopting the standard.\n\n \n\n56\n\n \n\n \n\nOn\nSeptember 18, 2025, the FASB issued ASU 2025-06, *Intangibles – Goodwill and Other – Internal-Use Software* (Topic\nASC 350-40) which amends certain aspects of the accounting for and disclosure of software costs under ASC 350-40. The ASU makes targeted\nimprovements to ASC 350-40 but does not fully align the framework for accounting for internally developed software costs that are subject\nto ASC 350-40 with the framework applied to software to be sold or marketed externally that is subject to ASC 985-20. The ASU also does\nnot amend the guidance on costs of software licenses that are within the scope of ASC 985-20. The amendments supersede the guidance on\nWeb site development costs in ASC 350-50 and relocate that guidance, along with the recognition requirements for development costs specific\nto Web sites, to ASC 350-40. The new guidance will be effective for all entities for annual periods beginning after December 15, 2027.\nEarly adoption is permitted as of the beginning of an annual reporting period. The guidance can be applied on a fully prospective basis,\na modified basis for in-process projects, or a full retrospective basis. The Company is currently evaluating the impact of adopting the standard.\n\n** **\n\n**Recent\nDevelopments**\n\n \n\nFinancings\n\n \n\n*March 2025 Private Placement*\n\n \n\nOn March 19, 2025, SOS Limited entered into a\nsecurities purchase agreement with certain non-U.S. investors pursuant to Regulation S under the Securities Act of 1933, as amended, for\nthe sale of an aggregate of 222,337,500 units at a purchase price of $0.034666 per unit, for aggregate gross proceeds of approximately\n$7.7 million. Each unit consisted of one Class A ordinary share and one warrant to purchase three Class A ordinary shares at an initial\nexercise price of $0.0398 per share (approximately $5.97 per ADS). The warrants were immediately exercisable, expire five years from issuance,\nand contain customary anti-dilution provisions and mandatory exercise provisions. The Company intends to use the net proceeds from the\noffering for working capital and general corporate purposes. The transaction closed on April 9, 2025 following the satisfaction of all\nclosing conditions.\n\n \n\n*July 2025 Registered Direct Offering and Concurrent\nPrivate Placement*\n\n \n\nOn July 31, 2025, SOS Limited entered into a securities\npurchase agreement with certain non-affiliated institutional investors pursuant to which the Company sold 2,142,855 American Depositary\nShares in a registered direct offering at a combined offering price of $3.50 per ADS and accompanying warrant, resulting in aggregate\ngross proceeds of approximately $7.5 million before deducting placement agent fees and offering expenses. In a concurrent private placement,\nthe Company issued unregistered warrants to purchase up to an aggregate of 4,285,710 ADSs, with each warrant immediately exercisable at\nan exercise price of $3.50 per ADS and expiring five and one-half years from the initial exercise date. The warrants and the ADSs issuable\nupon exercise thereof were issued in a private placement pursuant to Section 4(a)(2) of the Securities Act and Regulation D promulgated\nthereunder. The Company agreed to file a registration statement covering the resale of the warrants and the ADSs issuable upon exercise\nthereof. The Company also agreed to a 90-day restriction on the issuance of ADSs, ordinary shares or ordinary share equivalents, subject\nto certain exceptions, and the Company’s officers, directors and certain significant shareholders entered into 90-day lock-up agreements.\nMaxim Group LLC acted as the exclusive placement agent for the offering. The Company intends to use the net proceeds for working capital\nand general corporate purposes. The offering closed on July 31, 2025.\n\n \n\nTermination\nof ADR Program\n\n \n\nOn\nSeptember 8, 2025, in connection with a 150-for-one consolidation of the Company’s ordinary shares approved by shareholders at\nan extraordinary general meeting held on August 11, 2025, the Company terminated its ADS program and the Deposit Agreement with Citibank,\nN.A., as depositary. All outstanding ADSs were automatically cancelled, and each ADS holder received one (1) Class A Ordinary Share,\npar value US$0.75 per share, for each ADS cancelled. Following the termination, the Company’s Class A Ordinary Shares commenced\ndirect trading on the New York Stock Exchange.\n\n \n\n57"}