UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

For the quarterly period ended July 31, 2023

Commission File No.333-216645

Registrant’s telephone number, including area code (949) 202-9235

Securities registered pursuant to Section 12(b) of the Act: None

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for shorter period that the registrant as required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ☐ Yes     ☒ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). ☒ Yes     ☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). ☐ Yes     ☒ No

Indicate by checkmark whether the issuer has filed all documents and reports required to be filed by Section 12, 13 and 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court. ☐ Yes     ☐ No

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the most practicable date:

TABLE OF CONTENTS

PART I – FINANCIAL INFORMATION

Item 1. Financial Statements.

VITASPRING BIOMEDICAL CO., LTD.

INDEX TO FINANCIAL STATEMENTS

VITASPRING BIOMEDICAL CO., LTD

BALANCE SHEETS

(Unaudited)

See the accompanying Notes, which are an integral part of this unaudited financial statement.

VITASPRING BIOMEDICAL CO., LTD

STATEMENTS OF OPERATIONS

 (Unaudited)

See the accompanying Notes, which are an integral part of this unaudited financial statement.

VITASPRING BIOMEDICAL CO., LTD

STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (DEFICIT)

(Unaudited)

For the three and six months ended July 31, 2023

For the three and six months ended July 31, 2022

See the accompanying Notes, which are an integral part of this unaudited financial statement.

VITASPRING BIOMEDICAL CO., LTD

STATEMENTS OF CASH FLOWS

 (Unaudited)

See the accompanying Notes, which are an integral part of this unaudited financial statement.

VITASPRING BIOMEDICAL CO., LTD.

Notes to Unaudited Financial Statements

July 31, 2023

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion should be read in conjunction with our financial statements, including the notes thereto, appearing elsewhere in this Quarterly Report on Form 10-Q. This section contains forward-looking statements that involve risks and uncertainties, and reflect our plans, estimates and beliefs. Our actual results could differ materially from those discussed below. See “Special Note Regarding Forward-Looking Statements.”

Forward-Looking Statements

This annual report contains forward-looking statements. These statements relate to future events or our future financial performance. These statements often can be identified by the use of terms such as “may,” “will,” “expect,” “believe,” “anticipate,” “estimate,” “approximate” or “continue,” or the negative thereof. We intend that such forward-looking statements be subject to the safe harbors for such statements. We wish to caution readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made. Any forward-looking statements represent management’s best judgment as to what may occur in the future. However, forward-looking statements are subject to risks, uncertainties and important factors beyond our control that could cause actual results and events to differ materially from historical results of operations and events and those presently anticipated or projected. We disclaim any obligation subsequently to revise any forward-looking statements to reflect events or circumstances after the date of such statement or to reflect the occurrence of anticipated or unanticipated events.

As used in this annual report, the terms “we,” “us,” “our,” or “the Company,” mean VitaSpring Biomedical Co., Ltd., unless otherwise indicated.

All dollar amounts refer to US dollars unless otherwise indicated.

Overview

We are a development-stage biomedical and nutraceutical company focused on cell-based technologies for regenerative and preventative health applications. engaged in the research, development, and commercialization of products that promote wellness and a healthy lifestyle. We began limited operations in 2019 and underwent a change of ownership effective January 21, 2020, resulting in a new management team and strategic direction. In connection with this ownership change, we filed a Certificate of Amendment to our Articles of Incorporation to change our corporate name to VitaSpring Biomedical Co. Ltd., which became effective on April 21, 2020, following clearance by the Financial Industry Regulatory Authority (“FINRA”).

As of the date of this filing, we have not commenced principal revenue-generating operations and have generated limited revenues since inception. Our operations have been limited to organizational activities, administrative functions, and preparation for future service offerings.

Results of Operation

For the three months ended July 31, 2023 compared to the three months ended July 31, 2022

Revenue

We generated no revenue during the three months ended July 31, 2023 and 2022. We are currently focusing on restructuring our product strategy and developing long-term partnerships rather than pursuing short-term sales.

Cost of Goods Sold

We did not generate any cost of goods sold due to no revenue in the three months ended July 31, 2023 and 2022.

Operating Expenses

Operating expenses totaled $353,583 in the three months ended July 31, 2023 compared with $174,511 in the three months ended July 31, 2022. The increase in operating expense is mainly due to the opening of Taiwan office to seek business. We continue to carefully manage overhead while maintaining core research and corporate functions.

Other Income

We recorded no other income in the three months ended July 31, 2023 compared with $50, which primarily represents miscellaneous non-operating income in the three months ended July 31, 2022.

Provision for Income Taxes

Our income tax expense was $0 in three months ended July 31, 2023, compared with a tax benefit of $30,326 in the three months ended July 31, 2022. The variance primarily reflects the change from profitability in 2022 to a loss in 2023 and adjustments to deferred tax items.

Net Income (Loss)

As a result of the foregoing, we recorded a net loss of $353,583 for the three months ended July 31, 2023, compared with net income of $144,135 in the three months ended July 31, 2022. The change in net income to net loss was mainly due to the absence of revenue and the continuation of fixed operating costs.

For the six months ended July 31, 2023 compared to the six months ended July 31, 2022

Revenue

We generated no revenue during the six months ended July 31, 2023, compared with $1,490,000 in the six months ended July 31, 2022. The decrease was due to the no product sales in the six months ended July 31, 2023. We are currently focusing on restructuring our product strategy and developing long-term partnerships rather than pursuing short-term sales.

Cost of Goods Sold

Cost of goods sold was $0 in the six months ended July 31, 2023 compared with $922,000 in the six months ended July 31, 2022. We did not generate any cost of goods sold due to no revenue in the three months ended July 31, 2023.

Operating Expenses

Operating expenses totaled $658,184 in the six months ended July 31, 2023 compared with $399,384 in the six months ended July 31, 2022. The increase in operating expense is mainly due to the opening of Taiwan office to seek business. We continue to carefully manage overhead while maintaining core research and corporate functions.

Other Income

We recorded no other income in the six months ended July 31, 2023 compared with $8,572, which primarily represents miscellaneous non-operating income in the six months ended July 31, 2022.

Provision for Income Taxes

Our income tax expense was $0 in fiscal 2023, compared with a tax expense of $44,667 in the six months ended July 31, 2022. The variance primarily reflects the change from profitability in 2022 to a loss in 2023 and adjustments to deferred tax items.

Net Income (Loss)

As a result of the foregoing, we recorded a net loss of $658,184 for the six months ended July 31, 2023, compared with net income of $132,521 in the six months ended July 31, 2022. The change in net income to net loss was mainly due to the absence of revenue and the continuation of fixed operating costs.

Liquidity and Capital Resources

The following table summarizes our changes in working capital deficiency from January 31, 2023 to July 31, 2023:

The following table summarizes our cash flows for the six months ended July 31, 2023 and 2022:

As of July 31, 2023, we had cash of approximately $7,000, compared with $30,000 at January 31, 2023. The decrease of approximately $23,000 was mainly due to cash used in our operations.

We have funded our activities primarily through shareholder advances. We incurred a net loss of $658,184 in the six months ended July 31, 2023. We continue to rely on external funding and available cash balances to meet our working-capital needs. Management believes that additional capital will be required to support operations over the next twelve months.

We expect to continue to require additional capital to support operations, research, and regulatory initiatives. Management is exploring potential sources of financing, including private placements of equity or debt securities and strategic partnerships. There is no assurance that additional funding will be available on acceptable terms. If we cannot secure sufficient financing, we may need to delay or scale back parts of our business plan.

We believe our current cash resources will not be sufficient to fund planned operations for the next twelve months without additional capital. The continuation of our business depends on our ability to raise funds and generate future revenue.

Operating Activities

Cash used in operating activities of $27,752 for the six months ended July 31, 2023 reflected primarily our net loss of $658,184 increased by depreciation of $7,531, non-cash lease expense of $80,912 and stock-based compensation of $82,432, and a change in assets and liabilities of $459,557.

Cash used in operating activities of $85,622 for the six months ended July 31, 2022 reflected primarily our net income of $132,521 increased by depreciation of $7,531, non-cash lease expense of $91,688, stock-based compensation of $73,018 and deferred tax benefit of $5,227, and a change in assets and liabilities of $395,607.

Investing Activities

We had no investing activities during the six months ended July 31, 2023 and 2022.

Financing Activity

We has financing inflow of $5,277 from advances from related parties in the six months ended July 31, 2023. We had no financing inflows in the six months ended July 31, 2022. We may seek additional equity or debt financing in future periods to support ongoing operations.

We expect to continue to rely on equity financing and, where available, strategic partnerships or grants to meet our capital needs. Our ability to raise additional capital will depend on market conditions, investor interest, and our progress in commercializing our stem-cell and biomedical technologies.

Capital Requirements and Liquidity Outlook

We believe that our existing cash resources will not be sufficient to fund operations for the next twelve months without additional financing. To meet our capital needs, we plan to seek additional equity or debt financing and may also pursue strategic partnerships or licensing opportunities. There is no assurance that such financing will be available on favorable terms or at all. If we cannot obtain adequate funding, we may need to delay, scale back, or discontinue some of our business activities.

Going Concern

We evaluate our ability to continue as a going concern in accordance with ASC 205-40, Presentation of Financial Statements — Going Concern. This evaluation requires us to assess whether conditions or events raise substantial doubt about our ability to meet our obligations as they become due during the twelve months following the issuance of these financial statements.

Our financial statements have been prepared assuming we will continue as a going concern. As disclosed in Note 2 to our financial statements, as of July 31, 2023, we had an accumulated deficit of $4,046,203 and negative operating cash flow of $27,752, and limited operations, which raise substantial doubt about our ability to continue as a going concern. Our continued existence is dependent upon our ability to obtain additional funding and implement a business plan that generates sustainable revenues.

Off-Balance Sheet Arrangements

As of the date of this Quarterly Report, we do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors.

Plan of Operation and Funding

We expect that working capital requirements will continue to be funded through a combination of our existing funds and further issuances of securities. Our working capital requirements are expected to increase in line with the growth of our business.

Existing working capital, further advances and debt instruments, and anticipated cash flow are expected to be adequate to fund our operations over the next twelve months. We have no lines of credit or other bank financing arrangements. Generally, we have financed operations to date through the proceeds of the private placement of equity and debt instruments. In connection with our business plan, management anticipates additional increases in operating expenses and capital expenditures relating to: (i) developmental expenses associated with a start-up business and (ii) marketing expenses. We intend to finance these expenses with further issuances of securities, and debt issuances. Thereafter, we expect we will need to raise additional capital and generate revenues to meet long-term operating requirements. Additional issuances of equity or convertible debt securities will result in dilution to our current shareholders. Further, such securities might have rights, preferences or privileges senior to our common stock. Additional financing may not be available upon acceptable terms, or at all. If adequate funds are not available or are not available on acceptable terms, we may not be able to take advantage of prospective new business endeavors or opportunities, which could significantly and materially restrict our business operations.

Critical Accounting Policies and Estimates

The preparation of financial statements in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, expenses, and related disclosures. The Company’s significant accounting policies are described in Note 4 to the financial statements. Management considers the following policies to be critical because they involve significant judgments and assumptions, and because different assumptions could materially affect the Company’s financial condition or results of operations. Critical estimates are those estimates that in accordance with U.S. GAAP, involve a significant level of estimation uncertainty and have had or are reasonably likely to have a material impact on our financial statements. Management has determined that our most critical accounting estimates are those relating to fair value of financial instruments.

Use of Estimates

The preparation of financial statements in conformity with U.S. generally accepted accounting principles (“GAAP”) ordinarily requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, and expenses. However, for the quarter ended July 31, 2023, our operations and financial statement items did not require the use of any significant estimates or assumptions. All amounts presented are based on actual, readily determinable values, and no material judgments or estimation methodologies were applied.

Fair Value of Financial Instruments

The Company follows ASU 2022-03, ASC Subtopic “Fair Value Measurement (Topic 820): Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions” (“ASC 820”), which defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820 also establishes a fair value hierarchy that distinguishes between (1) market participant assumptions developed based on market data obtained from independent sources (observable inputs) and (2) an entity’s own assumptions about market participant assumptions developed based on the best information available in the circumstances (unobservable inputs). The fair value hierarchy consists of three broad levels, which gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). The three levels of the fair value hierarchy are described below:

Level 1

Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.

Level 2

Level 2 applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data.

Level 3

Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities.

The carrying amounts shown of the Company’s financial instruments including cash and cash equivalents and accounts payable approximate fair value due to the short-term maturities of these instruments.

Income Taxes and Deferred Tax Assets

We account for income taxes using the liability method under ASC 740. Deferred tax assets are recognized for temporary differences between financial statement and tax bases of assets and liabilities. A valuation allowance is established when it is more likely than not that all or part of a deferred tax asset will not be realized. Determining the amount of valuation allowance requires significant judgment in estimating future taxable income, applicable tax strategies, and the expected timing of reversals of temporary differences.

Material Commitments

None.

Purchase of Significant Equipment

We do not intend to purchase any significant equipment during the next twelve months.

Item 3. Quantitative and Qualitative Disclosures about Market Risk

We are a smaller reporting company and not required to provide this information.

Item 4. Controls and Procedures

Disclosure Controls and Procedures

Our management, with the participation of our Chief Executive Officer (CEO), is responsible for establishing and maintaining disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 (the “Exchange Act”). Disclosure controls and procedures are designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to management, including the CEO, to allow timely decisions regarding required disclosure.

As of the end of the fiscal quarter ended July 31, 2023, management conducted an evaluation, under the supervision and with the participation of our CEO, of the effectiveness of our disclosure controls and procedures. Based on this evaluation, our CEO concluded that our disclosure controls and procedures were not effective as of July 31, 2023, due to a material weakness in our internal control over financial reporting, as described below.

Management’s Report on Internal Control Over Financial Reporting

Management is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. Our internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”).

Because of inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, evaluations of effectiveness to future periods are subject to the risk that controls may become inadequate due to changes in conditions or deterioration in compliance with policies or procedures.

Management assessed the effectiveness of our internal control over financial reporting as of July 31, 2023, using the criteria set forth in the Internal Control—Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”). Based on this assessment, management concluded that our internal control over financial reporting was not effective as of that date, due to the following material weakness:

Remediation Plan

We are committed to improving our internal control environment. To remediate the identified material weakness, we plan to evaluate and enhance our internal control procedures and, as resources permit, hire additional qualified personnel or engage external consultants with relevant expertise in financial reporting and SEC compliance. We intend to enhance our internal control procedures in Q1 of 2026.

Changes in Internal Control Over Financial Reporting

There were no changes in our internal control over financial reporting during the fiscal quarter ended July 31, 2023, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II – OTHER INFORMATION

Item 1. Legal Proceedings

We are not subject to any legal proceedings and are unaware of any pending against us.

As disclosed in our Current Report on Form 8-K filed with the Securities and Exchange Commission on August 11, 2025, certain of our former officers and our director are subject of legal proceedings in Taiwan. These matters do not involve us, and we are not a party to any of the proceedings referenced in the Form 8-K.

Please refer to the Form 8-K for additional information regarding those matters.

Item 1A. Risk Factors

We are a smaller reporting company and not required to provide this information.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

We did not issue any equity securities for the quarter ended July 31, 2023.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

None.

Item 6. Exhibits

The following documents are filed as part of this report:

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.