NEW YORK and TOKYO, Nov. 18, 2025 (GLOBE NEWSWIRE) -- HeartCore Enterprises, Inc. (Nasdaq: HTCR) ("HeartCore" or the "Company"), an IPO consulting services company based in Tokyo, reported financial results for the third quarter and nine months ended September 30, 2025.
Third Quarter 2025 and Recent Operational & Financial Highlights
-- Divested software business subsidiary, HeartCore Co., Ltd ("HeartCore
Japan")
-- Authorized one-time distribution payment to stockholders
-- Announced Go IPO client, rYojbaba Co., Ltd. began trading on the Nasdaq
Stock Market
-- Signed 16th Go IPO contract
Management Commentary
"This past month, we made the strategic and transformative decision to divest our software business subsidiary, HeartCore Japan, in an all-cash transaction, effectively making a full pivot into our Go IPO business," said Company CEO Sumitaka Kanno. "We believe this move positions HeartCore for long-term, sustainable success by sharpening our focus on a more profitable business in Go IPO. In parallel with this transaction, we also implemented meaningful expense reductions that will help lower operating costs going forward. A portion of the divestiture proceeds was used towards the one-time distribution payment, which was paid out yesterday. We are also continuing to assess all strategic alternatives to divest our subsidiary, Sigmaways. We believe this move will support our bottom-line performance going forward and further accelerate our shift towards the IPO consulting space.
"In recent months, we signed our 16(th) Go IPO client, saw one client successfully begin trading, and anticipate another will commence trading soon. Additionally, following our Go IPO Korea seminar, we have been in discussion with several prospective Korean clients which we hope to materialize in the near future. Demand from Japan also remains strong, and we believe we are on the precipice of engaging additional potential clients in the next few months. This full transition into our Go IPO business now allows us to dedicate more time and resources to its growth, and with a strong pipeline, we look forward to continued expansion of our IPO consulting business in Japan and Korea."
Third Quarter 2025 Financial Results
Revenues were $3.0 million, compared to $16.2 million in the same period last year. The decrease was primarily due to the signature warrant revenue of $13 million from one large GO IPO deal in the prior period, and no comparable revenue in the current period.
Gross profit was $1.5 million, compared to $14.0 million in the same period last year. The decrease was primarily due to the decrease in the gross profit from GO IPO services.
Operating expenses decreased to $1.5 million, compared to $1.7 million in the same period last year. The decrease was primarily cut down of various operating expenses to save cash flows.
Net income was $0.4 million compared to a net income of $10.8 million in the same period last year.
Adjusted EBITDA was $0.5 million, compared to $12.0 million in the same period last year.
As of September 30, 2025, the Company had cash and cash equivalents of $1.5 million, compared to $2.0 million on December 31, 2024. On a pro forma basis, as of November 18, 2025, the Company has approximately $2.5 million of cash and cash equivalents, after the one-time payment to stockholders.
Nine Months 2025 Financial Results
Revenues were $7.1 million, compared to $21.3 million in the same period last year. The decrease was primarily due to the signature warrant revenue of $13M from one large GO IPO deal in the prior period, and no comparable revenue in the current period.
Gross profit was $2.6 million, compared to $15.1 million in the same period last year. The decrease was primarily due to the decrease in the gross profit from GO IPO services.
Operating expenses decreased to $4.5 million, compared to $5.5 million in the same period last year. The decrease was primarily due to a decrease in general and administrative, selling, and research and development expenses.
Net loss was $1.7 million compared to a net income of $7.1 million in the same period last year.
Adjusted EBITDA was $(0.6) million, compared to $10.4 million in the same period last year.
About HeartCore Enterprises, Inc.
HeartCore is a Tokyo-based IPO consulting services company, guiding Japanese growth companies to achieve successful U.S. exchange listings through its flagship service, Go IPO. HeartCore's Go IPO$(SM)$ consulting services provide comprehensive consultation support, including pre-IPO consulting, regulatory guidance, financial preparation, and operational readiness to help businesses navigate the complexities of a successful U.S. listing. HeartCore's goal is to streamline the entire process for Japanese companies to provide a seamless transition into the U.S. public markets. For more details, visit https://heartcore-enterprises.com/.
Non-GAAP Financial Measures
This document includes references to adjusted EBITDA, which is a non-GAAP financial measure. For the purposes of this presentation, adjusted EBITDA is calculated by adjusting net loss to exclude depreciation and amortization, changes in fair value of investments in marketable securities, changes in fair value of investment in warrants, interest income, and interest expenses.
This measure is presented as supplemental information and is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with accounting principles generally accepted in the U.S. ("GAAP").
Management believes that adjusted EBITDA provides useful information to investors by highlighting the Company's core operational performance, excluding non-cash and non-recurring items. However, non-GAAP financial measures have limitations and should not be considered in isolation or as a substitute for financial results prepared in accordance with GAAP.
For the three months ended September 30,
Item 2025 2024
---------------------------------- -------------------- --------------------
Net income $0.4 million $10.8 million
---------------------------------- -------------------- --------------------
(+) Depreciation and amortization
expense $0.0 million $0.2 million
---------------------------------- -------------------- --------------------
(+) Changes in fair value of
investments in marketable
securities $0.0 million -$0.1 million
---------------------------------- -------------------- --------------------
(+) Changes in fair value of
investment in warrants $0.1 million -$2.9 million
---------------------------------- -------------------- --------------------
(+) Loss on sale of warrants $0.0 million $4.0 million
---------------------------------- -------------------- --------------------
(+) Changes in fair value of
derivative liability $0.0 million $0.0 million
---------------------------------- -------------------- --------------------
(--) Interest income $0.0 million $0.0 million
---------------------------------- -------------------- --------------------
(+) Interest expenses $0.0 million $0.0 million
---------------------------------- -------------------- --------------------
Adjusted EBITDA $0.5 million $12.0 million
---------------------------------- -------------------- --------------------
For the nine months ended September 30,
Item 2025 2024
----------------------------------- -------------------- -------------------
Net income -$1.7 million $7.1 million
----------------------------------- -------------------- -------------------
(+) Depreciation and amortization
expense $0.0 million $0.5 million
----------------------------------- -------------------- -------------------
(+) Changes in fair value of
investments in marketable
securities $0.9 million $0.3 million
----------------------------------- -------------------- -------------------
(+) Changes in fair value of
investment in warrants $0.1 million -$1.6 million
----------------------------------- -------------------- -------------------
(+) Loss on sale of warrants $0.0 million $4.0 million
----------------------------------- -------------------- -------------------
(+) Changes in fair value of
derivative liability $0.0 million $0.0 million
----------------------------------- -------------------- -------------------
(--) Interest income $0.0 million $0.0 million
----------------------------------- -------------------- -------------------
(+) Interest expenses $0.1 million $0.1 million
----------------------------------- -------------------- -------------------
Adjusted EBITDA -$0.6 million $10.4 million
----------------------------------- -------------------- -------------------
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, or the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical facts included in this press release are forward-looking statements. In some cases, forward-looking statements can be identified by words such as "believed," "intend," "expect," "anticipate," "plan," "potential," "continue," or similar expressions. Such forward-looking statements include risks and uncertainties, and there are important factors that could cause actual results to differ materially from those expressed or implied by such forward-looking statements. These factors, risks, and uncertainties are discussed in HeartCore's filings with the Securities and Exchange Commission. Investors should not place any undue reliance on forward-looking statements since they involve known and unknown, uncertainties and other factors which are, in some cases, beyond HeartCore's control which could, and likely will materially affect actual results, and levels of activity, performance, or achievements. Any forward-looking statement reflects HeartCore's current views with respect to future events and is subject to these and other risks, uncertainties, and assumptions relating to operations, results of operations, growth strategy, and liquidity. HeartCore assumes no obligation to publicly update or revise these forward-looking statements for any reason, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future. The contents of any website referenced in this press release are not incorporated by reference herein.
HeartCore Investor Relations Contact:
Gateway Group, Inc.
John Yi and Steven Shinmachi
HTCR@gateway-grp.com
(949) 574-3860
HeartCore Enterprises, Inc.
Consolidated Balance Sheets
September 30, December 31,
2025 2024
------------- --------------
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents $ 1,451,019 $ 1,973,810
Accounts receivable 1,107,187 1,030,243
Investments in marketable securities 2,903,815 4,495,703
Investment in warrants 598,380 -
Prepaid expenses 144,048 131,325
Current portion of long-term note
receivable 200,000 100,000
Deferred offering costs 250,000 -
Other current assets 133,056 136,217
Current assets of discontinued
operations 5,824,649 1,550,067
Total current assets 12,612,154 9,417,365
Non-current assets:
Property and equipment, net 319,361 475,697
Operating lease right-of-use assets 29,386 172,594
Long-term investment in warrants 354,950 577,786
Long-term note receivable - 100,000
Deferred tax assets 3,914 31,575
Security deposits 6,578 108,880
Other non-current assets 10,828 11,715
Non-current assets of discontinued
operations - 3,069,422
Total non-current assets 725,017 4,547,669
Total assets $ 13,337,171 $ 13,965,034
============ ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued expenses $ 1,333,724 $ 1,637,108
Accounts payable and accrued expenses -
related party 25,507 47,199
Accrued payroll and other employee
costs 382,087 273,115
Due to related party - 885
Short-term debt - related party 70,900 75,000
Current portion of long-term debts 49,479 46,382
Insurance premium financing 52,823 16,626
Factoring liability 228,310 172,394
Operating lease liabilities, current 20,400 134,910
Finance lease liabilities, current 17,349 15,956
Income tax payables 716,253 818,030
Deferred revenue 472,830 751,251
Derivative liability 245,820 -
Other current liabilities 654,606 589,762
Current liabilities of discontinued
operations 4,735,007 2,843,104
Total current liabilities 9,005,095 7,421,722
Non-current liabilities:
Long-term debts 461,433 498,706
Operating lease liabilities,
non-current 12,126 41,530
Finance lease liabilities, non-current 33,899 43,593
Asset retirement obligations - 72,463
Non-current liabilities of discontinued
operations - 2,425,005
Total non-current liabilities 507,458 3,081,297
------------ -----------
Total liabilities 9,512,553 10,503,019
------------ -----------
Shareholders' equity:
Preferred shares, $0.0001 par value,
20,000,000 shares authorized; Series A
convertible preferred shares, 2,000
and no shares designated, issued and
outstanding as of September 30, 2025
and December 31, 2024, respectively;
aggregate liquidation preference of
$2,256,833 and nil as of September 30,
2025 and December 31, 2024,
respectively 1,360,586 -
Common shares, $0.0001 par value,
200,000,000 shares authorized,
23,310,770 and 21,937,987 shares
issued and outstanding as of September
30, 2025 and December 31, 2024,
respectively 2,331 2,193
Subscription receivable - (103,942)
Additional paid-in capital 21,269,122 20,656,153
Accumulated deficit (17,797,861) (16,244,843)
Accumulated other comprehensive income 357,275 343,936
Total HeartCore Enterprises, Inc.
shareholders' equity 5,191,453 4,653,497
Non-controlling interests (1,366,835) (1,191,482)
Total shareholders' equity 3,824,618 3,462,015
------------ -----------
Total liabilities and shareholders'
equity $ 13,337,171 $ 13,965,034
============ ===========
HeartCore Enterprises, Inc.
Unaudited Consolidated Statements of Operations and
Comprehensive Income (Loss)
For the nine months ended September 30,
-----------------------------------------------
2025 2024
Revenues $ 7,052,799 $ 21,270,891
Cost of revenues
(including cost of
revenues resulting from
transactions with a
related party of $61,078
and $117,601 for the
three and nine months
ended September 30, 2025,
respectively, and of
$101,452 and $126,569 for
the three and nine months
ended September 30, 2024,
respectively) 4,453,735 6,208,885
----------------- -----------------
Gross profit 2,599,064 15,062,006
Operating expenses:
Selling expenses 338,615 518,627
General and
administrative expenses
(including general and
administrative expenses
resulting from
transactions with a
related party of nil
and $29,048 for the
three and nine months
ended September 30,
2025, respectively, and
of $17,474 and $23,947
for the three and nine
months ended September
30, 2024,
respectively) 4,119,851 4,802,530
Research and development
expenses - 172,140
Total operating
expenses 4,458,466 5,493,297
----------------- -----------------
Income (loss) from
continuing operations (1,859,402) 9,568,709
----------------- -----------------
Other income (expenses):
Changes in fair value of
investments in
marketable securities (908,416) (308,059)
Changes in fair value of
investments in
warrants (74,109) 1,631,700
Loss on sale of warrants - (3,970,628)
Changes in fair value of
derivative liability (9,679) -
Interest income 4,525 13,280
Interest expenses (66,640) (85,275)
Other income 63,327 26,336
Other expenses (7,901) (70,246)
-----------------
Total other expenses (998,893) (2,762,892)
----------------- -----------------
Income (loss) from
continuing operations
before income tax expense (2,858,295) 6,805,817
----------------- -----------------
Income tax expense 54,886 100,475
----------------- -----------------
Net income (loss) from
continuing operations (2,913,181) 6,705,342
Income (loss) from
discontinued operations,
net of income tax 1,188,481 422,468
----------------- -----------------
Net income (loss) (1,724,700) 7,127,810
Less: net loss
attributable to
non-controlling
interests (171,682) (645,546)
----------------- -----------------
Net income (loss)
attributable to HeartCore
Enterprises, Inc. (1,553,018) 7,773,356
Dividends accrued on
Series A convertible
preferred shares (56,833) -
----------------- -----------------
Net income (loss)
attributable to HeartCore
Enterprises, Inc. common
shareholders $ (1,609,851) $ 7,773,356
================= =================
Other comprehensive income
(loss):
Foreign currency
translation adjustment 9,668 51,678
----------------- -----------------
Total comprehensive income
(loss) (1,715,032) 7,179,488
Less: comprehensive loss
attributable to
non-controlling
interests (175,353) (654,384)
----------------- -----------------
Comprehensive income
(loss) attributable to
HeartCore Enterprises,
Inc. $ (1,539,679) $ 7,833,872
================= =================
Net income (loss) from
continuing operations
attributable to HeartCore
Enterprises, Inc. per
common share
Basic $ (0.12) $ 0.35
================= =================
Diluted $ (0.12) $ 0.35
================= =================
Income (loss) from
discontinued operations
per common share
Basic $ 0.05 $ 0.02
================= =================
Diluted $ 0.04 $ 0.02
================= =================
Net income (loss) attributable to HeartCore
Enterprises, Inc. per common share
Basic $ (0.07) $ 0.37
================= =================
Diluted $ (0.07) $ 0.37
================= =================
Weighted average common
shares outstanding
Basic 22,489,677 20,861,012
================= =================
Diluted 27,153,162 20,861,012
================= =================
HeartCore Enterprises, Inc.
Unaudited Consolidated Statements of Cash Flows
For the nine months ended September 30,
-----------------------------------------------
2025 2024
--------------------- --------------------
Cash flows from operating
activities of continuing
operations:
Net income (loss) $ (1,724,700) $ 7,127,810
Income from discontinued
operations, net of income
tax 1,188,481 422,468
----------------- -----------------
Net income (loss) from
continuing operations (2,913,181) 6,705,342
Adjustments to reconcile net income (loss) from
continuing operations to net cash flows
used in operating
activities:
Depreciation and
amortization expenses 36,994 532,958
Loss on disposal of
property and equipment 116,981 1,798
Non-cash lease expense 52,843 93,554
Gain on termination of
lease (9,059) -
Deferred income taxes 29,680 (133,875)
Stock-based compensation 69,222 236,826
Marketable securities
received as noncash
consideration - (572,010)
Warrants received as
noncash consideration (837,913) (12,969,683)
Changes in fair value of
investments in
marketable securities 908,416 308,059
Changes in fair value of
investments in
warrants 74,109 (1,631,700)
Loss on sale of warrants - 3,970,628
Changes in fair value of
derivative liability 9,679 -
Gain on settlement of
asset retirement
obligations (45,873) -
Changes in assets and
liabilities:
Accounts receivable (77,103) 85,152
Prepaid expenses 127,401 (160,556)
Other assets 116,399 126,017
Accounts payable and
accrued expenses (304,033) 34,385
Accounts payable and
accrued expenses -
related party (20,386) 28,315
Accrued payroll and
other employee costs 106,123 21,942
Due to related party (884) -
Operating lease
liabilities (44,571) (98,223)
Income tax payables (105,064) 20,481
Deferred revenue (278,421) (55,047)
Other liabilities 7,683 428,522
Net cash flows used in
operating activities of
continuing operations (2,980,958) (3,027,115)
Cash flows from investing
activities of continuing
operations:
Purchase of investment in
SAFE - (75,000)
Net proceeds from sale of
warrants - 5,640,000
Proceeds from sale of
marketable securities 1,071,732 -
Net cash flows provided by
investing activities of
continuing operations 1,071,732 5,565,000
Cash flows from financing
activities of continuing
operations:
Payments for finance lease (12,692) (12,321)
Repayment of related party
debt (4,100) -
Repayment of long-term
debts (34,176) (24,485)
Repayment of insurance
premium financing (103,303) (107,297)
Net proceeds from
factoring arrangement 55,916 -
Net repayment of factoring
arrangement - (257,295)
Capital contribution from
non-controlling
shareholder - 67,195
Distribution of dividends - (834,566)
Proceeds from issuance of
common shares related to
at the market offering
agreement 30,445 -
Proceeds from collection
of subscription
receivable 103,942 -
Proceeds from exercise of
stock options 117,000 -
Proceeds from issuance of
Series A convertible
preferred shares and
common shares related to
securities purchase
agreement, net of share
issuance costs 1,800,000 -
Net cash flows provided by
(used in) financing
activities of continuing
operations 1,953,032 (1,168,769)
Cash flows from
discontinued operations:
Net cash flows provided by
(used in) operating
activities of discontinued
operations 127,672 (747,399)
Net cash flows provided by
investing activities of
discontinued operations 29,222 27,323
Net cash flows used in
financing activities of
discontinued operations (323,630) (360,672)
----------------- -----------------
Net cash flows used in
discontinued operations (166,736) (1,080,748)
Effect of exchange rate
changes 26,577 (68,730)
Net change in cash and
cash equivalents (96,353) 219,638
Cash and cash equivalents
- beginning of the
period 2,121,089 1,012,479
Cash and cash equivalents
- end of the period $ 2,024,736 $ 1,232,117
================= =================
Supplemental cash flow
disclosures:
Interest paid $ 88,321 $ 104,880
================= =================
Income taxes paid $ 131,118 $ 201,035
================= =================
Non-cash investing and
financing transactions:
Insurance premium
financing $ 139,500 $ 172,689
================= =================
Warrants converted to
marketable securities $ 388,260 $ 6,443,276
================= =================
Issuance of common shares
related to equity
purchase agreement $ 250,000 $ -
================= =================
Dividends accrued on
Series A convertible
preferred shares $ 56,833 $ -
================= =================
(END) Dow Jones Newswires
November 18, 2025 08:31 ET (13:31 GMT)