Treasure Global Inc. Reports 95.5% Revenue Decline and Significant Financial Challenges

Treasure Global Inc. reported significant financial challenges in its latest 10-Q filing for the quarter ending December 31, 2024. The company generated revenues of $301,898, a stark decline of approximately 95.5% compared to $6.7 million in the same quarter of the previous year. This drop was primarily attributed to a strategic decision to streamline its product offerings, particularly the elimination of lower-margin products such as e-vouchers, alongside reduced spending on customer rewards and marketing campaigns. Consequently, the gross profit for the quarter was $223,951, down from $345,603 a year earlier, reflecting a gross margin improvement from 5.1% to 74.2%.

In terms of operational metrics, the company reported a decrease in both registered users and active users on its ZCITY platform. As of December 31, 2024, there were 2,706,498 registered users, with only 3,293 active users, indicating a significant decline in user engagement. The company also noted that one customer accounted for approximately 74.9% of total revenues for the quarter, highlighting a concerning concentration risk. Additionally, the total number of participating merchants remained static at 2,027.

Strategically, Treasure Global made several organizational changes, including the acquisition of Foodlink Global Sdn. Bhd. in April 2023, which was later disposed of in May 2024. The company has also entered into various agreements to enhance its technological capabilities, including partnerships for developing AI-driven solutions and a digital wallet integrated within the ZCITY App. However, these initiatives have yet to translate into improved financial performance.

The company’s financial position remains precarious, with a net loss of $232,332 for the quarter, down from a loss of $1.2 million in the same period last year. The accumulated deficit as of December 31, 2024, stood at approximately $39.2 million. Despite recent capital raises, including a $3.5 million public offering in November 2023, management expressed substantial doubt about the company's ability to continue as a going concern, citing recurring losses and insufficient funds to meet working capital requirements.

Looking ahead, Treasure Global aims to alleviate its financial challenges through equity financing and support from related parties. However, the company acknowledges that without significant revenue generation, it may need to curtail or cease operations. The management's focus will be on enhancing user engagement and expanding its product offerings to stabilize its financial condition.