NEW YORK and TOKYO, May 15, 2026 (GLOBE NEWSWIRE) -- HeartCore Enterprises, Inc. (Nasdaq: HTCR) ("HeartCore" or the "Company"), an IPO consulting services company based in Tokyo, reported financial results for the first quarter ended March 31, 2026.
Recent Operational Highlights
-- As of March 31, 2026, HeartCore was engaged with 16 Go IPO clients,
including 6 clients currently in various stages of preparation for
potential public registrations and U.S. exchange listings
-- Regained Nasdaq $1.00 minimum bid price requirement
-- Authorized $2.0 million share repurchase program
Management Commentary
HeartCore CEO Sumitaka Kanno commented: "During the first quarter of 2026, HeartCore continued to advance its strategic focus on financial services and capital markets-related services, with Go IPO remaining the key contributor for coming quarters. While the Nasdaq listing environment has become selective and increasingly focused on compliance, we continue to see interest from Japanese and other Asia-based companies seeking access to the U.S. capital markets. In light of these current market conditions, we are focused on expanding the number of engagements and enhancing the overall quality of our pipeline by prioritizing clients that we believe demonstrate stronger listing readiness and long-term financing potential.
"Through our subsidiary Higgs Field Co., Ltd., we are also taking steps to support potential expansion into additional financial services and sectors, including digital securities and capital markets advisory services. During the first quarter, we added experienced financial industry personnel and further developed our organizational structure as we prepare to seek a Type I Financial Instruments business license in Japan. We are also working with external professionals and industry organizations to further strengthen our internal management and compliance framework.
"Looking ahead, we remain focused on broadening our Go IPO client base that aligns with Nasdaq's tightened requirements and diversifying our revenue base as we further develop and advance our financial services business."
First Quarter 2026 Financial Results
Revenues were $1.2 million compared to $2.1 million in the same period last year. The decrease was primarily due to a decline in customized software development and services revenue as a result of intense competition in the U.S. software market.
Gross profit was $74,000 compared to $0.5 million in the same period last year. The decrease was primarily due to lower gross profit from Go IPO consulting services resulting from increased outsourcing fees and additional resources invested to enhance customer experience, as well as lower gross profit from customized software development and services due to decreased revenues and higher subcontracting costs for outsourced software engineers amid rising salary levels in the software market.
Operating expenses decreased to $1.6 million compared to $1.7 million in the same period last year. The decrease was primarily due to a decrease in selling expenses.
Net loss was $2.0 million compared to a loss of $3.1 million in the same period last year. The improvement was primarily due to a reduction in the loss on the fair value of investments in marketable securities.
Adjusted EBITDA was a loss of $1.6 million compared to a loss of $1.3 million in the same period last year.
As of March 31, 2026, the Company had cash and cash equivalents of $0.8 million.
About HeartCore Enterprises, Inc.
HeartCore Enterprises, Inc. is headquartered in Tokyo, Japan, and is a leading consulting services company providing U.S. market listing support and related advisory services primarily to Japanese corporate clients. For more information, please 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 March 31,
Item 2026 2025
-------------------------------------- ------------------ ------------------
Net loss ($2.0) million ($3.1) million
-------------------------------------- ------------------ ------------------
(+) Depreciation $0.0 million $0.0 million
-------------------------------------- ------------------ ------------------
(+) Changes in fair value of
investments in marketable securities $0.3 million $1.8 million
-------------------------------------- ------------------ ------------------
(+) Changes in fair value of
investment in warrants $0.0 million $0.1 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
-------------------------------------- ------------------ ------------------
(+) Other income ($0.0) million ($0.0) million
-------------------------------------- ------------------ ------------------
(+) Other expenses $0.1 million $0.0 million
-------------------------------------- ------------------ ------------------
Adjusted EBITDA ($1.6) million ($1.3) 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
March 31, December 31,
2026 2025
ASSETS
Current assets:
Cash and cash equivalents $ 774,033 $ 1,985,962
Accounts receivable 572,547 707,865
Investments in marketable securities 3,394,190 3,690,187
Prepaid expenses 222,818 182,077
Current portion of long-term note
receivable 100,000 100,000
Deferred offering costs 250,000 250,000
Other current assets 175,335 208,503
Proceeds receivable from sale of
discontinued operations 1,382,897 1,291,298
Total current assets 6,871,820 8,415,892
Non-current assets:
Property and equipment, net 279,185 291,589
Operating lease right-of-use assets 506,456 29,449
Long-term investment in warrants 273,859 280,924
Deferred tax assets 22,633 23,121
Security deposits 278,154 282,958
Other non-current assets 241 549
Long-term proceeds receivable from sale
of discontinued operations 3,539,421 3,736,995
Total non-current assets 4,899,949 4,645,585
Total assets $ 11,771,769 $ 13,061,477
=========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued expenses $ 1,230,686 $ 1,146,501
Accounts payable and accrued expenses -
related party 96,333 124,618
Accrued payroll and other employee costs 663,683 509,547
Due to related party 401 285
Short-term debt - related party 69,000 75,000
Current portion of long-term debts 51,697 50,598
Insurance premium financing 97,773 13,430
Factoring liability 124,508 135,982
Operating lease liabilities, current 308,119 32,793
Income tax payables 1,847,411 1,857,386
Deferred revenue 650,469 676,216
Derivative liability 122,589 121,719
Other current liabilities 598,602 586,175
Total current liabilities 5,861,271 5,330,250
Non-current liabilities:
Long-term debts 434,895 448,376
Operating lease liabilities, non-current 211,544 -
Total non-current liabilities 646,439 448,376
----------- -----------
Total liabilities 6,507,710 5,778,626
----------- -----------
Shareholders' equity:
Preferred shares, $0.0001 par value,
20,000,000 shares authorized; Series A
convertible preferred shares, 4,000
shares designated, 1,017 shares issued
and outstanding as of March 31, 2026
and December 31, 2025; aggregate
liquidation preference of $1,262,686
and $1,158,362 as of March 31, 2026 and
December 31, 2025, respectively 691,858 691,858
Common shares, $0.0001 par value,
200,000,000 shares authorized,
1,288,812 and 1,270,991 shares issued
and outstanding as of March 31, 2026
and December 31, 2025, respectively* 129 127
Additional paid-in capital 21,876,230 21,902,169
Accumulated deficit (15,627,241) (13,755,534)
Accumulated other comprehensive loss (66,099) (58,497)
Total HeartCore Enterprises, Inc.
shareholders' equity 6,874,877 8,780,123
Non-controlling interests (1,610,818) (1,497,272)
Total shareholders' equity 5,264,059 7,282,851
----------- -----------
Total liabilities and shareholders'
equity $ 11,771,769 $ 13,061,477
=========== ===========
HeartCore Enterprises, Inc.
Unaudited Consolidated Statements of Operations and
Comprehensive Loss
For the Three Months
Ended March 31,
---------------------------
2026 2025
Revenues $ 1,245,844 $ 2,093,413
Cost of revenues (including cost of
revenues resulting from transactions
with a related party of $114,535 and
$25,195 for the three months ended
March 31, 2026 and 2025, respectively) 1,171,799 1,549,639
---------- ----------
Gross profit 74,045 543,774
Operating expenses:
Selling expenses 42,812 152,922
General and administrative expenses
(including general and administrative
expenses resulting from transactions
with a related party of nil and
$17,615 for the three months ended
March 31, 2026 and 2025,
respectively) 1,571,734 1,581,205
Total operating expenses 1,614,546 1,734,127
---------- ----------
Loss from continuing operations (1,540,501) (1,190,353)
---------- ----------
Other income (expenses):
Changes in fair value of investments
in marketable securities (295,997) (1,781,664)
Changes in fair value of investment in
warrants (7,065) (51,621)
Changes in fair value of derivative
liability (870) -
Interest income 582 2,243
Interest expenses (16,625) (17,794)
Other income 14,095 9,313
Other expenses (112,865) (547)
----------
Total other expenses (418,745) (1,840,070)
---------- ----------
Loss from continuing operations before
income tax expense (1,959,246) (3,030,423)
---------- ----------
Income tax expense 17,469 39,608
---------- ----------
Net loss from continuing operations (1,976,715) (3,070,031)
Loss from discontinued operations, net
of income tax - (67,350)
---------- ----------
Net loss (1,976,715) (3,137,381)
Less: net loss attributable to
non-controlling interests (105,008) (50,389)
---------- ----------
Net loss attributable to HeartCore
Enterprises, Inc. (1,871,707) (3,086,992)
Dividends accrued on Series A
convertible preferred shares (27,968) -
---------- ----------
Net loss attributable to HeartCore
Enterprises, Inc. common shareholders $(1,899,675) $(3,086,992)
========== ==========
Other comprehensive loss:
Foreign currency translation
adjustment (16,140) (8,014)
---------- ----------
Total comprehensive loss (1,992,855) (3,145,395)
Less: comprehensive loss attributable to
non-controlling interests (113,546) (49,152)
---------- ----------
Comprehensive loss attributable to
HeartCore Enterprises, Inc. $(1,879,309) $(3,096,243)
========== ==========
Net loss from continuing operations
attributable to HeartCore Enterprises,
Inc. per common share*
Basic $ (1.49) $ (2.74)
========== ==========
Diluted $ (1.49) $ (2.74)
========== ==========
Loss from discontinued operations per
common share*
Basic $ - $ (0.06)
========== ==========
Diluted $ - $ (0.06)
========== ==========
Net loss attributable to HeartCore Enterprises, Inc.
per common share*
Basic $ (1.49) $ (2.80)
========== ==========
Diluted $ (1.49) $ (2.80)
========== ==========
Weighted average common shares
outstanding*
Basic 1,271,631 1,102,702
========== ==========
Diluted 1,271,631 1,102,702
========== ==========
HeartCore Enterprises, Inc.
Unaudited Consolidated Statements of Cash Flows
For the Three Months
Ended March 31,
---------------------------
2026 2025
Cash flows from operating activities of
continuing operations:
Net loss $(1,976,715) $(3,137,381)
Loss from discontinued operations, net of
income tax - (67,350)
---------- ----------
Net loss from continuing operations (1,976,715) (3,070,031)
Adjustments to reconcile net loss from continuing
operations to net cash flows
used in operating activities of continuing
operations:
Depreciation expense 7,720 20,289
Loss on disposal of property and
equipment - 116,981
Non-cash lease expense 70,229 31,662
Gain on termination of lease - (9,059)
Deferred income taxes - 27,515
Stock-based compensation 2,031 32,280
Changes in fair value of investments in
marketable securities 295,997 1,781,664
Changes in fair value of investment in
warrants 7,065 51,621
Changes in fair value of derivative
liability 870 -
Gain on settlement of asset retirement
obligations - (45,873)
Changes in assets and liabilities:
Accounts receivable 135,238 (180,823)
Prepaid expenses 66,924 50,591
Other assets 107,886 (26,711)
Accounts payable and accrued expenses 85,404 (97,118)
Accounts payable and accrued expenses -
related party (28,338) (24,224)
Accrued payroll and other employee costs 154,736 (23,483)
Due to related party 125 (884)
Operating lease liabilities (60,127) (24,435)
Income tax payables (9,785) (80,196)
Deferred revenue (25,747) (233,911)
Other liabilities 12,897 12,686
Net cash flows used in operating
activities of continuing operations (1,153,590) (1,691,459)
Cash flows from investing activities of
continuing operations:
Purchases of property and equipment (954) -
Proceeds from sale of marketable
securities - 462,763
Net cash flows provided by (used in)
investing activities of continuing
operations (954) 462,763
Cash flows from financing activities of
continuing operations:
Payments for finance lease - (4,071)
Repayment of long-term debts (12,382) (10,561)
Repayment of related party debt (6,000) -
Repayment of insurance premium financing (23,657) (28,559)
Net repayment of factoring arrangement (11,474) (45,341)
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
Net cash flows provided by (used in)
financing activities of continuing
operations (53,513) 162,855
Cash flows from discontinued operations:
Net cash flows used in operating
activities of discontinued operations - (309,332)
Net cash flows provided by investing
activities of discontinued operations - 10,298
Net cash flows used in financing
activities of discontinued operations - (19,915)
---------- ----------
Net cash flows used in discontinued
operations - (318,949)
Effect of exchange rate changes (3,872) 2,685
Net change in cash and cash equivalents (1,211,929) (1,382,105)
Cash and cash equivalents - beginning of
the period 1,985,962 2,121,089
Cash and cash equivalents - end of the
period $ 774,033 $ 738,984
========== ==========
Supplemental cash flow disclosures:
Interest paid $ 16,625 $ 22,857
========== ==========
Income taxes paid (received), net $ (4,574) $ 93,586
========== ==========
Non-cash investing and financing
transactions:
Insurance premium financing $ 108,000 $ 139,500
========== ==========
Dividends accrued on Series A convertible
preferred shares $ 27,968 $ -
========== ==========
Operating lease right-of-use assets
obtained in exchange for operating lease
liabilities $ 552,577 $ -
========== ==========
(END) Dow Jones Newswires
May 15, 2026 08:31 ET (12:31 GMT)
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