10-K: Thunder Power Holdings Files Annual Report on Form 10-K

Thunder Power Holdings, Inc. has filed its annual report on Form 10-K for the fiscal year ended December 31, 2025, detailing its business operations, financial condition, and risk factors.

Summary

• Thunder Power Holdings, Inc. (the Company) has filed its annual report on Form 10-K for the fiscal year ended December 31, 2025.
• The Company is an early-stage developer of premium electric vehicles (EVs) with a limited operating history and no revenue from vehicle sales.
• The Company incurred a net loss of approximately $2.2 million for the year ended December 31, 2025, and has an accumulated deficit of approximately $39.1 million.
• Significant uncertainties exist regarding the Company's ability to continue as a going concern, including operating losses, liquidity constraints, Nasdaq delisting, and dependence on its principal shareholder.
• The Company is pursuing strategic transactions, including a proposed acquisition, and exploring financing alternatives.
• Key product development includes a Compact City Car planned for 2028, a Sports Coupe, and microcar projects.
• The Company's common stock was delisted from The Nasdaq Capital Market on July 31, 2025, and is now traded on the OTCQB Venture Market under the symbol AIEV.

Sentiment

Score: 2

Explanation: StockSavvy.ai views this filing as highly negative due to the company's pre-revenue status, significant net losses, minimal cash reserves, delisting from Nasdaq, and material weaknesses in internal controls, all of which raise substantial doubt about its ability to continue as a going concern.

Positives

• The Company is actively developing a portfolio of electric vehicles, including a Compact City Car, Sports Coupe, and microcars.
• The Company has developed proprietary technologies intended to enhance EV performance, range, and charging capabilities.
• The Company is exploring strategic transactions and financing alternatives to address its liquidity constraints.
• The Company has a clear go-to-market strategy involving dealer partners and an online platform.
• The Company is pursuing a proactive merger and acquisitions strategy in the clean energy sector.

Negatives

• The Company has incurred substantial operating losses and has no revenue from vehicle sales, raising substantial doubt about its ability to continue as a going concern.
• The Company's common stock has been delisted from The Nasdaq Capital Market and is now traded on the OTCQB Venture Market, which could adversely affect its market price, liquidity, and ability to raise capital.
• The Company's principal shareholder, Mr. Wellen Sham, is involved in significant legal proceedings in Taiwan, creating uncertainty regarding his ability to provide financial support.
• The Company has a limited operating history and no experience in mass manufacturing, making its future prospects difficult to evaluate.
• The Company is heavily reliant on licensing intellectual property and technology rights from affiliates, with no assurance that these agreements will be obtained or maintained.
• The Company has a material weakness in its internal control over financial reporting due to a lack of sufficient financial reporting and accounting personnel with U.S. GAAP expertise.

Risks

• The Company's limited operating history and lack of commercial product sales make its future prospects difficult to evaluate and increase investment risk.
• Failure to secure necessary intellectual property licenses from affiliates could materially affect the Company's business, financial condition, and operating results.
• The Company's business model is untested, and any failure to commercialize its strategic plans could lead to substantial liabilities.
• The Company faces intense competition in the automotive market, with many competitors possessing greater financial and technical resources.
• Delays in vehicle design, manufacturing, launch, and financing could significantly harm the Company's business and prospects.
• The Company's reliance on third-party suppliers for critical components exposes it to supply chain disruptions and potential cost increases.
• The Company's principal shareholder, Mr. Wellen Sham, is involved in criminal prosecution and civil litigation in Taiwan, which could negatively impact the Company's reputation and operations.
• The Company may need to raise additional funds, and such financing may not be available on favorable terms or at all.
• The Company's stock price may be volatile, and it could incur significant costs from class action litigation due to stock volatility.
• The Company is subject to evolving laws and regulations related to data privacy and security, and any failure to comply could result in significant fines and liability.
• The Company's auditor is headquartered in Singapore, raising potential concerns under the Holding Foreign Companies Accountable Act if PCAOB inspections are not possible.

Future Outlook

The Company expects to continue incurring substantial operating losses for the foreseeable future due to the capital-intensive nature of its business. Its ability to continue as a going concern is dependent on obtaining additional financing and generating sufficient cash flows from operations. The Company is pursuing strategic transactions and exploring financing alternatives to address its liquidity constraints.

Management Comments

• Management has undertaken certain actions to address these conditions, including exploring potential financing alternatives, seeking additional equity or debt funding, and evaluating cost reduction and restructuring initiatives.
• Management assessed the collectability by reviewing other receivable on an individual basis in accordance with ASC Topic 326, Credit Losses (ASC 326).
• Management assessed the recoverability of prepaid expenses for forward purchase contract which will be realized as the counterparty sells our shares.
• Management believes that its proprietary technologies will significantly increase the driving range for its potential EVs while allowing for faster recharging and lower costs of ownership.

Industry Context

StockSavvy.ai notes that Thunder Power Holdings operates in the highly competitive and rapidly evolving electric vehicle market. The company faces significant challenges from established automotive manufacturers and new EV entrants, many of whom have greater financial and technical resources. The global push towards sustainable transportation and government incentives for EVs provide a favorable backdrop, but the Company's success hinges on its ability to execute its product development and manufacturing plans amidst these competitive pressures and its own financial constraints.

Corporate Governance

Legal Proceedings

• Mr. Wellen Sham, the Company's controlling shareholder, is involved in criminal prosecution and multiple civil actions in Taiwan related to securities violations, breaches of fiduciary duty, and financial matters.
• The Company is a defendant in a lawsuit filed by Sam Yu alleging fraud, breach of contract, and negligence related to a SPAC and securities purchase agreements. The matter is in the discovery phase.

Related Party Transactions

• The Company borrowed $1,349,264 from Mr. Wellen Sham and $100,000 from Ms. Ling Houng Sham in 2025, with interest rates of 8%.
• The Company borrowed $991,560 from Mr. Wellen Sham in 2024, with interest rates ranging between 8% and 10%.
• The Company has outstanding balances due to related parties, including Mr. Wellen Sham ($2,823,585 as of Dec 31, 2025) and Ms. Ling Houng Sham ($330,751 as of Dec 31, 2025).
• The Company incurred rental expenses of $17,137 from TP HK in 2025 and $27,681 in 2024.

Stakeholder Impact

• Shareholders: Potential for significant dilution from future stock issuances, volatility in stock price, and risk of losing entire investment due to the company's financial condition and going concern issues.
• Creditors: Uncertainty regarding the company's ability to meet its financial obligations due to its liquidity constraints and operating losses.
• Employees: Potential impact on job security and compensation due to the company's precarious financial situation and ongoing restructuring efforts.
• Suppliers: Risk of non-payment or delayed payment due to the company's financial difficulties and potential supply chain disruptions.
• Customers: Potential impact on product availability, quality, and after-sales service due to the company's operational and financial challenges.

Next Steps

• Continue development and production of its electric vehicle models.
• Explore potential financing alternatives and strategic transactions.
• Address material weaknesses in internal control over financial reporting.
• Manage legal proceedings involving its principal shareholder.
• Establish and maintain relationships with suppliers and build out its supply chain.

Key Dates

Recommendation

Given the company's pre-revenue status, substantial net losses, minimal cash reserves, delisting from Nasdaq, material weaknesses in internal controls, and significant legal and financial uncertainties surrounding its principal shareholder, the outlook is extremely negative. The company's ability to continue as a going concern is in serious doubt, making it a highly speculative investment with a high probability of significant loss for investors.

Keywords

Thunder Power Holdings, Form 10-K, Annual Report, Electric Vehicles, EV, Automotive, Startup, Pre-revenue, Financials, Risk Factors, Going Concern, Nasdaq Delisting, OTCQB