UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2025

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission File Number: 001-38728

AVALON GLOBOCARE CORP.

(Exact name of registrant as specified in its charter)

Delaware		47--1685128
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

4400 Route 9 South, Suite 3100 Freehold, New Jersey		07728
(Address of principal executive offices)		(Zip Code)

(732) 780-4400

(Registrant’s telephone number, including area code)

Not Applicable

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock, par value $0.0001 per share		ALBT		The Nasdaq Capital Market

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 such shorter period that the registrant was 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, a non-accelerated filer, 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. (Check one):

Large accelerated filer ☐		Accelerated filer ☐
Non-accelerated filer ☒		Smaller reporting company ☒
		Emerging growth company ☐

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 Exchange Act). Yes ☐ No ☒

As of May 12, 2025, 1,893,971 shares of common stock, $0.0001 par value per share, were outstanding.

AVALON GLOBOCARE CORP.

FORM 10-Q

For the Quarterly Period Ended March 31, 2025

Table of Contents

	Page
Part I – Financial Information
Item 1. Financial Statements
Condensed Consolidated Balance Sheets – At March 31, 2025 (Unaudited) and December 31, 2024	1
Condensed Consolidated Statements of Operations and Comprehensive Loss (Unaudited) – For the Three Months Ended March 31, 2025 and 2024	2
Condensed Consolidated Statements of Changes in (Deficit) Equity (Unaudited) — For the Three Months Ended March 31, 2025 and 2024	3
Condensed Consolidated Statements of Cash Flows (Unaudited) – For the Three Months Ended March 31, 2025 and 2024	5
Notes to Unaudited Condensed Consolidated Financial Statements	6
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	33
Item 3. Quantitative and Qualitative Disclosures About Market Risk	40
Item 4. Controls and Procedures	40

Part II – Other Information
Item 1. Legal Proceedings	41
Item 1A. Risk Factors	41
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	42
Item 3. Defaults Upon Senior Securities	42
Item 4. Mine Safety Disclosures Item 5. Other Information	42
Item 6. Exhibits	43
Exhibit Index	43
Signatures	44

PART I - FINANCIAL INFORMATION

AVALON GLOBOCARE CORP. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

Item 1. Financial Statements.

	March 31,			December 31,
	2025			2024
	(Unaudited)
ASSETS
CURRENT ASSETS:
Cash	$	1,369,586		$	2,856,309
Rent receivable		81,854			80,829
Receivable from sale of equity method investment, current portion		975,000			-
Prepaid expense and other current assets		367,818			299,360

Total Current Assets		2,794,258			3,236,498

NON-CURRENT ASSETS:
Operating lease right-of-use assets, net		113,253			4,709
Receivable from sale of equity method investment, noncurrent portion		675,000			-
Property and equipment, net		10,660			12,912
Investment in real estate, net		6,980,551			7,022,721
Equity method investments, net		-			10,636,544
Other non-current assets		36,067			71,794

Total Non-current Assets		7,815,531			17,748,680

Total Assets	$	10,609,789		$	20,985,178

LIABILITIES AND (DEFICIT) EQUITY

CURRENT LIABILITIES:
Accrued professional fees	$	984,869		$	611,462
Accrued research and development fees		153,772			153,772
Accrued payroll liability and compensation		550,931			501,258
Accrued litigation settlement		373,450			373,450
Accrued liabilities and other payables		524,872			434,117
Accrued liabilities and other payables - related parties		100,000			732,916
Operating lease obligation, current portion		67,547			10,709
Advance from pending sale of noncontrolling interest - related party		3,328,078			3,108,106
Derivative liability		223,052			127,545
Note payable, net		5,745,254			5,715,447
Convertible note payable, net		2,397,528			2,113,773

Total Current Liabilities		14,449,353			13,882,555

NON-CURRENT LIABILITIES:
Operating lease obligation, noncurrent portion		51,706			-

Total Non-current Liabilities		51,706			-

Total Liabilities		14,501,059			13,882,555

Commitments and Contingencies (Note 15)

(DEFICIT) EQUITY:
Preferred stock, $0.0001 par value; 10,000,000 shares authorized;
Series A convertible preferred stock, 0 and 9,000 shares issued and outstanding at March 31, 2025 and December 31, 2024, respectively		-			9,000,000
Series B convertible preferred stock, 0 and 11,000 shares issued and outstanding at March 31, 2025 and December 31, 2024, respectively		-			11,000,000
Series C convertible preferred stock, 3,500 shares issued and outstanding at March 31, 2025 and December 31, 2024; Liquidation preference $3.5 million at March 31, 2025		3,500,000			3,500,000
Series D convertible preferred stock, 5,000 and 0 shares issued and outstanding at March 31, 2025 and December 31, 2024, respectively; Liquidation preference $5 million at March 31, 2025		8,837,527			-
Common stock, $0.0001 par value; 100,000,000 shares authorized;
1,655,134 shares issued and 1,651,667 shares outstanding at March 31, 2025; 1,445,979 shares issued and 1,442,512 shares outstanding at December 31, 2024		166			145
Additional paid-in capital		74,673,916			72,023,525
Less: common stock held in treasury, at cost;
3,467 shares at March 31, 2025 and December 31, 2024		(522,500	)		(522,500	)
Accumulated deficit		(90,155,236	)		(87,673,125	)
Statutory reserve		6,578			6,578
Accumulated other comprehensive loss		(231,721	)		(232,000	)
Total Avalon GloboCare Corp. stockholders’ (deficit) equity		(3,891,270	)		7,102,623
Noncontrolling interest		-			-

Total (Deficit) Equity		(3,891,270	)		7,102,623

Total Liabilities and (Deficit) Equity	$	10,609,789		$	20,985,178

See accompanying notes to the condensed consolidated financial statements.

AVALON GLOBOCARE CORP. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(Unaudited)

	For the Three Months Ended
	March 31,
	2025			2024

REAL PROPERTY RENTAL REVENUE	$	349,800		$	314,588

REAL PROPERTY OPERATING EXPENSES		280,390			263,126

REAL PROPERTY OPERATING INCOME		69,410			51,462

INCOME FROM EQUITY METHOD INVESTMENT - LAB SERVICES MSO		392,677			107,469

OTHER OPERATING EXPENSES:
Advertising and marketing expenses		71,150			45,000
Professional fees		1,691,579			442,335
Compensation and related benefits		340,420			353,571
Other general and administrative expenses		165,713			161,087

Total Other Operating Expenses		2,268,862			1,001,993

LOSS FROM OPERATIONS		(1,806,775	)		(843,062	)

OTHER (EXPENSE) INCOME
Interest expense - amortization of debt discount and debt issuance costs		(313,562	)		(272,196	)
Interest expense - other		(246,456	)		(236,215	)
Interest expense - related party		-			(10,596	)
Change in fair value of derivative liability		(114,360	)		31,212
Other expense		(958	)		(36,656	)

Total Other Expense, net		(675,336	)		(524,451	)

LOSS BEFORE INCOME TAXES		(2,482,111	)		(1,367,513	)

INCOME TAXES		-			-

NET LOSS	$	(2,482,111	)	$	(1,367,513	)

LESS: NET LOSS ATTRIBUTABLE TO NONCONTROLLING INTEREST		-			-

NET LOSS AFTER NONCONTROLLING INTEREST		(2,482,111	)		(1,367,513	)

DEEMED CONTRIBUTION ON EXCHANGE OF EQUITY INSTRUMENTS		162,473			-

NET LOSS ATTRIBUTABLE TO AVALON GLOBOCARE CORP. COMMON SHAREHOLDERS	$	(2,319,638	)	$	(1,367,513	)

NET LOSS PER COMMON SHARE ATTRIBUTABLE TO AVALON GLOBOCARE CORP. COMMON SHAREHOLDERS:
Basic and diluted	$	(1.43	)	$	(1.86	)

WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:
Basic and diluted		1,624,629			735,225

COMPREHENSIVE LOSS:
NET LOSS	$	(2,482,111	)	$	(1,367,513	)
OTHER COMPREHENSIVE INCOME (LOSS)
Unrealized foreign currency translation gain (loss)		279			(2,920	)
COMPREHENSIVE LOSS		(2,481,832	)		(1,370,433	)
LESS: COMPREHENSIVE LOSS ATTRIBUTABLE TO NONCONTROLLING INTEREST		-			-
COMPREHENSIVE LOSS ATTRIBUTABLE TO AVALON GLOBOCARE CORP. COMMON SHAREHOLDERS	$	(2,481,832	)	$	(1,370,433	)

See accompanying notes to the condensed consolidated financial statements.

AVALON GLOBOCARE CORP. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN (DEFICIT) EQUITY

For the Three Months Ended March 31, 2025

(Unaudited)

	Avalon GloboCare Corp. Stockholders’ (Deficit) Equity
	Series A Preferred Stock						Series B Preferred Stock						Series C Preferred Stock				Series D Preferred Stock				Common Stock							Treasury Stock											Accumulated
	Number						Number						Number				Number				Number				Additional			Number											Other					Total
	of						of						of				of				of				Paid-in			of						Accumulated			Statutory		Comprehensive			Noncontrolling		Equity
	Shares			Amount			Shares			Amount			Shares		Amount		Shares		Amount		Shares		Amount		Capital			Shares			Amount			Deficit			Reserve		Loss			Interest		(Deficit)
Balance, January 1, 2025		9,000		$	9,000,000			11,000		$	11,000,000			3,500	$	3,500,000		-	$	-		1,445,979	$	145	$	72,023,525			(3,467	)	$	(522,500	)	$	(87,673,125	)	$	6,578	$	(232,000	)	$	-	$	7,102,623

Issuance of common stock upon cashless exercise of stock warrants		-			-			-			-			-		-		-		-		186,877		19		(19	)		-			-			-			-		-			-		-

Issuance of common stock for services		-			-			-			-			-		-		-		-		22,278		2		111,230			-			-			-			-		-			-		111,232

Reclassification of derivative liability to equity		-			-			-			-			-		-		-		-		-		-		18,853			-			-			-			-		-			-		18,853

Series D Convertible Preferred Stock issued in exchange of Series A Convertible Preferred Stock		(9,000	)		(9,000,000	)		-			-			-		-		5,000		8,837,527		-		-		162,473			-			-			-			-		-			-		-

Series B Convertible Preferred Stock extinguished related to sale of equity method investment		-			-			(11,000	)		(11,000,000	)		-		-		-		-		-		-		2,348,695			-			-			-			-		-			-		(8,651,305	)

Stock-based compensation		-			-			-			-			-		-		-		-		-		-		9,159			-			-			-			-		-			-		9,159

Foreign currency translation adjustment		-			-			-			-			-		-		-		-		-		-		-			-			-			-			-		279			-		279

Net loss for the three months ended March 31, 2025		-			-			-			-			-		-		-		-		-		-		-			-			-			(2,482,111	)		-		-			-		(2,482,111	)

Balance, March 31, 2025		-		$	-			-		$	-			3,500	$	3,500,000		5,000	$	8,837,527		1,655,134	$	166	$	74,673,916			(3,467	)	$	(522,500	)	$	(90,155,236	)	$	6,578	$	(231,721	)	$	-	$	(3,891,270	)

See accompanying notes to the condensed consolidated financial statements.

AVALON GLOBOCARE CORP. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

For the Three Months Ended March 31, 2024

(Unaudited)

	Avalon GloboCare Corp. Stockholders’ Equity
	Series A Preferred Stock				Series B Preferred Stock				Common Stock						Treasury Stock											Accumulated
	Number				Number				Number				Additional		Number											Other
	of				of				of				Paid-in		of						Accumulated			Statutory		Comprehensive			Noncontrolling		Total
	Shares		Amount		Shares		Amount		Shares		Amount		Capital		Shares			Amount			Deficit			Reserve		Loss			Interest		Equity
Balance, January 1, 2024		9,000	$	9,000,000		11,000	$	11,000,000		736,769	$	74	$	67,886,082		(3,467	)	$	(522,500	)	$	(79,769,731	)	$	6,578	$	(231,727	)	$	-	$	7,368,776

Issuance of common stock as convertible note payable commitment fee		-		-		-		-		7,000		1		41,999		-			-			-			-		-			-		42,000

Stock-based compensation		-		-		-		-		-		-		13,533		-			-			-			-		-			-		13,533

Foreign currency translation adjustment		-		-		-		-		-		-		-		-			-			-			-		(2,920	)		-		(2,920	)

Net loss for the three months ended March 31, 2024		-		-		-		-		-		-		-		-			-			(1,367,513	)		-		-			-		(1,367,513	)

Balance, March 31, 2024		9,000	$	9,000,000		11,000	$	11,000,000		743,769	$	75	$	67,941,614		(3,467	)	$	(522,500	)	$	(81,137,244	)	$	6,578	$	(234,647	)	$	-	$	6,053,876

See accompanying notes to the condensed consolidated financial statements.

AVALON GLOBOCARE CORP. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

	For the Three Months Ended
	March 31,
	2025			2024

CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(2,482,111	)	$	(1,367,513	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation		44,428			44,481
Change in straight-line rent receivable		29,288			20,548
Amortization of operating lease right-of-use asset		18,956			29,448
Stock-based compensation and service expense		26,371			45,746
income from equity method investment		(392,677	)		(107,469	)
Distribution of earnings from equity method investment		-			160,788
Amortization of debt issuance costs and debt discount		313,562			272,196
Change in fair market value of derivative liability		114,360			(31,212	)
Changes in operating assets and liabilities:
Rent receivable		-			113,024
Security deposit		5,473			-
Deferred leasing costs		8,021			8,350
Prepaid expense and other assets		(24,698	)		(3,739	)
Accrued liabilities and other payables		556,057			(14,758	)
Accrued liabilities and other payables - related parties		-			(62,151	)
Operating lease obligation		(18,956	)		(23,448	)

NET CASH USED IN OPERATING ACTIVITIES		(1,801,926	)		(915,709	)

CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from sale of equity method investment		95,000			-

NET CASH PROVIDED BY INVESTING ACTIVITIES		95,000			-

CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issuance of convertible debt and warrants		-			665,000
Payments of convertible debt issuance costs		-			(72,700	)
Repayments of convertible debt		-			(866,000	)
Advance from pending sale of noncontrolling interest in subsidiary		219,972			1,210,472

NET CASH PROVIDED BY FINANCING ACTIVITIES		219,972			936,772

EFFECT OF EXCHANGE RATE ON CASH		231			(995	)

NET (DECREASE) INCREASE IN CASH		(1,486,723	)		20,068

CASH - beginning of period		2,856,309

SEC Form 10-Q filed by Avalon GloboCare Corp.