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 September 30, 2023

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

Commission File No. 001-40770

FOCUS UNIVERSAL INC.

(Exact Name of Small Business Issuer as specified in its charter)

Nevada	46-3355876
(State or other jurisdiction	(IRS Employer File Number)
of incorporation)

2311 E. Locust Court, Ontario, CA	91761
(Address of principal executive offices)	(Zip Code)

(626) 272-3883

(Registrant's telephone number, including area code)

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, $0.001 par value

FCUV

The Nasdaq Stock Market LLC

(Nasdaq Global Market)

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark whether the registrant: (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 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 (Section 232.405 of this chapter) during the preceding 12 months (or 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, a 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.

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 November 14, 2023, registrant had 64,821,817 shares outstanding of the registrant's common stock at a par value of $0.001 per share.

FORM 10-Q

FOCUS UNIVERSAL INC.

TABLE OF CONTENTS

PART I FINANCIAL INFORMATION	3

Item 1. Condensed Consolidated Financial Statements (Unaudited)	3

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	32

Item 3. Quantitative and Qualitative Disclosures About Market Risk	48

Item 4. Controls and Procedures	48

PART II OTHER INFORMATION	49

Item 1. Legal Proceedings	49

Item 1A. Risk Factors	49

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	49

Item 3. Defaults Upon Senior Securities	49

Item 4. Mine Safety Disclosures	49

Item 5. Other Information	49

Item 6. Exhibits	49

Signatures	50

PART I. FINANCIAL INFORMATION

References in this document to "us," "we," or "Company" refer to Focus Universal Inc.

ITEM 1. FINANCIAL STATEMENTS

FOCUS UNIVERSAL INC.

CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Index to the Financial Statements

Contents	Page

Condensed Consolidated Balance Sheets as of September 30, 2023 (unaudited) and December 31, 2022	4

Condensed Consolidated Statements of Operations for the Three and Nine Months Ended September 30, 2023 and 2022 (unaudited)	5

Condensed Consolidated Statements of Changes in Stockholder’s Equity for the Three and Nine Months Ended September 30, 2023 and 2022 (unaudited)	6

Condensed Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2023 and 2022 (unaudited)	8

Notes to the Unaudited Condensed Consolidated Financial Statements	9

FOCUS UNIVERSAL INC.

CONDENSED CONSOLIDATED BALANCE SHEETS


	September 30,			December 31,
	2023			2022
	(Unaudited)
ASSETS
Current Assets:
Cash	$	1,408,687		$	4,343,426
Accounts receivable, net		172,903			78,313
Accounts receivable – related party		–			34,507
Inventory		299,973			103,772
Other receivables		10,000			–
Prepaid expenses		109,941			142,342
Marketable equity securities		39,165			105,470
Total Current Assets		2,040,669			4,807,830

Property and equipment, net		4,119,973			4,228,630
Operating lease right-of-use assets		214,900			253,336
Deposits		23,420			33,264

Total Assets	$	6,398,962		$	9,323,060

LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable and accrued liabilities	$	285,206		$	267,685
Related party loan		1,000,000			–
Treasury stock payable		–			1,000,000
Other current liabilities		40,255			6,496
Lease liabilities, current portion		84,036			113,058
Total Current Liabilities		1,409,497			1,387,239

Non-Current Liabilities:
Lease liabilities, less current portion		122,959			165,952
Other liability		12,335			12,335
Total Non-Current Liabilities		135,294			178,287

Total Liabilities		1,544,791			1,565,526

Contingencies (Note 13)		–			–

Stockholders' Equity:
Common stock, par value $0.001 per share, 75,000,000 shares authorized; 64,771,817 and 65,296,383 shares issued and outstanding as of September 30, 2023 and December 31, 2022, respectively		64,771			65,297
Treasury stock at cost (1,183,040 shares and 400,000 shares held at September 30, 2023 and December 31, 2022, respectively)		(385,686	)		(2,000,000	)
Additional paid-in capital		26,100,446			27,514,733
Shares to be issued, common shares		46,100			48,075
Accumulated deficit		(20,964,470	)		(17,864,028	)
Accumulated other comprehensive loss		(6,990	)		(6,543	)
Total Stockholders' Equity		4,854,171			7,757,534

Total Liabilities and Stockholders' Equity	$	6,398,962		$	9,323,060

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements

FOCUS UNIVERSAL INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Revenue	$	318,370	$	54,686	$	769,856	$	242,675
Revenue - related party		–		5,968		–		39,788

SEC Form 10-Q filed by Focus Universal Inc.