Executive Summary / Key Takeaways

• EUDA Health Holdings Limited (NASDAQ:EUDAW) has undergone a significant strategic transformation, divesting its medical services practice to focus on property management and a newly acquired holistic wellness consumer products and services segment. This pivot aims to redefine the company's market position and growth trajectory.
• The company faces substantial financial challenges, including recurring losses, negative cash flows, and an accumulated deficit of $50.10 million as of December 31, 2024, raising significant doubt about its ability to continue as a going concern.
• The recent acquisition of Fortress Cove Limited, which includes CK Health Plus Sdn Bhd, established the holistic wellness segment in Malaysia, contributing $89,023 in revenue in 2024 but also incurring a $14.76 million impairment loss on intangible assets.
• EUDA Health's financial performance in 2024 showed total revenues of $4.01 million, primarily from property management, and a net loss from continuing operations of $17.64 million, underscoring the immediate need for successful execution of its new strategy and improved operational efficiency.
• The company's future hinges on its ability to secure additional financing, successfully integrate and grow its holistic wellness segment, and enhance profitability in its established property management services amidst a highly competitive landscape.

A Strategic Reimagination: From Digital Health to Diversified Services

EUDA Health Holdings Limited, initially formed as a Special Purpose Acquisition Company (SPAC) named 8i Acquisition 2 Corp. in January 2021, embarked on a transformative journey that culminated in a business combination with EUDA Health Limited (EHL) on November 17, 2022. This reverse recapitalization marked the beginning of EUDA Health's operational phase, initially encompassing property management and medical services. However, a significant strategic pivot in September 2023 saw the company streamline its medical services practice, classifying it as a discontinued operation to transition towards other medical service fields. This strategic shift continued into 2024 with the deconsolidation and divestiture of several medical service entities.

The company's current operational focus is now firmly rooted in two distinct segments: property management services and a newly established holistic wellness consumer products and services division. This reorientation represents a fundamental change in EUDA Health's business model, moving away from its prior association with digital health platforms to a more diversified service offering. The property management segment, based in Singapore, provides essential services to shopping malls, office buildings, and residential apartments, including common area maintenance and security. The holistic wellness segment, primarily operating in Malaysia, was bolstered by the May 2024 acquisition of Fortress Cove Limited, which owns CK Health Plus Sdn Bhd, a direct seller of holistic wellness consumer products and services.

Competitive Landscape and Strategic Positioning

The competitive environment for EUDA Health's current segments is characterized by fragmentation and varying degrees of intensity. In property management services, the company operates in a mature market where numerous local and regional players vie for contracts. Competition often centers on service quality, pricing, and established relationships. EUDA Health's long-standing presence in Singapore for property management provides a foundational revenue stream, but growth in this sector typically requires consistent operational excellence and efficient cost management.

For the nascent holistic wellness consumer products and services segment, the market is dynamic and growing, driven by increasing consumer awareness of health and well-being. This sector includes a wide array of offerings, from physical products to various therapies and membership programs. While the competitive analysis for EUDAW was based on its former digital health focus, the current holistic wellness market is populated by numerous brands and service providers, ranging from small local businesses to larger, established wellness corporations. EUDA Health's entry into this market through the acquisition of CK Health Plus Sdn Bhd provides a direct sales channel in Malaysia, offering products like collagens and specialized services. The company's strategic positioning in this segment will depend on its ability to differentiate its offerings, build brand loyalty, and effectively scale its direct sales and licensing models.

Technological Differentiators in Holistic Wellness

Within its holistic wellness segment, EUDA Health offers specialized services, notably the "Licensing service of bioenergy cabin." This proprietary offering involves granting licensees non-exclusive rights to utilize the CK Health brand, proprietary marks, and "Bioenergy Spa Capsules," coupled with ongoing business support throughout the licensing period. The information available does not detail specific quantifiable performance metrics or extensive R&D initiatives for these Bioenergy Spa Capsules, the strategic intent is clear: to provide a unique, branded wellness experience.

For investors, this offering contributes to EUDA Health's competitive moat by providing a distinct service within the holistic wellness market, potentially attracting a specific customer base seeking innovative wellness solutions. This specialized service can enhance market positioning by diversifying revenue streams beyond traditional product sales and therapies, potentially leading to higher-value engagements through licensing agreements. The success of this proprietary offering will be critical in driving growth and improving financial performance within the newly established segment, particularly as the company seeks to expand its footprint in the burgeoning Asian wellness market.

Financial Performance and Liquidity Under Scrutiny

EUDA Health's financial performance in 2024 reflects a company in transition, grappling with significant challenges. The total revenues for the year ended December 31, 2024, stood at $4.01 million, a modest increase from $3.71 million in 2023. The property management services segment remained the primary revenue driver, contributing $3.92 million, demonstrating relative stability. The newly formed holistic wellness segment generated $89,023 in revenue in its inaugural year of operation.

However, the company's profitability metrics reveal considerable strain. The gross profit for 2024 was $762,155, a decrease from $842,075 in 2023. Operating expenses surged to $18.10 million in 2024, largely due to a substantial $14.76 million impairment loss on intangible assets related to the Fortress Cove acquisition. This impairment significantly impacted the net loss from continuing operations, which widened to $17.64 million in 2024 from $8.43 million in 2023. Despite these losses, the discontinued medical services operations reported a net income of $2.25 million in 2024, following $1.60 million in 2023, highlighting the impact of the strategic divestiture. The company's effective tax rate for 2024 was 0%, influenced by the non-deductible impairment loss.

Liquidity remains a critical concern for EUDA Health. As of December 31, 2024, the company reported a working capital deficit of approximately $3.40 million and cash on hand of only $0.20 million. These figures, coupled with recurring losses from operations and negative cash flows since 2020, raise substantial doubt about the company's ability to continue as a going concern within the next year.

Net cash used in operating activities from continuing operations was $2.03 million in 2024.

The company has relied heavily on debt financing, including short-term loans from private lenders ($528,074) and related parties ($438,097) as of December 31, 2024, and convertible notes. Subsequent to year-end, between January and April 2025, EUDA Health secured additional loans totaling over $850,000 from related and third parties, underscoring its ongoing need for external funding.

Outlook and Risks

The outlook for EUDA Health is heavily dependent on the successful execution of its strategic pivot and its ability to address its significant liquidity challenges. Management's plan to alleviate the going concern risk includes securing various financing resources, such as borrowing from shareholders and affiliates, and exploring future public offerings. The successful integration and growth of the holistic wellness segment, particularly through the performance of CK Health Plus Sdn Bhd, will be crucial. The acquisition included a contingent consideration of one million additional ordinary shares if CK Health achieves net income milestones of $2 million in 2024 and $5 million in 2025; however, management currently views the probability of achieving these milestones as "very unlikely."

Several risks loom large for EUDA Health. The most pressing is the substantial doubt about its ability to continue as a going concern, with no assurance that required financing will be available on commercially acceptable terms. A failure to secure adequate capital could have a material adverse effect on the company. Legal proceedings, including internal disputes among directors and a statutory demand for alleged legal services, pose additional uncertainties and potential financial liabilities. Furthermore, concentrations of credit risk in cash balances and customer/vendor concentrations in accounts receivable and payable present ongoing operational and financial vulnerabilities.

Conclusion

EUDA Health Holdings Limited stands at a critical juncture, having strategically pivoted its core operations towards property management and holistic wellness consumer products and services. This transformation, marked by the divestiture of its medical services and the acquisition of a new wellness entity, aims to establish a more sustainable growth path. However, the company's financial health remains precarious, characterized by persistent losses, negative cash flows, and a significant accumulated deficit, which collectively cast a shadow of substantial doubt over its ability to continue as a going concern.

The success of EUDA Health's reimagined strategy hinges on its capacity to secure essential financing, effectively integrate and scale its holistic wellness offerings, and enhance the profitability of its property management services. While the introduction of proprietary wellness services like the Bioenergy Spa Capsules offers a unique market differentiator, the company must demonstrate tangible operational improvements and a clear path to sustained profitability. Investors considering EUDA Health must weigh the potential upside of its strategic pivot against the formidable financial and operational risks that currently define its investment landscape.