Executive Summary / Key Takeaways

• VIVIC Corp. is undergoing a significant strategic pivot, exiting the Taiwan market to concentrate its yacht sales and service operations in the United States and Southeast Asia, driven by evolving regional trade policies.
• The company is carving out a niche by designing and distributing yachts specifically for "yacht operators" in marine tourism and fractional ownership, while also maintaining a luxury yacht distribution business under the Monte Fino brand.
• A key differentiator and future growth driver is VIVIC's commitment to eco-friendly boating, highlighted by its Electric Catamaran Yacht Co-Development Agreement and a $2.2 million contract for electric yacht deliveries in Q3 2025.
• Despite these strategic initiatives, VIVIC faces substantial financial challenges, reporting a significant net loss in fiscal year 2025 and operating under a "going concern" doubt, necessitating further external financing.
• Investors should monitor VIVIC's ability to secure adequate funding, successfully execute its U.S. and Southeast Asia expansion, and capitalize on its electric yacht technology to achieve sustained profitability in a competitive market.

VIVIC's Strategic Transformation and Niche Ambition

VIVIC Corp. (OTCQB:VIVC) is charting a new course, transforming from a diversified pleasure boat industry participant to a focused global yacht sales and service provider. The company's recent strategic realignment centers on catering to the burgeoning demand for outdoor water sports, yacht tourism, and recreational activities, particularly for business entertainment without the complexities of full yacht ownership. This shift positions VIVIC to capitalize on a growing market for yacht sharing, luxury charters, and group travel, driven by increasing disposable incomes.

The broader high-end shipping industry is experiencing significant tailwinds from these trends, alongside a growing emphasis on environmental sustainability. Governments worldwide are implementing stricter emission standards for marine engines, mirroring regulations in the automotive sector. This regulatory landscape creates a compelling opportunity for companies like VIVIC that prioritize eco-friendly solutions.

VIVIC strategically targets "yacht operators" with vessels designed for marine tourism, group tours, business meetings, yacht clubs, and fractional ownership. This approach differentiates VIVIC from many larger, well-capitalized competitors who primarily serve individual yacht owners. While the traditional high-end yacht market is intensely competitive, VIVIC aims to dominate this specialized segment by offering yachts with standardized configurations, ample open space, flexible accommodations, superior energy efficiency, and lower acquisition costs, coupled with professional support.

Technological Edge: Powering a Sustainable Future

VIVIC's competitive advantage is significantly bolstered by its differentiated yacht designs and a proactive stance on sustainable technology. The company's VIVIC-branded yachts feature catamaran hull designs, which inherently offer enhanced fuel efficiency and expansive deck space for activities. These designs also prioritize ease of land transportation, standardized production for cost optimization, high-end interior decoration, and the crucial ability to convert the hull for use with either diesel or renewable energy propulsion.

A pivotal development in VIVIC's technological roadmap is its collaboration with Acel Power Inc. On January 29, 2025, VIVIC entered into an Electric Catamaran Yacht Co-Development Agreement with Acel Power Inc. to jointly develop high-performance all-electric yachts. This partnership has already materialized into a significant operational milestone: a US$2.2 million contract for the supply of three electric yachts (models EV1-1, EV1-2, and EV58), with deliveries slated for completion in the third quarter of 2025. This initiative directly addresses the increasing environmental standards and positions VIVIC at the forefront of eco-friendly boating, offering tangible benefits such as reduced environmental impact and potentially lower operating costs for yacht operators. For investors, this technological leadership translates into a stronger competitive moat, enhanced market positioning in a rapidly evolving industry, and a pathway to long-term growth by appealing to environmentally conscious customers and operators.

A History of Strategic Evolution

VIVIC Corp., established in Nevada in 2017, has undergone several strategic transformations. A change in management and control at the end of 2018 initiated explorations into various pleasure boat industry segments, including yacht sales, marine tourism, and marina development. By 2022, the company refined its focus to yacht sales in Taiwan and other selected global regions, divesting its mainland China operations, a process completed with the sale of Guangdong Weiguan Ship Tech Co., Ltd. in July 2023.

A more recent and impactful strategic shift occurred in August 2025. VIVIC determined to discontinue its pursuit of the Taiwan market and instead concentrate operations in the United States and Southeast Asia. This decision was a direct response to Taiwan's government policy prohibiting the import of ships from China, where VIVIC's primary suppliers are located. The wind-down of Vivic Corp. Taiwan Branch is expected by the end of 2025, with future business activities primarily conducted through its U.S. entity.

Operational Focus and Market Approach

VIVIC's operational model leverages outsourced manufacturing, ensuring production capabilities, technical expertise, and timely delivery through selected third-party producers like Kha Shing. VIVIC's technical staff closely monitors construction, maintaining quality control. The company also serves as the exclusive distributor of Monte Fino luxury yachts in Asia and the Middle East, and a non-exclusive distributor in other territories, targeting individual private yacht owners for vessels in the 70 to 150-foot range.

Beyond sales, VIVIC emphasizes comprehensive after-sale support, including maintenance reminders, technical assistance, and a dedicated staff of trained technicians. A two-year warranty on yacht hulls underscores its commitment to product quality and customer satisfaction. The company markets its offerings through participation in boat shows and a robust network of agents and operators across various regions.

Financial Performance and Liquidity Challenges

Despite its clear strategic direction and technological advancements, VIVIC's recent financial performance highlights significant challenges. For the fiscal year ended June 30, 2025, total revenue from continuing operations plummeted to $44,515, a stark contrast to $5.95 million in the prior year. This substantial decline was primarily attributed to the sale of 100 yacht models to a company director below cost, categorized as a marketing and advertising effort rather than core revenue generation.

Consequently, the company reported a gross loss of $82,412 for fiscal year 2025, a reversal from a gross profit of $1.80 million in fiscal year 2024. Operating expenses saw a notable increase, with general and administrative expenses rising by 52.80% to $784,492, driven by higher professional fees, bad debt, and payroll. A significant factor contributing to the net loss was $2.51 million in stock compensation expenses, including substantial grants to the chairman and new executive officers. These factors culminated in a net loss from continuing operations of $3.45 million for fiscal year 2025, a substantial increase from a net income of $980,951 in the previous year.

VIVIC's liquidity position as of June 30, 2025, is precarious, with cash and cash equivalents of only $41,903 and a working capital deficit of approximately $0.62 million.

The company's accumulated deficit reached approximately $5.75 million, and it generated negative cash flow from operating activities of $0.46 million during the year. The company's registered public accounting firm has expressed substantial doubt about VIVIC's ability to continue as a going concern, underscoring the critical need for additional financing. VIVIC is actively pursuing further funding through loans and equity issuances, recognizing that its continued operations are dependent on securing this capital.

Outlook and Strategic Imperatives

VIVIC's forward-looking strategy is clear: to become a leading global distributor of charter boats and to expand into other high-end boating areas, particularly through the development of high-performance all-electric yachts. The company's concentration on the United States and Southeast Asia markets is expected to drive future growth. This expansion will necessitate the recruitment of additional personnel, especially those with design and engineering expertise, to support its technological and market ambitions.

While specific quantitative guidance on future revenue or profitability is not available, the strategic direction indicates a commitment to leveraging its Monte Fino relationship and management's experience to expand its brand offerings and market territories. The successful execution of the $2.2 million electric yacht contract with Acel Power Inc. by Q3 2025 will be a key indicator of its progress in the electric boating segment.

Risks to the Investment Thesis

Investing in VIVIC carries significant risks, primarily stemming from its "going concern" uncertainty and the imperative to secure substantial additional financing. The company's highly leveraged position and limited operating history as a focused yacht sales entity amplify these financial risks. Economic downturns impacting discretionary consumer spending or fluctuations in fuel costs could materially reduce demand for yachts, adversely affecting VIVIC's business.

The competitive landscape is intense, with well-established players possessing greater resources and brand recognition. While VIVIC targets a niche, the low barriers to entry could attract new competitors. Reliance on third-party manufacturers, particularly in regions subject to geopolitical tensions and tariffs like China and Taiwan, poses supply chain risks. Furthermore, the company's dependence on key personnel, including its 86-year-old Chairman and CEO, Mr. Shang-Chiai Kung, and the management team's limited experience operating a public company, introduce operational and compliance challenges. Product liability, IT system failures, and evolving environmental regulations also present potential liabilities and increased operating costs.

Conclusion

VIVIC Corp. stands at a pivotal juncture, embarking on a strategic transformation to redefine its presence in the global yacht market. Its focused approach on yacht operators, coupled with a forward-looking investment in eco-friendly electric yacht technology, presents a compelling narrative for growth in specialized segments. The recent $2.2 million electric yacht contract with Acel Power Inc. underscores a tangible step towards its technological leadership and market expansion in the U.S. and Southeast Asia.

However, the path ahead is fraught with significant financial hurdles. The substantial net loss in fiscal year 2025 and the expressed doubt about its ability to continue as a going concern highlight the urgent need for successful capital raises and prudent financial management. VIVIC's ability to overcome these liquidity challenges, effectively scale its operations in new markets, and fully leverage its technological differentiators will be paramount in determining whether it can translate its strategic vision into sustained profitability and establish a defensible position in the competitive high-end boating industry.