WiMi Hologram Cloud Inc.

Company Overview

Business Model: WiMi Hologram Cloud Inc. (the "Company") offers AR-based holographic services and products, providing an innovative, immersive, and interactive holographic AR experience. Its core business leverages holographic AR technologies in software engineering, content production, cloud, and big data. The Company generates revenue primarily from holographic AR advertising services and holographic AR entertainment products (including payment middleware software, a game distribution platform, and holographic MR software). Additionally, it provides central processing algorithm services and computer chip products to enterprise customers, along with comprehensive solutions for central processing algorithms and related services with software and hardware integration.

Market Position: The Company operates in the relatively new and rapidly evolving holographic AR and semiconductor markets, characterized by intense competition, new industry standards, limited barriers to entry, disruptive technological developments, short product life cycles, customer price sensitivity, and frequent product introductions. While the Company believes it competes favorably based on factors such as breadth of use cases, product features, customization, and technological capabilities, it acknowledges its smaller size compared to some well-established enterprises. Its monetization methods are still in a preliminary stage, and growth depends on continuous innovation and market expansion.

Recent Strategic Developments:

• Divestitures: In 2023 and 2024, the Company divested several non-core assets to concentrate on its core business. This included the disposal of 100% equity interest in Fe-da Electronics Company Private Limited and its subsidiaries in April 2023, Guangzhou Bimai Network Technology Co., Ltd. in January 2023, Shenzhen Yiyou Online Technology Co., Ltd. in May 2024, and Khorgas Weidong Technology Co., Ltd. in October 2024, resulting in recognized losses from these transfers.
• Corporate Structure Changes: VIYI Algorithm Inc. (a subsidiary of WiMi Hologram Cloud Inc.) terminated its Variable Interest Entity (VIE) agreements with Shenzhen Yitian Internet Technology Co., Ltd. in April 2022, gaining 100% direct equity control.
• Internal Reorganizations: In February and November 2024, Shenzhen Viwotong Technology Co., Ltd. transferred 100% equity of Guangzhou Tapuyu Internet Technology Co., Ltd. and Beijing Younike Information Technology Co., Ltd. to Beijing Viwotong Technology Co., Ltd., and subsequently to Beijing Weiyun Spacetime Technology Co., Ltd. for group management purposes.
• Capital Structure Adjustments: Effective April 2, 2025, the Company's American Depositary Shares (ADSs) were cancelled, and its Class B ordinary shares began trading directly on NASDAQ under "WIMI" on April 3, 2025. A 20-to-1 share consolidation was effected on April 14, 2025, followed by a shareholder-approved increase in authorized share capital to US$1,500,000 divided into 750,000,000 shares on March 25, 2025.
• Investment in MicroAlgo Inc.: WiMi Hologram Cloud Inc. increased its equity stake in MicroAlgo Inc. to 67.65% as of March 25, 2025, through the conversion of convertible notes.

Geographic Footprint: The Company's primary operations and the majority of its revenues are sourced from Mainland PRC. It also has a significant presence in Hong Kong. Internationally, the Company maintains holding companies and subsidiaries in the Cayman Islands, Republic of Seychelles, Singapore, and British Virgin Islands. Its regulatory jurisdictions include the PRC, Hong Kong, Cayman Islands, and Singapore.

Cross-Border Operations: WiMi Hologram Cloud Inc. is a Cayman Islands holding company that conducts its operations in China through PRC subsidiaries and Variable Interest Entities (VIEs), such as Beijing WiMi Cloud Software Co., Ltd., due to PRC foreign ownership restrictions in certain internet and related businesses. The Company relies on contractual arrangements with its VIEs to exert effective control and consolidate their financial results. Key international subsidiaries include WiMi Hologram Cloud Limited (Hong Kong), Micro Beauty Lightspeed Investment Management HK Limited (Hong Kong), VIDA Semicon Co., Limited (Hong Kong), Viru Technology Limited (Hong Kong), Weeto Investment Pte. Ltd. (Singapore), Skystar Development Co., Ltd (Republic of Seychelles), VIYI Technology Ltd. (Hong Kong), CDDI Capital Ltd (British Virgin Islands), VIWO Technology Inc. (Cayman Islands), and VIWO Technology (HK) Limited (Hong Kong). The Company has not entered into any hedging transactions to mitigate foreign exchange risks arising from its multi-jurisdictional operations.

Financial Performance

Revenue Analysis

Profitability Metrics:

• Gross Margin: 28.4%
• Operating Margin: -5.4%
• Net Margin: 19.1%

Investment in Growth:

• R&D Expenditure: RMB 111.7 million (USD 15.5 million) (20.6% of revenue)
• Capital Expenditures: RMB 28,641 (USD 3,984)
• Strategic Investments: In 2024, the Company made significant purchases of short-term investments totaling RMB 1,109.6 million (USD 154.4 million) and received RMB 660.0 million (USD 91.8 million) from convertible notes issuance of MicroAlgo Inc.

Currency Impact Analysis: The Company's reporting currency is Renminbi (RMB), while its operating entities utilize various functional currencies including U.S. dollar (USD), Hong Kong dollar (HKD), and RMB. Fluctuations in exchange rates among these currencies impact the Company's reported revenues, earnings, and assets. The Company has not implemented any hedging strategies to mitigate foreign exchange risks. Translation adjustments are recorded in accumulated other comprehensive income (loss).

Business Segment Analysis

AR advertising services

Financial Performance:

• Revenue: RMB 541.9 million (USD 75.4 million) (-5.2% YoY)
• Operating Margin: 28.4% (Gross Margin)
• Key Growth Drivers: The decrease in revenue was primarily attributed to a decline in the overall market demand for internet advertising.

Product Portfolio:

• Major product lines and services: Holographic AR advertising software that integrates real or animated 3D objects into video footages on online streaming platforms. This is achieved through proprietary image and video recognition technologies, template matching, video processing, holographic 3D layer replacement, and dynamic fusion processing.
• New product launches or major updates: The Company continues to develop and upgrade technology modules for applications such as celebrity advertising, film distribution, and live video streaming.

Market Dynamics:

• Competitive positioning: The Company competes with both holographic AR advertisement producers and traditional advertisement producers.
• Key customer types and regional market trends: Customers include advertisers and third-party advertising agencies across various industries such as manufacturing, real estate, entertainment, technology, media and telecommunications, travel, education, and retail. The primary market is Mainland PRC.

Geographic Revenue Distribution:

• Mainland PRC: RMB 415.2 million (USD 57.8 million) (76.6% of segment revenue)
• Hong Kong: RMB 126.7 million (USD 17.6 million) (23.4% of segment revenue)

AR entertainment

Financial Performance:

• Revenue: RMB 0 (USD 0) (-100.0% YoY)
• Operating Margin: N/A
• Key Growth Drivers: Shenzhen Yitian Internet Technology Co., Ltd., a key subsidiary in this segment, did not engage in operational activities in 2024, resulting in no revenue generation.

Product Portfolio:

• Major product lines and services: Payment middleware software (often with AR functions) connecting mobile apps to payment channels, the 233 Game Platform (an online game distribution platform), and holographic MR software for integrated audio-visual operations, advertising, media asset management, and various holographic interactive systems.
• New product launches or major updates: The Company expects more applications for its AR holographic entertainment products with the development and popularization of AR holographic hardware devices.

Market Dynamics:

• Competitive positioning within segment: The Company generates revenue from mobile payment middleware through revenue-sharing with app developers and from its game platform.
• Key customer types and regional market trends: Based on users' demand for entertainment applications in 3D computer vision.

Geographic Revenue Distribution:

• No revenue reported for 2024.

Semiconductor business

Financial Performance:

• Revenue: RMB 0 (USD 0) (-100.0% YoY)
• Operating Margin: N/A
• Key Growth Drivers: The complete decline in revenue was due to the divestiture of Fe-da Electronics Company Private Limited and its subsidiaries in April 2023, as the Company decided to concentrate on its core business.

Product Portfolio:

• Major product lines and services: Provision of central processing algorithm services and computer chip products to enterprise customers. This includes comprehensive solutions for central processing algorithms and related services with software and hardware integration, such as customized central processing units (CPUs).

Market Dynamics:

• Competitive positioning within segment: Operates in a highly competitive semiconductor industry.
• Key customer types and regional market trends: Customers primarily include manufacturers of electronic products and internet information infrastructure service providers.

Geographic Revenue Distribution:

• No revenue reported for 2024.

International Operations & Geographic Analysis

Revenue by Geography:

International Business Structure:

• Subsidiaries: WiMi Hologram Cloud Limited (Hong Kong), Micro Beauty Lightspeed Investment Management HK Limited (Hong Kong), VIDA Semicon Co., Limited (Hong Kong), Viru Technology Limited (Hong Kong), Weeto Investment Pte. Ltd. (Singapore), Skystar Development Co., Ltd (Republic of Seychelles), VIYI Technology Ltd. (Hong Kong), CDDI Capital Ltd (British Virgin Islands), VIWO Technology Inc. (Cayman Islands), VIWO Technology (HK) Limited (Hong Kong).
• Joint Ventures: VIDA Semicon Co., Limited (53% owned by WiMi Hologram Cloud Limited).
• Licensing Agreements: Not explicitly detailed for international operations, but generally for AR-based holographic offerings.

Cross-Border Trade:

• Export Markets: Not explicitly detailed.
• Import Dependencies: Not explicitly detailed.
• Transfer Pricing: Contractual arrangements with VIEs are subject to potential audit or challenge by PRC tax authorities, which could lead to transfer pricing adjustments if not deemed to be on an arm’s-length basis.

Capital Allocation Strategy

Shareholder Returns:

• Share Repurchases: Not disclosed in the filing.
• Dividend Payments: WiMi Hologram Cloud Inc. has not declared or paid any cash dividends and currently intends to retain most, if not all, available funds and future earnings to operate and expand its business.
• Dividend Yield: Not applicable.
• Future Capital Return Commitments: Not disclosed in the filing.

Balance Sheet Position:

• Cash and Equivalents: RMB 1,070.5 million (USD 148.9 million) as of December 31, 2024.
• Total Debt: RMB 37.6 million (USD 5.2 million) as of December 31, 2024, comprising RMB 15.0 million (USD 2.1 million) in current bank loans and RMB 22.6 million (USD 3.1 million) in non-current related party loans.
• Net Cash Position: RMB 1,032.9 million (USD 143.7 million) as of December 31, 2024.
• Credit Rating: Not disclosed in the filing.
• Debt Maturity Profile: Related party loans of RMB 22.6 million (USD 3.1 million) are due in 2026. Operating lease obligations include RMB 0.8 million (USD 0.1 million) due in less than 1 year, RMB 0.5 million (USD 0.06 million) due in 1-2 years, and RMB 0.2 million (USD 0.03 million) due in 2-3 years.

Cash Flow Generation:

• Operating Cash Flow: RMB 532.9 million (USD 74.1 million) in 2024.
• Free Cash Flow: Approximately RMB 532.9 million (USD 74.1 million) in 2024 (Operating Cash Flow less Capital Expenditures).
• Cash Conversion Metrics: Not explicitly detailed in the filing.

Currency Management:

• Cash holdings by major currencies: As of December 31, 2024, cash balances were held in Mainland China (RMB 196.0 million / USD 27.3 million), Hong Kong (HKD 138.4 million / RMB 149.5 million / USD 20.8 million), Singapore (SGD 3,623.8 million / RMB 681.0 million / USD 94.7 million), and the US (USD 6.1 million / RMB 44.0 million).
• Natural hedging through operational diversification: Not explicitly stated.
• Financial hedging instruments and strategies: The Company has not entered into any hedging transactions to reduce its exposure to foreign exchange risks.

Operational Excellence

Production & Service Model: The Company's operational philosophy centers on delivering innovative, immersive, and interactive holographic AR experiences. Its production and service model for holographic AR advertising involves software-enabled insertion of 3D objects into video footages, leveraging proprietary image and video recognition, template matching, 3D layer replacement, and dynamic fusion processing technologies. For AR entertainment, it provides payment middleware for mobile apps and operates the 233 Game Platform. Its holographic MR software offers a comprehensive platform for audio-visual operations, advertising, and various interactive systems. The semiconductor business focuses on central processing algorithm services and computer chip products, including customized CPUs and integrated software/hardware solutions.

Global Supply Chain Architecture: Key Suppliers & Partners:

• Channel Providers: For AR advertising services, based on revenue-sharing arrangements.
• Content Providers: For AR entertainment, based on profit-sharing arrangements.
• App Developers: Partners for embedding payment middleware and utilizing the game distribution platform.
• Manufacturers of Electronic Products: Customers for semiconductor products and integrated solutions.
• Internet Information Infrastructure Service Providers: Customers for hardware products and server algorithm optimization.
• Third-party payment platforms: Utilized for collection services in mobile game operations.

Facility Network:

• Headquarters: Beijing, China, with approximately 827.2 square meters of leased office space.
• Manufacturing: Not explicitly detailed, but the Company owns buildings with an aggregate floor area of approximately 6,551 square meters.
• Research & Development: R&D efforts are focused on enhancing artificial intelligence, holographic AR and image processing, intelligent hardware, and photosensitive signal transmission technologies. Specific R&D centers are not detailed.
• Distribution: Not explicitly detailed.

Operational Metrics: The filing does not provide specific quantitative operational metrics such as capacity utilization or efficiency measures.

Market Access & Customer Relationships

Go-to-Market Strategy: Distribution Channels:

• Direct Sales: The Company employs an experienced sales and marketing team that engages in direct office visits, attends conferences, and participates in industry exhibitions.
• Channel Partners: For holographic AR advertising services, the Company works with channel providers under revenue-sharing arrangements.
• Digital Platforms: The 233 Game Platform serves as an online game distribution channel.

Customer Portfolio: Enterprise Customers:

• Tier 1 Clients: The Company serves a broad and diverse customer base across various industries, including manufacturing, real estate, entertainment, technology, media and telecommunications, travel, education, and retail.
• Strategic Partnerships: Collaborates with app developers and content owners (brands, film producers, talent agencies) to adapt intellectual properties into holographic AR formats.
• Customer Concentration: In 2024, one customer accounted for 12.0% of total revenues. In 2023, one customer accounted for 9.2% of total revenues, and in 2022, one customer accounted for 15.9% of total revenues. As of December 31, 2024, one customer accounted for 10.7% of accounts receivable.

Regional Market Penetration:

• Mainland PRC: Represents the Company's primary focus and source of a substantial portion of its revenues.
• Growth Markets: The Company plans to expand its presence in international markets, aiming to become a global holographic enterprise, believing its technology is applicable globally.

Competitive Intelligence

Global Market Structure & Dynamics

Industry Characteristics: The holographic AR and semiconductor industries are characterized by rapid evolution, continuous technological changes, intense competition, new industry standards, limited barriers to entry, disruptive technology developments, short product life cycles, customer price sensitivity, and frequent product introductions. The holographic AR market is relatively new with few proven methods for projecting customer demand or established industry standards. Monetization strategies are still in preliminary stages.

Competitive Positioning Matrix:

Direct Competitors

Primary Competitors:

• Holographic AR advertisement producers: Direct competitors in the evolving holographic AR advertising market.
• Traditional advertisement producers: Established players in the broader advertising industry.
• Digital marketing service providers: Competitors in the online advertising space.
• Online game service providers: Competitors in the AR entertainment segment.
• Well-established enterprises: Larger companies with greater financial, technical, sales, marketing, and customer base resources that could enter the holographic AR and semiconductor markets.

Regional Competitive Dynamics: Competition is expected to intensify. The Company's ability to maintain its competitive edge depends on the quality of its applications, effectiveness of sales and marketing, customer service, and strategic acquisitions of complementary technologies and businesses.

Risk Assessment Framework

Strategic & Market Risks

Global Market Dynamics: The Company faces risks from operating in rapidly evolving holographic AR and semiconductor markets, including intense competition, the need for continuous innovation, and uncertainties in monetization strategies. Failure to keep pace with technological developments or effectively manage growth could harm its business. Dependence on customer cooperation and interoperability with next-generation AR hardware are also key risks.

Technology Disruption: The holographic AR and semiconductor industries are subject to continuous technological changes. Failure to invest sufficiently in new technology, evolve business at speed and scale, or make the right strategic investments could negatively affect services, solutions, and competitive advantage. New services or technologies from competitors could reduce differentiation.

Customer Concentration: While the Company serves a diverse customer base, a single customer accounted for 12.0% of total revenues in 2024, indicating some level of concentration risk.

Operational & Execution Risks

Global Supply Chain Vulnerabilities: The Company relies on third-party services and technologies, and any disruption or changes could lead to increased costs or service interruptions. Regional Disruptions: Not explicitly detailed in the filing. Trade Restrictions: Not explicitly detailed in the filing.

IT Systems and Infrastructure: The business is highly dependent on the continuous and reliable operation of its IT systems, which are vulnerable to damage, interruption, security breaches, and the need for timely scaling. Disruptions could damage reputation and lead to customer migration. Intellectual Property Protection: Protecting patents, copyrights, trademarks, and trade secrets is critical but challenging, especially in China. Risks include unauthorized disclosure of source code, patent expiration, and infringement claims, which could lead to substantial costs and diversion of resources. Receivables Collection: The Company faces risks related to the timely collection of payments from customers, with potential for delays or defaults, which could adversely affect cash flows. Brand Recognition: The Company's success depends on maintaining and enhancing brand recognition in a competitive market, with risks if promotion efforts are ineffective or costly. Internal Controls: Material weaknesses were identified in internal control over financial reporting, specifically regarding financial reporting personnel's understanding of U.S. GAAP and information technology general controls (data backup, user account management, segregation of duties, risk assessment). These weaknesses pose risks to accurate financial reporting, compliance, and fraud prevention.

Financial & Regulatory Risks

Currency & Financial Risks: The Company incurred net losses in 2022 and 2023, and future profitability is not assured. Significant capital is required for R&D, and the ability to obtain future financing is uncertain. Fluctuations in exchange rates between RMB, USD, and HKD can materially affect financial results, and the Company does not employ hedging strategies. Interest Rate Risk: Not explicitly detailed in the filing. Credit & Liquidity: The Company's ability to pay dividends relies on distributions from PRC subsidiaries, which are subject to PRC regulations on retained earnings and foreign exchange controls. Regulatory & Compliance Risks:

• Multi-Jurisdictional Compliance: The Company's operations in China are subject to complex and rapidly evolving PRC laws and regulations, including those on foreign investment, telecommunication services, internet content, intellectual property, data security, online games, employment, and taxation.
• VIE Structure: The contractual arrangements with VIEs may not be as effective as direct ownership, and changes in PRC regulations or their interpretation could lead to severe penalties or forced relinquishment of interests.
• PRC Foreign Investment Law: Uncertainties exist regarding the interpretation and implementation of the PRC Foreign Investment Law and its potential impact on the viability of the VIE structure.
• Cybersecurity and Data Privacy: Extensive and evolving PRC laws (Cyber Security Law, Data Security Law, Personal Information Protection Law) impose significant compliance obligations. The Company states it is not subject to certain cybersecurity reviews due to its business model, but regulatory interpretations remain uncertain.
• Overseas Listings: The Company is subject to the CSRC's Trial Administrative Measures of Overseas Securities Offering and Listing by Domestic Companies, requiring filings for future overseas offerings.
• HFCA Act: While the Company's auditor (Onestop Assurance PAC, Singapore-based) is subject to PCAOB inspection, future regulatory changes could impact the ability to provide audit documentation, potentially leading to delisting risks.
• International Tax Strategy: Risk of being classified as a "PRC resident enterprise" for tax purposes, which could result in a 25% enterprise income tax on worldwide income and withholding taxes on dividends/gains for non-PRC shareholders. Transfer pricing arrangements with VIEs are also subject to scrutiny.

Geopolitical & External Risks

Country-Specific Risks: Adverse changes in China's economic, political, or social conditions, or government policies, could materially affect the Company's business. Heightened tensions in international economic relations between the United States and China, including trade policies and regulatory actions, could also adversely impact operations and share value.

Innovation & Technology Leadership

Research & Development Focus: The Company prioritizes continuous investment in its technology system, with R&D expenditures of RMB 111.7 million (USD 15.5 million) in 2024. Global R&D Network: While specific R&D centers are not detailed, the Company's efforts are focused on enhancing artificial intelligence technology, holographic AR and image processing technology, intelligent hardware technology, and photosensitive signal transmission technology. Innovation Pipeline: Key areas of development include:

• Holographic Image Processing and Recognition Intelligence Technology: Utilized for holographic AR advertisements, based on imaging detection, template matching, video processing, 3D layer replacement, and dynamic fusion processing.
• Holographic 3D Facial Recognition Technology: A biographic recognition technology combining holographic imaging capture and 3D portrait, capable of collecting over 30,000 featured points, offering advantages over traditional 2D recognition.
• Holographic Facial Change Technology: Based on 3D layer replacement, real-time image tracking, video synthesis, and audio addition, with potential for celebrity advertising, film distribution, and live video streaming.
• Software Engineering: Development of a company-wide software platform, integration with cloud infrastructure, and holographic AR/MR-related software and solutions.
• Content Production: Capabilities in image acquisition, object recognition, automated image processing, and computer vision for creating holographic AR content, supported by a comprehensive content library and licensed IPs.
• Cloud and Big Data: Development of a flexible and scalable cloud architecture for holographic AR experiences and advanced data analytics capabilities for real-time analysis and user profiling.
• 5G+: Adaptation of holographic services to 5G technology to leverage high speed and low latency for enhanced AR remote communication and data transmission.

Intellectual Property Portfolio:

• Patent Strategy: As of December 31, 2024, the Company held 240 registered patents in China, primarily utility model patents, covering technologies for image processing and display, model input/output, and 3D modeling.
• Licensing Programs: The Company licenses its holographic AR-related and MR-related software and solutions to entertainment industry customers.
• IP Litigation: Not explicitly detailed, but the Company acknowledges the difficulty and cost of preventing unauthorized use of its intellectual property.

Technology Partnerships: The Company cooperates with various content owners, including brands, film producers, and talent agencies, to adapt high-quality, popular IPs into holographic AR formats.

Leadership & Governance

Executive Leadership Team

International Management Structure: The filing does not provide specific details on the international management structure, regional leadership, or local management autonomy versus centralized oversight.

Board Composition: The Board of Directors consists of seven directors, including four independent directors: Hongtao Zhao, Dr. Harriet Ywan, Teck Yong Heng, and Ting Zhang. Teck Yong Heng serves as the chairman of the Audit Committee and is qualified as an "audit committee financial expert." Hongtao Zhao chairs both the Compensation Committee and the Nominating and Corporate Governance Committee. Directors serve for an unspecified term. Jie Zhao, the Chairman, controls over 50% of the total voting power, classifying WiMi Hologram Cloud Inc. as a "controlled company" under Nasdaq rules.

Regulatory Environment & Compliance

Multi-Jurisdictional Regulatory Framework: Primary Regulatory Environments:

• PRC: The Company's operations in China are subject to extensive and rapidly evolving laws and regulations, including those governing foreign investment, telecommunication services, internet content, intellectual property, data security, online games, employment, and taxation.
• Hong Kong: Subject to a 16.5% Hong Kong Profits Tax rate, with exemptions for foreign-derived income and no withholding taxes on dividend remittances.
• Cayman Islands: Exempt from taxes on profits, income, gains, or appreciation, and no inheritance tax or estate duty. No exchange control regulations.
• Singapore: Subject to a 17% Singapore Profits Tax rate, with partial exemptions for initial taxable income.

Cross-Border Compliance:

• Export Controls: Not explicitly detailed.
• Sanctions Compliance: Not explicitly detailed.
• Anti-Corruption: Not explicitly detailed.
• Cybersecurity Compliance: The Company is subject to PRC laws such as the Cyber Security Law, Data Security Law, and Personal Information Protection Law. While the Company believes it is not subject to the Cybersecurity Review Measures due to its business model (not directly serving individual users, limited personal information, no national security bearing data), uncertainties remain regarding regulatory interpretation and future enforcement.
• Overseas Listing Compliance: The Company is subject to the CSRC's Trial Administrative Measures of Overseas Securities Offering and Listing by Domestic Companies (effective March 31, 2023), requiring filings for future overseas offerings.
• HFCA Act Compliance: The Company's current auditor, Onestop Assurance PAC (headquartered in Singapore), is registered with the PCAOB and subject to regular inspections. Therefore, the Company has not been identified as a "Commission-Identified Issuer" under the HFCA Act. However, future regulatory changes or restrictions on audit work in China could impact this status.

International Tax Strategy:

• Transfer Pricing: Contractual arrangements between the Company and its VIEs are subject to potential audit and challenge by PRC tax authorities, which could lead to transfer pricing adjustments and increased tax liabilities.
• Tax Treaties: The Company may benefit from reduced withholding tax rates under tax treaties (e.g., 5% for Hong Kong resident enterprises), but this is subject to determination by PRC tax authorities regarding "beneficial owner" status.
• BEPS Compliance: Not explicitly detailed.
• PRC Resident Enterprise Classification: There is a risk that WiMi Hologram Cloud Inc. could be classified as a "PRC resident enterprise" for PRC tax purposes, which would subject its worldwide income to a 25% enterprise income tax rate and potentially impose withholding taxes on dividends and gains for non-PRC shareholders.

Environmental & Social Impact

Global Sustainability Strategy: The filing does not explicitly detail a global sustainability strategy, environmental commitments, carbon neutrality targets, or renewable energy adoption across operations.

Regional Sustainability Initiatives:

• Supply Chain: Not explicitly detailed.

Social Impact by Region:

• Community Investment: Not explicitly detailed.
• Labor Standards: The Company adheres to PRC labor laws and regulations, including mandatory contributions to employee social security plans (pension, unemployment, maternity, work-related injury, medical insurance) and housing funds for its PRC-based full-time employees.

Currency Management & Financial Strategy

Multi-Currency Operations: Currency Exposure:

Hedging Strategies:

• Transaction Hedging: The Company has not entered into any hedging transactions to reduce its exposure to foreign exchange risks.
• Translation Hedging: The Company has not entered into any hedging transactions to reduce its exposure to foreign exchange risks.
• Economic Hedging: The Company has not entered into any hedging transactions to reduce its exposure to foreign exchange risks.