Executive Summary / Key Takeaways

• TEN Holdings, Inc. (NASDAQ: XHLD) is undergoing a strategic transformation, pivoting from traditional event services to a Software-as-a-Service (SaaS) model with its Ten Events Pro ("Ten Pro") platform, aiming for scalable, recurring revenue in the rapidly growing global events market.
• The company's proprietary Xyvid Pro Platform and the forthcoming Ten Pro SaaS solution offer differentiated, studio-grade virtual and hybrid event experiences with advanced interactivity and analytics, positioning it against mass-market solutions.
• Despite a strong gross profit margin of 80.78% (TTM), XHLD faces significant financial challenges, including substantial net losses and negative operating cash flow, leading to "substantial doubt" about its ability to continue as a going concern.
• Key risks include potential shareholder dilution from its equity line of credit, the threat of Nasdaq delisting due to bid price non-compliance, and ongoing grand jury and SEC investigations related to its initial public offering.
• A strategic partnership with its majority shareholder, V-Cube, Inc. (TICKER:TYO:3681), is set to deliver advanced enterprise communication technology to the North American market, enhancing XHLD's competitive offerings and market reach.

The Digital Stage: TEN Holdings' Pivot to SaaS in a Trillion-Dollar Market

TEN Holdings, Inc., through its operating subsidiary Ten Events, Inc., is a provider of event planning, production, and broadcasting services, specializing in virtual, hybrid, and physical events. The company's core offering revolves around its proprietary Xyvid Pro Platform, an internet-based broadcast platform designed to deliver dynamic, interactive, and engaging virtual event experiences for clients globally. This platform is crucial for corporate town halls, global product unveilings, and other high-stakes events, offering real-time interactivity, customizable branding, and robust analytics. The company's mission is to become a global leader in innovative virtual events, enhancing engagement and connectivity.

The broader industry landscape presents a significant opportunity, with the global virtual events market projected at $404.3 billion (CAGR of 11.1% through 2027) and the live events industry at $1.2 trillion (CAGR of 7.5% through 2030). The corporate event market alone, which Xyvid Pro directly addresses, is valued at $355 billion. In response to these trends and the explosive growth of the $1 trillion global SaaS market (CAGR of 18.7% through 2030), TEN Holdings has embarked on a strategic pivot towards a Software-as-a-Service (SaaS) model with its Ten Events Pro ("Ten Pro") platform. This move, marked by an Early Adopter Program launch in July 2025 and a beta launch on July 1, 2025, is a defining milestone aimed at transforming how the company delivers value by reducing operational costs and unlocking scalable, recurring revenue streams.

The technological differentiation of XHLD's platforms is central to its investment thesis. The Xyvid Pro Platform offers "seamless, studio-grade event experiences" that provide "unmatched reliability and audience engagement" compared to mass-market solutions like Zoom , Google Meet, or Microsoft Teams. This focus on premium, high-stakes events allows XHLD to cater to clients demanding superior quality and customization. The forthcoming Ten Pro SaaS platform further enhances this offering with "cloud-based scalability," providing "cost-efficient, subscription-based access to event management tools" and predictable pricing. This technological roadmap includes integrating advanced features like AI-driven analytics and CRM integration, which are expected to elevate the virtual event experience, empower event companies to scale more effectively, and facilitate data-driven decisions. The strategic intent behind this R&D is to enhance the company's competitive moat, improve financial performance through higher margins and recurring revenue, and solidify its market positioning as a leader in innovative event technology.

A significant strategic move to bolster its technological capabilities and market reach was the October 15, 2025, announcement of a partnership with V-Cube, Inc. (TICKER:TYO:3681), its controlling stockholder and a leader in the global virtual events industry. This collaboration aims to deliver advanced enterprise communication technology to the North American market, leveraging V-Cube's proven technologies to accelerate product development and unlock new revenue-generating opportunities. This partnership is expected to position TEN Holdings as a leader in digital transformation for enterprises within the North American virtual events industry.

Financial Performance and Operational Realities

While the strategic pivot to SaaS and technological advancements paint a picture of future potential, TEN Holdings' recent financial performance highlights significant challenges. For the nine months ended September 30, 2025, total revenue decreased by 10.70% to $2.40 million, down from $2.69 million in the prior year period. This decline was primarily attributed to a major event series with the company's largest customer that occurred in Q1 2024 but did not repeat in Q1 2025, as this event is held biennially. However, for the three months ended September 30, 2025, total revenue saw a slight increase of 1.50% to $543,000, driven by a 15.60% increase in physical event revenue to $52,000, as a higher number of physical events took place. Virtual and hybrid event revenue for the quarter remained relatively flat at $491,000.

Despite revenue fluctuations, TEN Holdings maintains an impressive gross profit margin, reported at 80.78% on a trailing twelve-month basis, indicating strong operational efficiency in its core service delivery. However, this efficiency has not translated to overall profitability. The company reported a net loss of $1.99 million for the three months ended September 30, 2025, compared to a net loss of $975,000 in the prior year quarter. For the nine months ended September 30, 2025, the net loss significantly widened to $9.61 million, from $1.80 million in the comparable 2024 period.

The surge in operating expenses is a primary driver of these losses. Selling, General and Administrative (SGA) expenses increased by 66.70% to $2.19 million for the three months ended September 30, 2025, and by a substantial 152.80% to $9.50 million for the nine months ended September 30, 2025. These increases are largely due to additional costs associated with operating as a public company, including quarterly reviews, yearly audits, NASDAQ fees, D&O insurance, SEC legal expenses, and a significant $3.50 million in stock compensation expenses. Depreciation expenses also rose due to the continued development of the Xyvid Pro platform.

From a liquidity perspective, TEN Holdings had cash and cash equivalents of $310,000 as of September 30, 2025. The company's operations consumed $9.04 million in cash for the nine months ended September 30, 2025. To fund its operations and growth, the company relies on cash flow from operations, borrowed funds, and capital injections.

In June 2025, TEN Holdings entered into a purchase agreement with Lincoln Park Capital Fund, LLC, providing the right to sell up to $20 million worth of common stock over 24 months, with $19.60 million remaining available as of September 30, 2025. Net cash provided by financing activities increased significantly to $10.12 million for the nine months ended September 30, 2025, primarily due to proceeds from share issuance.

Competitive Landscape and Strategic Positioning

TEN Holdings operates in a competitive environment dominated by both specialized event technology providers and large, diversified technology giants. The company differentiates itself through its focus on "studio-grade event experiences" and "unmatched reliability and audience engagement" for high-stakes corporate events, contrasting with mass-market solutions that prioritize broad accessibility over deep customization. This niche focus allows XHLD to potentially build stronger customer loyalty through tailored solutions.

Compared to major players like Zoom Video Communications (ZM), Microsoft Corporation (MSFT), Cisco Systems (CSCO), and Alphabet Inc. (GOOGL) (through Google Meet), XHLD's offerings are more geared towards comprehensive event production, including live streaming, video editing, and on-demand libraries. While these larger competitors offer scalable video conferencing and collaboration tools, XHLD's Xyvid Pro and upcoming Ten Pro SaaS aim for a more integrated and customized event experience, particularly for hybrid events. The company's CEO, Randy Jones, has noted that "some of the products that are out there are legacy and and and not terribly cutting edge," suggesting a strategic intent to innovate beyond existing solutions.

The pivot to a SaaS model with Ten Pro is a direct response to the market's demand for predictable revenue streams and higher-margin growth, a characteristic that has historically led to significant valuation increases for publicly listed SaaS companies. This strategy aims to reduce operational costs associated with traditional event production and enhance customer retention. The partnership with V-Cube, Inc. (TICKER:TYO:3681), a leader in the global virtual events industry, further strengthens XHLD's competitive standing by leveraging proven technologies to expand its offerings in the North American market. This collaboration allows XHLD to offer broadcast-quality, scalable, and interactive virtual and hybrid events that "extend far beyond traditional meeting platforms."

However, XHLD's smaller scale and financial constraints could pose challenges in matching the R&D investment and market penetration capabilities of its larger rivals. While XHLD may lead in niche expertise and customized solutions, it could lag in overall technological integration and market share capture against competitors with vast ecosystems and diversified revenue streams.

Outlook and Critical Risks

The outlook for TEN Holdings is heavily tied to the successful execution of its SaaS transformation and its ability to address significant financial and regulatory hurdles. The public launch of the Ten Events Pro platform in Q1 2026, with its planned AI-driven analytics and CRM integration, is a key near-term catalyst. Management is also actively pursuing merger and acquisition opportunities to boost SaaS revenue and scale operations, with the new CFO, Virgilio D. Torres, bringing experience in capital raising and M&A to support these initiatives.

Despite these strategic initiatives, several critical risks loom large for investors. Foremost is the "substantial doubt" about the company's ability to continue as a going concern, stemming from persistent operating losses and negative cash flows. The company's viability is dependent on attracting new revenue-generating customers, securing new contracts, and obtaining additional financing, with no assurances of success.

Shareholders also face significant dilution risk. The Equity Line of Credit (ELOC) with Lincoln Park Capital Fund, LLC allows for the issuance of up to $20 million in common stock, which could substantially increase the number of shares outstanding and depress the stock price. Furthermore, TEN Holdings received a deficiency letter from Nasdaq on June 30, 2025, for failing to meet the minimum $1.00 bid price requirement, with a deadline of December 29, 2025, to regain compliance. While a reverse stock split is an option, its announcement or implementation could negatively affect the stock price. Delisting from Nasdaq would severely impact market liquidity and the company's ability to raise capital.

Adding to these challenges, the company disclosed receiving a grand jury subpoena from the U.S. Attorney’s Office on October 27, 2025, and learning of a related SEC investigation on October 28, 2025, both concerning its initial public offering. The outcome and potential impact of these investigations are currently unpredictable. Additionally, a Nasdaq deficiency letter regarding a "severe breakdown in corporate governance" due to the resignation of independent directors highlights internal control concerns.

Conclusion

TEN Holdings, Inc. stands at a pivotal juncture, attempting to leverage its differentiated Xyvid Pro Platform and strategic SaaS pivot with Ten Pro to capture a significant share of the expanding global events market. The company's strong gross profit margins and strategic partnership with V-Cube, Inc. (TICKER:TYO:3681) underscore its operational capabilities and potential for technological leadership in specialized event solutions. However, the investment thesis is overshadowed by profound financial instability, including ongoing losses and negative cash flow that raise "substantial doubt" about its going concern status.

The path forward for XHLD is fraught with challenges, from the need to secure additional financing and regain Nasdaq compliance to navigating regulatory investigations. While the strategic shift to a scalable SaaS model and the integration of advanced technologies like AI offer a compelling long-term vision, investors must weigh this potential against the immediate and significant financial, operational, and regulatory risks. The success of TEN Holdings will ultimately depend on its ability to execute its strategic transformation, attract and retain customers, and effectively manage its capital structure amidst a complex competitive and regulatory landscape.