What changed in Armlogi Holding Corp.'s 10-K — 2024 vs 2025
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Paragraph-level year-over-year comparison of Armlogi Holding Corp.'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.
+179 added−161 removedSource: 10-K (2025-09-25) vs 10-K (2024-09-26)
Top changes in Armlogi Holding Corp.'s 2025 10-K
179 paragraphs added · 161 removed · 140 edited across 7 sections
- Item 1A. Risk Factors+72 / −59 · 51 edited
- Item 7. Management's Discussion & Analysis+59 / −49 · 44 edited
- Item 1. Business+35 / −35 · 35 edited
- Item 2. Properties+9 / −8 · 6 edited
- Item 5. Market for Registrant's Common Equity+2 / −8 · 2 edited
Item 1. Business
Business — how the company describes what it does
35 edited+0 added−0 removed110 unchanged
Item 1. Business
Business — how the company describes what it does
35 edited+0 added−0 removed110 unchanged
2024 filing
2025 filing
Biggest changeA complex process of leasing additional warehouse space requires careful planning and execution, involving the identification of suitable locations, negotiation of lease terms, and logistics management for moving equipment and inventory. In addition, the recruitment and training of personnel for the new warehouses may also be challenging.
Biggest changeBefore choosing the right funding source, we will carefully consider our financial position, creditworthiness, and other factors. A complex process of leasing additional warehouse space requires careful planning and execution, involving the identification of suitable locations, negotiation of lease terms, and logistics management for moving equipment and inventory.
Through our expertise and liaison with the PRC, we are primarily targeting cross-border e-commerce merchants in the PRC, but we are also developing a growing international customer base in other countries, such as South Korea. Our U.S. domestic customers are typically domestic e-commerce merchants seeking efficient and reliable warehousing and logistics solutions to support their operations.
Through our expertise and liaison with the PRC, we are primarily targeting cross-border e-commerce merchants in the PRC, but we are also developing a growing international customer base in other countries, such as South Korea and Mexico. Our U.S. domestic customers are typically domestic e-commerce merchants seeking efficient and reliable warehousing and logistics solutions to support their operations.
On May 15, 2024, we closed our IPO of 1,600,000 shares of common stock at a price of $5.00 per share. In connection with the IPO, the shares of common stock began trading on the Nasdaq Global Market under the symbol “BTOC” on May 14, 2023.
On May 15, 2024, we closed our IPO of 1,600,000 shares of common stock at a price of $5.00 per share. In connection with the IPO, the shares of common stock began trading on the Nasdaq Global Market under the symbol “BTOC” on May 14, 2024.
Our operations span across the West Coast, Midwest, and East Coast of the U.S., with a total of nine warehouses under management, including one of the only 23 eBay-certified third-party warehouses in the country. Specifically, certain items, such as furniture or large home appliances, require special logistics facilities for storage, fulfillment, and shipping because of their size and weight.
Our operations span across the West Coast, Midwest, and East Coast of the U.S., with a total of ten warehouses under management, including one of the only 23 eBay-certified third-party warehouses in the country. Specifically, certain items, such as furniture or large home appliances, require special logistics facilities for storage, fulfillment, and shipping because of their size and weight.
Moreover, our success is largely based on our warehouse management capabilities enabled by our warehousing network, which covers the West Coast, Midwest, and East Coast of the United States. As of the date of this annual report, we operate nine warehouses in the U.S., and plan to continue expanding our geographic footprint in key markets.
Moreover, our success is largely based on our warehouse management capabilities enabled by our warehousing network, which covers the West Coast, Midwest, and East Coast of the United States. As of the date of this annual report, we operate ten warehouses in the U.S., and plan to continue expanding our geographic footprint in key markets.
We receive warehousing service fees, typically ranging from $3 to $50 for each service, based on the specific services that our customers choose and subject to a variety of factors that may affect the cost of those services, such as the total number of stock keeping units (“SKUs”), weight, volume, and storage time. ● Other Services.
We receive warehousing service fees, typically ranging from $3 to $500 for each service, based on the specific services that our customers choose and subject to a variety of factors that may affect the cost of those services, such as the total number of stock keeping units (“SKUs”), weight, volume, and storage time. ● Other Services.
As a result, traditional warehousing and logistics service providers may find it difficult to offer integrated one-stop solutions. The nine warehouses we operate not only provide large storage space, but are also equipped with forklifts, pallets, and trays for processing bulky items.
As a result, traditional warehousing and logistics service providers may find it difficult to offer integrated one-stop solutions. The ten warehouses we operate not only provide large storage space, but are also equipped with forklifts, pallets, and trays for processing bulky items.
As a result, we provide services for delivering these goods to one of our nine warehouses in the U.S. for further services, such as warehousing, storage, and e-commerce order fulfillment.
As a result, we provide services for delivering these goods to one of our ten warehouses in the U.S. for further services, such as warehousing, storage, and e-commerce order fulfillment.
We have established procedures for selecting independent third-party logistics service providers that we engage in, including a thorough review of their service prices and quality, their operating history, fleet condition, reliability, and availability. Among our suppliers, FedEx accounted for approximately 50% and 62% of our total purchases, during the fiscal years ended June 30, 2024 and 2023, respectively.
We have established procedures for selecting independent third-party logistics service providers that we engage in, including a thorough review of their service prices and quality, their operating history, fleet condition, reliability, and availability. Among our suppliers, FedEx accounted for approximately 9% and 50% of our total purchases, during the fiscal years ended June 30, 2025 and 2024, respectively.
In addition to our full-time employees, we also hired approximately seven independent contractors as of June 30, 2024. These contract workers serve as our supplemental workforce, primarily responsible for warehouse labor, security, and cleaning. We believe that we maintain a good working relationship with our employees, and we have not experienced material labor disputes in the past.
In addition to our full-time employees, we also hired approximately nine independent contractors as of June 30, 2025. These contract workers serve as our supplemental workforce, primarily responsible for warehouse labor, security, and cleaning. We believe that we maintain a good working relationship with our employees, and we have not experienced material labor disputes in the past.
We have implemented certain measures to protect our intellectual property, including: (i) hiring outside legal counsel to assist in the protection of our intellectual property; and (ii) timely registration and filing with relevant authorities and application of intellectual property rights for our significant technologies and self-developed mobile apps. Employees As of June 30, 2024, we had 200 full-time employees.
We have implemented certain measures to protect our intellectual property, including: (i) hiring outside legal counsel to assist in the protection of our intellectual property; and (ii) timely registration and filing with relevant authorities and application of intellectual property rights for our significant technologies and self-developed mobile apps. Employees As of June 30, 2025, we had 210 full-time employees.
In addition, inventory accuracy is a metric that measures the difference between our records of warehouse stock and actual stock. Inventory accuracy is critical for preventing stockouts, shortages, shrinkage, controlling inventory quality, and maintaining a positive customer experience. In this regard, our operations achieved an average of 99.72% inventory accuracy during the fiscal year ended June 30, 2024.
In addition, inventory accuracy is a metric that measures the difference between our records of warehouse stock and actual stock. Inventory accuracy is critical for preventing stockouts, shortages, shrinkage, controlling inventory quality, and maintaining a positive customer experience. In this regard, our operations achieved an average of 99.64% inventory accuracy during the fiscal year ended June 30, 2025.
Other services primarily include customs brokerage services, where we collaborate with customers to file the necessary documentation and pay the appropriate taxes and duties to relevant authorities. We receive brokerage service fees from customers, typically ranging from $20 to $200 per each service, depending on the number of items to be declared.
Other services primarily include customs brokerage services, where we collaborate with customers to file the necessary documentation and pay the appropriate taxes and duties to relevant authorities. We receive brokerage service fees from customers, typically ranging from $70 to $100 per each service, depending on the number of items to be declared.
No other customers represented 10% or more of our total revenue for the years ended June 30, 2024 and 2023.
No other customers represented 10% or more of our total revenue for the years ended June 30, 2025 and 2024.
We strive to provide our customers with transparency in pricing and a clear understanding of the fees they will be charged for our services, typically (i) ranging from $3 to $75 for a package of services selected by each overseas customer, and (ii) ranging from $800 to $2,500 for a package of services selected by each domestic customer. 8 Technology and Intellectual Property We have developed a platform that provides a solution for warehouse and logistics management.
We strive to provide our customers with transparency in pricing and a clear understanding of the fees they will be charged for our services, typically (i) ranging from $50 to $1,500 for a package of services selected by each overseas customer, and (ii) ranging from $50 to $1,500 for a package of services selected by each domestic customer. 8 Technology and Intellectual Property We have developed a platform that provides a solution for warehouse and logistics management.
This allows us to provide integrated solutions for our customers, whether they need domestic or international warehousing and logistics support. As of June 30, 2024 and 2023, we had an active customer base of 105 and 83, respectively, for our warehousing and logistics services. We have experienced rapid growth since our inception.
This allows us to provide integrated solutions for our customers, whether they need domestic or international warehousing and logistics support. As of June 30, 2025 and 2024, we had an active base of 505 and 105 customers, respectively, for our warehousing and logistics services. We have experienced rapid growth since our inception.
Department of Homeland Security (the “ DHS”), the Occupational Safety and Health Administration (the “OSHA”), the Consumer Financial Protection Bureau, the U.S. Department of Transportation (the “ DOT”). For example, the shipping of goods by sea is regulated by the FMC. Our Company is licensed by the FMC to operate as an ocean transportation intermediary (“OTI”).
Department of Homeland Security (the “DHS”), the Occupational Safety and Health Administration (the “OSHA”), the Consumer Financial Protection Bureau, the U.S. Department of Transportation (the “DOT”). For example, the shipping of goods by sea is regulated by the FMC. Our Company is licensed by the FMC to operate as an ocean transportation intermediary (“OTI”).
During the fiscal years ended June 30, 2024 and 2023, we generated approximately 96% and 96% of our revenue from PRC-based customers, respectively.
During the fiscal years ended June 30, 2025 and 2024, we generated approximately 84% and 96% of our revenue from PRC-based customers, respectively.
For the fiscal years ended June 30, 2024 and 2023, we had 105 and 83 customers, respectively, with 59% and 63% of them based in mainland China. We are looking to continue to grow our customer base in China and also expand into Southeast Asia including Vietnam, Thailand, Indonesia, and the Philippines, and Mexico.
For the fiscal years ended June 30, 2025 and 2024, we had 505 and 105 customers, respectively, with 86% and 59% of them based in mainland China. We are looking to continue to grow our customer base in China and also expand into Southeast Asia including Vietnam, Thailand, Indonesia, and the Philippines, and Mexico.
Our current warehousing facilities are leased to us and have an aggregate gross floor area of 2,765,667 square feet. Aside from the large storage space, our warehouses are equipped with automated sorting systems, forklifts, pallets, and trays that are suitable for processing bulky items.
Our current warehousing facilities are leased to us and have an aggregate gross floor area of 3,905,020 square feet. Aside from the large storage space, our warehouses are equipped with automated sorting systems, forklifts, pallets, and trays that are suitable for processing bulky items.
As of the date of this annual report, we operate nine warehouses in four states, covering three U.S. ports of destination, including the Port of Los Angeles/Long Beach in California, the Port of Savannah in Georgia, the Port of Houston in Texas, and the Port of Newark in New Jersey.
As of the date of this annual report, we operate ten warehouses in five states, covering three U.S. ports of destination, including the Port of Los Angeles/Long Beach in California, the Port of Savannah in Georgia, the Port of Houston in Texas, the Port of Newark in New Jersey and the Port of Edwardsville in Illinois.
We currently operate nine warehouses across the country, with an aggregate gross floor area of approximately 2,765,667 square feet. Aside from a nationwide footprint and large storage space, our warehouses are equipped with automated sorting systems, heavy-duty forklifts, and pallets and trays that are suitable for processing bulky items.
We currently operate ten warehouses across the country, with an aggregate gross floor area of approximately 3,905,020 square feet. Aside from a nationwide footprint and large storage space, our warehouses are equipped with automated sorting systems, heavy-duty forklifts, and pallets and trays that are suitable for processing bulky items.
Our overseas and domestic customers generated approximately 96% and 4% of our revenue, respectively, during the fiscal year ended June 30, 2024 and approximately 96% and 4% of our revenue, respectively, during the fiscal year ended June 30, 2023.
Our overseas and domestic customers generated approximately 84% and 16% of our revenue, respectively, during the fiscal year ended June 30, 2025 and approximately 96% and 4% of our revenue, respectively, during the fiscal year ended June 30, 2024.
For the fiscal years ended June 30, 2024 and 2023, we had total revenue of $167.0 million and $135.0 million, respectively, and net income of $7.4 million and $13.9 million, respectively. While we do not have any subsidiaries, assets, or employees in the PRC, we generate a significant part of our revenue from customers based in China.
For the fiscal years ended June 30, 2025 and 2024, we had total revenue of $190.4 million and $167.0 million, respectively, and net loss of $15.3 million and net income of $7.4 million, respectively. While we do not have any subsidiaries, assets, or employees in the PRC, we generate a significant part of our revenue from customers based in China.
As such, we believe our service fees are reasonable and affordable. Capability of Providing Efficient and Low-error Warehousing Services by Leveraging Warehouse and Order Management Technology We have developed a platform, primarily including our Armlogi order management system (“OMS”), which provides a comprehensive and integrated solution for warehouse and logistics management.
Capability of Providing Efficient and Low-error Warehousing Services by Leveraging Warehouse and Order Management Technology We have developed a platform, primarily including our Armlogi order management system (“OMS”), which provides a comprehensive and integrated solution for warehouse and logistics management.
The following table sets forth the number of our full-time employees as of June 30, 2024: Function: Number Warehousing and Logistics 155 Operations 17 Customer Services 21 Technology 3 Accounting 4 Total 200 9 We enter into employment contracts, non-disclosure agreements, and confidential information agreements with our full-time employees to establish clear terms and expectations of employment and protect our sensitive and confidential information.
The following table sets forth the number of our full-time employees as of June 30, 2025: Function: Number Warehousing and Logistics 168 Operations 17 Customer Services 17 Technology 1 Accounting 7 Total 210 9 We enter into employment contracts, non-disclosure agreements, and confidential information agreements with our full-time employees to establish clear terms and expectations of employment and protect our sensitive and confidential information.
We plan to build out additional infrastructure in key markets in the U.S., including California, Georgia, Tennessee, Florida, and Arizona. A variety of funding sources could be utilized to lease additional warehouse space, including cash reserves, loans from financial institutions, and investor fundraising. Before choosing the right funding source, we will carefully consider our financial position, creditworthiness, and other factors.
We plan to build out additional infrastructure in key markets in the U.S., including California, Georgia, Tennessee, Florida, Illinois, and Arizona. A variety of funding sources could be utilized to lease additional warehouse space, including cash reserves, loans from financial institutions, and investor fundraising.
Specifically, we have (i) five warehouses in California, three of which are in the City of Industry, one in Walnut, and one in Fontana; (ii) one warehouse in Georgia, (iii) one warehouse in Houston, Texas, and (iv) two warehouses in New Jersey.
Specifically, we have (i) four warehouses in California, one in the City of Industry, one in Walnut, one in Ontario and one in Fontana; (ii) one warehouse in Georgia, (iii) two warehouses in Texas, (iv) two warehouses in New Jersey, and (v) one warehouse in Illinois.
All of these endeavors involve risks and will require significant management, financial, and human resources. We cannot assure you that we will be able to effectively manage our growth or to implement our strategies successfully.
In addition, the recruitment and training of personnel for the new warehouses may also be challenging. All of these endeavors involve risks and will require significant management, financial, and human resources. We cannot assure you that we will be able to effectively manage our growth or to implement our strategies successfully.
The volume of packages we send often entitles us to large discounts from third-party logistics providers. As a result, we have been able to provide our customers with stable and reasonable transportation rates. Additionally, we are able to overcome the surge charges for oversized items and peak season fees by leveraging our logistics management tools to achieve lower freight charges.
As a result, we have been able to provide our customers with stable and reasonable transportation rates. Additionally, we are able to overcome the surge charges for oversized items and peak season fees by leveraging our logistics management tools to achieve lower freight charges. As such, we believe our service fees are reasonable and affordable.
We rely on third-party logistics providers, such as FedEx and UPS, for end-to-end delivery, as we do not have our own in-house delivery team or vehicles. Despite this, we offer transportation rates based on a long-term agreement between our nine warehouses and third-party logistics service providers.
(“UPS”), for end-to-end delivery, as we do not have our own in-house delivery team or vehicles. Despite this, we offer transportation rates based on a long-term agreement between our ten warehouses and third-party logistics service providers. The volume of packages we send often entitles us to large discounts from third-party logistics providers.
Co., Ltd., representing approximately 11.7%, 11.7%, 10.9%, and 10.0% of our total revenue, respectively. During the fiscal year ended June 30, 2023, our two largest customers were Aukey International Ltd. and Union Grand Imp. & Exp. Co., Ltd., representing 22.5% and 14.5% of our total revenue, respectively.
For the fiscal year ended June 30, 2024, our top four customers were Aukey International Ltd., Western Post (HK) Ltd., Goldensee Ltd., and Union Grand Imp. & Exp. Co., Ltd., representing approximately 11.7%, 11.7%, 10.9%, and 10.0% of our total revenue, respectively.
Reasonable Service Fees and Delivery Fees due to the Large Volume of Goods We Process Considering the large volume of merchandise we process, we are able to offer relatively inexpensive service fees and affordable delivery fees.
Reasonable Service Fees and Delivery Fees due to the Large Volume of Goods We Process Considering the large volume of merchandise we process, we are able to offer relatively inexpensive service fees and affordable delivery fees. We rely on third-party logistics providers, such as FedEx and United Parcel Service, Inc.
As of June 30, 2024 and 2023, we had an active customer base of 105 and 83 customers, respectively, for our warehousing and logistics services. For the fiscal year ended June 30, 2024, our top four customers were Aukey International Ltd., Western Post (HK) Ltd., Goldensee Ltd., and Union Grand Imp. & Exp.
As of June 30, 2025 and 2024, we had an active base of 505 and 105 customers, respectively, for our warehousing and logistics services. During the fiscal year ended June 30, 2025, our two largest customers were Goldensee Ltd. and Kimberly Tenneco Inc, representing 22.0% and 10.8% of our total revenue, respectively.
Over the same fiscal years, no other suppliers accounted for more than 10% of our total purchases. On April 10, 2020, Armstrong Logistic, one of our subsidiaries, entered into a service agreement with FedEx for its delivery service.
During the fiscal year ended June 30, 2025, UPS accounted for approximately 15.2% and MEGA CORP LOGISTIC LLC, a third-party vendor providing shipping services via FedEx, accounted for approximately 10%, respectively. On April 10, 2020, Armstrong Logistic, one of our subsidiaries, entered into a service agreement with FedEx for its delivery service.
Item 1A. Risk Factors
Risk Factors — what could go wrong, per management
51 edited+21 added−8 removed199 unchanged
Item 1A. Risk Factors
Risk Factors — what could go wrong, per management
51 edited+21 added−8 removed199 unchanged
2024 filing
2025 filing
Biggest changeIf such significant suppliers breach or terminate their contracts with us, or experience significant disruptions to their operations, we will be required to find and enter into arrangements with one or more replacement suppliers. Finding alternative suppliers could involve significant delays and other costs and these suppliers may not be available to us on reasonable terms or at all.
Biggest changeFinding alternative suppliers could involve significant delays and other costs and these suppliers may not be available to us on reasonable terms or at all. As a result, this could harm our business and financial results and result in lost or deferred revenue.
Additionally, they may cause shipment delays, resulting in customer dissatisfaction and reduced demand for our services. A prolonged transportation disruption caused labor action may materially adversely affect our business, results of operations and financial condition. Demand for our services may be adversely impacted by the changing consumer spending power and habits in the U.S.
Additionally, they may cause shipment delays, resulting in customer dissatisfaction and reduced demand for our services. A prolonged transportation disruption caused by labor action may materially adversely affect our business, results of operations and financial condition. Demand for our services may be adversely impacted by the changing consumer spending power and habits in the U.S.
In addition, negative publicity regarding claims or judgments made against our Company may damage our reputation and may result in a material adverse impact on us. We may be the subject of allegations, harassment, or other detrimental conduct by third parties, which could harm our reputation and cause them to lose market share and customers.
In addition, negative publicity regarding claims or judgments made against our Company may damage our reputation and may result in a material adverse impact on us. We may be the subject of allegations, harassment, or other detrimental conduct by third parties, which could harm our reputation and cause us to lose market share and customers.
As we provide a full spectrum of services, including facilitating overseas transportation of merchandise to the U.S., customs brokerage services, and warehouse management and order fulfillment services, we may compete with a broad range of companies, such as freight delivery service providers, customs brokers, warehousing companies, and third-party logistics service providers.
We provide a full spectrum of services, including facilitating overseas transportation of merchandise to the U.S., customs brokerage services, and warehouse management and order fulfillment services, we may, therefore, compete with a broad range of companies, such as freight delivery service providers, customs brokers, warehousing companies, and third-party logistics service providers.
These quotation services are generally considered to be markets that are less efficient and that provide less liquidity in the shares than Nasdaq. 25 Substantial future sales of our common stock or the anticipation of future sales of our common stock in the public market could cause the price of our common stock to decline.
These quotation services are generally considered to be markets that are less efficient and that provide less liquidity in the shares than Nasdaq. Substantial future sales of our common stock or the anticipation of future sales of our common stock in the public market could cause the price of our common stock to decline.
Sales of these shares into the market could cause the market price of our common stock to decline. If securities or industry analysts do not publish research or reports about our business, or if they publish a negative report regarding our common stock, the price of our common stock and trading volume could decline.
Sales of these shares into the market could cause the market price of our common stock to decline. 25 If securities or industry analysts do not publish research or reports about our business, or if they publish a negative report regarding our common stock, the price of our common stock and trading volume could decline.
Our revenue growth may slow or our revenue may decline for a number of reasons, including reduced demand for our warehousing and logistics services, increased competition, industry trend, or our failure to capitalize on growth opportunities.
Our revenue growth may slow down or our revenue may decline for a number of reasons, including reduced demand for our warehousing and logistics services, increased competition, industry trend, or our failure to capitalize on growth opportunities.
Our existing and potential competitors may enjoy competitive advantages over us, such as longer operating history, greater brand recognition, larger customer base, and better value-added services. We may lose clients if we fail to compete successfully, which could adversely affect our financial performance and business prospects. We cannot guarantee that our strategies will remain competitive or successful in the future.
Our existing and potential competitors may enjoy competitive advantages over us, such as longer operating history, greater brand recognition, larger customer base, and better value-added services. We may lose customers if we fail to compete successfully, which could adversely affect our financial performance and business prospects. We cannot guarantee that our strategies will remain competitive or successful in the future.
No other customers represented 10% or more of our total revenue for the years ended June 30, 2024 and 2023. For an example of a typical transaction, see “Item 1. Business — Customers.” We may lose a significant customer due to a variety of factors, including our ability to provide quality warehouse and logistics management services.
No other customers represented 10% or more of our total revenue for the years ended June 30, 2025 and 2024. For an example of a typical transaction, see “Item 1. Business — Customers.” We may lose a significant customer due to a variety of factors, including our ability to provide quality warehouse and logistics management services.
If we fail to maintain an effective system of internal controls or fail to remediate the material weaknesses in our internal controls over financial reporting that have been identified, we may fail to meet our reporting obligations or be unable to accurately report our results of operations or prevent fraud, and investor confidence and the market price of our common stock may be materially and adversely affected.
If we fail to maintain an effective system of internal controls or fail to remediate the material weakness in our internal controls over financial reporting that have been identified, we may fail to meet our reporting obligations or be unable to accurately report our results of operations or prevent fraud, and investor confidence and the market price of our common stock may be materially and adversely affected.
During the fiscal years ended June 30, 2024 and 2023, the COVID-19 pandemic did not have a material impact on our financial position and operating results. However, there is no assurance that a disease outbreak, such as the COVID-19 pandemic or any other natural disasters, will not occur in the future.
During the fiscal years ended June 30, 2025, 2024 and 2023, COVID-19 did not have a material impact on our financial position and operating results. However, there is no assurance that a disease outbreak, such as COVID-19 or any other natural disasters, will not occur in the future.
We are a public company in the United States subject to the Sarbanes-Oxley Act of 2002. Section 404 of the Sarbanes-Oxley Act of 2002 requires that we include a report of management on our internal control over financial reporting in our annual report on 10-K beginning with our annual report for the fiscal year ending June 30, 2025.
We are a public company in the United States subject to the Sarbanes-Oxley Act of 2002. Section 404 of the Sarbanes-Oxley Act of 2002 requires that we include a report of management on our internal control over financial reporting in our annual report on 10-K beginning with our annual report for the fiscal year ended June 30, 2025.
As such, we expect labor unrest and its effects on the transportation of our PRC customer’s merchandise to be a continuing challenge for us. Any disruptions, such as a port worker strike, work slowdown, or other transportation disruption in the U.S., may significantly disrupt our business.
As such, we expect labor unrest and its effects on the transportation of our PRC customers’ merchandise to be a continuing challenge for us. Any disruptions, such as a port worker strike, work slowdown, or other transportation disruption in the U.S., may significantly disrupt our business.
The Sarbanes-Oxley Act of 2002, as well as rules subsequently implemented by the SEC and Nasdaq, impose various requirements on the corporate governance practices of public companies. Compliance with these laws, rules, and regulations increases our legal and financial compliance costs and makes some corporate activities more time-consuming and costlier.
The Sarbanes-Oxley Act of 2002, as well as rules subsequently implemented by the SEC and Nasdaq, impose various requirements on the corporate governance practices of public companies. Compliance with these laws, rules, and regulations increases our legal and financial compliance costs and makes some corporate activities more time-consuming and costly.
As we do not have our own delivery team and networks, our business depends on the services provided by, and relationships with, various independent third parties, to provide truck and ocean services and to report certain events to us, including, but not limited to, shipment status information and freight claims.
Because we do not have our own delivery team and networks, our business depends on the services provided by, and relationships with, various independent third parties, to provide truck and ocean services and to report certain events to us, including, but not limited to, shipment status information and freight claims.
Although our business has not been materially impacted by the ongoing military conflict between Russian and Ukraine to date, it is impossible to predict the extent to which our operations, or those of our clients, will be impacted in the short and long term, or the ways in which the conflict may impact our business.
Although our business has not been materially impacted by the ongoing military conflict between Russian and Ukraine to date, it is impossible to predict the extent to which our operations, or those of our customers, will be impacted in the short and long term, or the ways in which the conflict may impact our business.
As we currently primarily compete in a niche market targeting PRC customers seeking to establish overseas warehouses in the U.S., we have the advantage of offering one-stop integrated supply chain solutions that include a package of all the services above.
Because we currently primarily compete in a niche market targeting PRC customers seeking to establish overseas warehouses in the U.S., we have the advantage of offering one-stop integrated supply chain solutions that include a package of all the services above.
Failure to correct the material weaknesses or failure to discover and address any other material weaknesses or control deficiencies could result in inaccuracies in our financial statements and could also impair our ability to comply with applicable financial reporting requirements and related regulatory filings on a timely basis.
Failure to correct the material weakness or failure to discover and address any other material weakness or control deficiencies could result in inaccuracies in our financial statements and could also impair our ability to comply with applicable financial reporting requirements and related regulatory filings on a timely basis.
As we derived approximately 96% and 96% of our revenue from overseas customers in the PRC during the fiscal years ended June 30, 2024 and 2023, respectively, the continued success of our operations will be heavily dependent on the willingness of our PRC customers to sell in the U.S. via global online e-commerce platforms, such as Amazon and eBay.
We derived approximately 84% and 96% of our revenue from overseas customers in the PRC during the fiscal years ended June 30, 2025 and 2024, respectively, and the continued success of our operations will be heavily dependent on the willingness of our PRC customers to sell in the U.S. via global online e-commerce platforms, such as Amazon and eBay.
Furthermore, such unethical, unprofessional, or even criminal behavior by employees could damage our reputation, result in fines, penalties, restitution, or other damages, and lead to the loss of current and future customers, all of which would adversely affect our business, financial condition, and results.
Furthermore, such unethical, unprofessional, or even criminal behavior by employees could damage our reputation, result in fines, penalties, restitution, or other damages, and lead to the loss of current and future customers, any of which would adversely affect our business, financial condition, and results of operations.
While we do not have any subsidiaries, assets, or employees in the PRC, we generate a significant part of our revenue from customers based in China. During the fiscal years ended June 30, 2024 and 2023, we generated approximately 96% and 96% of our revenue from the PRC market, respectively.
While we do not have any subsidiaries, assets, or employees in the PRC, we generate a significant part of our revenue from customers based in China. During the fiscal years ended June 30, 2025 and 2024, we generated approximately 84% and 96% of our revenue from the PRC market, respectively.
As we derived approximately 96% and 96%of our revenue from the PRC market during the fiscal years ended June 30, 2024 and 2023, respectively, we believe that our continued growth depends largely on our ability to maintain our Chinese client base.
As we derived approximately 84% and 96%of our revenue from the PRC market during the fiscal years ended June 30, 2025 and 2024, respectively, we believe that our continued growth depends largely on our ability to maintain our Chinese client base.
The extent and duration of the military action, sanctions and resulting market disruptions are impossible to predict, but could be substantial. Any such disruptions may also magnify the impact of other risks described in this annual report. In addition, the U.S.-China relationship has recently faced a daunting challenge, contributing to geopolitical instability worldwide.
The extent and duration of the military action, sanctions and resulting market disruptions are impossible to predict, but could be substantial. Any such disruptions may also magnify the impact of other risks described in this annual report. 12 In addition, the U.S.-China relationship has recently faced daunting challenges, contributing to geopolitical instability worldwide.
Because we derived approximately 96% and 96% of our revenue from the PRC market during the fiscal years ended June 30, 2024 and 2023, respectively, our business relies on a stable economic and political relationship between the U.S. and China.
Because we derived approximately 84% and 96% of our revenue from the PRC market during the fiscal years ended June 30, 2025 and 2024, respectively, our business relies on a stable economic and political relationship between the U.S. and China.
One of the main reasons that clients use contract warehouse and logistics management companies is the high cost, high degree of difficulties, and operational deficiencies associated with developing in-house logistics and supply chain expertise.
One of the main reasons that our customers use contract warehouse and logistics management companies is the high cost, high degree of difficulties, and operational deficiencies associated with developing in-house logistics and supply chain expertise.
In addition, we depend upon a significant supplier that accounted for more than 10% of our total purchases for approximately the past two years — specifically, FedEx accounted for 50% and 62% of our total purchases during the fiscal year ended June 30, 2024 and 2023, respectively.
In addition, we depend upon a significant supplier that accounted for more than 10% of our total purchases for approximately the past two years — specifically, FedEx accounted for 9% and 50% of our total purchases during the fiscal year ended June 30, 2025 and 2024, respectively.
Several third-party logistics service providers contributed a significant part of the total cost of revenue of our Company. In particular, for the fiscal years ended June 30, 2024 and 2023, FedEx accounted for approximately 50% and 62% of our total cost of revenue, respectively.
Several third-party logistics service providers contributed a significant part of the total cost of revenue of our Company. In particular, for the fiscal years ended June 30, 2025 and 2024, FedEx accounted for approximately 9% and 50% of our total cost of revenue, respectively.
Our reputation may be negatively affected as a result of the public dissemination of negative and potentially false information about our business and operations, which in turn may cause them to lose market shares and customers.
Our reputation may be negatively affected as a result of the public dissemination of negative and potentially false information about our business and operations, which in turn may cause us to lose market share and customers.
If any significant customer terminates its relationship with us, we cannot assure you that we will be able to secure an alternative arrangement with comparable customer in a timely manner, or at all. Losing one or more of these significant customers could adversely affect our revenue and profitability.
If any significant customer terminates its relationship with us, there is no assurance you that we will be able to secure an alternative arrangement with comparable customer in a timely manner, or at all. Losing one or more of these significant customers could adversely affect our revenue and profitability.
In preparing our consolidated financial statements as of and for the fiscal years ended June 30, 2024 and 2023, we have identified material weaknesses in our internal controls over financial reporting, which are: lack of formal policies and procedures related to a risk assessment process and internal control environment.
In preparing our consolidated financial statements as of and for the fiscal years ended June 30, 2025 and 2024, we have identified a material weakness in our internal controls over financial reporting, which is a lack of formal policies and procedures related to a risk assessment process and internal control environment.
Sales of substantial amounts of our common stock in the public market, or the perception that these sales could occur, could cause the market price of our common stock to decline. An aggregate of 41,634,000 shares of common stock are outstanding as of the date of this annual report.
Sales of substantial amounts of our common stock in the public market, or the perception that these sales could occur, could cause the market price of our common stock to decline. An aggregate of 42,623,215 shares of common stock are outstanding as of the date of this annual report.
We will remain an “emerging growth company” until the last day of the fiscal year following the fifth anniversary of the date of the first sale of our common stock pursuant to an effective registration statement under the Securities Act, although we will lose that status sooner if our revenue exceeds $1.235 billion, if we issue more than $1 billion in non-convertible debt in a three-year period, or if the market value of our common stock that is held by non-affiliates exceeds $700 million as of the last day of our most recently completed second fiscal quarter. 26 We may continue to be a smaller reporting company even after we are no longer an emerging growth company.
We will remain an “emerging growth company” until the last day of the fiscal year following the fifth anniversary of the date of the first sale of our common stock pursuant to an effective registration statement under the Securities Act, although we will lose that status sooner if our revenue exceeds $1.235 billion, if we issue more than $1 billion in non-convertible debt in a three-year period, or if the market value of our common stock that is held by non-affiliates exceeds $700 million as of the last day of our most recently completed second fiscal quarter.
We have experienced strong growth in the past. Our total revenue increased by approximately $31.9 million, or 23.6%, to approximately $167.0 million for the fiscal year ended June 30, 2024 from $135.0 million for the fiscal year ended June 30, 2023.
Our total revenue increased by approximately $31.9 million, or 23.6%, to approximately $167.0 million for the fiscal year ended June 30, 2024 from $135.0 million for the fiscal year ended June 30, 2023.
If existing or potential competitors develop or offer services that provide significant performance, price, creative optimization, or other advantages over those offered by us, our business, results of operations, and financial condition would be negatively affected.
It is also possible that potential competitors may emerge and acquire a significant market share. If existing or potential competitors develop or offer services that provide significant performance, price, creative optimization, or other advantages over those offered by us, our business, results of operations, and financial condition would be negatively affected.
As a result, our business, financial condition, and results of operations may be adversely affected. We are currently operating in a period of economic uncertainty and capital markets disruption, which has been significantly impacted by geopolitical instability due to the ongoing military conflict between Russia and Ukraine and the increasing strained relationship between the U.S. and China.
We are currently operating in a period of economic uncertainty and capital markets disruption, which has been significantly impacted by geopolitical instability due to the ongoing military conflict between Russia and Ukraine and the increasing strained relationship between the U.S. and China.
In addition, if we are unable to secure sufficient equipment or other transportation services from third parties to meet our commitments to our customers, our operating results could be materially and adversely affected, and our customers could switch to our competitors temporarily or permanently.
This reliance also could cause delays in reporting certain events, including recognizing claims. In addition, if we are unable to secure sufficient equipment or other transportation services from third parties to meet our commitments to our customers, our operating results could be materially and adversely affected, and our customers could switch to our competitors temporarily or permanently.
Our business may be disrupted by natural disasters causing supply chain disruptions. Natural disasters such as earthquakes, tsunamis, hurricanes, tornadoes, floods, or other adverse weather and climate conditions, whether occurring in the United States or abroad, could disrupt our operations and could damage or destroy infrastructure necessary to transport products as part of the supply chain.
We may face risks related to natural disasters, health epidemics, and other outbreaks, which could significantly disrupt our operations Natural disasters such as earthquakes, tsunamis, hurricanes, tornadoes, floods, or other adverse weather and climate conditions, whether occurring in the United States or abroad, could disrupt our operations and could damage or destroy infrastructure necessary to transport products as part of the supply chain.
A deteriorating relationship between the U.S. and China, or a prolonged stalemate between them, could materially adversely affect our business, results of operations, and financial condition. 12 China’s economic, political, and social conditions, as well as governmental policies, could affect the business environment and economic conditions in China, which may result in an adverse impact on the demand for our services, potentially harming our financial condition and operating results.
China’s economic, political, and social conditions, as well as governmental policies, could affect the business environment and economic conditions in China, which may result in an adverse impact on the demand for our services, potentially harming our financial condition and operating results.
Co., Ltd., accounted for approximately 11.7%, 11.7%, 10.9%, and 10.0% of our total revenue, respectively. For the fiscal year ended June 30, 2023, our two largest customers, Aukey International Ltd. and Union Grand Imp. & Exp. Co., Ltd., accounted for approximately 22.5% and 14.5% of our total revenue, respectively.
For the fiscal year ended June 30, 2024, our top four customers, Aukey International Ltd., Western Post (HK) Ltd., Goldensee Ltd., and Union Grand Imp. & Exp. Co., Ltd., accounted for approximately 11.7%, 11.7%, 10.9%, and 10.0% of our total revenue, respectively.
This could potentially lead to a decrease in demand for overseas warehousing and logistics services, as e-commerce merchants may opt to scale back their operations in the U.S. market.
These developments have increased the cost and complexity of cross-border trade, which could discourage Chinese e-commerce merchants from expanding or continuing their U.S.-bound operations. This could potentially lead to a decrease in demand for overseas warehousing and logistics services, as e-commerce merchants may opt to scale back their operations in the U.S. market.
Any adverse change in political relations between the U.S. and other countries or regions where our overseas customers are located (particularly the PRC), such as the ongoing U.S.-China trade conflicts, may negatively affect our business.
Increasing competition may result in pricing pressure and loss of our market share, either of which could have a material adverse effect on our financial condition and results of operations. 11 Any adverse change in political relations between the U.S. and other countries or regions where our overseas customers are located (particularly the PRC), such as the ongoing U.S.-China trade conflicts, may negatively affect our business.
GAAP and SEC reporting experience to support the expansion of our business and the need for the implementation of our internal controls over financial reporting. However, the implementation of these measures may not fully address the material weaknesses in our internal controls over financial reporting.
However, the implementation of these measures may not fully address the material weakness in our internal controls over financial reporting.
We compete with other competitors on the following bases: ● warehouse and infrastructure capacity; ● operational capabilities; ● business model; ● brand recognition; ● quality of services; ● effectiveness of sales and marketing efforts; and ● hiring and retention of talented staff. 11 Our competitors may operate with different business models, have different service structures, and may ultimately prove to be more successful or more adaptable to new regulatory, technological, and other developments.
We compete with other competitors on the following bases: ● warehouse and infrastructure capacity; ● operational capabilities; ● business model; ● brand recognition; ● quality of services; ● effectiveness of sales and marketing efforts; and ● hiring and retention of talented staff.
Our total revenue increased by approximately $79.0 million, or 141.0%, to approximately $135.0 million for the fiscal year ended June 30, 2023 from $56.0 million for the fiscal year ended June 30, 2022.
Our total revenue increased by approximately $23.4 million, or 14.0%, to approximately $190.4 million for the fiscal year ended June 30, 2025 from $167.0 million for the fiscal year ended June 30, 2024.
We make planning and spending decisions, including capacity expansion, procurement commitments, personnel needs, and other resource requirements based on our estimates of customer demand. A significant portion of our revenue is derived from customers whose demand for the warehousing and shipping services is tied closely to the end consumers in the U.S.
A significant portion of our revenue is derived from customers whose demand for the warehousing and shipping services is tied closely to the end consumers in the U.S.
We reported net income of approximately $13.9 million for the fiscal year ended June 30, 2023, representing a significant increase by $11.9 million, or 602.7%, from net income of $2.0 million for the fiscal year ended June 30, 2022.
We reported net loss of approximately $15.3 million for the fiscal year ended June 30, 2025, representing a decrease by $22.8 million, or 306.3%, from net income of $7.4 million for the fiscal year ended June 30, 2024.
During the fiscal years ended June 30, 2024 and 2023, we derived most of our revenue from a few customers. For the fiscal year ended June 30, 2024, our top four customers, Aukey International Ltd., Western Post (HK) Ltd., Goldensee Ltd., and Union Grand Imp. & Exp.
During the fiscal years ended June 30, 2025 and 2024, we derived most of our revenue from a few customers. For the fiscal year ended June 30, 2025, our two largest customers, Goldensee Ltd. and Kimberly Tenneco Inc, accounted for approximately 22.0% and 10.8% of our total revenue, respectively.
As a result, this could harm our business and financial results and result in lost or deferred revenue. Customer demand is difficult to forecast accurately, and as a result we may be unable to make planning and spending decisions to match such demand.
Customer demand is difficult to forecast accurately, and as a result we may be unable to make planning and spending decisions to match such demand. We make planning and spending decisions, including capacity expansion, procurement commitments, personnel needs, and other resource requirements based on our estimates of customer demand.
We cannot ensure that we will have no concentration of suppliers in the future. Such third-party suppliers are run by independent entities that are subject to their own unique operational and financial risks, which are beyond our control.
Such third-party suppliers are run by independent entities that are subject to their own unique operational and financial risks, which are beyond our control. If such significant suppliers breach or terminate their contracts with us, or experience significant disruptions to their operations, we will be required to find and enter into arrangements with one or more replacement suppliers.
Following the identification of the material weaknesses, we have taken certain remedial measures, including adopting directors’ resolutions to appoint independent directors, establish an audit committee, and strengthen corporate governance. We plan to take additional remedial measures, including: (i) developing policies and procedures to formalize our internal controls over financial reporting; (ii) hiring more qualified accounting personnel with relevant U.S.
Following the identification of the material weakness, we have taken certain remedial measures, including developing policies and procedures to formalize our internal controls over financial reporting.
Increasing competition may result in pricing pressure and loss of our market share, either of which could have a material adverse effect on our financial condition and results of operations.
As a result, our business, financial condition, and results of operations may be adversely affected. U.S. government trade actions could have a material adverse effect on our business, financial position, and results of operations.
Removed
They may in the future achieve greater market acceptance and recognition and gain a greater market share. It is also possible that potential competitors may emerge and acquire a significant market share.
Added
Our competitors may operate with different business models, have different service structures, and may ultimately prove to be more successful or more adaptable to new regulatory, technological, and other developments. They may in the future achieve greater market acceptance and recognition and gain a greater market share.
Removed
These third-party logistics service providers may not fulfill their obligations to us, which may prevent us from meeting our commitments to our customers. This reliance also could cause delays in reporting certain events, including recognizing claims.
Added
Over the past several years, the U.S. government has taken a number of trade actions that impact or could impact our operations, including imposing tariffs on certain goods imported into the U.S.
Removed
The COVID-19 pandemic adversely impacted our business, results of operations, and cash flows in 2022.
Added
As the majority of our customers import products into the U.S. from China, many of their products are subject to the tariffs imposed under Section 301 of U.S. trade law that have been applied to separate lists of Chinese goods imported into the U.S., beginning during the first Trump Administration, which remained largely in effect in the Biden Administration.
Removed
From 2019 to 2022, the COVID-19 pandemic resulted in the implementation of significant governmental measures intended to control the spread of the virus, including lockdowns, closures, quarantines, travel bans, and other precautionary measures, which resulted in significant business and supply chain disruptions and had direct impacts on international trade.
Added
A number of lawsuits and other legal challenges with respect to the Section 301 tariff actions have been filed and remain pending, which could result in changes to the tariffs. The Biden Administration largely maintained, defended, and enforced these particular trade actions.
Removed
Nasdaq may apply additional and more stringent criteria for our initial and continued listing, since we plan to have a relatively small public offering and insiders will hold a large portion of our listed securities.
Added
Changes in U.S. trade policy have created ongoing uncertainties in international trade relations, and it is unclear what future actions governments will or will not take with respect to tariffs or other international trade agreements and policies.
Removed
Nasdaq Listing Rule 5101 provides Nasdaq with broad discretionary authority over the initial and continued listing of securities on Nasdaq and Nasdaq may use such discretion to deny initial listing, apply additional or more stringent criteria for the initial or continued listing of particular securities, or suspend or delist particular securities based on any event, condition, or circumstance that exists or occurs that makes initial or continued listing of the securities on Nasdaq inadvisable or unwarranted in the opinion of Nasdaq, even though the securities meet all enumerated criteria for initial or continued listing on Nasdaq.
Added
During the 2024 presidential campaign, candidate Donald Trump expressed intentions to impose various tariffs on imports, such as 60% tariffs on goods imported from China, 25% tariffs on goods imported from Mexico, and between 10% and 20% tariffs on goods imported from other countries.
Removed
In addition, Nasdaq has used its discretion to deny initial or continued listing or to apply additional and more stringent criteria in the instances, including: (i) where the company engaged an auditor that has not been subject to an inspection by the Public Company Accounting Oversight Board of the United States (the “PCAOB”), an auditor that PCAOB cannot inspect, or an auditor that has not demonstrated sufficient resources, geographic reach, or experience to adequately perform the company’s audit; (ii) where the company planned a small public offering, which would result in insiders holding a large portion of the company’s listed securities (in which instance, Nasdaq was concerned that the offering size was insufficient to establish the company’s initial valuation, and there would not be sufficient liquidity to support a public market for the company); and (iii) where the company did not demonstrate sufficient nexus to the U.S. capital market, including having no U.S. shareholders, operations, or members of the board of directors or management.
Added
The current Trump administration began implementing these proposals through executive action, reigniting trade tensions with key U.S. trading partners. In early 2025, the Trump administration announced a renewed wave of tariff increases targeting Chinese imports, raising certain rates to as high as 145%.
Removed
Since we plan to have a relatively small public offering and our insiders will hold a large portion of our listed securities, Nasdaq may apply additional and more stringent criteria for our initial and continued listing, which may cause delay or even denial of our listing application.
Added
In response, China imposed retaliatory tariffs of up to 125% on U.S. goods and introduced export restrictions on critical raw materials, such as rare earth elements.
Added
Although a 90-day temporary easing of tariffs was announced in May 2025, which was further extended on August 12, 2025 for an additional 90 days expiring November 10, 2025, reducing U.S. tariffs on Chinese goods to 30% and Chinese tariffs on U.S. goods to 10%, tensions between the two countries remain following new U.S. restrictions on exports of advanced technology and the revocation of Chinese student visas.
Added
It is unclear what actions the Trump administration or Congress will take next with respect to these proposals.
Added
Ongoing or new trade wars or other governmental action related to tariffs or international trade agreements or policies could reduce demand for our customers’ products and services, increase their costs, reduce their profitability, adversely impact their supply chain or otherwise have a material adverse effect on their business and results of operations, any of which could have a material adverse effect on our business, financial position, and results of operations.
Added
Given the uncertainty regarding the scope and duration of these trade actions by the U.S. government or other countries, as well as the potential for additional trade actions, the impact on our business and results of operations remains uncertain.
Added
Any further deteriorating relationship between the U.S. and China, or a prolonged stalemate between them, could materially adversely affect our business, results of operations, and financial condition.
Added
In light of the renewed escalation of the U.S.-China trade war under the current Trump administration, these risks have intensified.
Added
In early 2025, the U.S. imposed new tariffs on Chinese goods — raising certain rates up to 145%— prompting the PRC government to implement retaliatory measures, including tariffs of up to 125% and restrictions on exports of critical raw materials, which tariffs have been reduced by the U.S. to 30% and China to 10% until November 10, 2025 on a temporary basis.
Added
More recently, in October 2024, the International Longshoremen’s Association initiated a significant strike on the East and Gulf Coasts, affecting around 45,000 workers and temporarily shutting down 14 major ports, including the Port Authority of New York and New Jersey.
Added
During the fiscal year ended June 30, 2025, UPS accounted for approximately 15.2% and MEGA CORP LOGISTIC LLC, a third-party vendor providing shipping services via FedEx, accounted for approximately 10%, respectively. We cannot ensure that we will have no concentration of suppliers in the future.
Added
During the fiscal year ended June 30, 2025, UPS accounted for approximately 15.2% and MEGA CORP LOGISTIC LLC, a third-party vendor providing shipping services via FedEx, accounted for approximately 10%, respectively. These third-party logistics service providers may not fulfill their obligations to us, which may prevent us from meeting our commitments to our customers.
Added
In addition, our business may be negatively impacted by the fear of, exposure to, or actual effects of, a disease outbreak, epidemic, pandemic, or similar widespread public health concern, including travel restrictions or recommendations or mandates from governmental authorities as a result of COVID-19, the threat of the virus, or the emergence of any variants.
Added
We also plan to undertake additional remedial measures, including engaging a qualified third-party internal audit firm to assist in designing, documenting, and testing our Internal Control over Financial Reporting (“ICFR”) framework in accordance with the Sarbanes-Oxley Act (“SOX”) requirements; implementing company-wide control policies and standardized procedures for transaction approvals, account reconciliations, and financial reporting cycles; and designating internal personnel to coordinate control execution, while ensuring proper oversight from our financial and management team.
Added
We may continue to be a smaller reporting company even after we are no longer an emerging growth company.
Item 1C. Cybersecurity
Cybersecurity — threats and controls disclosure
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Item 1C. Cybersecurity
Cybersecurity — threats and controls disclosure
1 edited+0 added−0 removed12 unchanged
2024 filing
2025 filing
Biggest changeOur cybersecurity incident response plan governs our assessment and response upon the occurrence of a material cybersecurity incident, including the process for informing senior management and our Board of Directors. 28
Biggest changeOur cybersecurity incident response plan governs our assessment and response upon the occurrence of a material cybersecurity incident, including the process for informing senior management and our Board of Directors. 27
Item 2. Properties
Properties — owned and leased real estate
6 edited+3 added−2 removed2 unchanged
Item 2. Properties
Properties — owned and leased real estate
6 edited+3 added−2 removed2 unchanged
2024 filing
2025 filing
Biggest changeIn addition, Armstrong Logistic, one of our subsidiaries, leases four warehouses in California, including: ● at 19545 San Jose Avenue, City of Industry, California 91746, from DNA Motor, a company owned by Jacky Chen, the former chief executive officer of Armstrong Logistic, pursuant to a sublease agreement, with an area of approximately 130,000 square feet, with a lease term from September 1, 2020 to September 30, 2025, and monthly rent of approximately $100,000; ● at 18400-18450 Gale Avenue, City of Industry, California 91748, from DNA Motor pursuant to a sublease agreement, with an area of approximately 140,000 square feet, with a lease term from July 1, 2022 to December 31, 2025, and monthly rent of approximately $127,000; As of October 1, 2023, Armstrong Logistic no longer operated at this warehouse location, pursuant to an operating services agreement with an agreement term from October 1, 2023 to November 30, 2025; ● at 280 Machlin Court, City of Industry, California 91789, from Sun-Yin USA Inc, pursuant to a sublease agreement, with an area of approximately 50,000 square feet, with a lease term from March 1, 2023 to February 28, 2025, and monthly rent of approximately $98,000.
Biggest changeIn addition, Armstrong Logistic, one of our subsidiaries, leases the following three warehouses in California: ● at 19545 San Jose Avenue, City of Industry, California 91746, from DNA Motor, a company owned by Jacky Chen, the former chief executive officer of Armstrong Logistic, pursuant to a sublease agreement, with an area of approximately 130,000 square feet, with a lease term from September 1, 2020 to December 31, 2027, and a monthly rent of approximately $110,600; ● at 5450 E Francis St, Ontario, CA 91761, from JCC California Properties LLC, pursuant to a lease agreement, with an area of approximately 480,000 square feet, with a lease term from January 1, 2025 to December 31, 2029, and a monthly rent of approximately $229,600; and ● at 11618 Mulberry Ave, Fontana, CA 92337, from United Facilities, Inc., pursuant to a lease agreement and its amendment, with an area of approximately 633,953 square feet, with a lease term from August 10, 2023 to September 30, 2028, and a monthly rent of approximately $785,600.
Item 2. Properties . Our principal executive offices are located in City of Walnut at 20301 East Walnut Drive North, Walnut, California, where we lease office space and a warehouse from DNA Motor Inc.
Item 2. Properties . Our principal executive offices are located in City of Walnut at 20301 East Walnut Drive North, Walnut, California 91789, where we lease office space and a warehouse from DNA Motor Inc.
Armstrong Logistic also leases two warehouses in New Jersey, including: ● at 839 Railroad Avenue, Florence, New Jersey 08554, from DNA Motor pursuant to a sublease agreement, with an area of approximately 300,000 square feet, with a lease term from July 1, 2021 to September 30, 2029, and monthly rent of approximately $210,000; and ● at 250 Carter Dr, Edison, New Jersey 07090, from Romark Logistics of NJ, LLC. pursuant to a sublease license agreement, with an area of approximately 87,000 square feet, with a lease term from May 1, 2023 to October 31, 2027, and monthly rent of approximately $121,000.
Armstrong Logistic also leases the following two warehouses in New Jersey: ● at 839 Railroad Avenue, Florence, New Jersey 08554, from DNA Motor pursuant to a sublease agreement, with an area of approximately 300,000 square feet, with a lease term from November 1, 2021 to September 30, 2029, and monthly rent of approximately $210,000; and ● at 250 Carter Dr, Edison, New Jersey 07090, from Romark Logistics of NJ, LLC. pursuant to a sublease license agreement, with an area of approximately 87,000 square feet, with a lease term from May 1, 2023 to October 31, 2027, and monthly rent of approximately $130,000.
This warehouse was subsequently expanded through a lease agreement with NL Cedars Group LLC, with an additional area of approximately 144,000 square feet, with a lease term from January 1, 2024 to February 28, 2029, and monthly rent of approximately $195,000.
This warehouse was subsequently expanded through a lease agreement with NL Cedars Group LLC, with a lease term from January 1, 2024 to February 28, 2029. Phase 1 of the lease with NL Cedars Group LLC commenced on January 1, 2024 and ended on November 30, 2024 and added approximately 144,000 square feet, at a monthly rent of approximately $195,000.
Armstrong Logistic also leases one warehouse in Georgia: ● at 1001 Trade Center Boulevard Building 4A, Rincon, Georgia 31326, from SFG CH Chatham Tract, LLC, pursuant to a lease agreement with an area of approximately 734,000 square feet, with a lease term from February 29, 2024 to July 31, 2034 .
Armstrong Logistic also leases one warehouse in Georgia: ● at 1001 Trade Center Boulevard Building 4A, Rincon, Georgia 31326, from HREX GITC4, DST, pursuant to a lease agreement with an area of approximately 734,000 square feet, with a lease term from July 1, 2024 to November 30, 2034, and a monthly rent of approximately $268,600.
Armstrong Logistic also leases one warehouse in Texas: ● at 645 Independence Parkway, La Porte, Texas 77571, from DNA Motor pursuant to a sublease agreement, with an area of approximately 200,000 square feet, with a lease term of from April 1, 2021 to August 31, 2026, and monthly rent of approximately $80,000.
Armstrong Logistic also leases the following two warehouses in Texas: ● at 645 Independence Parkway, La Porte, Texas 77571, from BCI IV Monument BP LP, pursuant to a lease agreement, with an area of approximately 200,000 square feet, which was assigned to Armstrong Logistic by DNA Motor from April 1, 2021 to August 31, 2026, and a monthly rent of approximately $84,900; and ● at 615, 619 E Sam Houston Pkwy, Pasadena, Texas 77503, from First Industrial LP, pursuant to a lease agreement, with an area of approximately 241,280 square feet, which was assigned to Armstrong Logistic by DNA Motor from January 24, 2025 to April 30, 2029, and a monthly rent of $121,479.
Removed
Armstrong Logistic temporarily ceased operations at this location and subleased the warehouse to a subtenant pursuant to a sublease agreement with an agreement term from October 1, 2023 to February 28, 2025.
Added
Phase 2 of the lease with NL Cedars Group LLC commenced on December 1, 2024 and ends on October 31, 2027, adding an additional area of approximately 113,000 square feet for a total of approximately 257,000 square feet, at a monthly rent of approximately $360,000.
Removed
On May 13, 2024, the subtenant terminated the sublease agreement early and Armstrong Logistic resumed operations at the warehouse; and ● at 11618 Mulberry Ave, Fontana, CA 92337, from United Facilities, Inc., pursuant to a lease agreement and its amendment, with an area of approximately 633,953 square feet, with a lease term from August 10, 2023 to September 30, 2028, and monthly rent of approximately $560,000.
Added
Phase 3 of the lease with NL Cedars Group LLC will commence on November 1, 2027 and end on February 28, 2029, adding an additional area of approximately 86,936 square feet for a total of approximately 343,936 square feet, at a monthly rent of approximately $520,000.
Added
Armstrong Logistic also leases one warehouse in Illinois: ● at 28 Gateway Commerce Center Dr W, Edwardsville, IL 62025, from Walgreens.com, Inc, pursuant to a sublease agreement, with an area of approximately 500,000 square feet, with a lease term from December 27, 2024 to February 29, 2032, and a monthly rent of $58,333.
Item 3. Legal Proceedings
Legal Proceedings — active lawsuits and investigations
1 edited+0 added−0 removed1 unchanged
Item 3. Legal Proceedings
Legal Proceedings — active lawsuits and investigations
1 edited+0 added−0 removed1 unchanged
2024 filing
2025 filing
Biggest changeWe are currently not a party to, and we are not aware of any threat of, any legal or administrative proceeding that, in the opinion of our management, is likely to have any material and adverse effect on our business, financial condition, cash flow, or results of operations. Item 4. Mine Safety Disclosures Not applicable. 29 PART II
Biggest changeWe are currently not a party to, and we are not aware of any threat of, any legal or administrative proceeding that, in the opinion of our management, is likely to have any material and adverse effect on our business, financial condition, cash flow, or results of operations. Item 4. Mine Safety Disclosures Not applicable. 28 PART II
Item 5. Market for Registrant's Common Equity
Market for Common Equity — stock, dividends, buybacks
2 edited+0 added−6 removed4 unchanged
Item 5. Market for Registrant's Common Equity
Market for Common Equity — stock, dividends, buybacks
2 edited+0 added−6 removed4 unchanged
2024 filing
2025 filing
Biggest changeEquity Compensation Plans For information on securities authorized for issuance under our existing equity compensation plan, see Item 12 under the heading “Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.” Recent Sales of Unregistered Securities Other than previously disclosed in our quarterly reports on Form 10-Q or current reports on Form 8-K, during the period covered by this annual report, we did not issue any securities which were not registered under the Securities Act of 1933, as amended (the “Securities Act”).
Biggest changeEquity Compensation Plans For information on securities authorized for issuance under our existing equity compensation plan, see Item 12 under the heading “Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.” Recent Sales of Unregistered Securities Other than previously disclosed in our quarterly reports on Form 10-Q or current reports on Form 8-K, during the period covered by this annual report, we did not issue any securities which were not registered under the Securities Act of 1933, as amended (the “Securities Act”). 29 Recent Purchases of Equity Securities None.
Holders of Record As of September 26, 2024, we had 41,634,000 shares of common stock issued and outstanding held by 31 stockholders of record, not including beneficial holders whose shares are held in names other than their own.
Holders of Record As of September 25, 2025, we had 45,442,479 shares of common stock issued and outstanding held by 45 stockholders of record, not including beneficial holders whose shares are held in names other than their own.
Removed
Use of Proceeds The following “Use of Proceeds” information relates to the registration statement on Form S-1, as amended (File Number 333-274667) for our IPO, which registration statement was declared effective by the U.S. Securities and Exchange Commission (“SEC”) on May 13, 2024.
Removed
In May 2024, we completed our IPO, in which we issued and sold an aggregate of 1,600,000 shares of common stock, at a price of $5.00 per share for $8,000,000. EF Hutton LLC was the representative of the underwriters of our IPO.
Removed
We incurred approximately $3. 0 million in expenses in connection with our IPO, which included approximately $600,000 in underwriting discounts, approximately $81,700 in expenses paid to or for underwriters, and approximately $2.3 million in other expenses.
Removed
None of the transaction expenses included payments to directors or officers of our Company or their associates, persons owning more than 10% or more of our equity securities or our affiliates.
Removed
None of the net proceeds we received from the IPO were paid, directly or indirectly, to any of our directors or officers or their associates, persons owning 10% or more of our equity securities or our affiliates. 30 The net proceeds raised from the IPO were $5,214,851 after deducting underwriting discounts and the offering expenses payable by us.
Removed
As of the date of this annual report, we have used approximately $2.8 million for working capital and other general corporate purposes in support of our current business. We intend to use the remaining proceeds from our IPO in the manner disclosed in our registration statement. Recent Purchases of Equity Securities None. Item 6. [Reserved].
Item 7. Management's Discussion & Analysis
Management's Discussion & Analysis (MD&A) — revenue / margin commentary
44 edited+15 added−5 removed20 unchanged
Item 7. Management's Discussion & Analysis
Management's Discussion & Analysis (MD&A) — revenue / margin commentary
44 edited+15 added−5 removed20 unchanged
2024 filing
2025 filing
Biggest changeOur business will be harmed if we are unable to hire, develop, and retain skilled and qualified personnel, if our new personnel are unable to achieve desired productivity levels in a reasonable period of time, or if we are unable to retain our existing personnel. 32 Results of Operations The following table outlines our consolidated statements of operations for the fiscal years ended June 30, 2024 and 2023: Year Ended June 30, 2024 Year Ended June 30, 2023 US$ US$ Revenue 166,977,034 135,044,436 Costs of sales 148,894,227 109,310,993 Gross profit 18,082,807 25,733,443 Operating costs and expenses: General and administrative 9,967,792 7,799,116 Total operating costs and expenses 9,967,792 7,799,116 Income from operations 8,115,015 17,934,327 Other (income) expenses: Other income (2,320,257 ) (1,408,634 ) Finance costs 47,649 60,419 Total other (income) expenses (2,272,608 ) (1,348,215 ) Income before provision for income taxes 10,387,623 19,282,542 Current income tax expense 2,145,072 4,980,481 Deferred income tax expense 801,333 380,523 Total income tax expenses 2,946,405 5,361,004 Net income 7,441,218 13,921,538 Total comprehensive income 7,441,218 13,921,538 Basic & diluted net earnings per share 0.19 0.35 Weighted average number of shares of common stock-basic 40,205,836 40,000,000 Weighted average number of shares of common stock-diluted 40,216,109 40,000,000 33 Revenue, costs of sales, and gross profit margin The following table sets forth our revenue for the fiscal years ended June 30, 2024 and 2023: Year Ended June 30, 2024 Year Ended June 30, 2023 US$ US$ Revenue 166,977,034 135,044,436 Costs of sales 148,894,227 109,310,993 Gross profit 18,082,807 25,733,443 Gross profit margin % 10.8 % 19.1 % The following table outlines the compositions of our revenue streams: Year Ended June 30, 2024 Year Ended June 30, 2023 US$ US$ Transportation services 115,323,654 97,072,485 Warehousing services 51,502,358 37,304,824 Other services 151,022 667,127 Total 166,977,034 135,044,436 Our revenue increased by $31.9 million, or 23.6%, to $167.0 million during the fiscal year ended June 30, 2024, compared to $135.0 million for the fiscal year ended June 30, 2023.
Biggest changeResults of Operations The following table outlines our consolidated statements of operations for the fiscal years ended June 30, 2025 and 2024: Year Ended June 30, 2025 Year Ended June 30, 2024 US$ US$ Revenue 190,408,258 166,977,034 Costs of service 193,408,827 148,894,227 Gross (loss) profit (3,000,569 ) 18,082,807 Operating costs and expenses: General and administrative 14,675,543 9,967,792 Total operating costs and expenses 14,675,543 9,967,792 (Loss) Income from operations (17,676,112 ) 8,115,015 Other (income) expenses: Other income, net (2,714,344 ) (2,320,257 ) Loss on debt extinguishment 1,192,431 — Loss on disposal of assets 43,625 — Finance costs 714,352 47,649 Total other (income) expenses (763,936 ) (2,272,608 ) (Loss) Income before provision for income taxes (16,912,176 ) 10,387,623 Current income tax expense (recovery) (26,954 ) 2,145,072 Deferred income tax expense (recovery) (1,536,455 ) 801,333 Total income tax expenses (recovery) (1,563,409 ) 2,946,405 Net (loss) income (15,348,767 ) 7,441,218 Total comprehensive (loss) income (15,348,767 ) 7,441,218 Basic & diluted net earnings per share (0.37 ) 0.19 Weighted average number of shares of common stock-basic 41,808,909 40,205,836 Weighted average number of shares of common stock-diluted 41,808,909 40,216,109 32 The following table sets forth our revenue for the fiscal years ended June 30, 2025 and 2024: Year Ended June 30, 2025 Year Ended June 30, 2024 US$ US$ Revenue 190,408,258 166,977,034 Cost of service 193,408,827 148,894,227 Gross profit (loss) (3,000,569 ) 18,082,807 Gross profit (loss) margin % -1.6 % 10.8 % The following table outlines the compositions of our revenue streams: Year Ended June 30, 2025 Year Ended June 30, 2024 US$ US$ Transportation services 127,013,393 115,323,654 Warehousing services 63,285,107 51,502,358 Other services 109,758 151,022 Total 190,408,258 166,977,034 Our revenue increased by $23.4 million, or 14.0%, to $190.4 million during the fiscal year ended June 30, 2025, compared to $167.0 million for the fiscal year ended June 30, 2024.
Investing Activities Net cash used in investing activities was $7.4 million for the fiscal year ended June 30, 2024, primarily attributable to $5.2 million cash used for the purchase of property and equipment, and $2.2 million used for loans extended to others.
For the fiscal year ended June 30, 2024, net cash used in investing activities was $7.4 million, primarily attributable to $5.2 million cash used for purchase of property and equipment and $2.2 million used for loans extended to others.
Financing Activities For the fiscal year ended June 30, 2024, we had net cash provided by financing activities of $7.8 million, which was primarily attributable to the net effects of: (i) $7.5 million collected from our initial public offering; (ii) $0.5 million collected from related parties for the repayment of loans we previously advanced to them; (iii) $1.0 million used for expenses relating to the initial public offering; (iv) $0.2 million used to repay finance lease liabilities; and (v) $1.0 million in capital contributions from stockholders.
For the fiscal year ended June 30, 2024, we had net cash provided by financing activities of $7.8 million, which was primarily attributable to the net effects of: (i) $7.5 million collected from our initial public offering; (ii) $0.5 million collected from related parties for the repayment of loans we previously advanced to them; (iii) $1.0 million used for expenses relating to the initial public offering; (iv) $0.2 million used to repay finance lease liabilities; and (v) $1.0 million in capital contributions from stockholders.
Risk Factors — Economic, Political, and Market Risks — China’s economic, political, and social conditions, as well as governmental policies, could affect the business environment and economic conditions in China, which may result in an adverse impact on the demand for our services, potentially harming our financial condition and operating results.” 31 Key Factors Affecting Our Results of Operations We believe the following key factors may affect our financial condition and results of operations.
Risk Factors — Economic, Political, and Market Risks — China’s economic, political, and social conditions, as well as governmental policies, could affect the business environment and economic conditions in China, which may result in an adverse impact on the demand for our services, potentially harming our financial condition and operating results.” Key Factors Affecting Our Results of Operations We believe the following key factors may affect our financial condition and results of operations.
It is estimated that the 50,000 affected accounts caused approximately RMB100 billion in losses for the cross-border e-commerce industry in the PRC, which has discouraged a growing number of PRC e-commerce sellers from selling their merchandise to the U.S. via Amazon.
It is estimated that the 50,000 affected accounts caused approximately RMB100 billion in losses for the cross-border e-commerce industry in the PRC, which has discouraged a growing number of PRC e-commerce sellers from selling their merchandise in the U.S. via Amazon.
Risk Factors — Operational Risks — Our largest customers generate a significant portion of our revenue and our business may rely on one or more suppliers that account for more than 10% of our total purchases, and interruption in operations of such significant customers or supplier may have an adverse effect on our business, financial condition, and results of operations.” Our Ability to Effectively Develop and Expand our Labor Force Our ability to increase our customer base and achieve broader market acceptance will depend to a significant extent on our ability to expand our sales, marketing, and support operations, as well as our ability to recruit and retain talented personnel.
Risk Factors — Operational Risks — Our largest customers generate a significant portion of our revenue and our business may rely on two suppliers that account for more than 10% of our total purchases, and interruption in operations of such significant customers or supplier may have an adverse effect on our business, financial condition, and results of operations.” 31 Our Ability to Effectively Develop and Expand our Labor Force Our ability to increase our customer base and achieve broader market acceptance will depend to a significant extent on our ability to expand our sales, marketing, and support operations, as well as our ability to recruit and retain talented personnel.
Such a crackdown on PRC sellers may significantly reduce the number of Chinese e-commerce sellers who intend to sell in the U.S., who are our primary customers. The loss of our PRC customer base due to the widespread suspension of PRC sellers in the cross-border e-commerce industry could be detrimental to our ongoing operations. See “Item 1A.
Such a crackdown on PRC sellers may significantly reduce the number of Chinese e-commerce sellers who intend to sell in the U.S., who are our primary customers. The loss of our PRC customer base due to the widespread suspension of PRC sellers in the cross-border e-commerce industry could be detrimental to our ongoing operations. See “ Item 1A.
Risk factors — Operational Risks — The suspension of PRC sellers on using international e-commerce platforms, such as the crackdown on PRC sellers by Amazon in early 2021, has discouraged and may continue to discourage a growing number of PRC e-commerce sellers from selling their merchandise to the United States, thus adversely affecting our business, financial condition, and results of operations” Our Ability to Maintain Our Major Customers During the fiscal years ended June 30, 2024 and 2023, our five largest customers accounted for approximately 53.0% and 62.0% of our total revenue, respectively.
Risk factors — Operational Risks — The suspension of PRC sellers on using international e-commerce platforms, such as the crackdown on PRC sellers by Amazon in early 2021, has discouraged and may continue to discourage a growing number of PRC e-commerce sellers from selling their merchandise to the United States, thus adversely affecting our business, financial condition, and results of operations.” Our Ability to Maintain Our Major Customers During the fiscal years ended June 30, 2025 and 2024, our five largest customers accounted for approximately 55.1% and 53.0% of our total revenue, respectively.
During the fiscal years ended June 30, 2024 and 2023, we generated approximately 96% and 96% of our revenue from PRC-based customers, respectively. See “Item 1A.
During the fiscal years ended June 30, 2025 and 2024, we generated approximately 84% and 96% of our revenue from PRC-based customers, respectively. See “Item 1A.
This allows us to provide integrated solutions for our customers, whether they need domestic or international warehousing and logistics support. As of June 30, 2024 and 2023, we had an active customer base of 105 and 83, respectively, for our warehousing and logistics services. We have experienced rapid growth since our inception.
This allows us to provide integrated solutions for our customers, whether they need domestic or international warehousing and logistics support. As of June 30, 2025 and 2024, we had an active base of 505 and 105 customers, respectively, for our warehousing and logistics services. 30 We have experienced rapid growth since our inception.
In the event that a significant customer terminates its relationship with us, we cannot assure that we will be able to secure an alternative arrangement with another comparable customer in a timely manner, or at all. Losing one or more of these major customers could adversely affect our revenue and profitability. See “Item 1A.
In the event that a significant customer terminates its relationship with us, there is no assurance that we will be able to secure an alternative arrangement with another comparable customer in a timely manner, or at all. Losing one or more of these major customers could adversely affect our revenue and profitability. See “Item 1A.
Off-balance Sheet Commitments and Arrangements Other than two standby letters of credit with Eastwest Bank in the aggregate amount of $2,061,673, we did not have during the period presented, and we do not currently have, any off-balance sheet financing arrangements as defined under the rules and regulations of the SEC, or any relationships with unconsolidated entities or financial partnerships, including entities sometimes referred to as structured finance or special purpose entities, that were established for the purpose of facilitating off-balance sheet arrangements or other contractually narrow or limited purposes.
Off-balance Sheet Commitments and Arrangements Other than six standby letters of credit with Eastwest Bank in the aggregate amount of $4,387,550, we did not have during the period presented, and we do not currently have, any off-balance sheet financing arrangements as defined under the rules and regulations of the SEC, or any relationships with unconsolidated entities or financial partnerships, including entities sometimes referred to as structured finance or special purpose entities, that were established for the purpose of facilitating off-balance sheet arrangements or other contractually narrow or limited purposes.
The estimated annual deprecation rates of our property and equipment are generally as follows: Category Depreciation method Depreciation rate Furniture and fixtures Straight-line 7 years Auto & trucks Straight-line 5 – 8 years Trailers & truck chassis Straight-line 15 – 17 years Machinery & equipment Straight-line 2 – 7 years Leasehold improvements Straight-line Shorter of lease term or 15 years As of June 30, 2024 and 2023, the historical cost of property and equipment was $14,773,842 and $9,566,674, respectively.
The estimated annual deprecation rates of our property and equipment are generally as follows: Category Depreciation method Depreciation rate Furniture and fixtures Straight-line 7 years Auto & trucks Straight-line 5 – 8 years Trailers & truck chassis Straight-line 5 – 17 years Machinery & equipment Straight-line 2 – 7 years Leasehold improvements Straight-line Shorter of lease term or 15 years As of June 30, 2025 and 2024, the historical cost of property and equipment was $17,532,767 and $14,773,842, respectively.
Specifically, instead of earning great reviews through high-quality products, those PRC sellers manipulated reviews by paying for positive product reviews or by giving away gift cards, which violates Amazon’s terms of service.
Specifically, instead of earning favorable reviews through high-quality products, those PRC sellers manipulated reviews by paying for positive product reviews or by giving away gift cards, which violated Amazon’s terms of service.
During the fiscal years ended June 30, 2024 and 2023, we mainly derived our cash inflow from operating activities.
During the fiscal years ended June 30, 2025 and 2024, we mainly derived our cash inflow from operating and financing activities.
We expect that our capital requirements will be met by cash generated from our operating activities and financing activities from our principal stockholders. We believe that our current cash and cash generated from our operating activities will be sufficient to meet our current and anticipated working capital requirements and capital expenditures for at least the next 12 months.
We believe that our current cash and cash generated from our operating and financing activities will be sufficient to meet our current and anticipated working capital requirements and capital expenditures for at least the next 12 months.
(ii) Changes in accounts receivable and other receivables were $8.2 million cash outflow for the fiscal year ended June 30, 2024. For the fiscal year ended June 30, 2023, changes in accounts receivable and other receivables were $8.5 million cash outflow, which led to a $0.3 million decrease in net cash outflow from operating activities.
(ii) Changes in accounts receivable and other receivables were $3.0 million cash inflow for the fiscal year ended June 30, 2025. For the fiscal year ended June 30, 2024, changes in accounts receivable and other receivables were $8.2 million cash outflow, which led to a $11.1 million decrease in net cash outflow from operating activities.
We currently operate nine warehouses across the country, with an aggregate gross floor area of approximately 2,765,667 square feet. Aside from a nationwide footprint and large storage space, our warehouses are equipped with automated sorting systems, heavy-duty forklifts, and pallets and trays that are suitable for processing bulky items.
We currently operate 10 warehouses across the country, with an aggregate gross floor area of approximately 3,905,020 square feet. Aside from a nationwide footprint and large storage space, our warehouses are equipped with automated sorting systems, heavy-duty forklifts, and pallets and trays that are suitable for processing bulky items.
For the fiscal years ended June 30, 2024 and 2023, we had total revenue of $167.0 million, and $135.0 million respectively, and net income of $7.4 million, and $13.9 million respectively. While we do not have any subsidiaries, assets, or employees in the PRC, we generate a significant portion of our revenue from customers based in China.
For the fiscal years ended June 30, 2025 and 2024, we had total revenue of $190.4 million, and $167.0 million, respectively, and net loss of $15.3 million, and net income of $7.4 million, respectively. While we do not have any subsidiaries, assets, or employees in the PRC, we generate a significant portion of our revenue from customers based in China.
Operating Activities Net cash provided by operating activities was $3.0 million for the fiscal year ended June 30, 2024, compared to net cash provided in operating activities of $11.8 million for the fiscal year ended June 30, 2023, representing a $8.8 million decrease in the net cash inflow provided by operating activities.
Operating Activities Net cash provided by operating activities was $1.5 million for the fiscal year ended June 30, 2025, compared to net cash provided by operating activities of $3.0 million for the fiscal year ended June 30, 2024, representing a $1.5 million decrease in the net cash inflow provided by operating activities.
As of June 30, 2024 and 2023, we had cash and restricted cash of $10 million and $6.6 million, respectively, which primarily consisted of cash deposited in banks. Our working capital requirements mainly consist of costs of sales and general and administrative expenses.
As of June 30, 2025 and 2024, we had cash and cash equivalents and restricted cash of $13.6 million and $10.0 million, respectively, which primarily consisted of cash deposited in banks. Our working capital requirements mainly consist of cost of service and general and administrative expenses.
The decrease was primarily due to the following: (i) We had net income of $7.4 million for the fiscal year ended June 30, 2024. For the fiscal year ended June 30, 2023, we had net income of $13.9 million, which led to a $6.5 million decrease in net cash inflow from operating activities.
The decrease was primarily due to the following: (i) We had net loss of $15.3 million for the fiscal year ended June 30, 2025. For the fiscal year ended June 30, 2024, we had net income of $7.4 million, which led to a $22.8 million decrease in net cash inflow from operating activities.
(iii) Changes in accounts payable and accrued liabilities used $0.7 million net cash outflow for the fiscal year ended June 30, 2024. For the fiscal year ended June 30, 2023, changes in accounts payable and accrued liabilities provided net cash inflow of $2.5 million, which led to a $3.2 million increase in net cash outflow from operating activities.
(iii) Changes in accounts payable and accrued liabilities were $2.1 million net cash inflow for the fiscal year ended June 30, 2025. For the fiscal year ended June 30, 2024, changes in accounts payable and accrued liabilities were net cash outflow of $0.7 million, which led to a $2.8 million decrease in net cash outflow from operating activities.
We recorded depreciation expenses of $1,827,231 and $1,111,088 during the fiscal years ended June 30, 2024 and 2023, respectively.
We recorded depreciation expenses of $2,555,625 and $1,827,231 during the fiscal years ended June 30, 2025 and 2024, respectively.
Net income As a result of the foregoing, our net income for the fiscal year ended June 30, 2024 was $7.4 million, compared with the net income of $13.9 million for the fiscal year ended June 30, 2023, representing a decrease by $6.5 million.
Net income As a result of the foregoing, our net loss for the fiscal year ended June 30, 2025 was $15.3 million, compared with the net income of $7.4 million for the fiscal year ended June 30, 2024, representing a decrease by $22.8 million.
(iv) Changes in tax payable provided $2.6 million net cash outflow for the fiscal year ended June 30, 2024. For the fiscal year ended June 30, 2023, changes in tax payable provided net cash inflow of $2.3 million, which led to a $4.9 million decreased in net cash inflow from operating activities.
(iv) Changes in tax payable were $0.1 million net cash outflow for the fiscal year ended June 30, 2025. For the fiscal year ended June 30, 2024, changes in tax payable were net cash outflow of $2.6 million, which led to a $2.5 million decrease in net cash outflow from operating activities.
This decline is attributable to increases in the rental expenses, salary and benefits, temporary labor expenses, and warehouse expenses of approximately 106%, 68%, 51%, and 83%, respectively, despite a relatively modest increase in warehousing services revenue of approximately 38.1%. Operating expenses Our operating expenses consist primarily of general and administrative expenses.
This decline is attributable to increases in the rental expenses, freight expenses, salary and benefits, temporary labor expenses, and warehouse expenses of approximately 25.9%, 26.4%, 35.2%, 37.9%, and 66.4%, respectively, despite a relatively modest increase in warehousing services revenue of approximately 22.9%. Operating expenses Our operating expenses consist primarily of general and administrative expenses.
The following table sets forth a breakdown of our income tax expense: Year Ended June 30, 2024 Year Ended June 30, 2023 US$ US$ Current income tax expense 2,145,072 4,980,481 Deferred income tax expense 801,333 380,523 Total income tax expenses 2,946,405 5,361,004 Our income tax expense decreased by $2.4 million in 2024, mainly due to the decrease in profit before tax by $8.9 million during the year.
The following table sets forth a breakdown of our income tax expense: Year Ended June 30, 2025 Year Ended June 30, 2024 US$ US$ Current income tax (recovery) expense (26,954 ) 2,145,072 Deferred income tax (recovery) expense (1,536,455 ) 801,333 Total income tax (recovery) expenses (1,563,409 ) 2,946,405 Our income tax expense decreased by $4.5 million in the fiscal year ended June 30, 2025, mainly due to the decrease in profit before tax by $27.3 million in the fiscal year 2025, compared to the fiscal year 2024.
Specifically, $1,513,947 and $905,384 of the depreciation expenses were recorded in costs of sales for the fiscal years ended June 30, 2024 and 2023, respectively. $313,284 and $205,704 of the depreciation expenses were recorded in general and administrative expenses for the fiscal years ended June 30, 2024 and 2023, respectively.
Specifically, $2,349,234 and $1,513,947 of the depreciation expenses were recorded in cost of service for the fiscal years ended June 30, 2025 and 2024, respectively. $206,391 and $313,284 of the depreciation expenses were recorded in general and administrative expenses for the fiscal years ended June 30, 2025 and 2024, respectively.
Despite that management determines that there are no critical accounting estimates, the one that requires relatively significant estimates relates to useful lives of property and equipment. 38 Property and equipment are recorded at cost, less accumulated depreciation and impairment.
Actual outcomes could differ materially from those estimates in a manner that could have a material effect on our consolidated financial statements. Despite that management determines that there are no critical accounting estimates, the one that requires relatively significant estimates relates to useful lives of property and equipment. Property and equipment are recorded at cost, less accumulated depreciation and impairment.
The following table sets forth a breakdown of our general and administrative expenses for the fiscal years ended June 30, 2024 and 2023: Year Ended June 30, 2024 Year Ended June 30, 2023 US$ US$ Bank charges 99,850 17,546 Amortization 313,283 205,703 Office expenses 2,441,784 1,151,786 Professional fees 447,955 420,775 Rental expenses 427,014 479,597 Repairs and maintenance 1,130,378 689,737 Salary and benefits 4,312,408 3,878,888 Sundries 255,739 76,084 Tax and licenses 149,321 104,589 Vehicle expenses 180,378 99,390 Other expenses 114,988 95,731 Credit loss expenses 94,694 579,290 Total 9,967,792 7,799,116 Our general and administrative expenses increased by $2.2 million, from $7.8 million for the fiscal year ended June 30, 2023 to $10.0 million for the fiscal year ended June 30, 2024, representing an increase of 28%.
The following table sets forth a breakdown of our general and administrative expenses for the fiscal years ended June 30, 2025 and 2024: Year Ended June 30, 2025 Year Ended June 30, 2024 US$ US$ Bank charges 162,657 99,850 Amortization 206,391 313,283 Office expenses 3,221,531 2,441,784 Professional fees 2,418,727 447,955 Rental expenses 2,646,508 427,014 Repairs and maintenance 1,251,729 1,130,378 Salary and benefits 3,646,361 4,312,408 Sundries 311,952 255,739 Tax and licenses 186,144 149,321 Vehicle expenses 187,194 180,378 Other expenses 160,739 114,988 Credit loss expenses 275,610 94,694 Total 14,675,543 9,967,792 34 Our general and administrative expenses increased by $4.7 million, from $10.0 million for the fiscal year ended June 30, 2024 to $14.7 million for the fiscal year ended June 30, 2025, representing an increase of 47.2%.
Liquidity and Capital Resources In assessing our liquidity, management monitors and analyzes our cash on-hand, our ability to generate sufficient revenue sources in the future, and our operating and capital expenditure commitments. As of the date of this annual report, we have financed our operations primarily through cash generated by operating activities and capital contributions from stockholders.
Liquidity and Capital Resources In assessing our liquidity, management monitors and analyzes our cash on-hand, our ability to generate sufficient revenue sources in the future, and our operating and capital expenditure commitments.
For the fiscal year ended June 30, 2023, net cash used in investing activities was $4.3 million, primarily attributable to $1.8 million cash used for the purchase of property and equipment and $2.4 million used for loans extended to others.
For the fiscal year ended June 30, 2024, changes in non-cash items provided net cash inflow of $8.0 million, which led to a $2.9 million increase in net cash inflow from operating activities. 36 Investing Activities Net cash used in investing activities was $1.8 million for the fiscal year ended June 30, 2025, primarily attributable to $2.9 million cash used for the purchase of property and equipment, and net of $1.0 million cash used for loans extended to others, and $2.0 million proceeds received from loan repayments.
As of June 30, 2024, we still have unused credit of $2,061,673 with Eastwest Bank.
As of June 30, 2025, we still had unused credit of $4,387,550 with Eastwest Bank.
Cash Flows for the Fiscal Years Ended June 30, 2024 and 2023 Year Ended June 30, 2024 Year Ended June 30, 2023 US$ US$ Net cash provided by operating activities 3,040,538 11,803,407 Net cash used in investing activities (7,437,605 ) (4,316,073 ) Net cash provided by (used in) financing activities 7,789,352 (3,177,995 ) Net increase in cash 3,392,285 4,309,339 Cash at beginning of year 6,558,099 2,248,760 Cash and restricted cash at end of year 9,950,384 6,558,099 36 We had a balance of cash and restricted cash of $10.0 million as of June 30, 2024, compared with a balance of $6.6 million as of June 30, 2023.
We may, however, need additional cash resources in the future if we experience changes in our business conditions or other developments. 35 Cash Flows for the Fiscal Years Ended June 30, 2025 and 2024 Year Ended June 30, 2025 Year Ended June 30, 2024 US$ US$ Net cash provided by operating activities 1,460,845 2,992,889 Net cash used in investing activities (1,805,223 ) (7,437,605 ) Net cash provided by financing activities 3,971,821 7,837,001 Net increase in cash and cash equivalents and restricted cash 3,627,443 3,392,285 Cash and cash equivalents and restricted cash at beginning of year 9,950,384 6,558,099 Cash and cash equivalents and restricted cash at end of year 13,577,827 9,950,384 We had a balance of cash and cash equivalents and restricted cash of $13.6 million as of June 30, 2025, compared with a balance of $10.0 million as of June 30, 2024.
Our costs of sales mainly represented the costs incurred for the use of third-party direct freight service carriers, such as FedEx and UPS, warehouse rental expenses, costs of labor, and trucking expenses. Costs of sales increased by $39.6 million, or 36.2%, during the fiscal year ended June 30, 2024, compared with the fiscal year ended June 30, 2023.
Other revenue mainly consisted of revenue from our customs brokerage services. Our cost of service mainly represented the costs incurred for the use of third-party direct freight service carriers, such as FedEx and UPS, warehouse rental expenses, costs of labor, and trucking expenses.
For the fiscal year ended June 30, 2023, we had net cash used in financing activities of $3.2 million, which was primarily attributable to the net effects of: (i) $2.5 million used to repay to related parties; (ii) $0.5 million used for loans extended to related parties; (iii) $0.4 million used for expenses relating to the initial public offering; (iv) $0.2 million used to repay finance lease liabilities; and (v) $0.5 million in capital contributions from shareholders. 37 Commitments and Contractual Obligations As of June 30, 2024, we had operating and finance leases for office space, warehouse space, and forklifts.
Financing Activities For the fiscal year ended June 30, 2025, we had net cash provided by financing activities of $4.0 million, which was primarily attributable to the net effects of: (i) $8.1 million of net proceeds convertible notes; (ii) $0.4 million of loans advanced to related parties; (iii) $3.4 million used for the repayment of convertible notes and commitment fees payable; and (iv) $0.4 million used to repay finance lease liabilities.
(v) Changes in non-cash items provided $8.1 million net cash inflow for the fiscal year ended June 30, 2024. For the fiscal year ended June 30, 2023, changes in non-cash items provided net cash inflow of $2.8 million, which led to a $5.3 million increase in net cash inflow from operating activities.
(v) Changes in non-cash items provided $11.0 million net cash inflow for the fiscal year ended June 30, 2025.
The increase was in line with the significant increase of our revenue. 34 The following table sets forth a breakdown of our costs of sales for the fiscal years ended June 30, 2024 and 2023: Year Ended June 30, 2024 Year Ended June 30, 2023 US$ US$ Amortization 35,317 204,457 Depreciation 1,683,436 905,384 Rental expenses 30,421,614 14,801,588 Freight expenses 89,506,874 75,960,644 Port handling and customs fees 266,784 675,574 Salary and benefits 7,553,353 4,485,060 Temporary labor expenses 12,657,528 8,381,160 Warehouse expenses 5,705,059 3,122,911 Utilities 547,587 410,330 Other expenses 516,675 363,885 Total 148,894,227 109,310,993 Our rental expenses (primarily warehouse operating lease expenses), freight expenses, temporary labor expenses, and salary and benefits increased significantly by $15.6 million, $13.5 million, $4.3 million, and $3.1 million, respectively, during the fiscal year ended June 30, 2024 compared to 2023.
This shift has partially cushioned the impact but continues to place downward pressure on freight profitability in the near term. 33 The following table sets forth a breakdown of our cost of service for the fiscal years ended June 30, 2025 and 2024: Year Ended June 30, 2025 Year Ended June 30, 2024 US$ US$ Amortization 38,081 35,317 Depreciation 2,725,602 1,683,436 Rental expenses 38,290,217 30,421,614 Freight expenses 113,167,867 89,506,874 Port handling and customs fees 518,962 266,784 Salary and benefits 10,210,118 7,553,353 Temporary labor expenses 17,451,331 12,657,528 Warehouse expenses 9,491,473 5,705,059 Utilities 933,045 547,587 Other expenses 582,131 516,675 Total 193,408,827 148,894,227 Our rental expenses (primarily warehouse operating lease expenses), freight expenses, temporary labor expenses, and salary and benefits increased significantly by $7.9 million, $23.7 million, $4.8 million, and $2.7 million, respectively, in the fiscal year ended June 30, 2025 compared to the fiscal year ended June 30, 2024.
As an integrated part of our one-stop warehousing and logistics services, our warehousing services also increased as a result of the growth in our transportation services. 3) Revenue from other services decreased by $0.5 million, or 77.4%. Other revenue mainly consisted of revenue from our customs brokerage services.
As an integrated part of our one-stop warehousing and logistics services, revenue increase from our warehousing services was driven by the growth in our transportation services and the addition of new warehouses acquired in 2025. 3) Revenue from other services decreased by $0.04 million, or 27.3% in the fiscal year ended June 30 2025, compared to the fiscal year ended June 30, 2024.
Lease terms expire at various dates through August 2024 to July 2034 with options to renew for varying terms at our sole discretion.
Commitments and Contractual Obligations As of June 30, 2025, we had operating and finance leases for office space, warehouse space, and forklifts. Lease terms expire at various dates through July 2025 to November 2034 with options to renew for varying terms at our sole discretion.
Our overall gross profit margin decreased from 19.1% for the fiscal year ended June 30, 2023 to 10.8% for the year ended June 30, 2024, primarily due to our expansion into the Fontana, California warehouse and the temporary disruption of operations in California as inventory was relocated to a new facility. Although the profit margins of our transportation services (e.g.
Our overall gross profit margin decreased from 10.8% for the fiscal year ended June 30, 2024 to -1.6% for the fiscal year ended June 30, 2025, primarily due to the increase in lease expenses, temporary labor expenses for new warehouses, and UPS expenses.
The increase was due to the following factors: 1) Revenue from our transportation services increased by $18.3 million, or 18.8%, due to the rapid expansion of our business in 2024, as we expanded our warehouse operational capacities in California and New Jersey. 2) Revenue from our warehousing services increased by $14.2 million, or 38.1%.
The increase was due to the following factors: 1) Revenue from our transportation services increased by $11.7 million, or 10.1%, due to due to the addition of new warehouse locations, which resulted in an increase in shipment volume in the fiscal year ended June 30, 2025 compared to the fiscal year ended June 30, 2024. 2) Revenue from our warehousing services increased by $11.8 million, or 22.9% in the fiscal year ended June 30 2025, compared to the fiscal year ended June 30, 2024.
The increase was due to the following factors: 1) Office expenses increased by $1.3 million, or 112%, mainly due to an increase of insurance by $1.0 million associated with the rapid expansion of our warehouses and the growth in our transportation services. 2) Repairs and maintenance expenses increased by $0.4 million, or 64%, as a result of the growth in our transportation services. 35 Income Tax Our California subsidiaries are subject to the current California state corporate income tax at a rate of 8.84% and federal income tax at a flat rate of 21%.
The increase was due to the following factors: 1) Office expenses increased by $0.8 million, or 31.9%, mainly due to an increase in truck insurance and general office expense associated with the rapid expansion of our business. 2) Rental expenses increased by $2.2 million, or 519.8%, mainly due to additional warehouses rented in 2025 and a higher amount of lease expense was allocated to 2025. 3) Professional fees increased by $2.0 million, or 439.9%, mainly due to the fees for the consulting services of two investment financial advisors and audit fees.
Removed
The increases in these expenses were all due to the growth of our revenue in transportation services and warehouse services.
Added
Our business will be harmed if we are unable to hire, develop, and retain skilled and qualified personnel, if our new personnel are unable to achieve desired productivity levels in a reasonable period of time, or if we are unable to retain our existing personnel.
Removed
FedEx, ocean freight, and truck deliveries) for the fiscal year ended June 30, 2024, remained stable or slightly higher compared to the previous year, the profit margins for our warehousing services experienced a significant decrease during the same period.
Added
Cost of service increased by $44.5 million, or 29.9%, during the fiscal year ended June 30, 2025, compared with the fiscal year ended June 30, 2024. The increase was primarily driven by the following two factors: i.
Removed
We may, however, need additional cash resources in the future if we experience changes in our business conditions or other developments.
Added
In the fiscal year ended June 30, 2025, the Company expanded its operations with the opening of two new warehouses, in addition to a new warehouse in the State of Illinois which was launched at the end of the fiscal year 2024.
Removed
As of June 30, 2024, maturities of lease liabilities for each of the following fiscal years ending June 30 and thereafter were as follows: Operating Finance US$ US$ 2025 25,755,542 175,880 2026 29,216,224 129,332 2027 28,967,443 61,194 2028 29,694,748 5,866 2029 17,613,484 - 2030 and beyond 30,913,470 - Total minimum lease payment 162,160,911 372,272 Less: imputed interest (44,818,373 ) (46,964 ) Total lease liabilities 117,342,538 325,308 Less: current potion (24,216,446 ) (155,625 ) Non-current portion 93,126,092 169,683 Other than the above leases, we did not have significant commitments, long-term obligations, or guarantees as of June 30, 2024.
Added
Unlike prior expansions, which benefited from shifting personnel from nearby existing locations, these new facilities required incremental labor hiring. Furthermore, the type of orders fulfilled at the two new warehouses are not the traditional drop-shipping model and typically carry lower profit margins. These dynamics resulted in a notable increase in warehouse labor, rental, and other related operating expenses. ii.
Removed
Actual outcomes could differ materially from those estimates in a manner that could have a material effect on our consolidated financial statements.
Added
Freight costs rose significantly due to changes in carrier economics. The Company’s gross profit margin on FedEx shipments declined from 23% in fiscal 2024 to 7% in fiscal 2025, largely driven by FedEx rate increases tied to tariffs and broader economic conditions. To mitigate this impact, management transitioned part of the freight volume to UPS.
Added
While UPS has provided a more stable cost structure, its current gross margin of 6% remains well below the 23% margin previously achieved with FedEx.
Added
The increases in lease expenses were due to the additional operating leases acquired during the year. The increases in freight expenses were due to the increase in UPS expenses. The increases in temporary labor expenses, warehouse expenses, and salary and benefits were due to the expansion of the warehouse operations.
Added
Income Tax Our California subsidiaries are subject to the current California state corporate income tax at a rate of 8.84% and federal income tax at a flat rate of 21%.
Added
As of the date of this annual report, we have financed our operations primarily through cash generated by operating activities, equity financing, debt financing from third parties and capital contributions from stockholders.
Added
We expect that our capital requirements will be met by cash generated from our financing activities. On November 25, 2024, we entered into a Standby Equity Purchase Agreement (the “SEPA”) with YA II PN, Ltd.
Added
(the “Investor”), pursuant to which we have the right to sell to the Investor up to $50.0 million (the “Commitment Amount”) of our shares of common stock, subject to certain limitations and conditions set forth in the SEPA, from time to time during the term of the SEPA.
Added
In connection with the SEPA, and subject to the conditions set forth therein, the Investor agreed to advance to the Company pursuant to certain convertible promissory notes (the “Convertible Notes”) an aggregate principal amount of up to $21.0 million (the “Pre-Paid Advance”), subject to a 10% original issue discount.
Added
As of June 30, 2025, aggregate annual lease obligations for each of the following fiscal years ending June 30 and thereafter were as follows: Operating Finance US$ US$ 2026 31,110,870 432,301 2027 36,578,138 312,731 2028 37,872,441 77,669 2029 25,804,167 67,226 2030 and beyond 39,734,608 - Total minimum lease payment 171,100,224 889,927 Less: imputed interest (42,879,765 ) (105,908 ) Total lease liabilities 128,220,459 784,019 Less: current potion (29,280,907 ) (386,327 ) Non-current portion 98,939,552 397,692 As of June 30, 2025, our significant contractual obligations also include Convertible Notes arising from the SEPA entered into by the Company in November 2024 with a principal balance of $10.0 million.
Added
Pursuant to the SEPA, the Company has the right to sell to the Investor up to the Commitment Amount of the Company’s shares of common stock, subject to certain limitations and conditions set forth in the SEPA, from time to time during the term of the SEPA.
Added
Unless converted into our shares of common stock prior to their maturity, we are obligated to repay Convertible Notes in cash. 37 The following table summarizes our future contractual obligations related to the Convertible Notes as of June 30, 2025: US$ Less than 1 year 2,020,000 1-3 years 3,800,000 Total 5,820,000 Other than the above leases and the Convertible Notes, we did not have significant commitments, long-term obligations, or guarantees as of June 30, 2025.