Foxx Development Holdings Inc. reported a substantial increase in total revenue, reaching $51.98 million for the nine months ended March 31, 2025. This represents a dramatic 3760.2% increase compared to $1.35 million in the same period of 2024, primarily driven by the acquisition of three new major wholesale customers and the introduction of wearable products and App service commission revenue.
Despite the top-line growth, the company recorded a net loss of $4.93 million for the nine months, a larger loss than the $2.07 million net loss in the comparable 2024 period. Operating expenses soared to $10.86 million, an increase of 457.8%, reflecting investments in sales expansion, public company infrastructure, and research and development for new products like 5G capabilities.
The financial results also revealed significant liquidity challenges, with approximately $4.65 million in cash used in operating activities during the nine-month period. The company held $3.80 million in cash and cash equivalents and had an accumulated deficit of $16.00 million as of March 31, 2025.
Management explicitly stated that the net cash used in operating activities, the net loss, and the accumulated deficit raise substantial doubt about the Company's ability to continue as a going concern within one year. The ability to meet working capital requirements is contingent on securing additional financing, for which there are no assurances of availability on acceptable terms.
Gross profit improved to $3.25 million (6.3% margin) from $59,901 (4.4% margin) in the prior year, attributed to better margins on mobile phones and the high-margin App service commission revenue. However, this was insufficient to offset the increased operating expenses, resulting in a loss from operations of $7.61 million.
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