Armlogi Holding Corp.

Previous wording

We provide one-stop warehousing and logistics services to cross-border e-commerce merchants outside the U.S. who seek to sell in the U.S. market. 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. As a one-stop warehousing and logistics service provider, we offer a full spectrum of services, including (i) customs brokerage services; (ii) transportation of merchandise to U.S. warehouses; and (iii) warehouse management and order fulfillment services, which further include (a) product storage and retrieval, (b) product packing and labeling, (c) kitting and repackaging, (d) order assembly and load consolidation, (e) inventory management and sales forecasting, (f) third-party distribution coordination, and (g) other value-added services. We also provide warehousing and logistics services to our U.S.-based commercial customers, who are typically domestic e-commerce merchants seeking efficient and reliable warehousing and logistics solutions to support their operations. In general, the warehousing and logistics services we provide to our domestic customers are similar to those we provide to our overseas customers. 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.

Current wording

We provide one-stop warehousing and logistics services to cross-border e-commerce merchants outside the U.S. who seek to sell in the U.S. market. 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. As a one-stop warehousing and logistics service provider, we offer a full spectrum of services, including (i) customs brokerage services; (ii) transportation of merchandise to U.S. warehouses; and (iii) warehouse management and order fulfillment services, which further include (a) product storage and retrieval, (b) product packing and labeling, (c) kitting and repackaging, (d) order assembly and load consolidation, (e) inventory management and sales forecasting, (f) third-party distribution coordination, and (g) other value-added services. We also provide warehousing and logistics services to our U.S.-based commercial customers, who are typically domestic e-commerce merchants seeking efficient and reliable warehousing and logistics solutions to support their operations. In general, the warehousing and logistics services we provide to our domestic customers are similar to those we provide to our overseas customers. 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.

Previous wording

We have experienced rapid growth since our inception. 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. 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. 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.”

Current wording

We have experienced rapid growth since our inception. 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. 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. 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.”

Previous wording

The majority of our customers consist of PRC e-commerce merchants who sell their merchandise into the U.S. market through e-commerce platforms. As such, our ability to acquire and maintain new or existing customers for our warehousing and logistics services is heavily reliant on their continued willingness to conduct cross-border e-commerce businesses, which may be significantly impacted by policies set by e-commerce platforms. For example, in early 2021, Amazon, the world’s largest e-commerce platform, claimed that it had suspended the accounts of over 50,000 Chinese sellers for improper use of review functions. 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. 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. There is no guarantee that our current or future international customers are fully compliant with the terms of service of all the international e-commerce platforms they use, including Amazon, or that those e-commerce platforms will not from time to time initiate such a widespread suspension of PRC sellers in the future. 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”

Current wording

The majority of our customers consist of PRC e-commerce merchants who sell their merchandise into the U.S. market through e-commerce platforms. As such, our ability to acquire and maintain new or existing customers for our warehousing and logistics services is heavily reliant on their continued willingness to conduct cross-border e-commerce businesses, which may be significantly impacted by policies set by e-commerce platforms. For example, in early 2021, Amazon, the world’s largest e-commerce platform, claimed that it had suspended the accounts of over 50,000 Chinese sellers for improper use of review functions. 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. 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. There is no guarantee that our current or future international customers are fully compliant with the terms of service of all the international e-commerce platforms they use, including Amazon, or that those e-commerce platforms will not from time to time initiate such a widespread suspension of PRC sellers in the future. 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.”

Previous wording

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. While we strive to maintain our competitive strengths, such as our quality warehousing and logistics services, competitive pricing, and quality customer services (see “Item 1. Business — Our Competitive Strengths”) to maintain our customer base, there is no guarantee that we will continue to maintain our business relationships with these major customers at the same level, or at all. 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. 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.”

Current wording

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. While we strive to maintain our competitive strengths, such as our quality warehousing and logistics services, competitive pricing, and quality customer services (see “Item 1. Business — Our Competitive Strengths”) to maintain our customer base, there is no guarantee that we will continue to maintain our business relationships with these major customers at the same level, or at all. 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. 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.”

Previous wording

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. The increase was due to the following factors:

Current wording

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. The increase was due to the following factors:

Previous wording

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. The increase was in line with the significant increase of our revenue.

Current wording

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. 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:

Previous wording

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. The increases in these expenses were all due to the growth of our revenue in transportation services and warehouse services.

Current wording

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. 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.

Previous wording

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. 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. 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%.

Current wording

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. 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%.

Previous wording

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 increase was due to the following factors:

Current wording

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%. The increase was due to the following factors:

Previous wording

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.

Current wording

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.

Previous wording

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.

Current wording

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.

Previous wording

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. 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.

Current wording

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, equity financing, debt financing from third parties and capital contributions from stockholders. 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.

Previous wording

Our working capital requirements mainly consist of costs of sales and general and administrative expenses. 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 may, however, need additional cash resources in the future if we experience changes in our business conditions or other developments.

Current wording

Our working capital requirements mainly consist of cost of service and general and administrative expenses. 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. (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. 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. 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. We may, however, need additional cash resources in the future if we experience changes in our business conditions or other developments.

Previous wording

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. During the fiscal years ended June 30, 2024 and 2023, we mainly derived our cash inflow from operating activities.

Current wording

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. During the fiscal years ended June 30, 2025 and 2024, we mainly derived our cash inflow from operating and financing activities.

Previous wording

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. The decrease was primarily due to the following:

Current wording

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. The decrease was primarily due to the following:

Previous wording

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.

Current wording

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.

Previous wording

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.

Current wording

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.

Previous wording

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.

Current wording

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.

Previous wording

As of June 30, 2024, maturities of lease liabilities for each of the following fiscal years ending June 30 and thereafter were as follows:

Current wording

As of June 30, 2025, aggregate annual lease obligations for each of the following fiscal years ending June 30 and thereafter were as follows:

Previous wording

Other than the above leases, we did not have significant commitments, long-term obligations, or guarantees as of June 30, 2024.

Current wording

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.

Previous wording

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. As of June 30, 2024, we still have unused credit of $2,061,673 with Eastwest Bank.

Current wording

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. As of June 30, 2025, we still had unused credit of $4,387,550 with Eastwest Bank.

Previous wording

As of June 30, 2024 and 2023, the historical cost of property and equipment was $14,773,842 and $9,566,674, respectively.

Current wording

As of June 30, 2025 and 2024, the historical cost of property and equipment was $17,532,767 and $14,773,842, respectively.

Previous wording

We recorded depreciation expenses of $1,827,231 and $1,111,088 during the fiscal years ended June 30, 2024 and 2023, respectively. 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.

Current wording

We recorded depreciation expenses of $2,555,625 and $1,827,231 during the fiscal years ended June 30, 2025 and 2024, 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.