GigaCloud Technology Inc

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Description of Business

GigaCloud Technology Inc (the “Company”), a limited liability company incorporated in the Cayman Islands, with its subsidiaries (collectively referred to as the “Group”, “we” or “our”) are principally engaged in large parcel merchandise sales and the provision of B2B technology solutions by utilizing the Group’s online platform (“GigaCloud Marketplace”) and fulfillment network primarily located in the United States, Japan, Europe, and Canada.

Organization

The accompanying unaudited condensed consolidated financial statements as of March 31, 2026 include the financial statements of the Company and its subsidiaries, and the consolidated statements in this Form 10-Q, should be read in conjunction with the consolidated financial statements and the related notes included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025 filed with the SEC.

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements of the Group have been prepared in accordance with the instructions to Form 10-Q and do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Results of operations for interim periods are not necessarily indicative of results for the entire year. As a result, these unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the 2025 Form 10-K.

There were no significant changes to our significant accounting policies as disclosed in the 2025 Form 10-K.

Cash, Cash Equivalents and Restricted Cash

Cash and cash equivalents consist of cash on hand and highly liquid investments purchased with original maturities of three months or less. Cash that is restricted for withdrawal or use is reported separately on the unaudited condensed consolidated balance sheets. The Group’s restricted cash represents security deposits held in designated bank accounts for issuance of letters of guarantee.

A reconciliation of cash, cash equivalents and restricted cash in the unaudited condensed consolidated balance sheets to the amounts in the unaudited condensed consolidated statements of cash flows is as follows:

Concentration and Risk

Concentration of customers and suppliers

No customers individually represented greater than 10.0% of total revenues of the Group for the three months ended March 31, 2026 and 2025.

One customer individually represented greater than 10.0% of total accounts receivable balance as of March 31, 2026, and two customers individually represented greater than 10.0% of total accounts receivable balance as of December 31, 2025, and no other customers accounted for 10.0% or more of total accounts receivable balance as of March 31, 2026 and December 31, 2025.

During the three months ended March 31, 2026 and 2025, one service provider individually represented 11.1% and 19.1% of total purchases, and no other vendors individually accounted for 10.0% or more of total purchases.

Concentration of credit risk

Financial instruments that potentially expose the Group to concentrations of credit risk consist principally of cash, cash equivalents, restricted cash, investments, accounts receivable, and amounts due from third-party payment platforms.

The Group’s investment policy requires cash, cash equivalents, restricted cash and investments to be placed with high quality financial institutions and to limit the amount of credit risk from any one institution. The Group regularly evaluates the credit standing of the counterparties or financial institutions.

Accounts receivable (Note 4) from product and service sales are exposed to credit risk. The assessment of the counter parties’ creditworthiness is primarily based on past payment history and current ability to pay, taking into account information specific to the counter parties as well as pertaining to the economic environment in which the counter parties operate.

Segment Reporting

The Group’s chief operating decision maker (“CODM”), who is its Chief Executive Officer, reviews financial information presented on a consolidated basis and uses consolidated revenue, gross margins, and net income to make decisions about allocating resources and assessing performance of the Group. For the purposes of internal reporting and management’s operational review, the Group’s CODM and management personnel do not segregate the Group’s business by revenue stream or geography. Management has determined that the Group hasone operating segment. The measurement of segment assets is reported on the unaudited condensed consolidated balance sheets as total assets. The revenue, costs and expenses, and the net income for the reportable segment are the same as those presented on the unaudited condensed consolidated statements of comprehensive income.

The CODM reviews and utilizes significant segment expenses, including cost of revenues, selling and marketing, general and administrative, and research and development at the consolidated level to manage and assess the Company's operations. Other segment items included in the consolidated net income are losses on disposal of property and equipment, interest expense, interest income, foreign currency exchange gains (losses), net, others, net, and income tax expenses, which are reflected in the consolidated statements of operations.

Long-lived assets consist of property and equipment and operating lease right-of-use assets. The geographic information for long-lived assets as of March 31, 2026 and December 31, 2025 was as follows:

Revenues reported are attributed to geographic areas based on locations of the Group’s fulfillment centers, except for platform commission revenues which are attributed to Hong Kong, where the server of the GigaCloud Marketplace is located. Revenues by geography for the three months ended March 31, 2026 and 2025 are as follows:

(1)Other regions mainly include the U.K., Japan, Canada and Hong Kong, with variations across different product/ service lines. No other individual region’s revenues exceeded 10% of the Company’s total revenues for the three months ended March 31, 2026 and 2025.

Recent Accounting Pronouncements

In July 2025, the FASB issued ASU No. 2025-05, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets. The amendments in this update provide a practical expedient permitting an entity to assume that conditions at the balance sheet date remain unchanged over the life of the asset when estimating expected credit losses for current classified accounts receivable and contract assets. This update is effective for annual periods beginning after December 15, 2025, including interim periods within those annual reporting years. If the practical expedient is elected, the amendments should be applied prospectively. Early adoption is permitted. The Group adopted this ASU on January 1, 2026 prospectively and the adoption did not have a material impact on its consolidated financial statements and related disclosures.

In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses. The ASU amends existing income statement disclosure guidance, primarily requiring disaggregated disclosure of specific expense categories, such as purchases of inventory, employee compensation, depreciation and intangible asset amortization. For public business entities, the ASU is effective for annual periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. Early adoption is permitted and the ASU can be applied on either a prospective or retroactive basis. The Group is currently evaluating the impact that the adoption of this standard will have on its consolidated financial statements and related disclosures.

In September 2025, the FASB issued ASU No. 2025-06, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software. The amendments in this update improve the operability of the guidance by removing all references to software development project stages so that the guidance is neutral to different software development methods. This update is effective for annual periods beginning after December 15, 2027, including interim periods within those annual reporting years. Early adoption is permitted as of the beginning of an annual reporting period. The amendments in the update permit an entity to apply the new guidance using any of the three transition approaches: a prospective transition approach, a modified transition approach and a retrospective transition approach. The Group is currently evaluating the impact that the adoption of this standard will have on its consolidated financial statements and related disclosures.

In December 2025, the FASB issued ASU No. 2025-11, Interim Reporting (Topic 270): Narrow-Scope Improvements. The amendments clarify the guidance in Topic 270 to improve the consistency of interim financial reporting. The update provides a comprehensive list of required interim disclosures and introduces a disclosure principle requiring entities to disclose events since the end of the last annual reporting period that have a material impact on the entity. This update is effective for annual periods beginning after December 15, 2027, including interim periods within those annual reporting years, with early adoption permitted. The Group is currently evaluating the impact that the adoption of this standard will have on its consolidated financial statements and related disclosures.

Reclassification

Certain reclassifications have been made to our prior period’s financial statements to conform to our current period presentation. These reclassifications had no effect on our previously reported results of operations or retained earnings.

2. BUSINESS COMBINATION

New Classic Home Furnishings, Inc. (“New Classic”)

In January 2026, the Group completed its acquisition of New Classic, a U.S. based wholesaler primarily serving the domestic home furnishings market (the “Acquisition”). The Group acquired 100% of the outstanding equity of New Classic for total consideration of $18.7 million after net working capital adjustments, inclusive of a post-close earnout to be paid in 2027. The acquisition was completed on a debt free basis and was funded using cash on hand from operations. The acquisition of New Classic had no impact on the Group’s weighted-average shares as no shares were issued.

The following table summarizes the estimated fair value of the assets acquired and liabilities assumed as of the acquisition date:

The following table summarizes the consideration paid/payable for the New Classic acquisition as of the acquisition date:

The New Classic acquisition agreement includes an earnout provision requiring a $3.6 million payment to the seller upon achieving$60.0 million in net revenue within thetwelve-month period beginning after the closing of the Acquisition. The earnout will be paid on a pro-rated basis if net revenue falls between $50.7 million and $60.0 million, and will not be paid if net revenue falls below $50.7 million. Any such payments will be made to the Seller no later than April 15, 2027. The Group determined the fair value of the contingent payment to be $3.3 million, using a probability weighted scenario approach based on the aforementioned earnout provisions and discounting the potential payments to their present value.

The intangible assets acquired of $270 thousand consist of customer relationships (amortized over 10 years), which was measured at fair value following the income approach.

The carrying value of accounts receivable, prepayments and other current assets, and accounts payable approximate their fair value.

Goodwill of $314 thousand represents the excess purchase price over the estimated fair value assigned to tangible and identifiable intangible assets acquired and liabilities assumed. Goodwill is attributable to expected synergies from future growth.

Acquisition-related costs for New Classic were approximately $265 thousand. Acquisition-related costs were expensed as incurred and are included in general and administrative expenses within the unaudited condensed consolidated statements of comprehensive income.

3. FAIR VALUE MEASUREMENTS

The Group utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible. The Group determines fair value based on assumptions that market participants would use in pricing an asset or liability in the principal or most advantageous market. The carrying amounts for the Group’s accounts receivable, accounts payable and accrued liabilities approximate fair value due to their short-term maturities. When considering market participant assumptions in fair value measurements, the following fair value hierarchy distinguishes between observable and unobservable inputs, which are categorized in one of the following levels:

•Level 1 Inputs: Unadjusted quoted prices in active markets for identical assets or liabilities.

•Level 2 Inputs: Other than quoted prices included in Level 1 inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full-term of the asset or liability.

•Level 3 Inputs: Unobservable inputs for the asset or liability used to measure fair value to the extent that observable inputs are not available, thereby allowing for situations in which there is little, if any, market activity for the asset or liability at measurement date.

Certain non-financial assets and liabilities are measured at fair value on a nonrecurring basis, including property and equipment, intangible assets and goodwill. These assets are subject to fair value adjustments in certain circumstances, such as when there is evidence of an impairment or when an asset or disposal group is classified as held for sale.

The following table presents the valuation of the Group’s financial assets and liabilities as of March 31, 2026 measured at fair value on a recurring basis.

(1) Balance sheet caption is determined by the duration to maturity at date of purchase and whether the assets are restricted for particular use.

(2) Fair value is determined using broker quotes reflecting current market conditions.

(3) Fair value is determined by applying a probability weighted scenario approach and discounting potential payments to their present value.

Investments and Cash Equivalents

Investments and cash equivalents are measured at fair value on a recurring basis. As of March 31, 2026, investments in the unaudited condensed consolidated balance sheets include time deposits and U.S. treasury securities, with maturity of three months to 12 months.

All fixed income securities are classified as available-for-sale with unrealized gains and losses included in “accumulated other comprehensive income or loss”. The related unrealized gains (losses) recorded in accumulated other comprehensive income (loss) were $(5) thousand and $1 thousand as of March 31, 2026 and 2025. No realized gains or losses were recorded for the three months ended March 31, 2026 and 2025, respectively.

Acquisition-Related Contingent Consideration

Contingent consideration is related to the Group’s acquisition of New Classic (see Note 2). The Group determined the fair value of the contingent payment using a probability weighted scenario approach based on earnout provisions and discounting the potential payments to their present value. The probabilities of the various scenarios regarding whether the target revenue can be achieved are based on management's estimates, which cannot be observed in the market and thus represents a Level 3 measurement. Each period, the Group evaluates the fair value of acquisition-related contingent consideration liabilities and records any changes in the fair value of such liabilities in others, net in the Group’s consolidated statements of comprehensive income. Based on current forecasts, the Group determined achievement of the earnout target is probable. Changes in either the revenue estimates or the discount rate could result in a material change to the amount of contingent consideration accrued.

A reconciliation of the Group’s contingent consideration liabilities related to acquisitions for the three months ended March 31, 2026 is as follows:

4. ACCOUNTS RECEIVABLE, NET

Accounts receivable, net, consisted of the following:

The movement of the allowance for credit losses is as follows:

5. INVENTORIES

Inventories consisted of the following:

6. LEASES

The Group leases its office space, fulfillment centers and other facilities under non-cancellable operating leases with various expiration dates. The Group also has equipment that is leased under non-cancellable finance leases. The Group considers various factors such as market conditions and the terms of any renewal options that may exist to determine whether it will renew or replace the lease. In the event the Group is reasonably certain to exercise the option to extend a lease, the Group will include the extended terms in the operating lease right-of-use asset and operating lease liability. Certain forklifts used in the fulfillment centers are leased under finance leases, which have a fixed lease term ofone tofive years from the lease commencement dates. Leases with an initial term of 12 months or less are not recorded on the balance sheet; the Group recognizes lease expense for these leases on a straight-line basis over the lease term.

The gross amounts of assets and liabilities related to both operating and finance leases are as follows:

The components of lease cost are as follows:

Lease terms and discount rates are as follows:

Future minimum lease payments as of March 31, 2026, including rental payments for lease renewal options the Group is reasonably certain to exercise, were as follows:

7. ORDINARY SHARES

Share Repurchases

In the three months ended March 31, 2026, the Group repurchased a total of 304,321 Class A ordinary shares at an average price of $40.27, totaling approximately $12.3 million. Direct and incremental costs incurred in relation to the repurchases were $12 thousand. Under existing repurchase plans authorized by our Board of Directors, $77.4 million remain available for Class A ordinary share repurchases as of March 31, 2026.

The following table presents the shares of treasury shares repurchased and reissued:

8. SHARE-BASED COMPENSATION

Restricted share units (the “RSU”)

A summary of the Company’s share-based compensation activities for the three months ended March 31, 2026 is presented below:

Compensation expenses recognized in connection with RSUs are allocated to the following expense items.

9. INCOME TAX

The Company’s provision for income taxes for the three months ended March 31, 2026 and 2025 was $7.8 million, and $5.4 million respectively, representing effective income tax rates of 17.0% and 16.5%, respectively. The difference between the U.S. federal income tax rate of 21.0% and the Group’s overall income tax rate was primarily due to a lower effective tax rate on foreign earnings.

10. NET INCOME PER ORDINARY SHARE

The following table sets forth the basic and diluted net income per ordinary share computation and provides a reconciliation of the numerator and denominator for the periods presented:

For the three months ended March 31, 2026 and 2025, the potential dilutive securities that have been included in the calculation of diluted net income per ordinary share are presented as follow:

11. REVENUES

The Group’s revenues are disaggregated by major products/service lines and timing of revenue recognition. Detailed information is specified as follows:

Contract Liabilities

Changes in the contract liabilities balances for the three months ended March 31, 2026 and 2025 are as follows:

Contract liabilities relate to considerations received in advance for merchandise sales and services provided for which control of the services occur at a later point in time. The contract liabilities will be recognized as revenue when the Group fulfills its performance obligations to transfer the promised products or services to customers, which is expected to occur withinone year.

The Group has elected the practical expedient under ASC 606-10-50-14(a) not to disclose information regarding remaining performance obligations which are part of contracts that have an original expected duration of one year or less.

12. COMMITMENTS AND CONTINGENCIES

The Group leases offices and fulfillment centers under non-cancelable operating lease agreements. Future minimum lease payments under these noncancelable lease agreements with initial terms longer than twelve months are disclosed as maturity of lease liabilities in Note 6.

The Group had no other material commitments or long-term obligations as of March 31, 2026.

13. SUBSEQUENT EVENTS

Subsequent to March 31, 2026, the Group executed a series of share repurchase transactions under a Rule 10b5-1 plan. As of May 7, 2026, the Group repurchased a total of 200,628 Class A ordinary shares at an average price of $44.98, totaling approximately $9.0 million. Direct and incremental costs incurred in relation to the repurchases were $8 thousand.