Revenue and Profitability - For Q1 2025, Cheetah reported revenue of $479,799 from logistics and warehousing services, with TWEW contributing $417,284 (87.0%) and Edward contributing $62,515 (13.0%) [3] - Revenue from Edward decreased by 18.6% due to reduced international trade flow resulting from U.S.-China trade tensions [3] - The company reported a gross profit of $56,256 for Q1 2025, with a cost of revenue of $423,543 [4] - Cheetah experienced a net loss of $753,909 in Q1 2025, compared to a net loss of $608,930 in the same period of 2024 [9] - For the three months ended March 31, 2025, Cheetah Net Supply Chain Service Inc. reported a net loss of $753,909, compared to a net loss of $608,930 for the same period in 2024, indicating an increase in losses of approximately 23.8% [30] - Cheetah Net Supply Chain Service Inc. reported a loss from continuing operations of $753,909 for the three months ended March 31, 2025, compared to a loss of $466,348 for the same period in 2024, reflecting an increase of about 61.5% [30] Expenses and Financial Position - General and administrative expenses increased by $0.2 million, or 30.3%, to $1.0 million compared to Q1 2024, primarily due to increased personnel-related expenses and new office space [5] - Interest income surged to $208,090 in Q1 2025, up 619.3% from $28,930 in Q1 2024, driven by interest on short-term loans and certificates of deposit [8] - The company incurred share-based compensation expenses of $16,185 for the three months ended March 31, 2025, while there were no such expenses reported for the same period in 2024 [30] - The company reported depreciation expenses of $9,882 for the three months ended March 31, 2025, compared to $2,171 for the same period in 2024, showing a significant increase of approximately 354.5% [30] Assets and Liabilities - As of March 31, 2025, total current assets were $10.2 million, with cash and cash equivalents at $0.3 million and loan receivables at $9.1 million [13] - The company had total stockholders' equity of $11.9 million as of March 31, 2025, down from $12.6 million at the end of 2024 [16] - Cheetah's current liabilities totaled approximately $0.9 million, primarily related to operating lease liabilities and other payables [13] - The balance of stockholders' equity as of March 31, 2025, was $11,879,948, a decrease from $12,617,672 as of December 31, 2024, indicating a decline of approximately 5.9% [27] - Cheetah Net Supply Chain Service Inc. had a total accumulated deficit of $(5,434,520) as of March 31, 2025, compared to $(4,680,611) as of December 31, 2024, reflecting an increase in the deficit of approximately 16.1% [27] Cash Flow and Investment Activities - The cash provided by operating activities for discontinued operations was $2,540,500 for the three months ended March 31, 2025, compared to $3,166,058 in the same period of 2024, reflecting a decrease of about 19.7% [30] - The total cash used in investing activities for the three months ended March 31, 2025, was $3,026,400, significantly higher than $47,617 used in the same period of 2024 [30] - Cheetah Net Supply Chain Service Inc. reported cash and cash equivalents of $324,142 at the end of March 31, 2025, down from $903,204 at the end of March 31, 2024, representing a decrease of approximately 64.1% [30] Future Outlook - The company plans to seek new business opportunities and improve operational efficiencies to position itself for future growth despite current challenges [2] - The fair value of common stock issued for acquisition was reported as $1,700,000 in the previous year, indicating ongoing investment activities [30]

Core Insights - Cheetah Net Supply Chain Service Inc. has shifted its focus from parallel-import vehicle sales to logistics and warehousing services due to challenging market conditions in China and trade tensions with the U.S. [2][3] - The company reported a significant decline in sales volume in the parallel-import vehicle segment, leading to the discontinuation of this business line [2][3] - The logistics and warehousing segment generated $479,799 in revenue for Q1 2025, with TWEW contributing 87% of this revenue [3][4] Recent Highlights - The parallel-import vehicle business faced a significant downturn, prompting the board to approve its discontinuation [2] - The company is focusing on operational efficiencies and expanding service offerings to position itself for future growth [2] - The newly acquired subsidiary TWEW outperformed the earlier acquisition, Edward Transit Express Group, indicating a positive shift in business strategy [2] Financial Performance - For Q1 2025, total revenue was $479,799, with a gross profit of $56,256 [3][4] - General and administrative expenses increased by 30.3% to $1.0 million, primarily due to hiring and operational expansions [5] - Interest income surged to $208,090, a 619.3% increase compared to the same period in 2024, driven by interest on short-term loans and certificates of deposit [7] Losses and Discontinued Operations - The company reported a net loss of $753,909 for Q1 2025, compared to a net loss of $608,930 in Q1 2024 [8][10] - The discontinued parallel-import vehicle business generated $1.4 million in revenue in Q1 2024 but incurred a gross loss of $9,283 [9][10] Liquidity and Cash Flow - As of March 31, 2025, current assets totaled $10.2 million, with cash and cash equivalents at $0.3 million [12] - The company reported net cash flow of $1.8 million from operating activities for Q1 2025 [13] - Total stockholders' equity decreased to $11.9 million from $12.6 million as of December 31, 2024 [13]

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2025 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number: 001-41761 Cheetah Net Supply Chain Service Inc. (Exact name of registrant as specified in its charter) North Carolina 81-350 ...

Discontinued Operations - The Company's sales from discontinued operations in the parallel-import vehicle segment declined by 95.7% to $1.6 million in 2024, down from $38.3 million in 2023[14]. - The net loss from discontinued operations was approximately $2.0 million in 2024, compared to a net income of $1.8 million in 2023, reflecting the impact of ceasing the parallel-import vehicle business[18]. - The company experienced a cash inflow from discontinued operations of $3,698,138, down from $7,257,146 in 2023[33]. Continuing Operations - Total revenues for the continuing operations in logistics and warehousing amounted to $455,805 in 2024, following the acquisition of Edward Transit Express Group[7]. - The Company reported a gross profit of $178,512 for its continuing operations in 2024, with a cost of revenues of $277,293[7]. - General and administrative expenses for continuing operations increased by 66.3% to $3.6 million in 2024, up from $2.2 million in 2023[8]. - Interest income for continuing operations surged by 3,124.7% to $320,472 in 2024, compared to $9,938 in 2023[10]. - The Company incurred a total net loss of $5.2 million for the year ended December 31, 2024, compared to a net income of $0.1 million in 2023[18]. - The company reported a loss from continuing operations of $3,232,194 in 2024, compared to a loss of $1,711,885 in 2023[27]. Financial Performance - Total revenue for 2024 was $455,805, compared to no revenue reported in 2023[27]. - Gross profit for 2024 was $178,512, with a cost of revenue of $277,293[27]. - Operating expenses increased significantly to $3,919,058 in 2024 from $2,190,513 in 2023, representing a 79% increase[27]. - The net loss for 2024 was $5,188,852, compared to a net income of $133,870 in 2023[27]. - Total assets increased to $15,379,454 in 2024 from $10,059,265 in 2023, marking a 53% growth[25]. - Total liabilities decreased to $2,761,782 in 2024 from $3,154,637 in 2023, a reduction of approximately 12%[25]. - Stockholders' equity rose to $12,617,672 in 2024, up from $6,904,628 in 2023, indicating an increase of 83%[25]. Cash Flow and Financing - Cash used in operating activities from continuing operations was $3,455,918, an increase from $1,646,921 in the previous year[33]. - The company generated net cash provided by operating activities of $242,220, down from $5,610,225 in 2023[33]. - Cash used in investing activities amounted to $6,130,932, significantly higher than $672,500 in the prior year[33]. - The company raised $7,309,120 from a follow-on public offering in May 2024 and $1,093,556 in July 2024[33]. - Net cash provided by financing activities was $7,106,676, compared to a net cash used of $4,563,108 in 2023[33]. - The ending cash balance for continuing operations increased to $1,650,962 from $432,998 in the previous year[33]. - The company paid $2,000 in income taxes, a decrease from $74,533 in 2023[33]. - The fair value of common stock issued for acquisition was $1,700,000, with no comparable figure in the previous year[33]. Acquisitions and Growth - The Company acquired TWEW for $1.0 million in December 2024, aiming to expand its logistics services in the western region[11]. - The company completed several stock issuances, including a follow-on public offering that raised approximately $8,402,656 in total[30]. - The weighted average shares outstanding increased to 1,955,214 in 2024 from 1,073,945 in 2023[27]. - The Company plans to seek additional equity financing if necessary to sustain growth and meet future liquidity requirements[22].

Core Viewpoint - Cheetah Net Supply Chain Service Inc. faced significant challenges in 2024 due to deteriorating market conditions in China, leading to a strategic shift from parallel-import vehicle sales to logistics and warehousing services, resulting in a total net loss of $5.2 million for the year [4][19]. Financial Performance - The company's total revenues from continuing operations were $455,805 for the year ended December 31, 2024, with a gross profit of $178,512 [9][28]. - Net losses from continuing operations were $3.2 million, compared to $1.7 million in 2023 [14][28]. - The company reported a gross loss of $24,820 from discontinued operations, a significant decline from a gross profit of $4.2 million in 2023 [16]. Discontinued Operations - Sales from the discontinued parallel-import vehicle business plummeted by 95.7% to $1.6 million in 2024 from $38.3 million in 2023 [15]. - The cost of revenues from discontinued operations decreased by 95.0% to $1.7 million in 2024, aligning with the sales downturn [15]. - The net loss from discontinued operations was approximately $2.0 million in 2024, compared to a net income of $1.8 million in 2023 [19]. Strategic Initiatives - The company acquired Edward Transit Express Group, Inc. for $1.5 million in February 2024 and TWEW for $1.0 million in December 2024 to expand its logistics and warehousing capabilities [6][9]. - Cheetah relocated its headquarters to Irvine, CA, to enhance its focus on logistics and warehousing, benefiting from proximity to major ports [6][9]. Shareholder Actions - The company completed a public offering of 404,979 shares at $3.68 per share in July 2024, generating net proceeds of $1.1 million [9]. - A reverse stock split at a ratio of 1-for-16 was approved and took effect on October 21, 2024, impacting the trading of its Class A common stock [9][26]. Liquidity and Cash Flow - As of December 31, 2024, the company had current assets of $11.0 million, including cash and cash equivalents of $1.7 million [20]. - The company reported cash flow of $0.2 million from operating activities, $6.1 million used in investing activities, and $7.1 million provided by financing activities during the year [21][33].

Financial Performance - The company reported a net loss of $5.2 million for the year ended December 31, 2024, primarily due to the wind-down of the discontinued parallel-import vehicle operations and increased operating expenses associated with the transition to logistics and warehousing services [195]. - Total revenue from continuing operations was $455,805 in 2024, reflecting the company's shift to logistics and warehousing services after discontinuing the parallel-import vehicle business [194]. - The company experienced a 95.7% drop in revenue from parallel-import vehicle sales, decreasing from $38.3 million in 2023 to $1.6 million in 2024 [183]. - The company recorded a loss from discontinued operations of approximately $2.0 million in 2024, compared to income of $1.8 million in 2023 [196]. - The net loss from continuing operations was $3.2 million in 2024, compared to a net loss of $1.7 million in 2023 [207]. - Revenue from discontinued operations fell to $1.6 million in 2024, a decrease of 95.7% from $38.3 million in 2023, due to the exit from the parallel-import vehicle business [210]. - Total cost of revenue for discontinued operations decreased by 95.0% to $1.7 million in 2024, down from $34.1 million in 2023 [211]. - Gross loss for discontinued operations was $24,820 in 2024, compared to a gross profit of $4.2 million in 2023, reflecting a decline of 100.6% [212]. - Total selling, general, and administrative expenses for discontinued operations increased by 175.8% to $1.8 million in 2024, driven by credit losses and forfeited vehicle deposits [213]. - Net cash provided by operating activities from discontinued operations was $3.7 million in 2024, down from $7.2 million in 2023 [225]. Operational Changes - The company relocated its headquarters from Charlotte, NC, to Irvine, CA, to enhance focus on logistics and warehousing operations [186]. - The company acquired TWEW in December 2024 to further expand its logistics services [186]. - The company is actively integrating TWEW's operations to strengthen its position in the logistics sector [187]. - The Company depleted its inventory of vehicles by the first quarter of 2024, with the entire inventory balance of $1,515,270 as of December 31, 2023, reclassified to discontinued operations [263]. - As of December 31, 2023, the Company operated as a single reportable segment focused on parallel-import vehicles, but transitioned back to a single segment focused on logistics and warehousing services by December 31, 2024 [257]. Expenses and Income - General and administrative expenses increased by $1.4 million (66.3%) to $3.6 million in 2024, driven by higher personnel-related expenses and costs associated with the acquisitions [200]. - Interest income from continuing operations increased to $320,472 in 2024, up from $9,938 in 2023, representing a growth of 3,124.7% [204]. - Total interest expenses decreased by 14.2% to $35,951 in 2024, down from $41,883 in 2023, primarily due to reduced credit card interest [205]. - General and administrative expenses for continuing operations were $3,641,713 in 2024, compared to $2,190,513 in 2023 [243]. - For the year ended December 31, 2024, total selling expenses for the discontinued parallel-import vehicle business were $117,819, down from $668,172 in 2023 [242]. Acquisitions and Intangible Assets - The Company recorded intangible assets from the acquisitions of Edward and TWEW during the year ended December 31, 2024 [264]. - There was no impairment recognized for intangible assets for the year ended December 31, 2024 [265]. - Goodwill is tested for impairment at the reporting unit level, with no impairment recorded as of December 31, 2024 [272]. Future Plans and Reporting - The Company intends to adopt ASU 2023-07 regarding segment reporting in its Annual Report for the year ending December 31, 2025 [276]. - The Company plans to adopt ASU 2023-09 concerning income tax disclosures in its Annual Report for the year ending December 31, 2025 [277]. Fair Value and Impairment - The Company applies a three-level fair value hierarchy for measuring fair value, with Level 1 being quoted prices for identical assets in active markets [269]. - The Company reviews its intangible assets for impairment whenever events indicate that the carrying amount may not be recoverable [264]. - The Company recognizes lease liabilities and right-of-use assets in accordance with FASB ASC No. 842 [271]. - The fair value of the Company's financial instruments approximated the fair value of the respective assets and liabilities as of December 31, 2024 and 2023 [266]. - The Company did not record any impairment for long-lived assets for the years ended December 31, 2024 and 2023 [275].

Acquisition Announcement - Cheetah Net Supply Chain Service Inc. has executed definitive agreements for the acquisition of TW & EW Services Inc., a California-based labor and logistics service provider, expected to close on or about December 4, 2024 [1][2] - The total cost of the acquisition includes a cash payment of $200,000 and share consideration valued at $800,000, with a per-share price of $1.704 [2] Strategic Implications - The acquisition is anticipated to strengthen Cheetah's position in the logistics sector by integrating TW & EW's expertise in general labor and logistics support services, which will streamline operations and create additional value for stakeholders [3] - Cheetah aims to capitalize on additional service opportunities and enhance service delivery to both current and future customers following the integration of TW & EW [3] Company Background - Cheetah Net is a provider of logistics and warehousing services, originally focused on the sale of parallel-import vehicles to the PRC market, and has transitioned towards broader logistics services in response to market challenges [4] - Established in 2016, Cheetah expanded its footprint in the logistics and warehousing industry in February 2024, demonstrating a commitment to adapting to evolving market conditions [4]

Revenue Performance - For Q3 2024, Cheetah generated $61,208 in revenue from logistics and warehousing, a decrease of $9.9 million or 99.4% compared to $10.0 million in Q3 2023[8] - For the nine months ended September 30, 2024, revenues were $1.9 million, down $30.6 million or 94.3% from $32.5 million in the same period of 2023[13] - Total revenues for the three months ended September 30, 2024, were $61,208, a significant decrease from $10,038,246 in the same period of 2023[24] Profitability - Gross profit for Q3 2024 decreased by approximately $1.1 million or 97.4%, with a gross margin increase from 11.6% in Q3 2023 to 48.8% in Q3 2024[9] - The company reported a gross profit of $87,348 for the nine months ended September 30, 2024, a decrease of approximately $3.5 million or 97.5% from $8.9 million in the same period of 2023[14] - Gross profit for the nine months ended September 30, 2024, was $87,348, compared to $3,562,786 for the same period in 2023, indicating a decline in profitability[24] Net Income and Loss - The net loss for Q3 2024 was $1.8 million, compared to a net income of $0.1 million in Q3 2023[12] - The net loss for the nine months ended September 30, 2024, was $3,037,102, compared to a net income of $170,715 for the same period in 2023[27] Expenses - General and administrative expenses rose to $1.1 million in Q3 2024, an increase of $0.6 million or 108.0% from $0.5 million in Q3 2023[10] - Operating expenses for the nine months ended September 30, 2024, totaled $4,210,029, compared to $2,279,743 for the same period in 2023[24] Cash and Liquidity - As of September 30, 2024, Cheetah had cash and cash equivalents of $5.3 million and working capital of approximately $11.6 million[20] - Cash and cash equivalents rose to $5,287,376 as of September 30, 2024, compared to $432,998 at the end of 2023[26] - The company experienced a net increase in cash of $4,854,378 for the nine months ended September 30, 2024[27] - Management believes that current measures will provide sufficient liquidity to meet future capital requirements for at least 12 months from the issuance date of its consolidated financial statements[22] Equity and Financing - The allowance for credit loss of accounts receivable was $1.1 million for the nine months ended September 30, 2024, compared to nil for the same period in 2023[16] - The company plans to seek additional equity financing if necessary to sustain continued growth and implement its business plan[22] - Total stockholders' equity increased to $13,953,743 as of September 30, 2024, from $6,904,628 at the end of 2023[26] - Total current assets increased to $12,418,881 as of September 30, 2024, from $9,820,537 as of December 31, 2023[26]

Core Insights - Cheetah Net Supply Chain Service Inc. is undergoing a significant business transformation from a parallel-import vehicle business to a logistics and warehousing model, driven by the downturn in the Chinese economy and the need to capitalize on U.S.-China trade flows [7] Company Updates - The company relocated its headquarters from Charlotte, NC to Irvine, CA to better align with its new business model and access the Southern California market [2] - A public offering of 404,979 shares at $3.68 per share was completed, generating net proceeds of $1.1 million for working capital and corporate purposes [3] - The board approved an Amended and Restated 2024 Stock Incentive Plan, leading to stock awards totaling 150,000 shares and share-based compensation expenses of $261,666 for Q3 2024 [4] - A reverse stock split at a ratio of 1-for-16 was approved and took effect on October 21, 2024, with trading on a post-split basis starting October 24, 2024 [5][6] Financial Performance - Q3 2024 revenue was $61,208, a decrease of $9.9 million or 99.4% compared to $10.0 million in Q3 2023, primarily due to the decline in the parallel-import vehicle business [8] - Gross profit for Q3 2024 decreased by approximately $1.1 million or 97.4%, but gross margin improved from 11.6% in Q3 2023 to 48.8% in Q3 2024 [9] - General and administrative expenses increased by $0.6 million or 108.0% to $1.1 million in Q3 2024, driven by personnel-related and rental expenses for the new logistics segment [10] - A credit loss allowance of $1.1 million was recorded for accounts receivable, reflecting overdue balances from the parallel-import vehicle business [11] - The net loss for Q3 2024 was $1.8 million, compared to a net income of $0.1 million in Q3 2023 [12] Nine-Month Financial Results - Revenues for the nine months ended September 30, 2024, were $1.9 million, down 94.3% from $32.5 million in the same period in 2023, largely due to the decline in the parallel-import vehicle business [13] - Gross profit for the nine months decreased by approximately $3.5 million or 97.5%, with a gross margin of 11.0% compared to 4.7% in the prior year [14] - General and administrative expenses rose by $1.0 million or 63.2% to $2.7 million, attributed to increased personnel and operational costs [15] - The net loss for the nine months was $3.0 million, compared to a net income of $0.2 million in the same period of the previous year [19] Liquidity and Cash Flow - As of September 30, 2024, the company had cash and cash equivalents of $5.3 million and working capital of approximately $11.6 million [20] - Cash provided by operating activities was $0.6 million for the nine months ended September 30, 2024, with total stockholders' equity at $14.0 million [21] - The company is focused on improving liquidity through operational cash generation and may seek additional equity financing if necessary [22]

Financial Performance - Total revenues for the three months ended September 30, 2024, were $61,208, a significant decrease from $10,038,246 for the same period in 2023, representing a decline of approximately 99.4%[8] - Gross profit for the three months ended September 30, 2024, was $29,869, compared to $1,167,360 for the same period in 2023, indicating a decrease of about 97.4%[8] - The company reported a net loss of $1,815,292 for the three months ended September 30, 2024, compared to a net income of $122,903 for the same period in 2023, reflecting a negative swing of approximately 1,572%[8] - Operating expenses for the three months ended September 30, 2024, totaled $2,478,771, compared to $714,150 for the same period in 2023, reflecting an increase of approximately 248.5%[8] - For the nine months ended September 30, 2024, the net loss was $3,037,102 compared to a net income of $170,715 for the same period in 2023[14] - Revenues for the nine months ended September 30, 2024, were $1.9 million, compared to $32.5 million for the same period in 2023, representing a decrease of $30.6 million, or 94.3%[174] - The company reported a net loss of $3.0 million for the nine months ended September 30, 2024, compared to a net income of $0.2 million for the same period in 2023[197] Assets and Liabilities - Total current assets increased to $12,418,881 as of September 30, 2024, up from $9,820,537 as of December 31, 2023, marking an increase of about 26.3%[6] - Total liabilities decreased to $2,874,412 as of September 30, 2024, down from $3,154,637 as of December 31, 2023, representing a reduction of approximately 8.8%[6] - The company’s total stockholders' equity increased to $13,953,743 as of September 30, 2024, compared to $6,904,628 as of December 31, 2023, indicating an increase of about 102.5%[6] - The company had cash and cash equivalents of $5,287,376 as of September 30, 2024, a substantial increase from $432,998 as of December 31, 2023[6] - Accounts receivable as of September 30, 2024, totaled $3,291,450, down from $6,494,695 as of December 31, 2023, reflecting a decrease in outstanding balances[66] - As of September 30, 2024, total loans receivable amounted to $3,058,295, a significant increase from $672,500 on December 31, 2023, reflecting a growth of approximately 354%[70] Revenue Sources - Revenue from the U.S. domestic market for parallel-import vehicles was $1,244,615 for the three months ended September 30, 2023, while there was no revenue reported for the same period in 2024[50] - The overseas market generated $8,793,631 in revenue for the three months ended September 30, 2023, with $1,430,951 for the nine months ended September 30, 2024, indicating a decrease in performance[50] - The logistics and warehousing segment reported $36,860 in revenue for the three months ended September 30, 2024, compared to no revenue in the same period of 2023[51] - The company generated revenue of $231,605 from logistics and warehousing services for the nine months ended September 30, 2024, following the acquisition of Edward in February 2024[185] Expenses and Costs - General and administrative expenses increased by $572,365, or 108.0%, to $1.1 million for the three months ended September 30, 2024, primarily due to increases in personnel-related and rental expenses[164] - Selling expenses decreased to approximately $117.8 million for the nine months ended September 30, 2024, from $603.2 million for the same period in 2023, a reduction of $485.4 million, or 80.5%[187] - The total cost of revenues for the three months ended September 30, 2024, was $31,339, representing a significant decrease compared to the previous year[164] - Total cost of revenue from parallel-import vehicles sold decreased by $27.3 million, or 94.3%, to $1.7 million for the nine months ended September 30, 2024, from $28.9 million for the same period in 2023[180] Shareholder Equity and Stock - The company raised $8,402,676 from a follow-on public offering, contributing to a net increase in cash of $4,854,378 for the period[14] - The company approved the grant of 45,938 shares of Class A common stock and 31,250 shares of Class B common stock to the CEO, which vested immediately[107] - As of September 30, 2024, the Company had 1,960,218 shares of Class A common stock and 546,875 shares of Class B common stock issued and outstanding[131] Credit and Loans - The company incurred share-based compensation expenses of $261,666 during the nine months ended September 30, 2024[14] - The company provided an unsecured short-term loan of $500,000 on December 11, 2023, with an interest rate increase from 12.0% to 18.0% upon maturity extension[71] - The company extended a short-term loan of $1,500,000 to Hongkong Sanyou Petroleum Co. Limited under the same terms as a previous loan of $1,000,000[72] Tax and Regulatory - The effective income tax rate for the three months ended September 30, 2024, was 23.6%, compared to 26.4% for the same period in 2023[114] - Total deferred tax assets as of September 30, 2024, were $1,548,590, significantly increased from $47,905 as of December 31, 2023[115] - Income tax benefits were $0.6 million for the three months ended September 30, 2024, compared with an income tax provision of approximately $44,217 for the same period in 2023[173] Market Conditions - The ongoing military conflicts and inflation may adversely affect the company's liquidity, business, financial condition, and results of operations[160] - The company is experiencing changes in consumer demand in the Chinese market towards fuel-efficient vehicles and EVs, which may negatively impact vehicle sales volumes[160] Acquisitions - The company acquired Edward Transit Express Group Inc. in February 2024 to expand logistics and warehousing operations and relocated its headquarters to Irvine, CA, in July 2024[147] - The acquisition of Edward was completed on February 2, 2024, for a total purchase price of $1,500,000, which included a cash payment of $300,000 and the issuance of shares valued at $9 million[128]