iPower (IPW) - 2025 Q1 - Quarterly Report

Financial Performance - Revenues for the three months ended September 30, 2024 decreased 28.3% to $19,008,521 compared to$26,508,374 for the same period in 2023[195] - Gross profit was $8,487,897 for the three months ended September 30, 2024, with a gross profit ratio of 45.7$11,234,331 for the three months ended September 30, 2024, primarily due to reduced selling and fulfillment expenses[199] - Loss from operations increased to $2,746,434 for the three months ended September 30, 2024, compared to$1,268,677 for the same period in 2023[200] - Net loss attributable to iPower Inc. for the three months ended September 30, 2024 was $2,029,281, an increase of 57.7$1,286,515 in the same period in 2023[202] - Comprehensive loss attributable to iPower Inc. for the three months ended September 30, 2024 was $2,084,335, representing a 61.9$1,287,222 in the same period in 2023[203] Cash Flow and Liquidity - Cash and cash equivalents as of September 30, 2024 were $2,577,305, a decrease of$4,800,532 from $7,377,837 as of June 30, 2024[205] - Net cash used in operating activities for the three months ended September 30, 2024, was$(1,415,643), a significant decrease from $4,052,341 in the same period of 2023[210] - Net cash used in investing activities increased to$202,140 for the three months ended September 30, 2024, compared to $0 in 2023, due to prepayments for software developments[212] - Net cash used in financing activities decreased to$3,308,599 for the three months ended September 30, 2024, down from $5,075,000 in 2023, primarily due to reduced payments on the revolving loan[212] Investments and Strategic Plans - The company plans to increase investments in product and brand development and is actively evaluating potential acquisition opportunities[186] Inventory and Supply Chain - Supply chain disruptions due to global economic factors have impacted inventory purchasing speed and increased costs, affecting profitability[188] Working Capital and Financial Position - As of September 30, 2024, working capital was$12.2 million, an increase from $11.2 million as of June 30, 2024[209] - The company anticipates that historical trends in working capital will remain stable for the foreseeable future[209] - The company does not have any off-balance sheet arrangements that could materially affect its financial condition[213] Goodwill and Intangible Assets - Goodwill balance remained unchanged at$3,034,110 as of September 30, 2024, with no impairment noted during the analysis[229] - Intangible assets include a covenant not to compete, supplier relationships, and software, amortized over useful lives ranging from 5 to 10 years[230] Credit Losses and Tax Positions - The company recorded an additional allowance for credit losses of approximately $1.5 million for the quarter ended September 30, 2024, due to the collectability of certain receivables from Amazon[221] - The company believes its income tax filing positions will be sustained on audit, with no material changes anticipated to its financial position[236]