Financial Performance - For the fiscal year ending December 31, 2022, the company's total revenue was $10.5 million, a decrease from $32.1 million in 2021 and $26.7 million in 2020[290]. - Revenue from application development services represented 36.7% of total revenue in fiscal 2022, down from 82.5% in fiscal 2020[290]. - The company incurred R&D expenses of approximately $3.46 million, $2.61 million, and $2.78 million in fiscal years 2022, 2021, and 2020, respectively[377]. - The sales and marketing expenses were approximately $2.0 million, $2.8 million, and $2.7 million for fiscal years 2022, 2021, and 2020, representing 18.7%, 8.6%, and 10.0% of total revenues for those years[373]. IPO and Funding - The company raised approximately $10.06 million in gross proceeds from its IPO, including $1.31 million from the over-allotment option[276]. - Powerbridge has utilized a portion of its IPO proceeds to accelerate R&D for its BaaS Services, aiming to drive product adoption and capture significant market share[343]. Market Trends - The global trade management software market is projected to grow from $334.5 million in 2019 to $416.23 million by 2024[295]. - The blockchain technology market size surpassed $488 million in 2018 and is expected to grow at a CAGR of over 69% from 2019 to 2025[296]. Employee and Organizational Structure - The company has a total of 177 full-time employees, with 90 in research and development[291]. - The company has a total of 177 full-time employees, with 90 in R&D, 17 in sales and marketing, 38 in technical and customer services, and 32 in general administration[389]. Strategic Initiatives - The company plans to leverage disruptive technologies to enhance its core technology capabilities and expand its solutions and services[289]. - The company intends to pursue strategic acquisitions and investments to enhance technology capabilities and increase market penetration[300]. - The company aims to expand into international markets by leveraging opportunities from China's Belt & Road Initiative[299]. - The company plans to expand its market coverage to international markets, targeting customers in different Belt and Road countries[371]. - The company aims to leverage strategic partnerships with government agencies and technology organizations to drive sales and market presence[375]. Product and Service Development - Powerbridge SaaS Services were introduced in 2016 and are designed to provide significant operational benefits to customers[282]. - Powerbridge BaaS Services aim to enhance workflow performance, reduce document handling, and optimize information exchange, providing significant improvements in productivity and efficiency[340]. - The Powerbridge BaaS Services include Compliance Blockchain Services and Supply Chain Blockchain Services, designed to improve operational efficiency and reduce trade costs[333]. - The Powerbridge BaaS Platform is being developed using the open-source Hyperledger Fabric framework, ensuring high scalability and performance[355]. - The company is developing its Inward Processed Manufacturing Cloud services to streamline logistics and compliance operations for inward processed manufacturing companies[327]. - Powerbridge's Trade Zone Operations Cloud is designed to help businesses and authorities manage operations in regulated bonded and free trade zones effectively[324]. Technology and Innovation - The company is leveraging big data technologies to process and analyze large volumes of global trade transaction data, enhancing compliance and logistics services[357]. - Artificial intelligence applications are being developed to support biometric recognition and optimize logistics processes in global trade[359]. - The company plans to enhance machine learning capabilities to improve efficiency in matching trade logistics services among businesses[361]. Compliance and Regulatory Environment - The company does not engage in information systems integration business and is not required to obtain qualification certificates from the Ministry of Industry and Information Technology[397]. - The company must comply with local minimum wage standards and may face fines for violations of the Labor Law and Labor Contract Law[399]. - Dispatched workers are entitled to equal pay as full-time employees for equal work, and the number of dispatched workers cannot exceed 10% of the total number of employees[400]. - Employers are required to participate in employee benefit plans, including social insurance funds, and may face penalties for non-compliance[401]. - PRC residents must register with SAFE for overseas investments, and failure to comply may result in fines up to RMB 300,000 for organizations[410]. Currency and Economic Factors - The company's functional currency is RMB, while financial statements are presented in U.S. dollars, affecting reported financial results[731]. - The RMB appreciated by 6.3% in fiscal year 2020 and further appreciated by 2.3% in fiscal year 2021, but depreciated by 8.2% in fiscal year 2022[732]. - The appreciation of RMB against the U.S. dollar negatively impacts the amount received from currency conversion for capital expenditures and working capital[733]. - The appreciation of the U.S. dollar against RMB negatively affects the dollar amount available for dividends, strategic acquisitions, or investments[733]. - Inflation in China has shown year-over-year changes in the consumer price index of 2.6% in 2020, 1.5% in 2021, and 2.0% in 2022[734]. - The company has not been materially affected by inflation historically, but future higher inflation rates in China may impact operations[734].
X3 Holdings(XTKG) - 2022 Q4 - Annual Report