Revenue Performance - For the three months ended September 30, 2025, the company reported net revenues of $5,407,677, a 162.77% increase from $2,057,935 in the same period of 2024[160]. - Net revenues increased by $3,349,742, or 162.77%, from $2,057,935 in 2024 to $5,407,677 in 2025, primarily driven by an increase in revenue from property purchases[176]. - Net revenues for the nine months ended September 30, 2025, were $15,916,659, an increase of $10,494,875, or 193.57% from $5,421,784 in 2024[202]. Cash Offer Program - Revenue from property purchases and sales through the Cash Offer program accounted for 95.85% of net revenues in Q3 2025, up from 81.15% in Q3 2024, with a revenue increase of $3,513,272, or 210.38%[162]. - The company aims to expand its Cash Offer program, which is currently funded by investments from the CEO and shareholders, to enhance revenue growth and profitability over time[142]. - Revenue from property purchases and sales through Cash Offer accounted for 96.40% of net revenues in 2025, increasing by $10,732,718, or 232.79% from $4,610,544 in 2024[188]. Real Estate Services - Real estate service revenue decreased by $163,530, or 42.15%, from $387,935 in Q3 2024 to $224,405 in Q3 2025, primarily due to declines in property management service revenue and real estate agency commissions[164]. - Real estate service revenue decreased by $237,843, or 29.32%, from $811,240 in 2024 to $573,397 in 2025[189]. - Real estate agency commission decreased by $100,741, or 33.60%, from $229,789 for the three months ended September 30, 2024, to $199,048 for the same period in 2025[165]. Costs and Expenses - Cost of revenues increased by $3,648,273, or 234.87%, from $1,553,307 in 2024 to $5,201,580 in 2025, primarily due to higher costs associated with increased revenue from property purchases[179]. - General and administrative expenses increased by $102,874, or 110.40%, from $93,185 in 2024 to $196,059 in 2025, driven by higher legal, payroll, and rent expenses[184]. - Selling expenses decreased by $8,962, or 93.59%, from $9,576 in 2024 to $614 in 2025, due to consistent marketing efforts[183]. Profitability - Gross profit decreased by $298,531, or 59.16%, from $504,628 in 2024 to $206,097 in 2025, with a gross margin of 3.84% compared to 24.52% in 2024[180]. - Gross profit for the nine months ended September 30, 2025, was $577,556, a decrease of $310,238, or 34.94% from $887,794 in 2024[205]. - Net income for the three months ended September 30, 2025, was $(305), a decrease of $284,414, or 100.11% compared to $284,109 in 2024[187]. Cash Flow and Liquidity - Cash and cash equivalents increased to $3,662,388 as of September 30, 2025, compared to $1,670,949 at the end of 2024, reflecting improved liquidity[217]. - Net cash used in operating activities was $2,298,995 for the nine months ended September 30, 2025, compared to $1,005,651 in 2024, indicating a significant increase in cash outflow[221]. - Net cash provided by financing activities was $4,598,160 for the nine months ended September 30, 2025, significantly higher than $1,074,341 in 2024, primarily from equity financing[223]. Strategic Initiatives - The company is focused on integrating AI technology to streamline real estate transactions and enhance client services, aiming to become a premier AI-driven real estate technology company[141]. - The company plans to invest approximately $2 million over the next 12 months to expand its real estate business and develop an artificial intelligence real estate platform[215]. Tax and Regulatory Matters - Income tax expenses decreased by $108,739, or 92.33%, from $117,777 in 2024 to $9,038 in 2025, attributed to lower income before income taxes[186]. - The Company has elected to file a consolidated federal income tax return as a C-corporation effective January 1, 2024, subject to a federal income tax rate of 21%[251]. - Income tax expenses decreased to $46,928 for the nine months ended September 30, 2025, down 74.75% from $167,905 in 2024, due to lower income before taxes[212]. Business Model Changes - The Company transitioned to operate as an independent real estate broker on November 17, 2023, marking a significant shift in its business model[236]. - The Company recognizes revenue primarily from real estate services and property purchases and sales through Cash Offer[233]. Accounting and Reporting Standards - The Company adopted the current expected credit loss (CECL) methodology effective January 1, 2023, for estimating credit losses on financial assets[241]. - The Company adopted ASU 2023-07 in Q4 2024, which improved reportable segment disclosures without a material impact on its financial statements[253]. - The Company is currently evaluating the impact of ASU 2024-03 on its consolidated financial statements and related disclosures[255].
Linkhome Holdings Inc(LHAI) - 2025 Q3 - Quarterly Report