Core Viewpoint - The overseas traffic business appears prosperous but is struggling within the ecosystem dominated by tech giants, as evidenced by the financial difficulties faced by Midoor Group, which is seeking to go public while revealing significant losses and operational challenges [1]. Group 1: Business Development and Structure - Midoor's business has evolved through three main phases: from a traditional cross-border trade intermediary (2014-2017) to a digital advertising agency (2018-2021), and finally to a cross-border e-commerce marketing service provider since 2021 [2]. - The company operates three main business segments: overseas marketing services, digital exhibition services, and overseas e-commerce operations, with overseas marketing services contributing over 98% of its revenue [5][6]. - Midoor's market share in the cross-border e-commerce service sector is only 0.5%, despite being the fifth largest provider in China [4]. Group 2: Financial Performance - Midoor's revenue from 2022 to 2024 was reported as $65.17 million, $70.85 million, and $71.13 million, with a significant slowdown in growth to just 0.4% in 2024 [6]. - The company experienced a net profit of $1.64 million in 2022, but reported a loss of $16.41 million in 2023, with losses further escalating to $19.85 million in the first half of 2025, marking a nearly 900-fold increase year-on-year [6][10]. - As of June 2025, Midoor's unremitted losses reached $32.53 million, with a debt-to-asset ratio consistently above 106%, indicating a precarious financial position [7]. Group 3: Dependency and Profitability Issues - Midoor's gross profit margins have remained low, fluctuating between 4% and 8%, with the core overseas marketing service margin dropping to 3.8% in 2023 due to increased media costs from platforms like Google and TikTok [10][11]. - The company is heavily reliant on a few major suppliers, with 96.5% of its procurement costs coming from the top five suppliers, primarily Google and TikTok, which limits its pricing power and profitability [11]. - The customer base is primarily composed of small to medium-sized cross-border sellers, with an average revenue per client of only $657,000, leading to intense price competition and further pressure on profit margins [12]. Group 4: Future Prospects and Challenges - Midoor plans to use the funds raised from its IPO to expand global operations and develop its overseas e-commerce operational system and technology [13]. - The company faces significant challenges, including tightening policies from major platforms and increasing industry competition, which may hinder its ability to transform its business model successfully [13].

Core Viewpoint - Mido's IPO application reveals a paradox of "increasing revenue without increasing profit," with a significant revenue growth of 81.6% to $55.8 million in the first half of 2025, but a staggering net loss of $19.85 million, marking a 892-fold increase in losses [1][9][27] Financial Performance - Mido's revenue structure is heavily reliant on overseas marketing services, which accounted for 98.7% of total revenue in the first half of 2025, but the gross margin for this core business plummeted to 3.8% in 2023 and only slightly improved to 4% in 2025 [3][4][6] - The overall gross margin has remained low, fluctuating between 4% and 8%, with the first half of 2025 showing a gross margin of 4.8%, significantly below the industry average of over 20% [1][3][4] Cost Structure - Mido's sales costs are predominantly consumed by media costs, which accounted for over 98% of total sales costs, indicating a severe limitation on retained gross profit [6][7] - The company's business model operates as a middleman, purchasing advertising space from platforms like Google and TikTok and reselling it to clients, which restricts its pricing power and profit margins [6][7] Market Dynamics - The global cross-border e-commerce market is projected to grow to $123.7 billion by 2029, with a compound annual growth rate of 24.3%, yet many small and medium-sized service providers, including Mido, are trapped in a cycle of low margins and fierce competition [2][15] - Mido's reliance on a concentrated supplier base, with 96.5% of procurement costs coming from its top five suppliers, poses a risk as any changes in platform policies can directly impact profitability [7][9] Competitive Landscape - The competitive environment is characterized by a high number of active service providers, with over a thousand in the market, leading to price wars and reduced margins for smaller players [15][16] - In contrast, leading companies in the industry have successfully achieved higher margins through technology and comprehensive service offerings, highlighting that low margins are not an industry inevitability but rather a result of business model choices [18][19] Future Prospects - Mido's IPO aims to raise funds for expanding its global business, developing higher-margin overseas e-commerce operations, and investing in marketing technology, but the success of this strategy is uncertain due to existing challenges [19][20] - The company has launched a new overseas e-commerce operation with a gross margin of 67.9%, but its slow revenue growth indicates that it may not significantly alter the overall low-margin situation in the short term [21][19] Industry Insights - Mido's situation reflects a broader issue within the cross-border service industry, where many small providers struggle with low margins due to reliance on platform-driven business models [25][27] - To escape the low-margin trap, service providers must focus on technology empowerment, comprehensive service offerings, and deepening customer relationships to enhance profitability [25][26]

Group 1 - The core viewpoint of the article is that Mido's Group is preparing for an IPO on the Hong Kong Stock Exchange, aiming to leverage its position in the rapidly growing cross-border e-commerce marketing services industry [1][3] - Mido's operates as a comprehensive service platform for cross-border e-commerce, providing digital marketing and operational support to clients selling products globally through major digital media platforms [1][2] - The cross-border marketing services market is projected to grow from $6.4 billion in 2020 to $14.3 billion by 2024, with a compound annual growth rate (CAGR) of 22.1%, and further to $30.5 billion by 2029, with a CAGR of 16.4% [1] Group 2 - Mido's has demonstrated strong financial performance, with revenue increasing from $65.17 million in 2022 to $71.13 million in 2024, and achieving $55.78 million in the first half of 2025, nearly doubling year-on-year [1][2] - The company is recognized as one of the top five cross-border e-commerce marketing service providers in China, with a comprehensive service offering and a large customer base, having over 1,000 overseas marketing service clients in the first half of this year [2] - The IPO is seen as a strategic milestone for Mido's, expected to enhance its capital position, improve governance and brand image, and expand its global business footprint, thereby creating long-term value for clients and society [3]