Linkage Global Inc Announces First Half 2025 Financial Results

TOKYO, July 03, 2025 (GLOBE NEWSWIRE) -- Linkage Global Inc (“Linkage Cayman”, or the “Company”), a cross-border e-commerce integrated services provider headquartered in Japan, today announced its unaudited financial results for the six months ended March 31, 2025. First Half 2025 Selected Financial Metrics Total revenues decreased by approximately $1.30 million to approximately $3.50 million for the six months ended March 31, 2025, compared to approximately $4.80 million for the same period of 2024.Gross profit increased by approximately $1.99 million to $2.70 million for the six months ended March 31, 2025, from approximately $0.71 million for the same period of 2024. Cross-border sales margin improved from 12.70% to 21.31%, while integrated e-commerce services margin rose from 50.67% to 93.56% during the same period.Net loss increased from approximately $1.41 million for the six months ended March 31, 2024 to approximately $3.09 million for the six months ended March 31, 2025. First Half 2025 Financial Results Revenues Total revenues declined by approximately $1.30 million, or 27.02%, from approximately $4.80 million for the six months ended March 31, 2024, to approximately $3.50 million for the same period of 2025, mainly due to a sharp drop in cross-border sales. Revenues from cross-border sales fell by approximately $3.74 million, or 82.35%, from approximately $4.54 million for the six months ended March 31, 2024 to approximately $0.80 million for the six months ended March 31, 2025. EXTEND, our Japanese subsidiary, contributed $0.43 million or 12.32% of total revenue, down 87.66% year-over-year. This decline was driven by poor market response to its 3C electronics product strategy. In response, the Company shifted focus to higher-margin, fully managed e-commerce services and reallocated staff accordingly. The cross-border business is now being restructured, with new product selections and the Company plans to explore TikTok store and livestream sales in Japan. Revenues from Integrated e-commerce services surged by $2.44 million, or 930.08%, from approximately $0.26 million to $2.70 million for the six months ended March 31, 2025, largely due to the launch of fully managed e-commerce operations in 2025. This new model, contributing $2.59 million in revenue and $2.46 million in gross profit, involves end-to-end store management for merchants, with fees based on gross merchandize volume (GMV). Revenues from digital marketing dropped from approximately $0.13 million for the six months ended March 31, 2024 to approximately $0.08 million for the six months ended March 31, 2025, after ending the Google partnership in January 2025 and beginning deregistration in April. Revenues from training and consulting, TikTok agent services declined by $0.10 million, or 75.25%, from $0.13 million to $0.03 million. Cost of Revenues Cost of revenues fell 80.34%, from approximately $4.09 million for the six months ended March 31, 2024, to approximately $0.80 million for the same period in 2025. This was mainly due to a sharp drop in cross-border sales costs, which declined $3.33 million, or 84.09%, from $3.96 million to $0.63 million, reflecting reduced procurement in line with lower sales. In contrast, costs for integrated e-commerce services rose $0.04 million, or 34.55%, from $0.13 million to $0.17 million. Of this, $0.13 million was related to the new fully managed e-commerce business, primarily covering staff salaries. Commission costs declined due to the termination of related services. Gross Profit Gross profit increased by approximately $1.99 million, or 280.57%, from approximately $0.71 million to approximately $2.70 million, mainly driven by the new fully managed e-commerce business, which contributed $2.46 million in profit with a 95.12% margin. The high margin was due to low operating costs, mostly staff salaries, with no enterprise resource planning development expenses in the current period as they were previously recognized. Cross-border sales margin improved from 12.70% to 21.31% due to a shift toward higher-margin products. Integrated e-commerce services margin rose from 50.67% to 93.56%, also driven by the new business model. Operating Expenses Operating expenses rose by 91.01%, from approximately $2.27 million to approximately $4.34 million, mainly due to higher general and administrative expenses, which increased 123.94%, from $1.74 million to $3.90 million for the six months ended March 31, 2025, which was primarily attributable to the allowance for credit loss, stock-based compensation and post-IPO financial and legal consulting fees. Selling and marketing expenses dropped 31.15%, from approximately $0.23 million to approximately $0.16 million, due to lower freight and advertising costs, as well as lower marketing and promotion expenses. Research and development expenses declined 7.87%, from approximately $0.30 million to approximately $0.27 million, as ERP development staff shifted to operational roles and their salaries were reclassified under business costs. Other Expenses Other expenses mainly include non-operating income and interest expenses, net. Non-operating income rose from $998 to approximately $0.39 million. Net interest expenses increased significantly from approximately $0.06 million to approximately $1.50 million, mainly due to the issuance of $10 million in convertible bonds in October 2024, with an actual interest rate of 42.52%, generating $1.56 million in interest expenses during the reporting period. Income Tax (Provision)/Benefit Income tax (provision) /benefit decreased by approximately $0.56 million, from approximately $0.02 million of tax benefit for the six months ended March 31, 2024 to approximately $0.34 million of tax expenses for the six months ended March 31, 2025. This decrease was primarily attributable to net profit for the fully managed e-commerce operation services with a tax rate of 16.5%. Net Loss As a result, net loss increased by approximately $1.68 million, or 119.62%, from approximately $1.41 million to approximately $3.09 million. About Linkage Global Inc Linkage Global Inc is a holding company incorporated in the Cayman Islands with no operations of its own. Linkage Cayman conducts its operations through its operating subsidiaries in Japan, Hong Kong, and mainland China. As a cross-border e-commerce integrated services provider headquartered in Japan, through its operating subsidiaries, the Company has developed a comprehensive service system comprised of two lines of business complementary to each other, including (i) cross-border sales and (ii) integrated e-commerce services. For more information, please visit www.linkagecc.com. Safe Harbor Statement Certain statements in this announcement are forward-looking statements. These forward-looking statements involve known and unknown risks and uncertainties and are based on the Company’s current expectations and projections about future events that the Company believes may affect its financial condition, results of operations, business strategy and financial needs. Investors can identify these forward-looking statements by words or phrases such as “approximates,” “assesses,” “believes,” “hopes,” “expects,” “anticipates,” “estimates,” “projects,” “intends,” “plans,” “will,” “would,” “should,” “could,” “may” or similar expressions. The Company undertakes no obligation to update or revise publicly any forward-looking statements to reflect subsequent occurring events or circumstances, or changes in its expectations, except as may be required by law. Although the Company believes that the expectations expressed in these forward-looking statements are reasonable, it cannot assure you that such expectations will turn out to be correct, and the Company cautions investors that actual results may differ materially from the anticipated results and encourages investors to review other factors that may affect its future results in the Company’s annual reports on Form 20-F and other filings with the U.S. Securities and Exchange Commission. For more information, please contact: Investor Relations WFS Investor Relations Inc. Connie Kang, Partner Email: ckang@wealthfsllc.com Tel: +86 1381 185 7742 Linkage Global IncUNAUDITED INTERIM CONDENSED CONSOLIDATED BALANCE SHEETSAS OF MARCH 31, 2025 AND SEPTEMBER 30, 2024(In U.S. dollars, except for share and per share data, or otherwise noted) As ofMarch 31,2025 As ofSeptember 30,2024 USD ASSETS Current assets Cash and cash equivalents 328,081 2,000,732 Accounts receivable, net 6,405,486 6,302,696 Inventories, net 35,675 66,331 Deposits paid to media platforms — 482,650 Prepaid expenses and other current assets, net 1,625,517 2,689,581 Amount due from related parties 1,243,450 — Short-term loan to third party 8,993,306 410,000 Interest receivable from loan to third party 386,261 — Total current assets 19,017,776 11,951,990 Non-current assets Property and equipment, net 50,594 85,807 Right-of-use assets, net 516,167 653,730 Total non-current assets 566,761 739,537 TOTAL ASSETS 19,584,537 12,691,527 LIABILITIES AND SHAREHOLDERS’ EQUITY Current liabilities Accounts payable 324,069 624,723 Accrued expenses and other current liabilities 303,413 236,813 Short-term debts — 32,810 Current portion of long-term debts 243,557 428,702 Contract liabilities 208,483 533,625 Amounts due to related parties — 314,544 Lease liabilities - current 203,600 231,978 Convertible notes 7,884,325 964,865 Interest payable of convertible notes 1,555,689 — Income tax payable 850,866 1,017,619 Total current liabilities 11,574,002 4,385,679 Non-current liabilities Long-term debts 734,023 839,560 Lease liabilities – non-current 334,973 441,504 Total non-current liabilities 1,068,996 1,281,064 Total liabilities 12,642,998 5,666,743 Commitments and contingencies (Note 21) Shareholders’ equity Class A ordinary shares (par value of US$0.0025 per share; 998,000,000 ordinary shares authorized, 3,080,000 and 2,150,000 ordinary shares issued and outstanding as of March 31, 2025 and September 30, 2024, respectively) * 7,700 5,375 Class B ordinary shares (par value of US$0.0025 per share; 2,000,000 ordinary shares authorized, 700,000 and nil ordinary shares issued and outstanding as of March 31, 2025 and September 30, 2024, respectively) * 1,750 — Additional paid in capital 8,564,021 5,591,596 Treasury Shares (500) — Statutory reserve 11,348 11,348 Retained earnings (1,474,142) 1,613,217 Accumulated other comprehensive loss (168,638) (196,752)Total shareholders’ equity 6,941,539 7,024,784 TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY 19,584,537 12,691,527 Linkage Global IncUNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOMEFOR THE SIX MONTHS ENDED MARCH 31, 2025 AND 2024(In U.S. dollars, except for share and per share data, or otherwise noted) For the six months ended March 31, 2025 2024 USD Revenues 3,501,947 4,798,363 Cost of revenues (804,142) (4,089,486)Gross profit 2,697,805 708,877 Operating expenses General and administrative expenses (3,904,027) (1,743,309)Selling and marketing expenses (157,637) (228,956)Research and development expenses (274,371) (297,811)Total operating expenses (4,336,035) (2,270,076)Operating loss (1,638,230) (1,561,199) Other expenses Interest expenses, net (1,496,504) (60,726)Other non-operating income 387,816 998 Total other expenses (1,108,688) (59,728) Loss before income taxes (2,746,918) (1,620,927)Income tax (provision)/ benefit (340,441) 215,161 Net loss (3,087,359) (1,405,766)Net loss attributable to the Company’s ordinary shareholders (3,087,359) — Other comprehensive income/(loss) Foreign currency translation adjustment 28,114 (10,107)Total comprehensive loss attributable to the Company’s ordinary shareholders (3,059,245) (1,415,873) Loss per ordinary share attributable to ordinary shareholders Basic and Diluted* (0.90) (0.67)Weighted average number of ordinary shares outstanding Basic and Diluted* 3,415,533 2,084,890 Linkage Global IncUNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWSFOR THE SIX MONTHS ENDED MARCH 31, 2025 AND 2024(In U.S. dollars, except for share and per share data, or otherwise noted) For the six months ended March 31, 2025 2024 USD CASH FLOWS FROM OPERATING ACTIVITIES: Net loss (3,087,359) (1,405,766) Adjustments to reconcile net loss to net cash used in operating activities: Effect of exchange rate changes 202,551 1,184 Allowance for credit loss 1,344,218 568,229 Interest payable of convertible notes 1,555,689 — Interest receivable from loan to third party (386,261) — Stock-Based Compensation 1,209,000 — Depreciation 22,205 40,959 Amortization of lease right-of-use assets 114,791 110,229 Inventory provision 4,328 2,203 Deferred tax benefits — (216,713)Changes in operating assets and liabilities: Accounts receivable, net (1,649,559) (725,166)Prepaid expenses and other current assets, net (261,232) (3,233,957)Inventories, net 26,328 539,517 Accounts payable (300,654) (320,628)Contract liabilities (325,142) 25,350 Accrued expenses and other current liabilities 66,600 (5,188)Amounts due from related parties 341,426 — Amounts due to related parties (314,238) (16,189)Tax payable (166,753) 928,135 Operating lease liabilities (134,909) (103,326)Net cash used in operating activities (1,738,971) (3,811,127) Cash flow from investing activities Repayments of loan to a related party (99,876) — Loan to third party (8,640,000) — Net cash used in investing activities (8,739,876) — Cash flow from financing activities Proceeds from issuance of Class A ordinary shares upon the completion of IPO — 5,356,792 Proceeds from Issuance of convertible notes 9,002,368 — Proceeds from short-term debts — 132,258 Repayments of short-term debts (32,810) (33,726)Repayments of long-term debts (124,959) (179,420)Repayments of other long-term debts (108,037) (878,962)Payments of listing expenses — (150,606)Net cash provided by financing activities 8,736,562 4,246,336 Effect of exchange rate changes 69,634 (58,969)Net change in cash and cash equivalents (1,672,651) 376,240 Cash and cash equivalents, beginning of the period 2,000,732 1,107,480 Cash and cash equivalents, end of the period 328,081 1,483,720 Supplemental disclosures of cash flow information: Income tax paid — 150,124 Interest expense paid 33,056 65,901 Supplemental disclosures of non-cash activities: Obtaining right-of-use assets in exchange for operating lease liabilities 155,160 147,083

Linkage Global Inc Announces First Half 2025 Financial Results

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