Marwynn Holdings Reports Significant Net Income Decline and Revenue Decrease

Marwynn Holdings, Inc. reported a net income of $23,418 for the three months ended January 31, 2025, a significant decrease from $279,944 in the same period last year. For the nine months ending January 31, 2025, the company experienced a net loss of $419,482, compared to a net income of $649,850 for the same period in 2024. Revenue for the latest quarter was $2,704,760, down 5.5% from $2,861,579 in the prior year, while total revenue for the nine months decreased by 4.2% to $8,198,563 from $8,554,176. The decline in revenue was primarily attributed to a significant drop in food and beverage sales, particularly due to reduced orders from Costco, one of the company's largest customers.

The company's cost of revenue for the three months increased to $1,586,985, up 6.3% from $1,493,502 in the previous year, driven by higher costs associated with indoor home improvement products. The gross profit margin also declined, with gross profit for the quarter at $1,117,775, representing 41.3% of total revenue, compared to 47.8% in the prior year. General and administrative expenses rose sharply by 17.3% to $950,847, reflecting increased payroll and professional fees, while selling expenses increased by 4.0% to $164,879.

Operationally, Marwynn Holdings has seen a shift in its revenue composition, with food and beverage sales accounting for only 21.4% of total sales in the latest quarter, down from 34.4% a year earlier. Conversely, sales of indoor home improvement products increased by 10.9% to $2,081,051, now representing 76.9% of total sales. The company also began generating revenue from consulting services, which accounted for 1.6% of total revenue in the latest quarter.

Looking ahead, Marwynn Holdings plans to enhance its revenue streams by diversifying its market focus from mass market channels to ethnic supermarket chains. The company is also working to finalize product approvals with Costco and expand its product offerings. Additionally, Marwynn is considering establishing a regional office in Los Angeles to strengthen its sales force and customer relationships in Southern California. Despite the current challenges, management believes that the company's cash on hand and operating cash flows will be sufficient to fund operations for at least the next 12 months, although they may seek additional financing if necessary.