Company: NEGG
Filing Date: 2025-04-28
Form Type: 20-F
Source: 0001213900-25-036055
Chunk: 82

Company: Newegg Commerce, Inc.
Filing Date: 2025-04-28
Form: 20-F
Item: Item 4A
Chunk 82
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 decreased to 10.6% for the year
ended December 31, 2024 from 11.2% for the year ended December 31, 2023, primarily due to reduced consumer demand for upgrading key technology
products like CPUs and graphics cards. To remain competitive amid softer sales, we implemented aggressive promotions in 2024, resulting
in a margin decline.

Selling, general and administrative expenses
(“ SG& A”)

For the year ended December 31, 2024, SG& A
expenses decreased to $183.0 million from $238.6 million for the year ended December 31, 2023, which mainly resulted from (i)
a $32.5 million decrease in salary and other compensation costs, (ii) a $5.9 million decrease in rent, and (iii) a $7.3 million decrease
in merchant payment fees, which is variable to sales.

Interest income and expense

Interest income is earned on (i) our loans
to affiliates; and (ii) cash invested in money market accounts or certificates of deposit. See “ Related Party Transactions”
for more information about our loans to affiliates. Interest expense represents the interest we are charged on our borrowings, including
term loan, line of credit and capital leases.

For the year ended December 31, 2024, interest
income increased to $2.7 million from $2.3 million for the year ended December 31, 2023.

For the year ended December 31, 2024, interest
expense decreased to $1.0 million from $2.5 million for the year ended December 31, 2023.

Other income, net

For the years ended December 31, 2024 and 2023,
we recorded other income, net, of $3.5 million and $2.6 million, respectively. For the year ended December 31, 2024, other income,
net, primarily consisted of property rental income of $1.8 million, vendor incentive payments of $1.5 million, and sales tax discount
of $0.3 million. For the year ended December 31, 2023, other income, net, primarily consisted of sales tax rebates of $0.9 million,
property rental income of $1.1 million, sales tax discount of $0.3 million, and foreign exchange gain of $0.3 million.

Gain from sale of investment

For the year