Company: MKDWW
Filing Date: 2025-04-03
Form Type: F-1
Source: 0001641172-25-002610
Chunk: 127

Company: MKDWELL Tech Inc.
Filing Date: 2025-04-03
Form: F-1
Chunk 127
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3. The increase in products revenues was mainly contributed to the increased sales of intelligent vehicle control system due to the fact that new customers and new orders are mainly concentrated in this type of products.

Revenues from our commissioned processing service increased by US$0.08 million, or 8.7%, from US$0.87 million for the year ended December 31, 2022 to US$0.94 million for the year ended December 31, 2023, which was mainly due to one of our major customers was expanding its business in 2023 and increased the demand of service.

Rental income decreased by US$0.09 million, or 25.1%, from US$0.36 million for the year ended December 31, 2022 to US$0.27 million for the year ended December 31, 2023, which was mainly due to a decrease in leasehold area resulting from the expiration of two lease contracts in 2023.

Revenues from others decreased by US$0.26 million, or 66.0%, from US$0.39 million for the year ended December 31, 2022 to US$0.13 million for the year ended December 31, 2023, which was mainly due to reduced electricity demand from lessees in consistent with the decrease in leasehold area.

Cost of revenues

Our cost of revenues primarily consists of (i) direct materials, labor costs and manufacturing overheads associated with manufactured electronic products, (ii) direct labor costs and manufacturing overheads associated with commissioned processing service, (iii) depreciation of leased property, and (iv) other cost related to the business operation.

Our cost of revenues increased by US$0.86 million, or 40.4% from US$2.13 million for the year ended December 31, 2022 to US$3.00 million for the year ended December 31, 2023, primarily due to an increase in our direct material cost with respect to manufactured electronic products and an increase in labor cost due to the expansion of production scale and the increase in employee basic wages, which are in consistent with the increase in revenues from our sales of manufactured electronic products and commissioned processing service.

Gross profit and gross profit margin

Gross profit represents our revenues less cost of revenues. Gross profit margin represents our gross profit as a percentage of our revenues.

Gross profit decreased by US$0.35 million, or 33.9% from US$