Company: FOXX
Filing Date: 2025-01-24
Form Type: 424B3
Source: 0001213900-25-006111
Chunk: 24

Company: Foxx Development Holdings Inc.
Filing Date: 2025-01-24
Form: 424B3
Chunk 24
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 the manufactured products until the customer pays the full purchase price. We have the right to retake possession and resell the products if the customer default on the purchase order. Upon delivering the products to the customers, we receive the remaining 80% to 85% of the total purchase price. We do not have short -termor long -termagreements with our customers and just rely on purchase orders. These distributors have established relationships with leading telecommunications carriers, and we have been relying on their connections, relationships, and market knowledge to effectively promote our products, enabling us to establish a strong presence in the market. Due to the reduced manufacturing capacity during the COVID -19pandemic and the concentrated market demand for mobile phones and tablet products, we had been offering such products to a limited number of third -partydistributors who demonstrated a strong intent to buy and were willing to offer more appealing payment terms. For the year ended June 30, 2024, three customers accounted for 41%, 29% and 16% of the Company’s total revenues. For the year ended June 30, 2023, one customer accounted for 100% of our total revenues. We relied on these customers to buy our mobile phones and tablet products and sell such products to end -users. We have begun changing our business strategy from relying on a limited number of customers to increasing the number of customers and lowering customer concentration by developing relationships with multiple more customers to diversify and avoid reliance on a few or a fixed set of distributors and we are also exploring other channels for selling our products, however, we may continue to rely on our customers to sell tablets and smartphones. We may also rely on these third -partydistributors or sales agents to distribute and assist us with the marketing and sale of other products we expect to launch. Our future revenue generation and growth, particularly for phones and tablets, may continue to 10 depend in large part on our success in establishing and maintaining this sales and distribution channel. Our customers purchase products from us and reselling them at a higher price to generate profit. However, if our customers encounter challenges such as difficulty in selling our products, negative feedback from end users, or insufficient profit margins to sustain their operations, they may choose not to continue purchasing or marketing our products. In addition, there can be no assurance that our customers will focus adequate resources on selling our products to end -usersor will be successful in selling them. Many of our customers are in the business of distributing and sometimes manufacturing other, possibly