Company: NEGG
Filing Date: 2025-04-28
Form Type: 20-F
Source: 0001213900-25-036055
Chunk: 86

Company: Newegg Commerce, Inc.
Filing Date: 2025-04-28
Form: 20-F
Item: Item 4A
Chunk 86
---
                 (1.7  
  Gain from change in fair value of warrants liabilities                                            (0.1                 (0.1                 (1.1  
  Adjusted EBITDA                                             $                                     (9.5      $         (21.3      $           0.6  

  Liquidity and Capital Resources  
 ───────────────────────────────────

Cash flows and working capital

We have historically funded our operations through
existing working capital, credit facilities, bank loans, return from investing activities, and equity financings. See Notes 8 and 9 to
our consolidated financial statements included elsewhere in this annual report for more information about the line of credit and long-term
debt that we obtain from financial institutions.

Our cash and cash equivalents consist primarily
of cash on deposit, certificates of deposit, and money market accounts. Cash equivalents are all highly liquid investments with original
maturities of three months or fewer. Amounts receivable from payment processors are also considered cash equivalents as they are
both short term and highly liquid in nature and are typically converted to cash within three business days. Amounts due to us from
payment processors that are classified as cash and cash equivalents totaled $6.3 million and $12.9 million at December
31, 2024 and December 31, 2023, respectively. We anticipate that our existing cash and funds generated from operations, combined
with periodic draws from our existing line of credit, will be sufficient to meet our working capital needs and expected capital expenditures
for at least 12 months from the date of the filing of this annual report. Our cash and cash equivalents are primarily denominated
in U. S. dollars.

We historically experience higher sales in the
fourth quarter due to the holiday season. In anticipation of such higher sales, we typically begin building up our inventory levels in
the late third quarter. Such inventory build-up may require us to expend cash faster than we generate by our operations during these periods.
Also, as a result of this inventory build-up and faster inventory turnover during the fourth quarter, our accounts payable are typically
at their highest levels at year-end, as compared to the first, second and third quarters when sales are lower. From time to time, we also
invest in one-time capital expenditures such as the purchase of our new office building in Diamond Bar, California, for an aggregate purchase
price of $23.2 million in June 2023.

We intend to finance our future working capital
requirements and capital