Company: NEGG
Filing Date: 2025-04-28
Form Type: 20-F
Source: 0001213900-25-036055
Chunk: 31

Company: Newegg Commerce, Inc.
Filing Date: 2025-04-28
Form: 20-F
Item: Item 3
Chunk 31
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  our future results of operations and financial condition.  

Financing may not be available in amounts or on
terms acceptable to us, if at all. Any failure by us to raise additional funds on terms favorable to us, or at all, could limit our ability
to grow our business and develop or enhance our product and service offerings to respond to market demand or competitive challenges.

Legal and Regulatory Risks

Significant developments stemming from recent
U. S. government actions and proposals concerning tariffs and other economic proposals could have a material adverse effect on us.

As of December 31, 2024 and 2023, approximately
58% and 65% of our products that were sold through our platforms, both direct sales and marketplace, were manufactured in China, respectively.
U. S. government actions since 2018 have imposed greater restrictions and economic disincentives on international trade impacting imports
and exports. The U. S. government has adopted changes, and may adopt further changes, to trade policy and in some cases, to renegotiate,
or potentially terminate, certain existing bilateral or multi-lateral trade agreements. It imposed additional tariffs on certain foreign
goods, including steel and aluminum, semiconductor manufacturing equipment and spare parts thereof, and has amended export regulations
regarding sales to companies on the U. S. Entity List, and the export of semiconductor manufacturing equipment and advanced semiconductor
technology and commodities to a range of countries, including China. These changes prohibit the sale and other transfers of U. S. origin
and foreign produced direct products that are manufactured using controlled U. S.-origin and controlled equipment, technology, and software
located outside the United States to certain companies on the U. S. Entity List and to targeted companies. These regulations continue to
evolve and have impacts on international supply chains that Newegg relies on for some of its products.

In 2022, the U. S. Congress enacted the CHIPS and
Science Act, Pub. L. No. 117-167 (“ CHIPS Act”). The CHIPS Act may increase costs for Newegg in several ways. First, the law
prevents CHIPS Act funding recipients from using the funds to engage in any joint research or technology licensing efforts with foreign
entities of concern, which may increase the costs of certain products. The CHIPS Act also may also cause China to take retaliatory action
against the United States, which could disrupt supply chains or increase the costs of certain products.

For