Company: DSWL
Filing Date: 2025-06-18
Form Type: 6-K
Source: 0001171843-25-003948
Chunk: 8

Company: DESWELL INDUSTRIES INC
Filing Date: 2025-06-18
Form: 6-K
Chunk 8
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 computed by dividing income
available to common holders by the weighted average number of common shares outstanding during the period. Diluted net income
per share gives effect to all potentially dilutive common shares outstanding during the period.

The weighted average number of common shares outstanding is
adjusted to include the number of additional common shares that would have been outstanding if the potentially dilutive common shares
had been issued. In computing the dilutive effect of potential common shares, the average stock price for the period is used
in determining the number of treasury shares assumed to be purchased with the proceeds from the exercise of options.

The net income for the six months ended March 31, 2025 and
2024 were both from the Company’s continuing operations.

DESWELL INDUSTRIES, INC.

MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS

Results of Operations

The Company’s revenues are derived from the manufacture and sale
of (i) injection-molded plastic parts and components, and (ii) electronic products and subassemblies of audio equipment. The
Company carries out all of its manufacturing operations in southern China, where it is able to take advantage of the lower overhead costs
and less expensive labor rates as compared with Hong Kong.

Net Sales - The Company's net sales for the six months ended March 31,
2025 were $32,434,000, a increase of $796,000 or 2.5% as compared to $31,638,000 in the corresponding period in fiscal 2024. The increase
was related to decrease of $675,000 in our plastic segment and an increase of $1,471,000 in our electronic segment, as compared with the
respective net sales from these segments in the corresponding period of the prior fiscal year.

The decrease in net sales in the plastic segment was mainly related to
decreases in orders of $172,000 from existing customers for printers, $373,000 for robotic mops and vacuum cleaners, and $203,000 for
tooling, offsetting increases in orders of $85,000 for plastic and gardening tool boxes from other existing customers.

The revenue increase in the electronic segment was mainly due to an increase
in orders of $4,264,000 from existing customers for home entertainment products, offsetting decreases in orders of $2,624,000 for vending
machines and $209,000 for audio equipment from other existing customers.

Gross Profit - Gross profit for the