Company: WCT
Filing Date: 2025-05-16
Form Type: 20-F
Source: 0001213900-25-044576
Chunk: 43

Company: Wellchange Holdings Co Ltd
Filing Date: 2025-05-16
Form: 20-F
Item: Item 4A
Chunk 43
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  Total                              2,489,995      547,630      1,942,365      78.0      2,309,218      691,984      1,617,234  

For the years ended December 31, 2023
and 2024, gross profit was US$1,942,365 and US$1,617,234, respectively, and gross profit margin was 78.0% and 70.0%, respectively, of
operating revenue.

For customized software solutions, the gross profit
decreased by US$626,633 or 38.5% from US$1,628,591 for the year ended December 31, 2023 to US$1,001,958 for the year ended December 31
2024. It was principally attributable to the decrease in demand for the IT software for the SMBs, the decrease in customer orders received
from 46 for the year ended December 31, 2023 to 21 for the year ended December 31, 2024 which led to the decrease in revenue
of customized software solutions. Moreover, the gross profit margin decreased by 0.3% from 89.8% for the year ended December 31, 2023
to 89.5% for the year ended December 31, 2024, it was mainly due to increase in the amortization of intangible assets resulted from acquisition
of additional modules to enhance its ERP system during current year.

For white label software, the gross profit increased by US$209,679
or 118.1% from US$177,472 for the year ended December 31, 2023 to US$387,151 for the year ended December 31, 2024. The increase in gross
profit and gross profit margin was mainly due to the effort on the marketing activities and a new customer approached for implementation
of the software with a better contractual term.

For subscription service, the gross profit increased
by US$91,823 or 67.4% from US$136,302 for the year ended December 31, 2023 to US$228,125 for the year ended December 31, 2024. With increase
in scale and expansion, the Company increased its bargaining power and negotiated with customers with more competitive term and the average
contract service price increased. As a result, both gross profit and gross profit margin increased.

Operating expenses