Company: CHOW
Filing Date: 2025-01-13
Form Type: DRS/A
Source: 0001493152-25-001833
Chunk: 100

Company: ChowChow Cloud International Holdings Ltd
Filing Date: 2025-01-13
Form: DRS/A
Chunk 100
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 was mainly attributable to the increase in our revenue from managed and support service with AI and AIOps included in the revenue category of “Sale of Software and IT Application Products with IT Professional Services”, which generally entailed higher gross profit margins.

The differences between Revenue from Products and Cost of Products, and between Revenue from Services and Cost of Services, are not solely indicative of the margins on these contracts. These differences are driven by the classification of costs by nature. As such, the Company focuses on analyzing its overall margin across all revenue streams, considering both product and service components collectively.

Selling and marketing expenses

Selling and marketing expenses consisted primarily of (i) marketing service fee paid to the third party; and (ii) commission paid to the third parties relevant to the sales function.

Our major selling and marketing expenses were comprised of the following items during the years indicated:

|                                               |     | Year ended December 31, |    2022 |     |   |       |     |     |      2023 |     |     |         |     |   |       |     |   |  Change |   |
|:----------------------------------------------|:----|:------------------------|--------:|:----|:--|------:|:----|:----|----------:|:----|:----|--------:|:----|:--|------:|:----|:--|--------:|:--|
|                                               |     | HK$                     |         |     | % |       |     | HK$ |           |     | US$ |         |     | % |       |     | % |         |   |
| Marketing service fee paid to the third party |     |                         |  33,000 |     |   |   9.0 |     |     |   986,495 |     |     | 126,474 |     |   |  96.3 |     |   | 2,889.4 |   |
| Commission paid to the third parties          |     |                         | 332,540 |     |   |  91.0 |     |     |    38,103 |     |     |   4,885 |     |   |   3.7 |     |   |   (88.5 | ) |
| Total                                         |     |                         | 365,540 |     |   | 100.0 |     |     | 1,024,598 |