Company: FUFU
Filing Date: 2025-04-21
Form Type: 20-F
Source: 0001213900-25-033733
Chunk: 137

Company: Bitfufu Inc.
Filing Date: 2025-04-21
Form: 20-F
Item: Item 5
Chunk 137
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4, representing a decrease of 21.8%, primarily
to the termination of hosting services by certain customers.

Cost of revenues from sales
of mining equipment was nil and US$28.0 million in 2023 and 2024, respectively. The increase was in line with the occurrence of miner
transactions during 2024, especially during the fourth quarter when the mining equipment transaction market became more active.

Cost of revenues from leasing
of mining equipment and sourcing services for mining equipment sales were nil in 2023 and 2024, respectively, as we temporarily suspended
these services as part of our strategic shift towards the development of our cloud-mining business.

Gross profit

Our gross profit increased from US$12.7 million in 2023 to US$29.7
million in 2024, and the gross profit margin increased from 4.5% in 2023 to 6.4% in 2024, mainly due to an increase in market price and
the optimization of hosting costs.

The gross profit margin of our cloud-mining solutions decreased from
7.6% in 2023 to 6.2% in 2024, mainly as a result of lower pricing strategies implemented to attract new customers and promotion plans
in 2024. The gross profit margin of our self-mining operations increased from negative 1.2% in 2023 to 6.5% in 2024, which was primarily
attributable to the combined effect of (i) the increase in the price of bitcoin; (ii) the decline in bitcoin production due to the impact
of halving events; and (iii) relocation of mining equipment from high-cost to low-cost hosting facilities.

Sales and marketing expenses

Our sales and marketing expenses
increased significantly from US$1.9 million in 2023 to US$7.5 million in 2024, which was primarily due to share-based compensation
expenses of US$4.5 million in 2024, compared to no such expense in 2023.

General and administrative expenses

Our general and administrative
expenses increased significantly from US$3.7 million in 2023 to US$25.3 million in 2024, mainly due to US$17.6 million share-based
compensation expenses which was nil during last year, along with a US$2.3 million rise in legal and consulting expenses due to the expansion
of our business development activities. Additionally, other expenses