Company: KPEA
Filing Date: 2025-02-14
Form Type: 10-Q
Source: 0001493152-25-006580
Chunk: 5

Company: Kun Peng International Ltd.
Filing Date: 2025-02-14
Form: 10-Q
Item: Item 2
Chunk 5
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-charges and value-added tax (“VAT”) of gross sales.

Our
retail revenue primarily included the sale of consumer health care and health-related household products to our customers via our mobile
application, King Eagle Mall, which was launched in July 2020. Our wholesale revenue was derived from our new online platform, Kun Zhi
Jian, which was launched in October 2022. This new online platform focuses on promoting and selling our own brand of preventive health
care related products, such as the thermal therapy cabin, to our wholesalers.

We
have developed more revenue streams since December 2023: (i) commission revenue, generating through the Mini Program by selling health
care instruments on behalf of third parties on a commission basis; (ii) equipment service revenue, generating through providing cards
for medical consultation service online and selling prepaid cards to our customers for the use of card-operated health screening equipment
located at the Kun Zhi Jian Customer Service Center; (iii) training revenue, generating through offering training program provided by
a local health care service team; and (iv) technical service revenue, generating through promoting vendors’ products or businesses
on online platform.

We
recognized commission revenue upon the completion of delivery of the sales order to the end customer. We recognized the equipment service
revenue upon the completion of medical consultation service and consuming the prepaid cards. We recognized training revenue upon completion
of training sessions by our customers. We recognized technical service revenue upon the completion of promoting vendors’ products
or businesses on our platform.

Compared
to the three months ended December 31, 2023, we generated $356,519 or 36.6% lower revenue for the same period in 2024 due to the substantially
sharp decrease in Retail. For the three months ended December 31, 2024, we focused our business on equipment services. The market for
health care equipment has potential growth in the future as more and more people looking for professional health care assistance after
COVID-19.

Cost
of revenue

Our
cost of revenue for the three months ended December 31, 2024 was $55,683 or 62.72% decrease over our cost of revenue for the three month
period ended December 31, 2023 of $149,347. This primarily included the purchase of consumer health care and health related household
products from our suppliers and payments of maintaining health screening equipment and training fees to our third-party trainers. During
the quarter ended December