Company: FOXX
Filing Date: 2025-05-15
Form Type: 10-Q
Source: 0001213900-25-043597
Chunk: 79

Company: Foxx Development Holdings Inc.
Filing Date: 2025-05-15
Form: 10-Q
Item: Item 1
Chunk 79
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%
  
    Gross profit percentage 
     6.3% 
     4.4% 
     1.8% 

For the nine months ended
March 31, 2025 and 2024, our overall gross profit percentage was 6.3% and 4.4%, respectively. The increase in gross profit percentage
of 1.8% was primarily due to the increase in gross profit percentage for mobile phones, wearable products and others and App service commission
revenue and others.

Gross profit percentage of
tablets decreased from 26.6% to 20.4% from the nine months ended March 31, 2024 to the same period in 2025. This was primarily due the
decrease of sales of those with higher unit selling prices and lower unit purchase prices.

Gross profit (loss) percentage
for mobile phones increased from (16.7)% to 2.4% from the nine months ended March 31, 2024, to the same period in 2025. This was primarily
due to our change of business strategy as discussed above, which lead to the increase in the unit selling price of electronic products,
and the decrease in the unit purchase price of the purchasing goods.

For the nine months ended
March 31, 2025, our gross profit percentage of wearable products and others was 12.2%. We did not have this kind of products for the nine
months ended March 31, 2024.

For the nine months ended
March 31, 2025, our gross profit percentage of App service commission and others was 98.8% because App service commission revenue was
commission based revenue that was earned at a point in time when the revenue is generated from the App, that is when clicks and/or impressions
occur at a point in time when the end users of the mobile devices use the App and we received the App revenue share (service commission)
from our partners without cost of goods. We did not have this kind of service for the nine months ended March 31, 2024.

43

Operating Expenses

Total operating expenses
increased by approximately $9.0 million, or 457.8%, to approximately $10.9 million for the nine months ended March 31, 2025 from approximately
$1.9 million for the nine months ended March 31, 2024.

Our operating expenses are
summarized as follows:

    For