Company: LASE
Filing Date: 2025-06-24
Form Type: 10-K
Source: 0001641172-25-016194
Chunk: 370

Company: Laser Photonics Corp
Filing Date: 2025-06-24
Form: 10-K
Item: Item 1A
Chunk 370
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 stronger completion
on the market and a need for a price adjustment. The net revenue decreased accordingly by $524,278 or 13.30% in the year of 2024
in comparison to 2023.

45

Sales
Pipeline

Our
Sales Pipeline at the end of December 31, 2024, has reached $41.1M in industrial products and $19.9M in Military and Government sales
what can support the revenue for up to $10M a year.

Gross
Profit

For
the year ending December 31, 2024, we reported gross profit in the amount of $1,481,046 or 43.37% of net sales, as compared to $2,897,777
or 73.56% net sales, in the year ended December 31, 2023. Gross profit is affected by numerous factors, including our module average
selling prices, foreign exchange rates, the existence and effectiveness of subsidies and other economic incentives, competitive pressures,
market demand, market mix, our manufacturing costs, product development costs, the effective utilization of our production facilities,
and the ramp-up of production on new products. Our cost of sales includes the cost of raw materials and components for manufacturing
laser systems. We are vertically integrated and currently manufacture all critical components for our products as well as assemble finished
products. Our cost of sales also includes direct labor for manufacturing, and manufacturing overhead such as engineering, equipment maintenance,
quality and production control, and procurement costs. Cost of sales does not include depreciation of manufacturing plant and equipment
and facility-related expenses.

Overall,
we expect our cost of sales to continue to decrease over the next several years due to an increase in worldwide capacity in fiber laser
parts and components, and availability of optical generators, an increase in unit output per production line, and more efficient absorption
of fixed costs driven by economies of scale. This expected decrease in cost for laser technology would be partially offset during periods
in which we underutilize manufacturing capacity.

The Company contracted with a third party
to test impairment of their intangible assets. After the evaluation was completed, the company recognized an impairment of $932,669 based
on the third parties report.

Operating
Expenses

Operating
expenses for the year ended December 31, 2024, were $ 7,944,389 as compared to $ 6,246,011 for the year ended December 31, 2023, representing
an increase of $