Company: DDC
Filing Date: 2025-05-15
Form Type: 20-F
Source: 0001213900-25-043916
Chunk: 22

Company: DDC Enterprise Ltd
Filing Date: 2025-05-15
Form: 20-F
Item: Item 3
Chunk 22
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 We also expect to continue to make significant future expenditures related to the continuous development and expansion of our
business, including:

  acquisitions of new businesses and products and the ongoing working capital needs of those businesses and products;  

  investments in our product development team and research and development team and in the development of new products;  

  investments in sales and marketing, enlarging our customer base and promoting market awareness of our brands and products;  

  investments in expansion of our online and offline distribution channels in a measured manner;  

  investment in enhancing data and information technology and improving operating efficiency, including improving the efficiency in supply chain management, warehouse management and inventory con...  

  incurring costs associated with general administration, including legal, accounting and other expenses related to being a public company.  

As a result of these significant
expenses, we will have to generate sufficient revenue to remain profitable in future periods. We may not generate sufficient revenue for
a number of reasons, including potential lack of demand for our products, increasing competition, challenging macro-economic environment,
the ramifications of the COVID-19 pandemic, as well as other risks discussed elsewhere in this annual report. If we fail to sustain or
increase profitability, our business and results of operations could be adversely affected.

Our historical financial conditions and
results of operations are not representative of our future performance. We may be unable to effectively manage our future growth and expansion,
and may not achieve growth in revenue and profit. If we are unable to manage our growth effectively, we may not be able to capitalize
on new business opportunities and our business and financial results may be materially and adversely affected.

We have experienced growth and plan to further expand in the future
including through acquisitions. For the year ended December 31, 2024, we recorded RMB273.3 million (or US$37.4 million) in total revenue
compared to RMB205.5 million for the year ended December 31, 2023, representing a 33.0% increase. Subsequent to December 31, 2024, we
completed one acquisitions. Assuming the acquisition had taken place on 1 January 2024, the unaudited pro forma revenue of the Company
for the year ended December 31, 2024 would be RMB276.5 million (or US$111.2 million). For the year ended December 31, 2024, our gross
margin increased to 28.7% versus 25.0% for the year ended December