Company: FOXX
Filing Date: 2025-05-15
Form Type: 10-Q
Source: 0001213900-25-043597
Chunk: 190

Company: Foxx Development Holdings Inc.
Filing Date: 2025-05-15
Form: 10-Q
Item: Item 8
Chunk 190
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 hires during the nine months ended March 31,
2025, approximately $0.5 million credit losses due to the increasing risk of uncollectable accounts from one customer, approximately $0.3
million increase in stock-based compensation as we granted restricted stock units in November 2024 to our management team members under
employee incentive plan, and approximately $0.7 million increase in other general and administrative miscellaneous expenses, such
as insurance, rent expense, travel expense, and office expense due to increased expenses in the increased of our operations. We anticipate
a continued rise in our SG&A as we persist in executing our business expansion plan and integrating IoT-enabled devices alongside
our cloud platform to streamline operations in 2025.

Research and Development — related
party

Research and development
(“R&D”) expenses from a related party increased by approximately $46,000, or 100.0%, where the increase was primarily
due to an R&D project began in 2024. During the nine months ended March 31, 2025 and 2024, a related party completed additional 40%
and 20%, respectively, of the 5G development project pursuant to a R&D agreement between us and the related party, and we recognized
a R&D expense approximately of $91,000 and $46,000, respectively, accordingly based on the progression of the R&D project.

44

Research and Development 

R&D expenses increased by approximately $1.6 million, or 100.0%,
from $0 for the nine months ended March 31, 2024 to $1.6 million for the same period in 2025. The increase is due to hiring more employees
and engaging third parties to provide development services for new products during the nine months ended March 31, 2025. The increase
is also attributable to approximately $0.1 million increase in stock-based compensation as we granted restricted stock units in November
2024 to our R&D team members under employee incentive plan.

Other income (expense), net

Our other income (expense),
net is summarized as follows:

    For the Nine Months ended March 31, 

    2025  
    2024  
    Change  
    Change  (%) 

    (Unaudited)  
    (Unaudited)  

    Other income (expense) 

    Interest expense 
    $(3,005,186) 
    $(169