What changed in this filing

/stocks — the workspaceLOADING

Item 2. Management’s Discussion and Analysis

2024-05-14 compared with 2024-02-14 · 181 added, 174 removed, 328 unchanged (52% of the section changed)

MANAGEMENT’S DISCUSSION AND ANALYSIS

OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL

CONDITION AND RESULTS OF OPERATIONS

The following Management’s

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results and the timing of events could differ materially from those anticipated in these forward-looking statements as a result of several

Historical results may not

indicate future performance.

Our forward-looking statements reflect our current views about future events, are based on assumptions and

are subject to known and unknown risks and uncertainties that could cause actual results to differ materially from those contemplated

Historical results may

not indicate future performance.

Our forward-looking statements reflect our current views about future events, are based on assumptions

and are subject to known and unknown risks and uncertainties that could cause actual results to differ materially from those contemplated

by these statements.

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Driven by technology and data,

(“iPower,” “we,” “us,” or “the Company”) is an online supplier of consumer

goods, including consumer home goods, hydroponics equipment, general gardening, furniture and pet supplies.

Through the operations of

our e-commerce platforms and channel partners, our fulfillment centers in Rancho Cucamonga and Duarte, California, we believe we are one

of the leading marketers, distributors and retailers in the consumer gardening and home goods categories, based on management’s

Our core strategy continues to focus on expanding our geographic reach across the United States and internationally through

organic growth, both in terms of expanding our customer base as well as brand and product development.

iPower has developed a set of methodologies

driven by proprietary data formulas to effectively bring products to market and increase sales.

(“iPower,” “we,” “us,” or “the Company”) is an online retailer and supplier

of consumer goods, including consumer home, pet and garden products, as well

as a provider of value-added ecommerce services for third-party products and brands.

Our capabilities include a full spectrum of online

channels, robust fulfillment capacity, a network of warehouses serving the US, competitive last mile delivery partners and a differentiated

business intelligence platform.

With these capabilities, iPower efficiently moves a diverse catalog of SKUs from its supply chain partners

to end consumers every day, providing the best value to customers in US and other countries.

iPower has developed a set

of methodologies driven by proprietary data formulas to effectively bring products to market and increase sales.

Products on iPower's

SuperSuite platform consistently achieve Amazon Best Seller status and Amazon Choice designation.

We are actively developing

and acquiring our in-house branded products, which to date include the iPower and Simple Deluxe brands and

more, with some of our products achieving Amazon best seller product leaders and Amazon Choice products designations, among others.

supply chain partners with strong products and brands.

Acquisitions and Joint Ventures

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war may nonetheless increase the likelihood of supply chain disruptions and hinder our ability to find the materials we need to make our

Thus far, as a result of the general global economic disruption, we have experienced a delay in, as well as an increase in,

costs in shipping, resulting in in increased inventory levels in our warehouse facilities, thus resulting in reduced profits.

Thus far, as a result of the general global economic disruption, we have experienced a delay in, as well as an increase in costs

related to shipping, resulting in increased inventory levels in our warehouse facilities, thus resulting in reduced profits.

supply chain disruptions may put upward pressure on our costs and increase the risk that we may be unable to acquire the materials and

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Ongoing COVID-19 Pandemic and Related Disruptions

While the worst of the COVID-19

pandemic has seemingly passed and we believe that the pandemic is unlikely to significantly impact our business going forward, we continue

to closely monitor its impact on our business, results of operations and financial results.

The situation surrounding the pandemic remains

fluid and the full extent of the positive or negative impact of the COVID-19 pandemic on our business will depend on certain developments

including the length of time of any regional outbreaks, the impact on consumer activity and behaviors, and the effect on our customers,

employees, suppliers and stockholders, all of which are uncertain and cannot be predicted.

While the COVID-19 pandemic has not had a material

adverse impact on our operations to date and we believe the long-term opportunity that we see for shopping online remains unchanged, it

is difficult to predict all of the positive or negative impacts that COVID-19 may have on our business over time.

We will continue to

actively monitor the situation and may take further actions that alter our business operations as may be required by federal, state, local

or foreign authorities, or that we determine are in the best interests of our customers, employees, suppliers, stockholders and communities.

While it appears the COVID-19

pandemic has largely passed and we believe that any aftereffects of the pandemic are unlikely to significantly impact our business going

forward, we continue to closely monitor its impact on our business, results of operations and financial results.

The situation surrounding

the pandemic remains fluid and the full extent of the positive or negative impact of the COVID-19 pandemic on our business will depend

on certain developments including the length of time of any regional outbreaks, the impact on consumer activity and behaviors, and the

effect on our customers, employees, suppliers and stockholders, all of which are uncertain and cannot be predicted.

While the COVID-19

pandemic has not had a material adverse impact on our operations to date and we believe the long-term opportunity that we see for shopping

online remains unchanged, it is difficult to predict all of the positive or negative impacts that the pandemic, or any future pandemics,

may have on our business over time.

We will continue to actively monitor the situation and may take further actions that alter our business

operations as may be required by federal, state, local or foreign authorities, or that we determine are in the best interests of our customers,

employees, suppliers, stockholders and communities.

Regulatory Environment

In additional to general consumer

In addition to general consumer

goods, we sell hydroponic gardening products to end users that may use such products in new and emerging industries or segments, including

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RESULTS OF OPERATIONS

For the three months ended December 31,

2023 and 2022

For the three months ended March 31, 2024

The following table presents

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Three Months Ended

December 31, 2023

March 31, 2024

Three Months Ended

December 31, 2022

March 31, 2023

Cost of goods sold

Operating expenses

Operating loss

Operating income (loss)

Other expenses

Loss before income taxes

Income tax benefit

Income (loss) before income taxes

Income tax expense (benefit)

Net income (loss)

Non-controlling interest

Net loss attributable to iPower Inc.

Other comprehensive (loss) income

Comprehensive loss attributable to iPower Inc.

$ (2,075,083 )

Net income (loss) attributable to iPower Inc.

Other comprehensive income

Comprehensive income (loss) attributable to iPower Inc.

$ (1,512,930 )

Gross profit % of revenues

Operating loss % of revenues

Net loss % of revenues

for the three months ended December 31, 2023 decreased 12.75% to $16,800,122 as compared to $19,254,590 for the three months ended

December 31, 2022.

While pricing remained stable, the decreased revenue mainly resulted from a decrease in sales volume during the

three months ended December 31, 2023 as the Company offered less promotions and clearance activities due to lower inventory level as

compared to the three months ended December 31, 2022.

This was partially offset by growth in the Company’s SuperSuite supply

chain offerings.

Operating income (loss) % of revenues

Net income (loss) % of revenues

for the three months ended March 31, 2024 increased 15.24% to $23,308,508 as compared to $20,225,619 for the three months ended March

With slightly increased selling price due to inflation and sales of new products, the increased revenue mainly resulted from

an increase in sales volume during the three months ended March 31, 2024 as we got more orders from Amazon as compared to the three months

ended March 31, 2023.

This was further enhanced by growth in the Company’s SuperSuite supply chain offerings.

Costs of Goods Sold

Costs of goods sold for the

three months ended December 31, 2023 decreased 15.98% to $9,481,882 as compared to $11,285,064 for the three months ended December 31,

The decrease was primarily due to a decrease in sales and freight costs.

See discussions on gross profit below.

three months ended March 31, 2024 decreased 0.59% to $12,360,170 as compared to $12,433,898 for the three months ended March 31, 2023.

The decrease was primarily due to a decrease in product and freight costs.

See the discussion on gross profit below.

Gross profit was $10,948,338

for the three months ended December 31, 2023 as compared to $7,969,526 for the three months ended December 31, 2022.

The gross profit

ratio increased to 43.56% for the three months ended December 31, 2023 from 41.39% for the three months ended December 31, 2022.

in the gross profit ratio was mainly driven by the decrease in costs of goods sold as a result of decreased freight charges during the

current period.

for the three months ended March 31, 2024 as compared to $7,791,721 for the three months ended March 31, 2023.

The gross profit ratio

increased to 46.97% for the three months ended March 31, 2024 from 38.52% for the three months ended March 31, 2023.

The increase in the

gross profit ratio was mainly driven by the slightly increased selling price and the decrease in costs of goods sold as a result of decreased

freight charges during the current period.

However, we cannot be assured that this trend will continue.

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Operating expenses for the

three months ended December 31, 2023 decreased 18.10% to $9,870,587 as compared to $12,052,092 for the three months ended December 31,

The decrease was mainly due to the combination of a decrease in selling and fulfillment expenses of $2.4 million as a result of

decreased costs related to advertising, merchant fees, rental expenses, and delivery fees, and an increase in general and administrative

expenses of $0.2 million, which included payroll expenses, stock-based compensation expense, insurance expenses and other operating expenses.

Loss from Operations

Loss from operations was $2,552,347

for the three months ended December 31, 2023 as compared to $4,082,566 for the three months ended December 31, 2022.

The decrease in loss

was resulted from the decrease in operating expenses and the increase in gross profit ratio, as discussed above.

three months ended March 31, 2024 decreased 6.28% to $9,347,062 as compared to $9,602,919 for the three months ended March 31, 2023.

decrease was mainly due to the combination of a decrease in selling and fulfillment expenses of $0.5 million as a result of vendor credits

of $858,456 recorded during the quarter ended March 31, 2024, which was partially offset by increased costs related to advertising, merchant

fees, rental expenses and delivery fees, and an increase in general and administrative expenses of $0.3 million, which included payroll

expenses, stock-based compensation expense, insurance expenses, legal and other operating expenses.

Income (Loss) from Operations

Income (loss) from operations

was $1,601,276 for the three months ended March 31, 2024 as compared to $(1,811,198) for the three months ended March 31, 2023.

in income resulted from an increase in the gross profit ratio, driven by the slightly increased selling price and the decrease in costs

of goods sold as a result in an overall decrease in freight charges, and a decrease in operating expenses, as discussed above.

Other Expenses

Other expenses for the three

months ended December 31, 2023 was $54,575 as compared to $258,457 for the three months ended December 31, 2022.

The decrease in other

expenses was mainly due to a decrease in interest, including amortization of debt discount on the revolving loan of $131,507 and an increase

in other non-operating income of $69,238.

Net Loss Attributable to iPower Inc.

Net loss attributable to iPower

for the three months ended December 31, 2023 was $1,914,828 as compared to $3,290,439 for the three months ended December 31, 2022,

representing a decrease of net loss of $1,375,611.

The decrease was primarily due to the increase in gross profit and decrease in operating

expenses as discussed above.

Comprehensive Loss Attributable to iPower

Comprehensive loss attributable

Other expenses for the

three months ended March 31, 2024 was $211,660 as compared to $312,155 for the three months ended March 31, 2023.

The decrease in

other expenses was mainly due to a decrease in interest, including amortization of debt discount on the revolving loan of $57,424

and other non-operating expenses of $42,566.

Net Income (Loss) Attributable to iPower

Net income (loss) attributable

to iPower Inc.

for the three months ended December 31, 2023 was $2,075,083 as compared to $3,243,290 for the three months ended December

31, 2022, representing a decrease of comprehensive loss of $1,168,207.

The decrease was due to the reasons discussed above, along with

an increase in other comprehensive loss of $207,404 as a result of foreign currency translation adjustments resulting from the translation

of RMB, the functional currency of our VIE in the PRC, to USD, the reporting currency of the Company.

For the six months ended December 31, 2023

for the three months ended March 31, 2024 was $1,016,082 as compared to $(1,530,534) for the three months ended March 31,

2023, representing an increase in net income of $2,546,616.

The increase was primarily due to the increase in gross profit, decrease in

other non-operating expenses, and a decrease in operating expenses, as discussed above.

Comprehensive Income (Loss) Attributable

to iPower Inc.

Comprehensive income (loss)

attributable to iPower Inc.

for the three months ended March 31, 2024 was $1,085,204 as compared to $(1,512,930) for the three months

ended March 31, 2023, representing an increase of comprehensive income of $2,598,134.

The increase was due to the reasons discussed above,

along with an increase in other comprehensive income of $51,518 as a result of foreign currency translation adjustments resulting from

the translation of RMB, the functional currency of our VIE in the PRC, to USD, the reporting currency of the Company.

For the nine months ended March 31, 2024

The following table presents

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period to period.

Six Months Ended

December 31, 2023

Six Months Ended

December 31, 2022

Nine Months Ended

March 31, 2024

Nine Months Ended

March 31, 2023

Cost of goods sold

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Operating loss

Other expenses

(10,487,070 )

Other income (expenses)

Loss before income taxes

(11,097,353 )

Income tax benefit

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Net loss attributable to iPower Inc.

Other comprehensive (loss) income

Other comprehensive loss

Comprehensive loss attributable to iPower Inc.

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Net loss % of revenues

for the six months ended December 31, 2023 decreased 4.35% to $43,308,496 as compared to $45,277,263 for the six months ended

December 31, 2022.

While pricing remained stable, the decreased revenue mainly resulted from a decrease in sales volume during the

six months ended December 31, 2023 as the Company offered less promotions and clearance activities due to lower inventory level as

compared to the six months ended December 31, 2022.

This was partially offset by growth in the Company’s SuperSuite supply

chain offerings.

for the nine months ended March 31, 2024 increased 1.70% to $66,617,004 as compared to $65,502,882 for the nine months ended March 31,

The slightly increased revenue mainly resulted from an increase in selling price and sales volume from growth in the Company’s

SuperSuite supply chain offerings during the nine months ended March 31, 2024 as compared to the nine months ended March 31, 2023.

Costs of Goods Sold

Costs of goods sold for the

six months ended December 31, 2023 decreased 11.31% to $24,231,411 as compared to $27,322,021 for the six months ended December 31, 2022.

The decrease was primarily due to a decrease in sales and freight costs.

See discussions on gross profit below.

nine months ended March 31, 2024 decreased 7.96% to $36,591,581 as compared to $39,755,919 for the nine months ended March 31, 2023.

decrease was primarily due to a decrease in product and freight costs.

See the discussion on gross profit below.

Gross profit was $30,025,423

for the six months ended December 31, 2023 as compared to $17,955,242 for the six months ended December 31, 2022.

The gross profit ratio

increased to 44.05% for the six months ended December 31, 2023 from 39.66% for the six months ended December 31, 2022.

The increase in

the gross profit ratio was mainly driven by the decrease in costs of goods sold as a result of decreased freight charges during the current

for the nine months ended March 31, 2024 as compared to $25,746,963 for the nine months ended March 31, 2023.

The gross profit ratio increased

to 45.07% for the nine months ended March 31, 2024 from 39.31% for the nine months ended March 31, 2023.

The increase in the gross profit

ratio was mainly driven by the slightly increased selling price and the decrease in costs of goods sold as a result of decreased freight

charges during the current period.

However, we cannot be assured that this trend will continue.

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Operating expenses for the

six months ended December 31, 2023 decreased 14.02% to $22,898,109 as compared to $26,631,114 for the six months ended December 31, 2022.

The decrease was mainly due to the combination of a decrease in selling and fulfillment expenses of $0.8 million as a result of decreased

costs related to advertising, merchant fees, rental expenses and delivery fees, and a decrease of $3.1 million of impairment loss on goodwill

triggered by a decrease in the Company’s share price of its common stock and the net loss incurred during the six months ended December

nine months ended March 31, 2024 decreased 11.01% to $32,245,171 as compared to $36,234,033 for the nine months ended March 31, 2023.

The decrease was mainly due to the combination of a decrease in selling and fulfillment expenses of $1.27 million, including vendor credits

of $858,456 recorded during the quarter ended March 31, 2024 and decreased costs related to advertising, merchant fees, rental expenses

and delivery fees, an increase in general and administrative expense of $0.3 million, and a decrease of $3.1 million of impairment loss

on goodwill triggered by a decrease in the Company’s share price of its common stock and the net loss incurred during the nine months

ended March 31, 2023.

Loss from Operations

Loss from operations was $2,219,748

for the six months ended December 31, 2023 as compared to $8,675,872 for the six months ended December 31, 2022.

The decrease in loss

was resulted from the decrease in operating expenses and the increase in gross profit, as discussed above.

for the nine months ended March 31, 2024 as compared to $10,487,070 for the nine months ended March 31, 2023.

The decrease in loss from

operations resulted from the decrease in operating expenses and the increase in gross profit, as discussed above.

Other Expenses

Other expenses for the six

months ended December 31, 2023 was $351,131 as compared to $298,128 for the six months ended December 31, 2022.

The increase in other

expenses was mainly due to a combination of a decrease in interest expenses and a decrease in other non-operating income of $209,688 resulted

from termination of sublease in January 2023.

Other expenses for the nine

months ended March 31, 2024 was $562,791 as compared to $610,283 for the nine months ended March 31, 2023.

The slightly decreased other

expenses was mainly due to a decrease in interest expenses of $208,607, which was partially offset by a decrease in other non-operating

income of $167,122.

Net Loss Attributable to iPower Inc.

Net loss attributable to iPower

for the six months ended December 31, 2023 was $3,201,343 as compared to $7,472,815 for the six months ended December 31, 2022, representing

for the nine months ended March 31, 2024 was $2,185,261 as compared to $9,003,349 for the nine months ended March 31, 2023, representing

a decrease of net loss of $6,818,088.

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to iPower Inc.

for the six months ended December 31, 2023 was $3,362,305 as compared to $7,537,141 for the six months ended December 31,

for the nine months ended March 31, 2024 was $2,277,101 as compared to $9,050,071 for the nine months ended March 31, 2023,

representing a decrease of comprehensive loss of $6,772,970.

The decrease was due to the reasons discussed above, along with an

increase in other comprehensive loss of $96,636 as a result of foreign currency translation adjustments resulting from the translation

The decrease was due to the reasons discussed above, partially offset by

an increase in other comprehensive loss of $45,118 as a result of foreign currency translation adjustments resulting from the translation

of RMB, the functional currency of our VIE in the PRC, to USD, the reporting currency of the Company.

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credit facility from JPMorgan Chase Bank ("JPM”).

We had cash and cash equivalents of $1,488,027 as of December 31, 2023, representing

We had cash and cash equivalents of $2,714,724 as of March 31, 2024, representing

a $1.0 million decrease from $3,735,642 as of June 30, 2023.

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Based on our current operating

plan, and despite the current uncertainty resulting from the ongoing Ukraine-Russia and Israel-Hamas military conflicts, and the effects

of COVID-19, we believe that our existing cash and cash equivalents and cash flows from operations will be sufficient to finance our operations

during the next 12 months.

plan, and despite the current uncertainty resulting from the ongoing Ukraine-Russia and Israel-Hamas military conflicts, and any latent

effects of COVID-19, we believe that our existing cash and cash equivalents and cash flows from operations will be sufficient to finance

our operations during the next 12 months.

Our cash requirements consist

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In addition, we plan to increase the size of our in-house product

catalog, which will have a net beneficial impact on our margin profile and ability to generate cash.

Currently, we have approximately

$10 million in unused credit available under the revolving line with JPM.

Given our current working capital position and available funding

from our revolving credit line, we believe we will be able to manage through the current challenges by managing payment terms with customers

catalog, which will have a net beneficial impact on our profit margin profile and ability to generate cash.

While we have approximately

$18 million in unused credit available under the revolving line with JPM, the JPM revolving loan has a maturity date of November 12, 2024.

Currently we are working on renewal of the revolving line with JPM.

Nonetheless, given our current working capital position and available funding from our revolving credit line, which we will seek to refinance

between now and the JPM maturity date, we believe we will be able to manage through the current challenges by managing payment terms with

customers and vendors.

Working Capital

As of December 31, 2023 and

June 30, 2023, our working capital was $4.7 million and $17.9 million, respectively.

The historical seasonality in our business during

the year can cause cash and cash equivalents, inventory and accounts payable to fluctuate, resulting in changes in our working capital.

As of March 31, 2024 and June

30, 2023, our working capital was $6.6 million and $17.9 million, respectively.

The historical seasonality in our business during the

year can cause cash and cash equivalents, inventory and accounts payable to fluctuate, resulting in changes in our working capital during

Operating Activities

Net cash provided by operating

activities for the six months ended December 31, 2023 and 2022 was $5,045,730 and $7,778,208, respectively.

activities for the nine months ended March 31, 2024 and 2023 was $5,151,956 and $7,785,832, respectively.

The decrease in cash provided

by operating activities mainly resulted from the decrease of changes in accounts payable, accounts receivable, inventories, prepayments

and other current assets, partially offset by a decrease of changes in other payable and accrued liabilities.

by operating activities was mainly resulted from the decrease of changes in accounts receivable, inventories, prepayments and other current

assets, and accounts payable, partially offset by an increase of changes in deferred tax assets/liabilities, other payables and accrued

liabilities and a decrease in net loss.

Investing Activities

For the six months ended December

31, 2023 and 2022, net cash used in investing activities was $0 and $127,367, respectively.

The decrease in cash used in investing activities

was because the Company did not have additional purchase of equipment during the six months ended December 31, 2023.

For the nine months ended

March 31, 2024 and 2023, net cash used in investing activities was $0 and $144,885, respectively.

The decrease in cash used in investing

activities was because the Company did not purchase any additional equipment during the nine months ended March 31, 2024, whereas such

equipment had been purchased in the same period during 2023.

Financing Activities

Net cash used in financing

activities was $7,175,000 and $5,540,436, respectively, for the six months ended December 31, 2023 and 2022.

activities was $6,100,000 and $8,002,476, respectively, for the nine months ended March 31, 2024 and 2023.

The main reason the Company

experienced an increase in net cash used in financing activities was primarily due to our payment of $9.2 million for:

(1) $1.9 million

to pay down the note payable to White Cherry;

and (2) $7.3 million to pay down the outstanding balance of the asset-based revolving loan

facility with JPM.

experienced a decrease in net cash used in financing activities was primarily due to a combination of increase in proceeds from loans

and our payment of $11.1 million for:

(1) $3.8 million to pay off the notes payable to White Cherry;

and (2) $7.3 million to pay down

the outstanding balance of the asset-based revolving loan facility with JPM.

OFF-BALANCE SHEET ARRANGEMENTS

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historical experience.

The Company evaluates the criteria

of ASC 606 - Revenue Recognition Principal Agent Considerations in determining whether it is appropriate to record the gross amount of

product sales and related costs or the net amount earned as commissions.

Generally, when the Company is primarily responsible for fulfilling

the promise to provide a specified good or service, the Company is subject to inventory risk before the good or service has been transferred

to a customer and the Company has discretion in establishing the price, revenue is recorded at gross.

The Company evaluates the

criteria of ASC 606 - Revenue Recognition Principal Agent Considerations in determining whether it is appropriate to record the gross

amount of product sales and related costs or the net amount earned as commissions.

Generally, when the Company is primarily responsible

for fulfilling the promise to provide a specified good or service, the Company is subject to inventory risk before the good or service

has been transferred to a customer and the Company has discretion in establishing the price, revenue is recorded at gross.

Payments received prior to

31 unchanged sentences

impact DHS’s economic performance.

DHS’s operational funding is provided by the Company after February 15, 2022.

term of the agreements, which run for a term of 10 years from February 2022 to February 2032, the Company bears all risk of loss and has

the right to receive all of the benefits from DHS.

As such, based on the determination that the Company is the primary beneficiary of

DHS, in accordance with ASC 810-10-25-38A through 25-38J, DHS is considered a variable interest entity (“VIE”) of the Company

and the financial statements of DHS have been consolidated from the date such control existed, February 15, 2022.

See Note 4 and Note

5 for details on acquisition.

DHS’s operational funding has been provided by the Company following the February 15, 2022

During the term of the Agreements, the Company bears all the risk of loss and has the right to receive all of the benefits

As such, based on the determination that the Company is the primary beneficiary of DHS, in accordance with ASC 810-10-25-38A

through 25-38J, DHS is considered a VIE of the Company and the financial statements of DHS have been consolidated from the date such control

existed, February 15, 2022.

See Note 4 and Note 5 for details regarding the acquisition.

Goodwill represents the excess

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the Company’s goodwill is partially impaired.

During the six months ended

December 31, 2023, in addition to a qualitative goodwill impairment analysis following the steps laid out in ASC 350-20-35-3C, the Company

also performed a quantitative analysis using the Discounted Cash Flow and Market Capital Method and noted no goodwill impairment.

December 31, 2023 and 2022, the remaining goodwill balance amounted to $3,034,110.

During the period ended March

31, 2024, the Company performed a qualitative goodwill impairment analysis following the steps laid out in ASC 350-20-35-3C and noted

no goodwill impairment.

As of March 31, 2024 and June 30, 2023, the goodwill balance amounted to $3,034,110 and $3,034,110, respectively.

Intangible Assets, net

Finite life intangible assets

at December 31, 2023 include a covenant not to compete, supplier relationship and software recognized as part of the acquisition of Anivia.

at March 31, 2024 include a covenant not to compete, supplier relationship and software recognized as part of the acquisition of Anivia.

Intangible assets are recorded at the estimated fair value of these items at the date of acquisition, February 15, 2022.

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other fair value determinations.

As of December 31, 2023, there were no indicators of impairment.

As of March 31, 2024 and 2023, there were no indicators of impairment.

Stock-based Compensation

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to the amount expected to be realized.

As of December 31, 2023, the Company expected that the deferred tax assets are fully realizable

so did not record any valuation allowance.

As of March 31, 2024, the Company expected that the deferred tax assets are fully realizable so

did not record any valuation allowance.

As a result of the implementation

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis