ATIF Holdings Reports 700% Revenue Growth but Incurred $1.9 Million Net Loss in Latest Quarter

ATIF Holdings Limited reported significant financial developments in its latest 10-Q filing for the quarter ending January 31, 2025. The company generated revenues of $200,000 for the three months ended January 31, 2025, a substantial increase from $25,000 in the same period last year, marking a 700% rise. For the six months ending January 31, 2025, revenues also increased to $200,000 from $150,000 in the prior year, reflecting a 33% growth. Despite this revenue growth, ATIF reported a net loss of $1.9 million for the quarter, compared to a loss of $407,638 in the previous year, and a net loss of $2.3 million for the six months, up from $1.0 million.

The company’s operational expenses saw a decrease, with total operating expenses for the three months ending January 31, 2025, at $550,797, down from $572,516 in the same period last year. Selling expenses decreased by 48% to $48,000, primarily due to reduced advertising costs. However, general and administrative expenses increased slightly by 5% to $502,797. The increase in losses was largely attributed to significant losses from investments in trading securities, which amounted to $1.3 million for the quarter, compared to a gain of $80,670 in the previous year.

In terms of strategic developments, ATIF completed a registered direct offering in January 2025, selling 3,820,000 ordinary shares at $1.25 per share, resulting in gross proceeds of approximately $4.8 million. This capital infusion has bolstered the company’s liquidity, with cash and cash equivalents rising to approximately $5.3 million as of January 31, 2025, compared to $1.2 million at the end of July 2024. The company also reported short-term investments in trading securities of approximately $2.8 million.

Operationally, ATIF continues to focus on providing consulting services primarily to a single customer, which accounted for all of its revenue during the reporting period. The company is transitioning its consulting services from a focus on Chinese enterprises to a broader North American market, aiming to assist small and medium-sized enterprises in going public. As of January 31, 2025, ATIF had no accounts receivable, indicating a shift in its customer base and operational strategy.

Looking ahead, ATIF's management expressed concerns regarding its ability to continue as a going concern due to ongoing net losses and the need for additional capital. The company is focused on executing its business plan, which includes increasing revenue while managing operating costs. The outlook remains cautious, with management emphasizing the importance of effective customer acquisition and retention strategies in a competitive market.