Concentration of Risk |
9 Months Ended |
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Mar. 31, 2026 | |
| Risks and Uncertainties [Abstract] | |
| Concentration of Risk | Note 17 - Concentration of Risk
Credit risk
Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash and cash equivalents and accounts receivable.
As of March 31, 2026 and June 30, 2025, $713,685 and $2,007,890, respectively, were deposited with various financial institutions and financial services companies in the United States and PRC. Accounts at each institution in the United States are insured by the Federal Deposit Insurance Corporation (FDIC) for up to $250,000. The Company had approximately $0.4 million and $1.4 million, respectively, in excess of the FDIC insurance limit, as of March 31, 2026 and June 30, 2025.
Accounts receivable are typically unsecured and derived from revenue earned from customers, thereby exposing the Company to credit risk. The risk is mitigated by the Company’s assessment of its customers’ creditworthiness and its ongoing monitoring of outstanding balances. The Company maintains reserves for estimated credit losses, and such losses have generally been within expectations.
The business of WFOE in China may be impacted by Chinese economic conditions, changes in regulations and laws, and other uncertainties.
Customer and vendor concentration risk
For the nine months ended March 31, 2026 and 2025, Amazon Vendor and Amazon Seller customers accounted for 60% and 85% of the Company’s total revenues, respectively. As of March 31, 2026 and June 30, 2025, respectively, accounts receivable from Amazon Vendor and Amazon Seller accounted for 62% and 72% of the Company’s total accounts receivable.
For the nine months ended March 31, 2026 and 2025, one supplier accounted for 67% and 12% of the Company’s total purchases, respectively. As of March 31, 2026 and June 30, 2025, accounts payable to one supplier accounted for 24% and 10% of the Company’s total accounts payable.
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