MemeStrategy (02440) issues profit warning, expecting a net loss of not less than 150 million yuan in 2025.

MEMESTRATEGY (02440) announced that the group is expected to incur a net loss of not less than RMB 150 million for the year ending December 31, 2025 (RMB 77.5 million in 2024), primarily due to the loss of the IoT business segment not less than RMB 110 million for the current year. The related IoT business was operated by the company's controlling shareholder, Home Office Development Limited, under the former name "Ho King Technology International Holdings Limited" before completing the acquisition of the company's shares in January last year. The increase in the group's expected net loss for the current year and the expected loss in the IoT business segment are mainly due to the impairment loss of trade receivables (mainly from the IoT business) under the expected credit loss model not less than RMB 100 million (RMB 29 million in 2024). This impairment loss in trade receivables is a non-cash item, which is expected not to have adverse effects on the overall cash flow or business operations of the group, made on a prudent basis and due to the unfavorable economic environment and deteriorating customer credit as a result of complex market competition.