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Pursuant to Section 13 or 15(d) of

the Securities Exchange Act of 1934


Date of report (Date of earliest event reported): August 12, 2022


(Exact name of registrant as specified in its charter)


Delaware   001-41204   47-2869399

(State or other jurisdiction

of incorporation)



File Number)


(I.R.S. Employer

Identification Number)


8201 164th Ave NE #200, Redmond, WA 98052-7615

(Address of principal executive offices)


(206) 385-0488 ext. 100

(Registrant’s telephone number, including area code)



(Former name or former address, if changed since last report)


Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2.)


Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))


Securities registered pursuant to Section 12(b) of the Act:


Title of each class   Trading Symbol(s)   Name of each exchange on which registered
Common Stock   HOUR   The Nasdaq Capital Market


Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).


Emerging growth company


If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐






Item 2.02. Results of Operations and Financial Condition.


On August 12, 2022, Hour Loop, Inc. (the “Company”) issued a press release announcing its financial results for the quarter ended June 30, 2022. A copy of this press release is attached hereto as Exhibit 99.1 and incorporated herein by reference. The information contained in the website is not a part of this current report on Form 8-K.


Item 9.01. Financial Statements and Exhibits.


(d) Exhibits.


Exhibit No.   Description
99.1   Press release issued by the registrant on August 12, 2022.
104   Cover Page Interactive Data File (embedded within the Inline XBRL document)






Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.


Dated: August 12, 2022 By: /s/ Sam Lai
  Name: Sam Lai
  Title: Chief Executive Officer and Interim Chief Financial Officer





Exhibit 99.1





Hour Loop Reports Second Quarter 2022 Results


Demonstrates Strong Execution Despite Challenging Macroeconomic Environment and Unfavorable e-Commerce Traffic in Q2


Provides Full Year 2022 Revenue Guidance Range of $81 million to $90 million


Redmond, WA, Aug 12, 2022 – Hour Loop, Inc. (NASDAQ: HOUR) (“Hour Loop”), a leading online retailer, announces its financial and operational results for the second quarter ended June 30, 2022.


Financial Highlights for Second Quarter 2022:


Total revenues increased 27.1% and 19.8% to $14.8 million, compared to $11.6 million in the year-ago period and $12.4 million for the first quarter of 2022, respectively.
Net loss totaled $0.31 million, compared to net income of $1.1 million in the year-ago period and net loss of $0.65 million for the first quarter of 2022.
Cash used in operating activities for the six months ended June 30, 2022 was $13.2 million, compared to $0.2 million in the year-ago period.


Management Commentary


“We’re pleased with our second quarter 2022 performance as we reported strong financial and operational results despite the significantly impacted consumer spending environment driven by inflationary and supply chain pressures and the trending down traffic in overall e-commerce,” said Sam Lai, CEO of Hour Loop. “Against this backdrop, we further demonstrated our ability to execute on our strategy and drive growth as planned. Given that our investment in labor and inventories were frontloaded in the first quarter, we have delivered second quarter 2022 revenues of $14.8 million, up 27.1% and 19.8% compared to the year ago period and first quarter of 2022, respectively, while our net loss significantly narrowed.


“While we are encouraged by our progress, we are not immune to the challenging macroeconomic environment, which impacted our gross profit percentage as a result of increased operating expenses, FBA fees, and a strong competitive environment. However, despite these challenges, we are frontloading our investments for the year while projecting to show profitability and maintain double digit growth for the full year 2022. We believe our investments are necessary to grow our headcount, rapidly scale, and set a foundation for future success once these headwinds ease, and we are building on our momentum since our IPO. We look forward to continuing to execute, drive growth, and ultimately deliver increased value for our shareholders.”




Second Quarter 2022 Financial Results


Total revenues in the second quarter of 2022 were $14.8 million compared to $11.6 million in the year-ago period and $12.3 million for the first quarter of 2022, respectively. The increase was primarily due to continued growth and maturity in our operating model, despite a continuation in overall e-commerce traffic decline in the second quarter.


Gross profit percentage declined 1.92% to 56.46%, compared to 58.38% of total revenues in the comparable period a year ago but improved from 52.3% for the first quarter of 2022. The year-over-year decrease was a function of our aggressive growth initiatives and a heightened inflationary environment causing higher cost of goods sold, increased FBA fees, and strong competition.


Operating expenses increased 52.8% to $8.7 million compared to $5.7 million in the year- ago period. This was a function of increased platform fees paid to Amazon, and a significant increase in our labor force.


Net loss in the second quarter was $0.31 million, or $0.01 per diluted share, compared to net income of $0.86 million, or $0.03 per diluted share, in the comparable year-ago period. The decrease was driven by increased costs and expenses as a result of the reasons mentioned above. Nevertheless, net loss in the second quarter narrowed to around half of the net loss for the first quarter of 2022.


As of June 30, 2022, the Company had $2.3 million in cash and cash equivalents, compared to $10.6 million as of December 31, 2021. This decrease was driven by the growth of inventory and labor force.


Inventories as of June 30, 2022, were $14.6 million compared to $7.0 million as of December 31, 2021. The Company intentionally invested heavily in inventories for strategic reasons.


Full Year 2022 Financial Outlook


For the full year 2022, the Company maintains its guidance for revenue to be in the range of $81 million to $90 million, representing 30% to 45% year-over-year growth.


About Hour Loop, Inc.


Hour Loop is an online retailer engaged in e-commerce retailing in the U.S. market. It has operated as a third-party seller on www.amazon.com and has sold merchandise on its website at www.hourloop.com since 2013. The Company expanded its operations to www.walmart.com in October 2020. To date, the Company has generated practically all of its revenue as a third-party seller on www.amazon.com and only a negligible amount of revenue from its own website and Walmart. Hour Loop manages more than 100,000 stock-keeping units (“SKUs”). Product categories include home/garden décor, toys, kitchenware, apparels, and electronics. The Company’s primary strategy is to bring most of its vendors product selections to the customers. It has advanced software that assists the Company in identifying product gaps so it can keep such products in stock year-round including the entirety of the last quarter (holiday season) of the calendar year. In upcoming years, Hour Loop plans to expand its business rapidly by increasing the number of business managers, vendors and SKUs.




Forward-Looking Statements


This press release contains statements that constitute “forward-looking statements” including with respect to the Company’s business strategy, product development and industry trends. Forward-looking statements are subject to numerous conditions, many of which are beyond the control of the Company. While the Company believes these forward-looking statements are reasonable, undue reliance should not be placed on any such forward-looking statements, which are based on information available to the Company on the date of this release. These forward-looking statements are based upon current estimates and assumptions and are subject to various risks and uncertainties, including, without limitation, those set forth in the Company’s filings with the Securities and Exchange Commission, as the same may be updated from time to time. Thus, actual results could be materially different. The Company undertakes no obligation to update these statements whether as a result of new information, future events or otherwise, after the date of this release, except as required by law.


Investor Contact

Finance Department







As of June 30, 2022 (Unaudited) and December 31, 2021


   June 30,   December 31, 
   2022   2021 
Current assets          
Cash and cash equivalents  $2,306,430   $10,592,572 
Accounts receivable, net   151,607    125,991 
Inventory, net   14,601,346    7,041,864 
Prepaid expenses and other current assets   831,839    965,298 
Total current assets   17,891,222    18,725,725 
Property and equipment, net   156,335    15,667 
Deferred tax assets   325,030    45,488 
Right-of-use lease assets   485,066    30,111 
TOTAL ASSETS  $18,857,653   $18,816,991 
Current liabilities          
Accounts payable  $5,358,935   $9,539,258 
Accrued expenses and other current liabilities   1,255,714    1,282,161 
Due to related parties   4,294,731    5,214,794 
Income taxes payable   126,333    126,333 
Current operating lease liabilities   303,923    - 
Total current liabilities   11,339,636    16,162,546 
Non-current liabilities          
Long-term operating lease liabilities   184,704    - 
Total liabilities   11,524,340    16,162,546 
Commitments and contingencies   -    - 
Stockholders’ equity          
Preferred stock: $0.0001 par value, 10,000,000 shares authorized, none issued and outstanding
   -    - 
Common stock: $0.0001 par value, 300,000,000 shares authorized, 35,042,578 and 33,300,000 shares issued and outstanding   3,504    3,330 
Additional paid-in capital   5,645,322    4,291 
Retained earnings   1,696,400    2,654,695 
Accumulated other comprehensive loss   (11,913)   (7,871)
Total stockholders’ equity   7,333,313    2,654,445 


The accompanying footnotes are an integral part of these unaudited condensed consolidated financial statements.






For the Periods Ended June 30, 2022 AND 2021



   Three Months   Three Months   Six Months   Six Months 
   Ended   Ended   Ended   Ended 
   June 30,   June 30,   June 30,   June 30, 
   2022   2021   2022   2021 
Revenues, net  $14,800,518   $11,643,230   $27,154,501   $20,966,143 
Cost of revenues   (6,443,910)   (4,845,441)   (12,341,179)   (8,939,993)
Gross profit   8,356,608    6,797,789    14,813,322    12,026,150 
Operating expenses                    
Selling and marketing   6,480,625    4,803,598    12,006,727    8,630,792 
General and administrative   2,275,642    925,698    3,951,606    1,462,507 
Total operating expenses   8,756,267    5,729,296    15,958,333    10,093,299 
(Loss) income from operations   (399,659)   1,068,493    (1,145,011)   1,932,851 
Other (expenses) income                    
Other expense   (3,944)   (3,754)   (9,394)   (4,624)
Interest expense   (20,567)   (10,328)   (104,125)   (10,328)
Other income   13,754    52,098    20,693    54,504 
Total other (expenses) income, net   (10,757)   38,016    (92,826)   39,552 
(Loss) income before income taxes   (410,416)   1,106,509    (1,237,837)   1,972,403 
Provision for income taxes   97,009    -    279,542    - 
Net (loss) income   (313,407)   1,106,509    (958,295)   1,972,403 
Other comprehensive (loss) income                    
Foreign currency translation adjustments   (9,497)   2,893    (11,913)   1,671 
TOTAL COMPREHENSIVE (LOSS) INCOME  $(322,904)  $1,109,402   $(970,208)  $1,974,074 
Basic and diluted (loss) income per common share  $(0.01)  $0.03   $(0.03)  $0.06 
Weighted-average number of common shares outstanding   34,939,695    33,300,000    33,300,000    33,300,000 


The accompanying footnotes are an integral part of these unaudited condensed consolidated financial statements.






For the Six Months Ended June 30, 2022 and 2021


















   Shares   Amount   Capital   Earnings   (Loss) Income   Equity 
BALANCE AT March 31, 2021   33,300,000   $3,330   $4,291   $4,885,513   $(4,403)  $    4,888,731 
Contribution                            - 
Distribution                  (2,132,000)        (2,132,000)
Currency translation adjustments                       1,671    1,671 
Net Income   -    -    -    1,106,509    -    1,106,509 
BALANCE AT June 30, 2021   33,300,000   $3,330   $4,291   $3,860,022   $(2,732)  $3,864,911 
BALANCE AT March 31, 2022   35,032,753   $3,503   $5,615,322   $2,009,807   $(10,287)  $7,618,345 
Stock based compensation   9,825    1    30,000              30,001 
Currency translation adjustments                       (1,626)   (1,626)
Net Loss   -    -    -    (313,407)   -    (313,407)
BALANCE AT June 30, 2022   35,042,578   $3,504   $5,645,322   $1,696,400   $(11,913)  $7,333,313 


The accompanying footnotes are an integral part of these unaudited condensed consolidated financial statements.