Note 16 - Segment Information

The Company’s business consists of one operating segment, which is also its one reportable segment. The Company operates solely in the United States and derives revenues by providing sales of food and non-food to customers. The segment’s customer base consists primarily of Asian restaurants located throughout the United States. The Company’s chief operating decision maker (“CODM”) is its chief executive officer, who reviews financial information presented on a consolidated basis. The CODM uses consolidated net (loss) income to assess financial performance and allocate resources. The Company’s measure of segment assets is total assets, as reported on the consolidated balance sheets.

The following table presents selected financial information with respect to the Company’s single operating segment for the years ended December 31, 2025 and 2024:

Year Ended December 31,
(In thousands)20252024
Net revenue$1,228,282 $1,201,667 
Less:
Cost of revenue1,020,706 996,473 
Operating expenses:
Payroll and related labor costs97,956 98,991 
Professional fees8,230 11,066 
Depreciation12,677 10,397 
Amortization15,705 16,280 
Other segment expenses (a)
67,194 61,292 
Distribution, selling and administrative expenses201,762 198,026 
Goodwill impairment charges38,815 46,303 
Other (income) expenses:
Interest expense11,467 11,425 
Other (income) expense, net(1,057)2,818 
Change in fair value of interest rate swap contracts1,870 (1,693)
Lease guarantee income— (5,548)
Income tax expense (benefit)(5,970)1,965 
Less: net income (loss) attributable to noncontrolling interests(468)409 
NET LOSS AND COMPREHENSIVE LOSS ATTRIBUTABLE TO HF FOODS GROUP INC.$(38,843)$(48,511)
_______________
(a)Other segment expenses include distribution, selling and administrative expenses which are not provided to the chief operating decision maker on a regular basis. These expenses include primarily auto & truck expense, insurance, occupancy expense and utilities.
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Historical Timeline

Fiscal YearFiled
2025Mar 16, 2026Showing above
2024Mar 17, 2025
2020Mar 16, 2021
2019Mar 16, 2020
2018Apr 1, 2019

About Segments Disclosures

Segment disclosures break a company into its reportable operating units, revealing revenue, profit, and asset allocation that consolidated financial statements obscure. Under ASC 280, segments must match how the chief operating decision maker views the business, providing a window into internal management structure and resource allocation priorities.

Key signals: compare segment margins to identify which units drive profitability and which destroy value. Watch for changes in the number of reportable segments — segment aggregation or disaggregation often coincides with strategic shifts or attempts to obscure declining performance. Intersegment elimination patterns reveal internal pricing practices. The reconciliation between segment totals and consolidated figures exposes corporate overhead allocation and unallocated items. Geographic revenue concentration highlights regulatory and currency exposure. Compare segment-level capital expenditure against segment revenue to assess where management is investing for future growth versus harvesting existing assets.