Lakeside Holding Ltd Segments Disclosure
NOTE 18 — SEGMENT REPORTING
The Company follows Financial Accounting Standards Board (FASB”) Accounting Standards codification “ASC”) Topic 280, Segment Reporting, as amended by Accounting Standards Update (“ASU”) No.2023-07. Segment Reporting Topic 280: Improvements to Reportable Segment Disclosures, the Company continually monitors the reportable segments for changes in fact and circumstances to determine whether changes in the identification or aggregation of operating segments are necessary. An operating segment is a component of the Company that engages in business activities from which it may earn revenues and incur expenses, and is identified on the basis of the internal financial reports that are provided to and regularly reviewed by the Company’s chief operating decision maker in order to allocate resources and assess performance of the segment.
The Company’s chief operating decision maker (“CODM”) is Mr. Henry Liu, the . The CODM regularly reviews financial information, including segment revenue, gross profit, significant segment expenses (selling expenses and general and administrative expenses), segment net income (loss), and segment assets to evaluate segment performance and allocate resources accordingly.
Based on internal management reporting and assessment, the Company concludes that it has two reporting segments listed as below for the year ended June 30, 2025 and one reporting segment for the year ended June 30, 2024. The Company and its subsidiaries are located either in the U.S. or China. The Company is primarily engaged in the business of providing customized cross-border freight solutions in the U.S. and distribution of pharmaceutical products in China. Segment net income (loss) excludes general corporate administrative expenses and selling expenses including corporate functional costs relating to professional expenses, payroll expense of management, and interest expenses in connection with convertible debt that are managed centrally at the corporate level and are excluded from the measure of segment performance reviewed by the CODM
The summary of key information by segments for the year ended June 30, 2025 was as follows:
| Cross-border freight solutions (U.S.) | Pharmaceutical distribution (China) | Others | Total for year ended June 30, 2025 | |||||||||||||
| Revenue from external customers | $ | 13,122,145 | $ | 2,762,465 | $ | $ | 15,884,610 | |||||||||
| Revenue from related parties | $ | 1,905,815 | $ | $ | $ | 1,905,815 | ||||||||||
| Cost of revenue | $ | 13,699,648 | $ | 1,212,318 | $ | $ | 14,911,966 | |||||||||
| Gross profit | $ | 1,328,312 | $ | 1,550,147 | $ | $ | 2,878,459 | |||||||||
| Selling expense | $ | $ | 309,249 | $ | 84,041 | $ | 393,290 | |||||||||
| General and administrative expense | $ | 4,766,407 | $ | 314,975 | $ | 2,329,524 | $ | 7,410,906 | ||||||||
| Depreciation & amortization | $ | 182,718 | $ | 14,476 | $ | 54,760 | $ | 251,954 | ||||||||
| Income tax provision (credit) | $ | 89,581 | $ | 225,653 | $ | (13,357 | ) | $ | 301,877 | |||||||
| Capital expenditure | $ | 79,728 | $ | 65,522 | $ | 5,654 | $ | 150,904 | ||||||||
| Long-lived assets | $ | 3,290,286 | $ | 380,407 | $ | 455,842 | $ | 4,126,535 | ||||||||
| Segment assets | $ | 6,810,674 | $ | 2,730,023 | $ | 4,864,764 | $ | 14,405,461 | ||||||||
| Segment profit (loss) | $ | (3,317,353 | ) | $ | 667,492 | $ | (2,596,275 | ) | $ | (5,246,136 | ) | |||||
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.