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CLPS Inc

CLPS
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Business Summary

CLPS Incorporation is a global information technology (IT), consulting, and solutions service provider primarily focused on global institutions in banking, wealth management, e-commerce, and automotive sectors . The company has been operating for over 20 years, driving digital transformation and optimizing operational efficiency through innovations in artificial intelligence (AI), cloud computing, and big data . Its diverse business lines also span education and study abroad programs, and global tourism integrated with transportation services . CLPS operates across 10 countries worldwide, with strategic regional hubs in Shanghai (mainland China), Singapore (Southeast Asia), and California (North America), supported by subsidiaries in Japan and the UAE . The total assets of China's banking financial institutions reached RMB 444.6 trillion (USD 60.9 trillion) at the end of 2024, representing a year-on-year increase of 6.5% . The software and information technology service industry in China generated RMB 13.7 trillion (USD 1.9 trillion) in revenue in 2024, an increase of 10.0% over 2023, with a total profit of RMB 1.69 trillion (USD 231.5 billion), an increase of 8.7% . The overall market size of China's banking IT solution market reached RMB 71.3 billion (USD 9.8 billion) in 2024, an increase of 2.9% over 2023 .

The company faces intense competition from both onshore and offshore IT services companies, expecting this competition to persist and intensify . Key competitive factors include industry expertise, breadth and depth of service offerings, quality of services, reputation, track record, marketing and selling skills, scalability of infrastructure, and price . Domestically, CLPS competes with Shenzhen Forms Syntron Information Co., Ltd., Sunline Tech, Amarsoft, and CSII, all of which are domestic listed companies with considerable market share in the IT services industry . Internationally, competitors include Wipro, TCS Consultancy, and Infosys Limited . CLPS does not typically compete directly with larger global consulting and outsourcing firms like Accenture, Capgemini, Hewlett-Packard, and IBM, unless these firms seek smaller engagements or enter the Chinese market . CLPS believes its delivery capabilities are competitive and its domestic China market experience provides a competitive advantage .

CLPS generates revenue through IT consulting services, customized IT solution services, academic education services, and other services such as software sales, training, and headhunting . IT consulting services are primarily billed on a time-and-expense basis, while customized IT solution services are typically fixed-price contracts . Academic education services generate revenue through fixed tuition fees paid in advance . The company's business model emphasizes providing turn-key financial solutions and leveraging a global service network to serve diverse clients cost-effectively .

For the fiscal year ended June 30, 2025, total revenues increased by 15.2% to approximately $164.5 million from $142.8 million in fiscal 2024 . IT consulting services revenue increased by 16.0% to $158.8 million from $136.8 million in fiscal 2024 , accounting for 96.5% of total revenues . Customized IT solution services revenue decreased by 11.6% to $2.8 million from $3.1 million in fiscal 2024 , representing 1.7% of total revenues . Academic education services revenue increased by 96.3% to $2.0 million from $1.0 million in fiscal 2024 , accounting for 1.2% of total revenues . Other services revenue decreased by 49.7% to $0.9 million from $1.8 million in fiscal 2024 , representing 0.6% of total revenues .

The company reported a gross profit of approximately $36.3 million in fiscal 2025, an increase of 10.2% from $32.9 million in fiscal 2024 . The gross margin decreased to 22.1% in fiscal 2025 from 23.1% in fiscal 2024 . Selling and marketing expenses increased by 13.3% to $5.2 million in fiscal 2025 from $4.6 million in fiscal 2024 , representing 3.1% of revenues . Research and development (R&D) expenses decreased by 18.7% to $5.8 million in fiscal 2025 from $7.2 million in fiscal 2024 , representing 3.5% of total revenues . General and administrative expenses increased by 26.8% to $31.9 million in fiscal 2025 from $25.1 million in fiscal 2024 . The company reported a net loss of $6.4 million in fiscal 2025, compared to a net loss of $1.8 million in fiscal 2024 . Basic and diluted losses per common share were $0.26 in fiscal 2025, compared to $0.09 in fiscal 2024. As of June 30, 2025, cash and cash equivalents were approximately $28.2 million , total assets were approximately $118.1 million , and total liabilities were $60.5 million . Total shareholders' equity was approximately $57.6 million .

In terms of operational developments, CLPS completely acquired College of Allied Educators Pte. Ltd. (CAE) on January 3, 2024, expanding into the academic education sector and introducing IT-related courses . On June 7, 2024, Ridik Pte. acquired 100% equity interest in Shell Infotech Pte. Ltd. and its subsidiary, Shell Infotech Consulting Sdn. Bhd., to strengthen its position in Southeast Asia's IT services market . The company also established new subsidiaries, Ridik Dubai in the United Arab Emirates on July 31, 2024, and PT Ridik Fintech Services (Ridik Indonesia) in Indonesia on February 28, 2025, as part of its global expansion strategy . CLPS also incorporated Shanghai Qinhui in Shanghai on December 27, 2024, holding 46% equity interest .

Business Outlook

The company intends to pursue additional revenue opportunities from existing Chinese and global clients, focusing on delivering high-quality services and solutions and identifying additional opportunities as these clients will continue to constitute a significant portion of revenues and medium-term growth . CLPS will also continue to target new Chinese and global clients, leveraging its comprehensive service and solution offerings and deepening domain expertise in the finance industry . Furthermore, the company plans to invest in a delivery platform that benefits both Chinese and global clients, capturing synergies between the China and global markets .

CLPS plans to continue investing in research and development, deepening its domain expertise, and developing specific solutions for target industry verticals . This includes enhancing domain knowledge in the financial industry and relevant business-specific processes, leveraging accumulated domain knowledge to address client needs more effectively . The company will focus on researching and developing cutting-edge technologies such as distributed application systems, cloud computing, microservices, open API, RPA, blockchain, AI, and big data, with a focus on continuous scientific and technological innovation . CLPS offers comprehensive data services and IT solutions for big data, expertise in cloud computing including building custom 'private clouds' and cloud migration, and a unified platform for rapid development of custom Large Language Model (LLM) agents . The company is also a leading force in AIGC technology, focusing on research, application development, and ecosystem building, and leverages blockchain technology to revolutionize the banking and financial services industry .

The company places a high priority on attracting, training, developing, and retaining its human capital base to be increasingly competitive . Spearheaded by the CLPS Academy, it will continue to build its professional talent pool through Talent Creation Program (TCP) and Talent Development Program (TDP) to ensure a sustainable supply of financial IT talent resources . These programs involve collaboration with universities, utilization of a technical curriculum, and professional certifications . CLPS expects to open additional training centers overseas to meet increasing demand for its services and solutions and will strengthen collaboration with leading domestic universities for on-campus recruiting . For fiscal year 2025, 196 interns were trained . The acquisition of College of Allied Educators Pte. Ltd. (CAE) strategically expands the company into academic education, providing a platform for vertical integration and introducing IT-related programs to create internship and job opportunities for graduates .

CLPS strives to gain significant operating efficiencies by leveraging historical and ongoing investments in infrastructure, research and development, and human capital . The company operates its business on a single, integrated platform with centralized functions to provide economies of scale . It also expects to continue investing in its IT infrastructure and more advanced technologies, such as cloud computing, to enhance scalability and grow cost-effectively . As part of expanding its scale, CLPS intends to continue building training centers tailored to human capital needs to deploy human capital more efficiently, thereby improving overall resource utilization and productivity .

The company will continue to pursue selective alliances and acquisitions to enhance its industry-specific technology and service delivery capabilities, building on its track record of successfully acquiring and integrating targeted companies . The focus will be on enhancing technology capabilities, deepening penetration into key clients, expanding the portfolio of service offerings, and expanding operations geographically .

CLPS remains focused on investing in long-term sustainable growth and delivering on its dual-engine strategy of horizontal and vertical expansion . This includes pursuing growth in its global footprint and market share, as well as in technological and talent development . The company established new subsidiaries, Ridik Dubai in the United Arab Emirates and Ridik Indonesia, to broaden its footprint and enhance service offerings, and inaugurated the College of Allied Educators (CAE) in Singapore to foster talent development .

The company is capitalizing on growth opportunities through strategic diversification into emerging sectors, with diverse business lines spanning fintech, payment and credit services, e-commerce, education and study abroad programs, and global tourism integrated with transportation services . This approach allows CLPS to enhance service delivery, explore new revenue streams, and strengthen its competitive position across multiple sectors .

The planned initial public offering of JAJI Global, a consolidated subsidiary, may impact CLPS's operational results and financial reporting . If CLPS's equity interest in JAJI Global decreases to below 50% as a result of this offering, or any potential future offering, CLPS may no longer consolidate its financial results, which could materially affect its operational results and financial condition and lead to changes in financial statement presentation . Significant intercompany transactions between CLPS and JAJI Global, including loan arrangements, may continue to be considered related party transactions if equity interest falls below 50%, subjecting CLPS to additional disclosure requirements and increased scrutiny .

Risk Factors

The company faces several material risks, including the inability to effectively manage growth, which could strain management personnel, systems, and resources, potentially affecting business and prospects . Adverse changes in the economic environment, both in China and globally, could reduce client purchases and increase pricing pressure, negatively impacting revenues and results of operations . Intense competition from onshore and offshore IT services companies could lead to client loss and revenue decline . The company's reliance on a relatively small number of major clients, with the top client accounting for 13.4% of total revenue in fiscal 2025 , means the loss of business from these clients could significantly harm the business . For example, Citibank's strategic shift to exit consumer banking in China negatively impacted financial performance in fiscal 2025 . Inability to collect receivables from clients, with accounts receivable balance, net of allowance, amounting to approximately $44.9 million as of June 30, 2025 , could adversely affect results of operations and cash flows . The growth and success of the business depend on the ability to anticipate and develop new services and enhance existing ones to keep pace with rapid technological changes . Unsuccessful strategic alliances or acquisitions could impede growth and negatively affect revenues and net income . The international nature of the business exposes CLPS to risks such as significant currency fluctuations between the Renminbi and the U.S. dollar, legal uncertainties across different legal regimes, potentially adverse tax consequences, and current and future tariffs and other trade barriers . As of October 2025, U.S.-China trade tensions have sharply escalated, with the U.S. announcing 100% tariffs on all Chinese imports effective November 1, 2025, in response to China's new export controls on rare earth minerals, which could disrupt global supply chains and increase costs .

Management Priorities

Management emphasizes a commitment to driving digital transformation and optimizing operational efficiency across industries through innovations in artificial intelligence, cloud computing, and big data, leveraging its 20 years of experience in the fintech and financial services industry . The company aims to provide comprehensive services, solutions, and products to its clients, having created a niche in turn-key financial solutions . Management highlights its strategic regional hubs in Shanghai, Singapore, and California, supported by subsidiaries in Japan and the UAE, as a robust global service network empowering industries to evolve into data-driven, intelligent ecosystems . The overall tone suggests a focus on sustainable growth through a dual-engine strategy of horizontal and vertical expansion, with a strong emphasis on global footprint expansion, technological advancement, and talent development . Management also notes the company's positive operating cash flow for the year ended June 30, 2025 and believes it has sufficient working capital for the next 12 months .

View Source Annual Report on SEC.gov ↗

References

  1. [1] Item 4, Information on the Company — A. History and Development of the Company
  2. [2] Item 4, Information on the Company — B. Business Overview — Industry and Market Background — China's Banking Industry
  3. [3] Item 4, Information on the Company — B. Business Overview — Industry and Market Background — Software and Information Technology Service Industry in China
  4. [4] Item 4, Information on the Company — B. Business Overview — Industry and Market Background — Financial institutions/banking IT solutions
  5. [5] Item 3, Key Information — D. Risk factors — Risks Related to Our Business — We face intense competition from onshore and offshore IT services companies, and, if we are unable to compete effectively, we may lose clients, and our revenues may decline.
  6. [6] Item 4, Information on the Company — B. Business Overview — Competition
  7. [7] Item 5, Operating and Financial Review and Prospects — Management's Discussion and Analysis of Financial Condition and Results of Operations — Revenues
  8. [8] Item 5, Operating and Financial Review and Prospects — Management's Discussion and Analysis of Financial Condition and Results of Operations — Revenues
  9. [9] Item 5, Operating and Financial Review and Prospects — Management's Discussion and Analysis of Financial Condition and Results of Operations — Revenues
  10. [10] Item 5, Operating and Financial Review and Prospects — Management's Discussion and Analysis of Financial Condition and Results of Operations — Revenues
  11. [11] Item 5, Operating and Financial Review and Prospects — Management's Discussion and Analysis of Financial Condition and Results of Operations — Revenues
  12. [12] Item 5, Operating and Financial Review and Prospects — Management's Discussion and Analysis of Financial Condition and Results of Operations — Revenues
  13. [13] Item 5, Operating and Financial Review and Prospects — Management's Discussion and Analysis of Financial Condition and Results of Operations — Revenues
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  22. [22] Item 5, Operating and Financial Review and Prospects — Management's Discussion and Analysis of Financial Condition and Results of Operations — Gross profit and gross margin
  23. [23] Item 5, Operating and Financial Review and Prospects — Management's Discussion and Analysis of Financial Condition and Results of Operations — Gross profit and gross margin
  24. [24] Item 5, Operating and Financial Review and Prospects — Management's Discussion and Analysis of Financial Condition and Results of Operations — Gross profit and gross margin
  25. [25] Item 5, Operating and Financial Review and Prospects — Management's Discussion and Analysis of Financial Condition and Results of Operations — Gross profit and gross margin
  26. [26] Item 5, Operating and Financial Review and Prospects — Management's Discussion and Analysis of Financial Condition and Results of Operations — Selling and marketing expenses
  27. [27] Item 5, Operating and Financial Review and Prospects — Management's Discussion and Analysis of Financial Condition and Results of Operations — Selling and marketing expenses
  28. [28] Item 5, Operating and Financial Review and Prospects — Management's Discussion and Analysis of Financial Condition and Results of Operations — Selling and marketing expenses
  29. [29] Item 5, Operating and Financial Review and Prospects — Management's Discussion and Analysis of Financial Condition and Results of Operations — Research and development ("R&D") expenses
  30. [30] Item 5, Operating and Financial Review and Prospects — Management's Discussion and Analysis of Financial Condition and Results of Operations — Research and development ("R&D") expenses
  31. [31] Item 5, Operating and Financial Review and Prospects — Management's Discussion and Analysis of Financial Condition and Results of Operations — Research and development ("R&D") expenses
  32. [32] Item 5, Operating and Financial Review and Prospects — Management's Discussion and Analysis of Financial Condition and Results of Operations — General and administrative expenses
  33. [33] Item 5, Operating and Financial Review and Prospects — Management's Discussion and Analysis of Financial Condition and Results of Operations — General and administrative expenses
  34. [34] Item 5, Operating and Financial Review and Prospects — Management's Discussion and Analysis of Financial Condition and Results of Operations — Net (loss) income
  35. [35] Item 5, Operating and Financial Review and Prospects — Management's Discussion and Analysis of Financial Condition and Results of Operations — Net (loss) income
  36. [36] Item 5, Operating and Financial Review and Prospects — Management's Discussion and Analysis of Financial Condition and Results of Operations — Results of Operations for Continuing Operations
  37. [37] Item 5, Operating and Financial Review and Prospects — Management's Discussion and Analysis of Financial Condition and Results of Operations — Results of Operations for Continuing Operations
  38. [38] Item 5, Operating and Financial Review and Prospects — Management's Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources
  39. [39] Item 5, Operating and Financial Review and Prospects — Management's Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources
  40. [40] Item 5, Operating and Financial Review and Prospects — Management's Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources
  41. [41] Item 5, Operating and Financial Review and Prospects — Management's Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources
  42. [42] Item 5, Operating and Financial Review and Prospects — Management's Discussion and Analysis of Financial Condition and Results of Operations — Acquisitions and Investments — Acquisition of CAE
  43. [43] Item 5, Operating and Financial Review and Prospects — Management's Discussion and Analysis of Financial Condition and Results of Operations — Acquisitions and Investments — Acquisition of Shell Infotech Singapore and Shell Infotech Malaysia
  44. [44] Item 4, Information on the Company — B. Business Overview — Our Strategies — Continue to implement our global expansion strategy
  45. [45] Item 5, Operating and Financial Review and Prospects — Management's Discussion and Analysis of Financial Condition and Results of Operations — Acquisitions and Investments — Investment in Shanghai Qinhui
  46. [46] Item 4, Information on the Company — B. Business Overview — Our Strategies — Grow revenue with existing and new clients
  47. [47] Item 4, Information on the Company — B. Business Overview — Our Strategies — Continue to invest in research and development, deepen domain expertise and develop specific solutions for target industry verticals
  48. [48] Item 4, Information on the Company — B. Business Overview — Research and Development
  49. [49] Item 4, Information on the Company — B. Business Overview — Our Strategies — Continue to invest in training and development of our world-class human capital base
  50. [50] Item 4, Information on the Company — B. Business Overview — Our Competitive Strengths — Talent Creation Program, Talent Development Program, and Academic Education
  51. [51] Item 4, Information on the Company — B. Business Overview — Our Strategies — Drive efficiencies through ongoing improvements in operational excellence
  52. [52] Item 4, Information on the Company — B. Business Overview — Our Strategies — Capture new growth opportunities through strategic alliances and acquisitions
  53. [53] Item 4, Information on the Company — B. Business Overview — Our Strategies — Continue to implement our global expansion strategy
  54. [54] Item 4, Information on the Company — B. Business Overview — Our Strategies — Continue to implement our global expansion strategy
  55. [55] Item 4, Information on the Company — B. Business Overview — Our Strategies — Capitalizing on growth opportunities through strategic diversification into emerging sectors
  56. [56] Item 3, Key Information — D. Risk factors — The planned initial public offering of JAJI Global may impact our operational results and financial reporting, and could give rise to related party transaction concerns.
  57. [57] Item 3, Key Information — D. Risk factors — Risks Related to Our Business — We may be unable to effectively manage our growth, which could place significant strain on our management personnel, systems and resources. We may not be able to achieve anticipated growth, which could materially and adversely affect our business and prospects.
  58. [58] Item 3, Key Information — D. Risk factors — Risks Related to Our Business — Adverse changes in the economic environment, either in China or globally, could reduce our clients’ purchases from us and increase pricing pressure, which could materially and adversely affect our revenues and results of operations.
  59. [59] Item 3, Key Information — D. Risk factors — Risks Related to Our Business — We face intense competition from onshore and offshore IT services companies, and, if we are unable to compete effectively, we may lose clients, and our revenues may decline.
  60. [60] Item 3, Key Information — D. Risk factors — Risks Related to Our Business — We generate a significant portion of our revenues from a relatively small number of major clients and loss of business from these clients could reduce our revenues and significantly harm our business.
  61. [61] Item 3, Key Information — D. Risk factors — Risks Related to Our Business — We generate a significant portion of our revenues from a relatively small number of major clients and loss of business from these clients could reduce our revenues and significantly harm our business.
  62. [62] Item 3, Key Information — D. Risk factors — Risks Related to Our Business — We generate a significant portion of our revenues from a relatively small number of major clients and loss of business from these clients could reduce our revenues and significantly harm our business.
  63. [63] Item 3, Key Information — D. Risk factors — Risks Related to Our Business — If we are unable to collect our receivables from our clients, our results of operations and cash flows could be adversely affected.
  64. [64] Item 3, Key Information — D. Risk factors — Risks Related to Our Business — If we are unable to collect our receivables from our clients, our results of operations and cash flows could be adversely affected.
  65. [65] Item 3, Key Information — D. Risk factors — Risks Related to Our Business — The growth and success of our business depends on our ability to anticipate and develop new services and enhance existing services in order to keep pace with rapid changes in technology and in the industries we focus on.
  66. [66] Item 3, Key Information — D. Risk factors — Risks Related to Our Business — We may be unsuccessful in entering into strategic alliances or identifying and acquiring suitable acquisition candidates, which could impede our growth and negatively affect our revenues and net income.
  67. [67] Item 3, Key Information — D. Risk factors — Risks Related to Our Business — The international nature of our business exposes us to risks that could adversely affect our financial condition and results of operations.
  68. [68] Item 3, Key Information — D. Risk factors — Changes in general economic conditions, geopolitical conditions, U.S.-China trade relations and other factors beyond the Company’s control may adversely impact our business and operating results.
  69. [69] Item 5, Operating and Financial Review and Prospects — Overview
  70. [70] Item 4, Information on the Company — B. Business Overview — Our Strategies — Continue to implement our global expansion strategy
  71. [71] Item 5, Operating and Financial Review and Prospects — Management's Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources
  72. [72] Item 5, Operating and Financial Review and Prospects — Management's Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources

Analysis on 5/22/2026