20-F: Amber International Reports Significant Revenue Growth Amidst Increased Losses and Strategic Merger in Digital Asset Sector

Amber International Holding Limited, formerly iClick Interactive Asia Group Limited, reported a substantial increase in revenue for the six months ended December 31, 2024, driven by its digital asset wealth management solutions, despite a widening net loss primarily due to unrealized fair value changes in digital assets.

Summary

• Amber International Holding Limited (formerly iClick Interactive Asia Group Limited) completed a reverse acquisition merger with Amber DWM Holding Limited on March 12, 2025, with Amber DWM becoming a wholly-owned subsidiary and iClick being renamed.
• The company's fiscal year end changed from June 30 to December 31, effective January 1, 2025, with this report covering the transition period from July 1, 2024, to December 31, 2024.
• Revenue for the six months ended December 31, 2024, increased significantly to US$5.6 million, up from US$1.7 million in the same period of 2023, primarily due to robust growth in wealth management solutions.
• Wealth management solutions revenue surged from US$0.8 million in H2 2023 to US$5.0 million in H2 2024, driven by strong demand for structured products.
• Execution solutions revenue also grew from US$56 thousand to US$0.3 million, benefiting from strategic partnerships and favorable market conditions.
• However, payment solutions revenue decreased from US$0.8 million to US$0.3 million as clients opted to maintain digital assets rather than convert to fiat.
• Gross profit more than doubled to US$1.7 million in H2 2024 from US$0.8 million in H2 2023, but the gross profit margin declined from 48.7% to 31.2% due to increased customer referral fees.
• Total operating expenses increased to US$4.6 million in H2 2024 from US$2.4 million in H2 2023, mainly due to higher personnel expenses, legal and professional fees, and IT services for business expansion.
• The company reported a net loss of US$12.9 million for the six months ended December 31, 2024, a substantial increase from the US$5.8 million net loss in the prior year period.
• The increased net loss was largely driven by US$10.0 million in unrealized fair value losses on digital assets on loan from related parties, compared to US$3.8 million in the prior period, primarily due to increases in Bitcoin (BTC) and Ethereum (ETH) prices.
• Total equity improved significantly from a deficit of US$4.4 million as of June 30, 2024, to a positive US$29.8 million as of December 31, 2024, largely due to a US$47.1 million waiver of loans from the ultimate holding company, Amber Global Ltd, and other related companies.
• Cash and cash equivalents increased to US$6.3 million as of December 31, 2024, from US$3.8 million as of June 30, 2024.

Sentiment

Score: 6

Explanation: While the company experienced significant growth in revenue and a substantial improvement in equity due to related party loan waivers, the widening net loss and declining gross profit margin indicate challenges in achieving profitability. The positive strategic developments and strong parent company support are balanced against the increased operational losses and market volatility risks.

Positives

• Revenue increased significantly by 229% to US$5.6 million for the six months ended December 31, 2024, compared to US$1.7 million in the prior year period, indicating strong business growth.
• Wealth management solutions revenue saw robust growth, increasing from US$0.8 million to US$5.0 million, driven by strong demand for diverse investment products like structured products.
• Gross profit more than doubled to US$1.7 million in H2 2024 from US$0.8 million in H2 2023.
• Total equity improved substantially from a deficit of US$4.4 million as of June 30, 2024, to a positive US$29.8 million as of December 31, 2024, primarily due to a US$47.1 million waiver of loans from related parties.
• Cash and cash equivalents increased to US$6.3 million as of December 31, 2024, from US$3.8 million as of June 30, 2024, strengthening liquidity.
• The company successfully completed a merger with iClick Interactive Asia Group Limited, leading to its rebranding as Amber International Holding Limited and Nasdaq listing under the AMBR ticker, enhancing market presence.
• Intercompany service agreements effective March 12, 2025, entitle the company to 100% of consolidated net income from WhaleFin Technologies Limited (WFTL) and Sparrow Tech Private Limited, indicating future revenue streams.
• Sparrow Tech Private Limited, a wholly-owned subsidiary, received necessary approvals and was rebranded to Amber Premium Singapore, reinforcing its regulated, institutional-grade digital asset services.

Negatives

• Net loss significantly widened to US$12.9 million for the six months ended December 31, 2024, from US$5.8 million in the prior year period, indicating worsening profitability.
• Operating loss increased to US$2.7 million in H2 2024 from US$1.6 million in H2 2023.
• Gross profit margin decreased from 48.7% to 31.2%, primarily due to an increase in customer referral fees, suggesting higher costs of revenue relative to sales.
• Total other expenses increased substantially to US$10.3 million from US$4.2 million, largely driven by US$10.0 million in unrealized fair value losses on digital assets on loan from related parties, reflecting market volatility impact.
• Payment solutions revenue decreased from US$0.8 million to US$0.3 million, indicating a decline in crypto-to-fiat conversion volumes as clients preferred to hold digital assets.

Risks

• Market demand for digital asset management products is highly sensitive to regulatory changes, technological advancements, major company actions, security concerns, and evolving social media trends.
• Operating results are dependent on the volatile prices of digital assets (e.g., BTC, ETH), transaction volumes, and market liquidity, leading to potential significant unrealized gains or losses.
• The effectiveness of the '1+N' premium servicing model may be impacted during periods of market volatility, potentially affecting client engagement and service delivery.
• The company faces fee pressure in the evolving digital asset industry, requiring continuous development of new products and services to maintain competitiveness.
• The complex and evolving regulatory environment for digital assets presents challenges, influencing the company's ability to onboard customers and offer products across various regions.
• Risks associated with the storage and protection of digital assets, including potential substantial losses due to disruptions, closures of cryptocurrency custodians, cyber-attacks, or thefts, given the lack of insurance policy for digital assets.

Future Outlook

The company's crypto reserve plan, announced in May 2025, aims for up to US$100 million, initially focusing on high-conviction digital assets like Binance Coin (BNB), Solana (SOL), Sui (SUI), Ripple (XRP), Bitcoin (BTC), and Ethereum (ETH), with flexibility to expand into other ecosystem-aligned tokens and stablecoins like World Liberty Financial USD (USD1). Following the merger, the company is entitled to 100% of the consolidated net income generated from certain contracts associated with WhaleFin Technologies Limited (WFTL) effective from January 1, 2025, and 100% consolidated net income of Sparrow Tech effective from March 12, 2025, pending certain regulatory approvals for DWM Asset Restructuring.

Management Comments

• Management believes the company has sufficient funds to meet its working capital requirements and debt obligations for at least the next 12 months.
• The company's strategy is to maintain its position as a trusted brand while developing new products and services to enhance its customer value proposition and offset the effects of any future fee pressure.
• The company is committed to designing products and services that adhere to legal requirements and expects to continue investing significant resources to comply with evolving regulatory requirements in multiple jurisdictions.

Industry Context

Amber DWM operates within the rapidly expanding digital asset market, positioning itself as an institutional gateway to crypto finance. The company aims to address the evolving needs of institutional investors and high-net-worth individuals (HNWIs) who are increasingly exploring opportunities beyond traditional financial instruments in the digital asset sector, including blockchain-based innovations, decentralized finance (DeFi) applications, and tokenized financial products. The market demand is influenced by regulatory changes, technological advancements, and overall sentiment towards digital assets, requiring agility and innovation to meet evolving consumer needs.

Legal Proceedings

• The company is not presently a party to any legal or administrative proceedings or claims that would individually or taken together have a material adverse effect on its business, results of operations, financial condition, or cash flows.

Related Party Transactions

• The company has extensive transactions with its ultimate holding company, Amber Global Ltd, and various affiliates including Amber AI Ltd, WhaleFin Technologies Ltd, Amber Technologies Service Pte Ltd, and Lead Accelerating Limited.
• A significant non-distributable capital reserve of US$47,100,915 arose from the waiver of loans by Amber Global Ltd and other related companies for certain cryptocurrencies loans, advances, payment on behalf, and intercompany payables with the Group as of December 31, 2024.
• The company incurred US$22,685 in interest expenses to related parties for the six months ended December 31, 2024.
• Revenue from WhaleFin Technologies Ltd was US$1,549,321 and from Lead Accelerating Limited was US$2,871,129 for the six months ended December 31, 2024.
• Amounts due from related parties totaled US$11,532,911 as of December 31, 2024, which are unsecured, interest-free, and payable on demand or with 30-day credit terms.
• Amounts due to related parties totaled US$9,979,742 as of December 31, 2024, which are unsecured, interest-free, and with 30-day credit terms, or repayable on demand/in 12 months for loans.

Stakeholder Impact

• Shareholders: Experienced a significant improvement in total equity due to a large loan waiver from related parties, but also faced increased net losses and diluted loss per share.
• Employees: Personnel expenses increased, indicating growth in the workforce or compensation, which could positively impact employees.
• Customers: Benefit from comprehensive wealth management, full-stack execution, and seamless crypto payment solutions, but may experience fee pressure as the industry evolves.
• Creditors: Related party loans were waived, reducing the company's debt obligations to its parent group, which is a positive for the company's balance sheet structure.
• Regulatory Authorities: The company is committed to compliance and holds licenses in multiple jurisdictions, including a Major Payment Institution (MPI) License in Singapore, demonstrating adherence to regulatory standards.

Next Steps

• The company's next annual report will be for the 12-month period ending December 31, 2025.
• The company will continue to make capital expenditures to support its business.
• Regulatory approvals for DWM Asset Restructuring are pending, which will finalize the economic benefits from intercompany service agreements with WhaleFin Technologies Limited and Sparrow Tech.

Key Dates

Recommendation

Keywords

Digital Asset Management, Cryptocurrency, Wealth Management, SEC Filing, 20-F, Blockchain, DeFi, Bitcoin, Ethereum, Nasdaq, Financial Technology, Singapore, Hong Kong, Dubai, Structured Products, OTC Trading, Payment Solutions, Market Risk, Cybersecurity