CLPS Incorporation Announces Chairman's Letter to the Company's Shareholders

Rhea-AI Summary

CLPS Incorporation (Nasdaq: CLPS) released a chairman's letter dated January 2, 2026 outlining 2025 results and strategic shifts. Fiscal 2025 revenue was $164.5M (+15.2% YoY) and gross profit $36.3M (+10.2%). A long‑term client reduced headcount at China solution centers, forcing dissolution of most dedicated IT teams and causing significant one‑time severance charges that materially pressured net income; adjusted net income (ex‑terminations) was $78.0k. The company launched RPA product Nibot, a Web3‑ready issuance platform via Qinson, and advanced AI modernization projects. Revenue outside mainland China rose ~90.5% to $42.5M. Management forecasts 2026 revenue growth of 10%–15% and noted a JAJI Global F‑1 filing and new Indonesia subsidiary as expansion moves.

Positive

• Revenue $164.5M (+15.2% YoY)
• Gross profit $36.3M (+10.2% YoY)
• Revenue outside mainland China +90.5% to $42.5M
• Management guidance: 2026 revenue +10%–15%
• Launched Nibot RPA and Web3 issuance platform (Qinson)
• JAJI Global submitted Form F‑1 for proposed IPO

Negative

• Long‑term client downsizing led to dissolution of dedicated IT teams
• Significant one‑time severance charges materially pressured fiscal 2025 net income
• Adjusted net income (ex‑terminations) only $78.0k for fiscal 2025

Key Figures

Fiscal 2025 revenue $164.5M Fiscal year 2025 total revenue, up 15.2% year-over-year

Revenue growth 15.2% Year-over-year revenue increase in fiscal 2025

Gross profit $36.3M Fiscal 2025 gross profit, up 10.2% year-over-year

Adjusted net income $78.0K Fiscal 2025 net income excluding employee termination compensation

2026 revenue growth outlook 10%-15% Anticipated revenue growth rate for fiscal year 2026

Overseas revenue $42.5M Fiscal 2025 revenue generated outside mainland China, up 90.5%

Overseas growth 90.5% Year-over-year increase in revenue outside mainland China

Education revenue $2.0M Fiscal 2025 revenue contributed by College of Allied Educators

Market Reality Check

$1.01 Last Close

Volume Volume 37,281 is 2.49x the 20-day average of 14,966, indicating elevated trading activity before this letter. high

Technical Shares at 0.8032 are trading below the 200-day MA of 0.98 and sit close to the 52-week low of 0.8009.

Peers on Argus 1 Up 1 Down

Peers showed mixed moves: VEEA +15.89%, DTST +0.99%, GLE -18.6%, SAIH +5.75%, CYCU -4.83%. Momentum scanner flagged GLE up 14% and VEEA down 5.77%, reinforcing that CLPS’s setup appears stock-specific rather than a uniform sector rotation.

Common Catalyst Only one peer had AI-themed headlines, suggesting no broad, shared catalyst across the group.

Historical Context

Date	Event	Sentiment	Move	Catalyst
Nov 07	AI partnership PoC	Positive	+0.0%	PoC of Nibot with BEA in HKMA GenA.I. Sandbox to enhance banking workflows.
Oct 24	Web3 platform launch	Positive	+3.8%	Launch of Web3-ready stablecoin issuance platform via Hong Kong subsidiary Qinson.
Oct 17	FY2025 earnings	Negative	-24.7%	Revenue growth but severance-driven losses and H2 net loss pressured sentiment.
Oct 10	Earnings preview	Neutral	-1.1%	Announcement of timing for second half and full-year fiscal 2025 results release.
Sep 11	AI modernization win	Positive	+2.9%	Successful AI-based modernization of 30-year-old mortgage system for major HK bank.

Pattern Detected

Recent moves have generally aligned with news tone: positive AI/crypto and partnership updates saw mild gains, while weaker earnings drove a sharp decline.

Recent Company History

Over the last several months, CLPS reported fiscal 2025 results with revenue of $164.5M and gross profit of $36.3M, but one-time severance costs led to losses and a -24.69% reaction. Subsequent announcements focused on AI-driven legacy modernization, a Web3-ready stablecoin platform, and a GenA.I. Sandbox PoC with BEA, which drew modestly positive price responses. Today’s shareholder letter reiterates these themes—AI, Web3, diversification, and international growth—framing them as the foundation for a more resilient model after a key client downsizing.

Regulatory & Risk Context

Active S-3 Shelf Registration 2025-10-24

US$80,000,000 registered capacity

CLPS has an effective Form F-3 shelf filed on 2025-10-24, allowing issuance of up to US$80,000,000 of various securities for working capital and general corporate purposes. The shelf has 0 recorded takedowns so far, leaving full registered capacity available.

Market Pulse Summary

This announcement reiterates CLPS’s 2025 transformation, including revenue of $164.5M, gross profit of $36.3M, and adjusted net income of $78.0K after severance costs. It emphasizes diversification across AI, automation, Web3, education, and international markets, with overseas revenue rising to $42.5M. Investors may watch how management executes on the projected 10%-15% fiscal 2026 revenue growth, the ramp-up of Nibot and digital asset offerings, and progress on the JAJI Form F-1 process.

Key Terms

robotic process automation (RPA) technical

"We successfully launched Nibot, our proprietary Robotic Process Automation (RPA) product."

Robotic process automation (RPA) is software that mimics routine human tasks—like copying data between systems, filling forms, or approving standard requests—so computers can perform them automatically. For investors, RPA matters because it can reduce labor costs, speed up operations, and cut errors without big IT projects, improving profit margins and scalability; however, it can also change staffing needs and requires oversight to manage risks and maintenance.

web3 technical

"unveiled a Web3-ready issuance platform, marking our strategic entry into the stablecoin"

An approach to the internet that uses decentralized technologies (like blockchains and smart contracts) to give users control over data, identity and digital assets instead of relying on a single company. For investors it matters because it enables new business models—token-based ownership, marketplaces and governance structures—but also brings higher volatility, novel revenue streams and regulatory uncertainty, so investment outcomes can be very different from traditional tech.

stablecoin financial

"entry into the stablecoin and digital asset infrastructure ecosystem."

A stablecoin is a type of digital currency designed to keep its value steady, often by being backed by traditional assets like money or commodities. For investors, stablecoins offer a reliable way to move money quickly across digital platforms without the value fluctuations common with other cryptocurrencies, making them useful for saving, trading, or transferring funds with less risk of sudden losses.

form f-1 registration statement regulatory

"JAJI Global Incorporation, has submitted a Form F-1 registration statement to the U.S."

A Form F-1 registration statement is the document a non‑U.S. company files with the U.S. securities regulator to register shares or other securities for sale to U.S. investors. It provides investors with standardized, detailed information — company operations, audited financials, key risks, how the offering works and what the company will do with the money raised — like a product label that helps you judge value and risk before investing.

AI-generated analysis. Not financial advice.

HONG KONG, Jan. 2, 2026 /PRNewswire/ -- CLPS Incorporation (Nasdaq: CLPS) ("CLPS" or "the Company"), today released a letter to shareholders from the Chairman of its Board of Directors. The full text of the letter follows:

Dear Valued Shareholders,

Happy New Year!

As we begin 2026, I wish to extend my sincere appreciation for your continued trust and support. Looking back at the past year, CLPS remained steadfastly focused on disciplined execution and technological innovation, even as we navigated a dynamic global macroeconomic environment. During this period, our long-term and historically largest client announced a substantial reduction of personnel at its China Solution Centers (CSCs) in Dalian and Shanghai. This development compelled us to dissolve most of the dedicated IT teams serving this account. While this created a significant impact on our fiscal 2025 financial results, it has also accelerated our transition toward a more diversified and resilient business model.

Beyond these challenges, 2025 served as a pivotal year of transformation for the Company. We strengthened our IT solutions capabilities, expanded our geographic footprint, and deepened strategic partnerships—laying a robust foundation for sustainable, diversified growth.

1. Technological Innovation

Innovation remains at the core of CLPS's strategy. During the year, we made meaningful progress in advancing next-generation digital solutions across artificial intelligence (AI), automation, Web3, and financial infrastructure.

We successfully launched Nibot, our proprietary Robotic Process Automation (RPA) product. Distinguished by its high configurability, low-code implementation, and strong compatibility, Nibot has garnered strong client acclaim. This momentum was highlighted by its successful deployment for a leading Hong Kong banking client in the second half of 2025.

Concurrently, our wholly-owned Hong Kong subsidiary, Qinson Credit Card Services Limited, unveiled a Web3-ready issuance platform, marking our strategic entry into the stablecoin and digital asset infrastructure ecosystem. These initiatives reflect our commitment to building scalable, future-ready technologies that address evolving client needs.

Furthermore, our AI-driven solutions enabled sophisticated use cases, including the legacy system modernization for a major Hong Kong financial institution. This project successfully established a replicable technology framework, paving the way for the Company's expansion into modernizing complex financial systems.

2. Financial Performance and Outlook

In fiscal 2025, amid a cautious budgeting environment across our global client base, CLPS focused on diversifying its revenue streams and accelerating the development of a more resilient financial framework.

• Revenue: CLPS delivered total revenue of $164.5 million, representing a 15.2% increase year-over-year. While the downsizing of a key client's CSCs has created a phased financial impact—primarily affecting net income in fiscal year 2025, with a projected shift to revenue in the next—this challenge has strengthened our resolve to accelerate our strategic transformation. These efforts are already yielding positive results; after absorbing this one-time impact, we anticipate maintaining a revenue growth rate of 10%-15% for fiscal year 2026.
• Profitability: Gross profit increased 10.2% to $36.3 million. In response to the aforementioned client downsizing, the Company restructured its IT staffing, incurring significant one-time severance charges. While this created unavoidable short-term pressure on net income, our core operational performance remains stable. Excluding all employee termination compensation, adjusted net income for fiscal year 2025 was $78.0 thousand.

Looking ahead, management is cautiously optimistic. While we sustain organic growth through core IT consulting services, we see growing demand for AI-enabled transformation, automation, and digital modernization solutions.

3. Strategic Partnerships

Partnerships were vital to advancing our innovation roadmap. We collaborated with The Bank of East Asia, Limited to conduct a Proof-of-Concept of Nibot, an advanced AI agent that integrates RPA and Generative Artificial Intelligence (GenA.I.). The initiative is part of the second cohort of the GenA.I. Sandbox, jointly launched by the Hong Kong Monetary Authority and the Hong Kong Cyberport Management Company Limited. This underscores our ability to partner with leading financial institutions and regulators on cutting-edge initiatives, validating our technological capabilities and positioning CLPS as a trusted partner in shaping the future of intelligent financial services.

4. Operations and Organizational Development

Operational excellence remains a priority as we scale. We established the CLPS AI Innovation Committee, strengthening governance and strategic alignment around AI deployment. In addition, our majority-owned subsidiary, JAJI Global Incorporation, has submitted a Form F-1 registration statement to the U.S. Securities and Exchange Commission ("SEC") in connection with its proposed initial public offering of ordinary shares, and we are progressing steadily through this process. Supporting these strategic milestones, we continue to invest in our delivery frameworks to ensure innovation is matched with reliability and execution quality.

5. Global Expansion

Fiscal 2025 marked a milestone in our international growth with the establishment of our Indonesia subsidiary. This move further deepens our localized footprint in the region and fulfills our commitment to cultivating Southeast Asia as a key growth market.

Our geographic diversification continues to yield exceptional results: revenue generated outside mainland China grew approximately 90.5% to $42.5 million, highlighting the success of our global expansion strategy. Supported by an established presence across five major regions—Greater China, Southeast Asia, East Asia, North America, and the Middle East—CLPS's global operational network is becoming increasingly robust, driving a comprehensive enhancement of our competitive advantage.

6. Business Diversification

CLPS continues to build a resilient, multi-sector business model. Our diversification strategy provides operational flexibility across different economic cycles, spanning fintech solutions, payment services, e-commerce, and global tourism.

Notably, we have achieved strong momentum within our education sector; the College of Allied Educators, acquired by the Company, contributed $2.0 million in revenue during fiscal 2025. This result demonstrates our ability to efficiently integrate strategic assets and underscores our successful expansion beyond core IT services into high-potential industry verticals.

2025 was a year of deliberate groundwork and steady progress. While challenges remain, CLPS enters 2026 with clearer strategic direction, enhanced innovation capabilities, and an expanding global footprint.

On behalf of the Board and management team, I thank our employees for their unwavering dedication, our clients and partners for their collaboration, and you, our shareholders, for your ongoing trust and support. We remain firmly committed to reinforcing our long-term value proposition and advancing CLPS as a trusted global technology partner.

With sincerity and determination,

Xiao Feng Yang
Chairman of the Board
CLPS Incorporation

About CLPS Incorporation

CLPS Incorporation (NASDAQ: CLPS), established in 2005 and headquartered in Hong Kong, is at the forefront of driving digital transformation and optimizing operational efficiency across industries through innovations in artificial intelligence, cloud computing, and big data. Our diverse business lines span sectors including fintech, payment and credit services, e-commerce, education and study abroad programs, and global tourism integrated with transportation services. Operating across 10 countries worldwide, with strategic regional hubs in Shanghai (mainland China), Singapore (Southeast Asia), and California (North America), and supported by subsidiaries in Japan and the UAE, we provide a robust global service network that empowers legacy industries evolve into data-driven, intelligent ecosystems. For further information regarding the Company, please visit: https://ir.clpsglobal.com/, or follow CLPS on Facebook, Instagram, LinkedIn, X (formerly Twitter), and YouTube.

Forward-Looking Statements

Certain of the statements made in this press release are "forward-looking statements" within the meaning and protections of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements include statements with respect to the Company's beliefs, plans, objectives, goals, expectations, anticipations, assumptions, estimates, intentions, and future performance. Known and unknown risks, uncertainties and other factors, which may be beyond the Company's control, may cause the actual results and performance of the Company to be materially different from such forward-looking statements. All such statements attributable to us are expressly qualified in their entirety by this cautionary notice, including, without limitation, those risks and uncertainties related to the Company's expectations of the Company's future growth, deployment in the AI technology sector, performance and results of operations, the Company's ability to capitalize on various commercial, M&A, technology and other related opportunities and initiatives, as well as the risks and uncertainties described in the Company's most recently filed SEC reports and filings. Such reports are available upon request from the Company, or from the Securities and Exchange Commission, including through the SEC's Internet website at http://www.sec.gov. We have no obligation and do not undertake to update, revise or correct any of the forward-looking statements after the date hereof, or after the respective dates on which any such statements otherwise are made.

Contact:

CLPS Incorporation
Rhon Galicha
Investor Relations Office
Phone: +86-182-2192-5378
Email: ir@clpsglobal.com

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SOURCE CLPS

FAQ

What were CLPS (CLPS) fiscal 2025 revenue and growth rate?

CLPS reported $164.5 million in revenue for fiscal 2025, a +15.2% YoY increase.

How did the client downsizing affect CLPS results in 2025?

A long‑term client reduced China CSC staff, forcing dissolution of dedicated teams and causing significant one‑time severance charges that pressured 2025 net income.

What is CLPS's revenue outlook for fiscal 2026?

Management anticipates maintaining 10%–15% revenue growth for fiscal 2026 after absorbing the one‑time impact.

What new products and platforms did CLPS launch in 2025?

CLPS launched Nibot (RPA) and a Web3‑ready issuance platform via its Hong Kong subsidiary Qinson.

How much revenue did CLPS generate outside mainland China in 2025?

Revenue outside mainland China grew ~90.5% to $42.5 million in fiscal 2025.

Did CLPS pursue any capital or expansion actions in 2025?

Yes. CLPS established an Indonesia subsidiary and its majority‑owned JAJI Global submitted a Form F‑1 to the SEC for a proposed IPO.