STAK Inc.

STAK Inc. operates in two distinct industries through its subsidiaries: the oilfield-specialized production and maintenance equipment industry in mainland China, conducted primarily through YLAN Technology (Changzhou) Co., Ltd., and the modular gas-to-electricity power generation systems industry in the United States, conducted through STAK Vision Energy Inc. The oilfield maintenance industry is intensely competitive and includes thousands of companies both domestically and internationally ¹. The market in which the company's customers operate can fluctuate significantly, often in correlation with oil and natural gas prices ². Demand for energy, including crude oil, natural gas liquids and natural gas, is generally linked to broad-based economic activities, and a slowdown in economic growth, an economic downturn or recession, or other adverse economic or political development in the US, Europe, or Asia could have a significant adverse effect on global financial markets and commodity prices ³. Fuel conservation measures, alternative fuel requirements, increasing consumer demand for alternatives to oil and natural gas, and technological advances in fuel economy and renewable energy generation systems could reduce the demand for oil, and certain jurisdictions have implemented policies or incentives to decrease the use of hydrocarbons and encourage the use of renewable fuel alternatives ⁴. The company's U.S. subsidiary targets AI data centers and other energy-intensive applications across North America with modular gas-to-electricity power generation systems primarily based on gas-fired internal combustion engines and generator set technologies ⁵.

The oilfield maintenance industry is intensely competitive, and the company faces competition from new entrants and established companies with greater resources ⁶. Some potential competitors may have special vehicles manufacture permits, allowing them to design and manufacture oil pumping trucks by themselves and giving them a pricing advantage, and some may also have greater name recognition, greater operating revenues, larger customer bases, longer customer relationships and greater financial, technical, personnel and marketing resources ⁷. The company does not hold a special vehicle production permission to produce special vehicles as requested by the Chinese Ministry of Industry and Information Technology, so it relies on a collaborative outsourcing model to provide final products to customers, which reduces the initial operational investment in large fixed assets but brings policy risks and business expansion bottlenecks ⁸. The company designs and manufactures oilfield-specialized production and maintenance equipment, then collaborates with qualified specialized vehicle manufacturing companies to integrate the equipment onto vehicle chassis, producing specialized oilfield vehicles for sale ⁹. The company is heavily dependent on its top customers, who are dealers that purchase its products and resell to downstream end-users, oilfield service companies; for the year ended June 30, 2026, the top three customers contributed approximately 50% to revenue ¹⁰. The company does not maintain long-term agreements with the top customers and the services agreements with the top customers are made on a per-project basis ¹¹.

The company generates revenue through the sale of specialized oilfield equipment, the sale of specialized oilfield vehicles, service income from automation solutions, and other service income. For the fiscal year ended June 30, 2026, specialized oilfield equipment revenue accounted for 19.5% of total revenue, compared to 48.0% for the fiscal year ended June 30, 2025 ¹². The company's customers are primarily dealers that purchase its products and resell to downstream end-users, oilfield service companies ¹³. The company promotes and attracts new customers through methods including cultivating positive word-of-mouth referrals within the industry and proactively expanding its business through its sales team ¹⁴. The company's growth strategy includes continued research on oilfield-specialized production and maintenance equipment, maintaining its brand, rapid response to meet customer and market demands, and a future new sales model by integrating supply chain finance ¹⁵. The company's U.S. subsidiary, STAK Vision Energy Inc., is engaged in the development and commercialization of modular gas-to-electricity power generation systems for AI data centers and other energy-intensive applications ¹⁶.

The company's product and service lines comprise specialized oilfield equipment, specialized oilfield vehicles, automation solutions, and other services. The company designs and manufactures oilfield-specialized production and maintenance equipment, then collaborates with qualified specialized vehicle manufacturing companies to integrate the equipment onto vehicle chassis, producing specialized oilfield vehicles for sale ¹⁷. Additionally, the company sells oilfield-specialized equipment components, related products, and provides automation solutions ¹⁸. For the fiscal year ended June 30, 2026, specialized oilfield equipment revenue accounted for 19.5% of total revenue, compared to 48.0% for the fiscal year ended June 30, 2025 ¹⁹. The company's U.S. subsidiary is developing modular gas-to-electricity power generation systems primarily based on gas-fired internal combustion engines and generator set technologies, targeting AI data centers and other energy-intensive applications across North America ²⁰. The company has obtained the applicable environmental permits required for its current commercialization activities for these systems ²¹.

During the period, the company completed its initial public offering and listing on the Nasdaq Capital Market, with the CSRC publishing the notification of its approval of the company's completion of the required filing procedures on August 9, 2024 ²². The company's Class A Ordinary Shares are listed on the Nasdaq Capital Market under the symbol STAK ²³. As of June 30, 2026, there were 19,210,349 ordinary shares outstanding, being the sum of 10,010,349 Class A ordinary shares of par value of US$0.001 each, and 9,200,000 Class B ordinary shares of par value of US$0.001 each ²⁴. The company adopted a dual class share structure such that each Class A Ordinary Share is entitled to one (1) vote and each Class B Ordinary Share is entitled to thirty (30) votes ²⁵. As of the date of the annual report, Mr. Chuanbo Jiang, the CEO and Chairman of the board, and Ms. Huyun Gao, the COO, collectively beneficially owned all of the company's issued and outstanding Class B Ordinary Shares, which constitute approximately 96.5% of the total voting power ²⁶. The company's directors and officers currently own an aggregate of approximately 96.5% of the total voting power ²⁷. The company is a "controlled company" as defined under the Nasdaq Stock Market Rules because Mr. Chuanbo Jiang is beneficially owns 83.7% of the issued and outstanding Class B Ordinary Shares, representing approximately 80.8% of the total voting power ²⁸.

The company reported net income of $0.4 million for the fiscal year ended June 30, 2026, compared to a net loss of $5.7 million for the fiscal year ended June 30, 2025 ²⁹. As of June 30, 2026 and 2025, the company's accounts receivable balance amounted to approximately $2.8 million and $2.0 million, respectively ³⁰. For the fiscal years ended June 30, 2026 and 2025, no transfers, dividends or distributions from a subsidiary were made to STAK Inc. or other investors ³¹. For the fiscal year ended June 30, 2026, STAK Inc. did not make any capital contributions to STAK (Changzhou) Intelligent Technology Co., Ltd., or WFOE, through its intermediate holding company ³². The company's PRC Subsidiaries are required to set aside at least 10% of their after-tax profits each year, if any, to fund certain statutory reserve funds until such reserve funds reach 50% of their registered capital ³³.

The company is developing modular gas-to-electricity power generation systems primarily based on gas-fired internal combustion engines and generator set technologies, targeting AI data centers and other energy-intensive applications across North America ³⁴. This business represents a new area of operations, and the company has limited operating history and experience in developing, marketing and commercializing power generation systems for these applications ³⁵. The company's ability to successfully develop and expand this business will depend on various factors, including the development and performance of its systems, customer demand, availability and cost of suitable fuel supplies, applicable regulatory and environmental requirements, financing, supply chain management, and its ability to secure customers and successfully execute projects ³⁶. The company may incur significant costs in developing and commercializing this business before generating meaningful revenue ³⁷. The development, testing, commercialization and deployment of these systems may require significant capital expenditures and other resources, including expenditures for product development, equipment, personnel, supply chain management, project execution and sales and marketing ³⁸. The company may need to continue investing substantial financial and other resources in this business before generating meaningful revenue from it ³⁹.

The company's growth strategy includes continued research on oilfield-specialized production and maintenance equipment, maintaining its brand, rapid response to meet customer and market demands, and a future new sales model by integrating supply chain finance ⁴⁰. The company will continue to expand its sales network and product offerings to bring greater convenience to its customers and to increase its customer base and number of transactions ⁴¹. The company expects to continue to invest significantly to acquire new customers and retain existing ones, especially its top customers ⁴². The company's plans for business expansion and development are dependent upon its raising additional capital, with plans calling for new investments in research and development, marketing, expanded service capacity, and working capital and other items ⁴³. Should the company's capital needs be higher than estimated, or should additional capital be required, it may seek additional investments, loans or debt financing to fully pursue its strategies ⁴⁴.

The company's modular gas-to-electricity power generation systems are subject to applicable regulatory and environmental requirements, and the operation and further deployment of these systems may remain subject to ongoing compliance with applicable U.S. Environmental Protection Agency requirements and state-level environmental regulations, as well as any additional certifications, permits or approvals that may become applicable as the business expands or as regulatory requirements change ⁴⁵. Changes in applicable laws or regulations, additional regulatory requirements, or delays or costs associated with maintaining compliance could increase operating costs or delay or limit the further commercialization and deployment of the systems ⁴⁶. The company has obtained the applicable environmental permits required for its current commercialization activities ⁴⁷.

The company's oilfield vehicles business relies on qualified vehicles manufacturers in mainland China to assemble the oilfield-specialized vehicles by using the oilfield maintenance equipment manufactured by the company ⁴⁸. The company does not hold a special vehicle production permission to produce special vehicles as requested by the Chinese Ministry of Industry and Information Technology, so it relies on a collaborative outsourcing model to provide final products to customers ⁴⁹. If the government does not allow outsourcing or if the company's business demand exceeds the outsourcing factory's capacity in the future, it could severely restrict its growth ⁵⁰. The company may not have sufficient controls over the quality of the final products assembled by the qualified vehicles manufacturers ⁵¹.

The company's plans for business expansion and development are dependent upon its raising additional capital, with plans calling for new investments in research and development, marketing, expanded service capacity, and working capital and other items ⁵². The company may need additional capital and may sell additional Ordinary Shares or other equity securities or incur indebtedness, which could result in additional dilution to its shareholders or increase its debt service obligations ⁵³. The company does not expect to pay dividends in the foreseeable future, and investors must rely on price appreciation of the Class A Ordinary Shares for return on their investment ⁵⁴. The company's PRC Subsidiaries are required to set aside at least 10% of their after-tax profits each year, if any, to fund certain statutory reserve funds until such reserve funds reach 50% of their registered capital ⁵⁵. The PRC Subsidiaries didn't distribute dividends and have made no further plans to pay dividends since such date and do not expect to do so unless and until they have generated sufficient accumulated profits and have met the requirements for statutory reserve funds ⁵⁶.

The company's growth rates may decline for any number of possible reasons, including decreasing customer demand, increasing competition, declining growth of the marketing industry in general, emergence of alternative business models, or changes in government policies or general economic conditions ⁵⁷. The company's operating history may not be indicative of its future growth or financial results, and there is no assurance that it will be able to increase its revenues in future periods ⁵⁸. The company's limited operating history in its services to provide specialized oilfield equipment and integrated solutions may not be indicative of its future growth or financial results ⁵⁹. The company's growth prospects should be considered in light of the risks and uncertainties that fast-growing companies with a limited operating history and experience in the industry may encounter ⁶⁰.

The company is subject to the filing procedures with the CSRC in connection with subsequent securities offerings, and the approval of or clearance by the CAC and other compliance procedures may be required in connection with subsequent securities offerings ⁶¹. According to the Overseas Listing Regulations, if an overseas listed issuer intends to effect any follow-on offering in an overseas stock market, it should, through its major operating entity incorporated in the PRC, submit filing materials to the CSRC within three working days after the completion of the offering ⁶². The required filing materials shall include, but not be limited to, (1) filing report and relevant commitment letter and (2) domestic legal opinions ⁶³. The company cannot assure that it will be able to complete such filings in a timely manner, or at all ⁶⁴. The company's Ordinary Shares may be delisted under the HFCA Act if the PCAOB is unable to inspect its auditors for two consecutive years ⁶⁵.

The company is heavily dependent on its top customers, who are dealers that purchase its products and resell to downstream end-users, oilfield service companies; for the year ended June 30, 2026, the top three customers contributed approximately 50% to revenue, and the company does not maintain long-term agreements with the top customers, with services agreements made on a per-project basis ⁶⁶. The company does not hold a special vehicle production permission to produce special vehicles as requested by the Chinese Ministry of Industry and Information Technology, so it relies on a collaborative outsourcing model to provide final products to customers; if the government does not allow outsourcing or if business demand exceeds the outsourcing factory's capacity in the future, it could severely restrict growth ⁶⁷. The company's expansion into the modular gas-to-electricity power generation systems business may not be successful, as it represents a new area of operations with limited operating history and experience, and the company may incur significant costs in developing and commercializing this business before generating meaningful revenue ⁶⁸. The company's accounts receivable balance amounted to approximately $2.8 million and $2.0 million as of June 30, 2026 and 2025, respectively, and if the company is unable to timely collect its accounts receivable on a timely and consistent basis, its cash flows and access to operating capital could be adversely affected ⁶⁹. The company has identified a material weakness in its internal control over financial reporting related to its lack of sufficient financial reporting and accounting personnel with appropriate knowledge of U.S. GAAP and SEC reporting requirements to properly address complex U.S. GAAP accounting issues and to prepare and review its consolidated financial statements and related disclosures to fulfill U.S. GAAP and SEC financial reporting requirements ⁷⁰.

Management's message to shareholders emphasizes the company's dual-track strategy of maintaining and growing its established oilfield-specialized equipment and integrated solutions business in mainland China while pursuing a new expansion into modular gas-to-electricity power generation systems for AI data centers and other energy-intensive applications across North America through its U.S. subsidiary, STAK Vision Energy Inc. ⁷¹. The company's growth strategy is based on currently prevailing circumstances and the assumption that certain circumstances will or will not occur, as well as the inherent risks and uncertainties involved in various stages of development, and there is no assurance that the company will be successful in implementing its strategies including (i) continued research on oilfield-specialized production and maintenance equipment, (ii) maintaining its brand, (iii) its rapid response to meet its customers and market demands, and (iv) future new sales model by integrating supply chain finance ⁷². Management has identified three strategic priorities for the period ahead: first, the development and commercialization of modular gas-to-electricity power generation systems, which may require significant capital expenditures and other resources, including expenditures for product development, equipment, personnel, supply chain management, project execution and sales and marketing, and may require continued investment of substantial financial and other resources before generating meaningful revenue ⁷³; second, the expansion of the company's sales network and product offerings to increase its customer base and number of transactions ⁷⁴; and third, the continued investment to acquire new customers and retain existing ones, especially its top customers ⁷⁵. The company's plans for business expansion and development are dependent upon its raising additional capital, with plans calling for new investments in research and development, marketing, expanded service capacity, and working capital and other items ⁷⁶. The company reported net income of $0.4 million for the fiscal year ended June 30, 2026, compared to a net loss of $5.7 million for the fiscal year ended June 30, 2025 ⁷⁷. The company's directors and officers currently own an aggregate of approximately 96.5% of the total voting power ⁷⁸.