CLPS Incorporation Announces Chairman's Letter to the Company's Shareholders
MWN-AI** Summary
CLPS Incorporation (NASDAQ: CLPS) released a letter to shareholders from Chairman Xiao Feng Yang, reflecting on the company's performance and future strategies as it enters 2026. Throughout 2025, CLPS faced challenges, notably the personnel reductions at its largest client’s China Solution Centers, which impacted financial results. Despite this, the company emphasized disciplined execution and innovation, laying a foundation for resilience and growth.
Key initiatives included the advancement of digital solutions in artificial intelligence (AI), automation, and Web3 technologies. Noteworthy developments included the launch of Nibot, a highly configurable Robotic Process Automation product, and a Web3-ready issuance platform by its subsidiary, Qinson Credit Card Services. These innovations were pivotal in enabling modern financial systems and addressing changing client needs.
Financially, CLPS reported total revenue of $164.5 million, a 15.2% increase year-over-year, while gross profit rose by 10.2%. The strategic downsizing challenge was acknowledged, yet it prompted a restructuring that is anticipated to stabilize future financial performance, with management forecasting revenue growth of 10%-15% for fiscal 2026.
Strategically, partnerships formed with major institutions, including The Bank of East Asia, underlined CLPS's commitment to innovation. The establishment of an Indonesia subsidiary marked a significant milestone in global expansion, with revenue outside mainland China growing by approximately 90.5%.
As CLPS diversifies its business model across various sectors, including fintech, education, and tourism, it prepares for a promising future. Yang expressed appreciation for the stakeholders' support and highlighted the company's focus on long-term value and trusted technology partnerships in a rapidly evolving landscape.
MWN-AI** Analysis
CLPS Incorporation's recent shareholder letter underscores significant transformations within the company, adapting to a challenging economic landscape and enhancing its commitment to technological innovation. As we move into 2026, investors should carefully consider several key insights that suggest both risk and opportunity.
First, the dissolution of dedicated IT teams due to the downsizing of their largest client has had a substantive impact on fiscal 2025 results. However, the company's revenue still grew by 15.2%, driven by its proactive diversification efforts. This resilience amidst adversity can be seen as a positive indicator of management's ability to navigate market fluctuations.
Technological advancements, particularly the launch of Nibot—a Robotic Process Automation product—demonstrate CLPS's strategic focus on AI and automation. Such innovations can position the company competitively in a rapidly evolving tech landscape. Investors should note the growing demand for AI-driven solutions, which may offer substantial revenue growth potential in the coming years.
Financial guidance indicates a cautious optimism with projected revenue growth of 10%-15% for fiscal 2026, despite temporary setbacks. Importantly, the gross profit has similarly shown a solid increase, and adjusted net income reflects improved operational stability, excluding one-time costs from restructuring.
Global expansion efforts are also noteworthy, with substantial revenue growth outside of mainland China and the establishment of new subsidiaries, particularly in Southeast Asia. This geographical diversification mitigates reliance on any single market and could enhance revenue stability moving forward.
In summary, while challenges remain, CLPS's strategic shift towards innovation, geographical diversification, and resilient operational performance bodes well for potential long-term growth. Investors looking for opportunities within the tech sector may find CLPS an attractive option, albeit with caution around its short-term challenges. Continuous monitoring of the company's ability to execute its transformation strategy will be crucial.
**MWN-AI Summary and Analysis is based on asking OpenAI to summarize and analyze this news release.
PR Newswire
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
SOURCE CLPS
FAQ**
In his letter, the Chairman mentions the "substantial reduction of personnel at its China Solution Centers" – how is CLPS Incorporation CLPS strategizing to mitigate the financial impact of this change on its operations and revenue forecasts for 2026?
With the launch of Nibot and other technological innovations, what specific measures is CLPS Incorporation CLPS taking to enhance its competitive edge in the AI-driven solutions market and ensure client satisfaction?
Given the revenue increase reported for fiscal 2025, how does CLPS Incorporation CLPS plan to sustain its projected revenue growth rate of 10%-15% for fiscal year 2026 amid ongoing market uncertainties?
As CLPS Incorporation CLPS expands its global footprint, particularly in Southeast Asia, what specific opportunities does the company anticipate pursuing to further diversify its revenue streams and strengthen its market position?
**MWN-AI FAQ is based on asking OpenAI questions about CLPS Incorporation (NASDAQ: CLPS).
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