2023 Financial Results
During the fiscal year ended December 31, 2023, our financial performance reflected the consequences of strategic decisions and external market forces. Our revenue experienced a substantial decline compared to the previous year. Revenue from our operations decreased by $16.8 million, or 30.5%, from approximately $55.2 million in 2022 to $38.4 million in 2023. This decline can be primarily attributed to an intentional pause in vehicle procurement in the fourth quarter, prompted by a price volatility in the PRC market and the results of an earlier shift in our procurement pricing strategy. The impact of these factors was particularly pronounced in the fourth quarter of 2023.
Total cost of revenue decreased by $16.6 million, or 32.8%, from $50.7 million in 2022 to $34.1 million in 2023. Our cost of revenue amounted to 88.9% and 91.9%, respectively, of our revenue. Our total cost of revenue decreased in line with the reduced revenue, indicating effective cost control measures. The procurement strategy shift, initiated earlier in 2023, was a significant factor in this decrease, allowing us to manage costs more effectively despite external market pressures.
Selling expenses decreased by 25.7% to $0.7 million, representing 1.7% of our revenue, a slight increase from 1.6% in 2022. This change is due to a 29.9% reduction in ocean freight expenses and 19.1% decrease in payroll and benefits, despite a 191.2% increase in other expenses. The decrease in selling expenses can be attributed primarily to a reduction in the number of vehicles sold during the fourth quarter.
Income from operations was $1.4 million in 2023, compared with $2.1 million the previous year.
Total other expenses consisted primarily of interest expense, which decreased significantly by approximately $1.2 million, or 49.2%, to $1.2 million for the year ended December 31, 2023, from $2.4 million for the year ended December 31, 2022, primarily due to the significant drop of inventory financing activities, reduced letter of credit financing activities, and the completion of our IPO in the third quarter of 2023.
Net income in 2023 was $0.1 million, or $0.01 per share, compared with net income of $0.8 million, or $0.05 per share, for 2022.