111, Inc. Amends 20-F/A for Auditor Opinion Update; B2B Sales Dominate

TL;DR

**YI's 20-F/A amendment is a necessary cleanup, but the underlying B2B revenue concentration and past going concern issues still warrant caution.**

AI Summary

111, Inc. (YI) filed an Amendment No. 1 on Form 20-F/A for the fiscal year ended December 31, 2024, primarily to include an updated opinion from its predecessor auditor, Deloitte Touche Tohmatsu Certified Public Accountants LLP, regarding the financial statements for the years ended December 31, 2022 and 2023. The amendment addresses an SEC request related to the original filing on April 29, 2025, specifically concerning the exclusion of retrospective adjustments for basis of presentation and segment reporting in Notes 2(a) and 2(ad) of the financial statements. For the fiscal year ended December 31, 2024, the company generated RMB 14,033 million in B2B product sales, representing 97.5% of its total revenues. Grant Thornton Zhitong Certified Public Accountants LLP served as the auditor for the 2024 fiscal year, while Deloitte Touche Tohmatsu Certified Public Accountants LLP audited the 2022 and 2023 periods. The filing highlights revenue recognition as a critical audit matter due to the significant volume of B2B product sales. As of December 31, 2024, 111, Inc. had 172,877,660 ordinary shares outstanding, comprising 100,877,660 Class A ordinary shares and 72,000,000 Class B ordinary shares.

Why It Matters

This amendment is crucial for investors as it clarifies the auditor's opinion on 111, Inc.'s financial statements for 2022 and 2023, addressing a specific SEC request. A clean and unambiguous auditor's report is vital for investor confidence and regulatory compliance, especially for a company with a history of accumulated deficit and going concern issues as noted in the 2023 financial statements. The dominance of B2B product sales, accounting for 97.5% of total revenues in 2024, underscores the company's business model focus and potential competitive pressures in that segment. This filing ensures that the financial reporting is robust, providing a clearer picture for market participants to assess YI's operational health and future prospects.

Risk Assessment

Risk Level: medium — The filing indicates a 'going concern' issue as of December 31, 2023, due to recurring losses and the uncertainty of completing qualified initial public offerings, which could trigger cash redemption of redeemable non-controlling interest. While the amendment itself is a procedural correction, the underlying financial health concerns from the prior period, coupled with the high concentration of 97.5% of 2024 revenue from B2B product sales, suggest a medium risk profile.

Analyst Insight

Investors should scrutinize the updated financial statements for 2022 and 2023 to understand the impact of the auditor's revised opinion and assess the company's progress in addressing the 'going concern' issues. Monitor future filings for signs of improved profitability and diversification beyond the heavily concentrated B2B segment to mitigate revenue risk.

Key Numbers

• RMB 14,033 million — B2B Product Sales (Represented 97.5% of total revenues for the fiscal year ended December 31, 2024, highlighting revenue concentration.)
• 97.5% — Percentage of Total Revenue from B2B Product Sales (Indicates significant reliance on the B2B segment for revenue generation in 2024.)
• 172,877,660 — Total Ordinary Shares Outstanding (As of December 31, 2024, comprising 100,877,660 Class A and 72,000,000 Class B shares.)
• 2025-08-29 — Filing Date of Amendment No. 1 (Date the 20-F/A was filed, updating the original April 29, 2025 filing.)

Key Players & Entities

• 111, Inc. (company) — Registrant
• SEC (regulator) — Securities and Exchange Commission
• Junling Liu (person) — Chief Executive Officer and Co-Chairman of the Board
• Grant Thornton Zhitong Certified Public Accountants LLP (company) — Auditor for fiscal year ended December 31, 2024
• Deloitte Touche Tohmatsu Certified Public Accountants LLP (company) — Predecessor auditor for fiscal years ended December 31, 2022 and 2023
• The Nasdaq Stock Market LLC (company) — Exchange where YI is registered
• RMB 14,033 million (dollar_amount) — B2B product sales for fiscal year ended December 31, 2024

FAQ

Key Financial Figures

• $0.00005 — ty Class A ordinary shares, par value US$0.00005 per share) YI The Nasdaq Stock Mark

Filing Documents

• yi-20241231x20fa.htm (20-F/A) — 2278KB
• yi-20241231xex12d1.htm (EX-12.1) — 11KB
• yi-20241231xex12d2.htm (EX-12.2) — 12KB
• yi-20241231xex13d1.htm (EX-13.1) — 5KB
• yi-20241231xex13d2.htm (EX-13.2) — 6KB
• yi-20241231xex15d4.htm (EX-15.4) — 5KB
• 0001410578-25-001911.txt ( ) — 11752KB
• yi-20241231.xsd (EX-101.SCH) — 90KB
• yi-20241231_cal.xml (EX-101.CAL) — 79KB
• yi-20241231_def.xml (EX-101.DEF) — 398KB
• yi-20241231_lab.xml (EX-101.LAB) — 760KB
• yi-20241231_pre.xml (EX-101.PRE) — 644KB
• yi-20241231x20fa_htm.xml (XML) — 2164KB

Item 18

Item 17 Item 18 If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes No APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PAST FIVE YEARS Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Section 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court. Yes No Table of Contents TABLE OF CONTENTS Page EXPLANATORY NOTE 1 Part III Item 17.

Financial Statements

Financial Statements 2 Item 18.

Financial Statements

Financial Statements 2 Item 19. Exhibits 2 i Table of Contents EXPLANATORY NOTE 111, Inc. (the "Company") is filing this Amendment No. 1 on Form 20-F/A (this "Amendment No. 1") to amend its annual report on Form 20-F for the fiscal year ended December 31, 2024 filed with the Securities and Exchange Commission (the "SEC") on April 29, 2025 (the "Original Filing"), to amend Items 17 and 18 with the inclusion of an updated opinion from the predecessor auditor which does not include reference to the exclusion of the retrospective adjustments related to basis of presentation and segment reporting discussed in Note 2(a) and 2(ad) to the Company's financial statements, as requested by the SEC in relation to the Original Filing. The Company is restating in their entirety the following sections of the Original Filing: (i) "Part III – Item 17. Financial Statements" and (ii) "Part III – Item 18. Financial Statements" in this Amendment No. 1. This Amendment No. 1 speaks as of the filing date of the Original Filing, or April 29, 2025. No attempt has been made in this Amendment No. 1 to modify or update in any way any other items or disclosures in the Original Filing. Except as specifically noted herein, this Amendment No. 1 does not amend, update or restate any of the information previously included in the Original Filing, nor does this Amendment No. 1 reflect any event that has occurred after the date of the Original Filing. Accordingly, this Amendment No. 1 should be read in conjunction with the Original Filing and the Company's other filings with the SEC subsequent to April 29, 2025. As required by Rule 12b-15 of the Securities and Exchange Act of 1934, as amended, the Company is also filing or furnishing the certifications required under Section 302 and Section 906 of the Sarbanes-Oxley Act of 2002 as exhibits to this Amendment No. 1. 1 Table of Contents PART III

Financial Statements

Item 17. Financial Statements We have elected to provide financial statements pursuant to Item 18.

Financial Statements

Item 18. Financial Statements The consolidated financial statements of 111, Inc., its subsidiaries and its consolidated affiliated entities are included at the end of this annual report.

Exhibits

Item 19. Exhibits Exhibit Number Description of Document 1.1 Twelfth Amended and Restated Memorandum and Articles of Association of the Registrant (incorporated by reference to Exhibit 3.2 of our registration statement on Form F-1 (file no. 333-226849), as amended, initially filed with the Securities and Exchange Commission on August 15, 2018) 2.1 Registrant's Specimen American Depositary Receipt (incorporated by reference to Exhibit 4.1 of our registration statement on Form F-1 (file no. 333-226849), as amended, initially filed with the Securities and Exchange Commission on August 15, 2018) 2.2 Registrant's Specimen Certificate for Class A Ordinary Shares (incorporated by reference to Exhibit 4.2 of our registration statement on Form F-1 (file no. 333-226849), as amended, initially filed with the Securities and Exchange Commission on August 15, 2018) 2.3 Deposit Agreement between the Registrant, the Bank of New York Mellon and all owner and holders from time to time of ADSs issued thereunder, dated September 12, 2018 (incorporated by reference to Exhibit 4.3 of our registration statement on Form S-8 (file no. 333-229313), as amended, initially filed with the Securities and Exchange Commission on January 22, 2019) 2.4*

Description of Securities

Description of Securities 4.1 English translation of 2013 Share Incentive Policy of the Registrant (incorporated by reference to Exhibit 10.1 of our Registration Statement on Form F-1 (file no. 333-226849) filed with the Securities and Exchange Commission on August 15, 2018) 4.2 English translation of 2014 Share Incentive Policy of the Registrant (incorporated by reference to Exhibit 10.2 of our Registration Statement on Form F-1 (file no. 333-226849) filed with the Securities and Exchange Commission on August 15, 2018) 4.3 The 2016 Share Incentive Plan of the Registrant (incorporated by reference to Exhibit 10.3 of our Registration Statement on Form F-1 (file no. 333-226849) filed with the Securities and Exchange Commission on August 15, 2018) 4.4 The 2018 Share Incentive Plan of the Registrant (incorporated by reference to Exhibit 10.4 of our Registration Statement on Form F-1 (file no. 333-226849) filed with the Securities and Exchange Commission on August 15, 2018) 4.5 Form of Employment Agreement between the Registrant and its executive officers (incorporated by reference to Exhibit 10.5 of our registration statement on Form F-1 (file no. 333-226849), as amended, initially filed with the Securities and Exchange Commission on August 15, 2018) 4.6 Form of Indemnification Agreement between the Registrant and its directors and executive officers (incorporated by reference to Exhibit 10.6 of our registration statement on Form F-1 (file no. 333-226849), as amended, initially filed with the Securities and Exchange Commission on August 15, 2018) 4.21 English translation of Property Lease Contract between Kunshan Fuchan Warehousing Services Co., Ltd. and Yao Fang Information Technology (Shanghai) Co., Ltd. dated February 5, 2016 (incorporated by reference to Exhibit 10.21 of our registration statement on Form F-1 (file no. 333-226849), as amended, initially filed with the Securities and Exchange Commission on August 15, 2018) 4.22 English

SIGNATURES

SIGNATURES The registrant hereby certifies that it meets all of the requirements for filing its annual report on Form 20-F and that it has duly caused and authorized the undersigned to sign this annual report on its behalf. 111, Inc. By: /s/ Junling Liu Name: Junling Liu Title: Chief Executive Officer and Co-Chairman of the Board Date: August 29, 2025 4 Table of Contents 111, INC. INDEX TO CONSOLIDATED FINANCIAL STATEMENTS Report of Independent Registered Public Accounting Firm (PCAOB ID: 1487 ) F-2 Reports of Independent Registered Public Accounting Firm (PCAOB ID: 1113 ) F-4 Consolidated Balance Sheets as of December 31, 2023 and 2024 F-5 Consolidated Statements of Comprehensive Loss for the years ended December 31, 2022, 2023 and 2024 F-6 Consolidated Statements of Changes in Shareholders' Equity (Deficit) for the years ended December 31, 2022, 2023 and 2024 F-7 Consolidated Statements of Cash Flows for the years ended December 31, 2022, 2023 and 2024 F-8

Notes to Consolidated Financial Statements

Notes to Consolidated Financial Statements F-9

Financial Statements Schedule I — Financial Information for Parent Company

Financial Statements Schedule I — Financial Information for Parent Company F-40 F-1 Table of Contents REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM Board of Directors and Shareholders 111, Inc. Opinion on the Financial Statements We have audited the accompanying consolidated balance sheet of 111, Inc. and subsidiaries (the "Company") as of December 31, 2024, the related consolidated statements of comprehensive loss, changes in shareholders' equity (deficit), and cash flows for the year then ended, and the related notes and the financial statement schedule (collectively referred to as the "consolidated financial statements"). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024, and the results of its operations and its cash flows for the year then ended in conformity with accounting principles generally accepted in the United States of America. Convenience Translation Our audit also comprehended the translation of Renminbi amounts into United States dollar amounts and, in our opinion, such translation has been made in conformity with the basis stated in Note 2(aj). Such United States dollar amounts are presented solely for the convenience of readers in the United States of America. Basis for Opinion These consolidated financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ("PCAOB") and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan

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