Culper Research has issued a new short report on GigaCloud Technology, expressing concern over the e-commerce logistics company’s warehouse operations, last-mile delivery business and the validity of its AI technology.

In a September 28 short report, Culper challenged GigaCloud’s claim of running 14 warehouses in the U.S. stating it has disclosed just 73 employees in the region. “Simply put, we don’t think it’s at all possible to profitably run 14 warehouses with over 3.7 million square feet which supposedly distribute hundreds of millions of dollars of furniture with [around five employees per warehouse],” the short seller asserted.

Culper added that it saw “laughably sparse activity” when it visited nine of the company’s warehouses in New Jersey and California.

The short outfit also challenged GigaCloud’s claims that its last-mile delivery business had generated $80 million in revenue over the last 12 months highlighting that its logistics subsidiary has “just five vehicles registered” and noting talks with former employees which revealed an “incredibly inefficient” last-mile operation.

Taking issue with its artificial intelligence technology, Culper pointed out that its financial statements fail to disclose any software development expenses or capitalized software costs, calling into question GigaCloud’s claims that AI had managed to “transform the entire supply chain.”

The short seller also claimed to have uncovered “numerous entities which are neither named subsidiaries nor disclosed as [GigaCloud] related parties, yet which name [GigaCloud] insiders… on corporate documents.”

“At the very least, we think the very existence of these entities suggests undisclosed related party issues, and in the worst case, might suggest more nefarious schemes,” Culper concluded.

GigaCloud’s stock stood at $7.20 at 11:35 a.m. in New York, down almost 24%.