Reborn Coffee, Inc.
For the period ended Dec 31, 2025. Filed Apr 22, 2026.
View on SEC.govAbout this filing
A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2025 · Filed Apr 22, 2026
REBN$1.21-4.0%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2024-12-31; filed 2025-03-31.
0001213900-25-026307
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2025-12-31; filed 2026-04-22.
0001213900-26-046490
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 54 previous paragraphs and 70 current paragraphs.
37 unchanged; 13 reworded; 20 added; 4 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 16 previous and 16 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (20)
Current report
Service income is primarily derived from Reborn Logistics’ freight forwarding and logistics services. The Company recognizes service revenue when shipment transactions are delivered. Each shipment transaction or service order generally represents a separate contract with a customer. A performance obligation is established once a customer agreement with an agreed-upon transaction price exists. The transaction price is typically fixed and is not contingent upon the occurrence or non-occurrence of future events, and payment is generally due within 45 to 60 days from the invoice date.
Current report
The Company’s transportation arrangements involve organizing the movement of freight to a customer’s destination. Transportation services, including certain ancillary services such as loading and unloading, freight insurance, and customs clearance, represent a single performance obligation, as these services are not distinct in the context of the contract. This performance obligation is satisfied and revenue is recognized as control of the services transfers to the customer during the transit period, as the customer’s goods move from origin to destination.
Current report
The Company evaluates whether it controls the transportation services provided to determine whether it is acting as a principal or an agent. The Company has determined that it acts as the principal in its transportation service arrangements, as it controls pricing, manages all aspects of the shipment process, and assumes the risks associated with delivery and collection. Accordingly, service income is presented on a gross basis in the consolidated statements of operations. Service income represents approximately 11.5% of the Company’s total revenue.
Current report
The Company has entered into license agreements that allow licensees to operate and market Reborn Coffee branded stores and products under the Reborn Coffee trademarks. Under these agreements, the Company provides ongoing services, including training, marketing support, system updates, and other operational assistance. As the Company is required to provide these ongoing services, license revenue is recognized over the term of the license agreement. License agreements typically have initial terms of three years and may be renewed for additional periods. License income represents approximately 13.6% of the Company’s total revenue.
Current report
Product, Food and Drink Costs – Stores, Wholesales and Online
Current report
Product, food and drink costs – stores and cost of sales – wholesale and online primarily include the costs of ingredients of food and beverage sold and related supplies used in customer service. The wholesale and online sales also include costs of packaging and shipping.
Current report
Cost of service income – subcontractors (Reborn Logistics)
Current report
Cost of service income – subcontractors mainly represent the cost of independence contractors and third-party carriers in the performance of its freight forward and transportation services.
Current report
General and administrative expense includes store-related expense as well as the Company’s corporate headquarters’ expenses. These include rent and utilities, payroll and benefits, and depreciation expenses.
Current report
Costs of Service Income –Subcontractors – Costs of service income were approximately $0.7 million for the year ended December 31, 2025. The costs of service income – subcontractors were mainly representing the cost of independence contractors and third-party carriers in the performance of its freight forward and transportation services.
Current report
**Professional Fees –**Professional fees were approximately $1.6 million for the year ended December 31, 2025 compared to $0.7 million for the comparable period in the prior year, representing an increase of approximately $0.9 million, or 134.5%. The increase was primarily related to legal and accounting services during 2025 in connection with the convertible debts and other related equity activities.
Current report
**Stock Compensation Expenses–**Stock compensation expenses were approximately $1.5 million for the year ended December 31, 2025 compared to $0.8 million for the comparable period in the prior year, representing an increase of approximately $0.7 million, or 88.6%. The increase was mainly driven by increased activities during 2025.
Current report
***Other Expense –***Other expense primarily includes debt discount, derivative expenses, gain on debt extinguishment and asset impairment loss. Other expense was $3.1 million for the year ended December 31, 2025 compared to $0.2 million for the year ended December 31, 2024, an increase of $2.9 million or 1,572.4%. The increase was contributed by $1.1 million of debt discounts expense from the convertible debt, $0.7 million of loss on debt extinguishment, $1.6 million of asset impairment loss, offset by other income of $0.3 million.
Current report
On February 6, 2025, we entered into a Debenture Purchase Agreement with the purchasers named therein (the “Debenture Investors”). Under the Debenture Purchase Agreement, we agreed to issue 10% original issue discount secured convertible debentures (“Debentures”) in a principal amount of up to $10,000,000, divided into up to four separate tranches that are each subject to certain closing conditions (the “Debenture Transaction”). The conversion price per share of each Debenture, subject to adjustment as provided therein, is equal to 92.5% of the lowest daily VWAP (as defined in the Debentures) of our shares of common stock during the five trading day period ending on the trading day immediately prior to delivery or deemed delivery of the applicable Conversion Notice (as defined in the Debentures). The Debentures accrue interest at a rate of 10% per annum paid in kind, unless there is an event of default in which case the Debentures will accrue interest at a default rate.
Current report
Upon the consummation of the closing of each tranche, we also agreed to issue common stock purchase warrants (the “Debenture Warrants”) to each Debenture Investor who participates in such closing. The Debenture Warrants will: (i) provide for the purchase by the applicable Debenture Investor of a number of shares of common stock equal to 20% of the total principal amount of the related Debenture purchased by the Debenture Investor on the applicable closing date divided by 92.5% of the lowest daily VWAP of common stock for the five consecutive trading day period ended on the last trading day immediately preceding such closing date and (ii) be exercisable at an exercise price equal to 92.5% of the average of the lowest daily VWAP of the common stock over the consecutive trading days immediately preceding the delivery of the applicable Notice of Exercise (as defined in the Debenture Warrants).
Current report
As of the date of this Report, we have conducted four closings pursuant to the Debenture Purchase Agreement and sold Debentures in the aggregate principal amount of $ $4,166,665 for a purchase price of $3,750,000, representing an original issue discount of ten percent (10%). We also issued to the Debenture Investors 1,041,667 Debenture Warrants in connection with the closings. In addition, on March 31, 2026, we issued an additional 250,000 common stock purchase warrants to the Debenture Investor, which have an exercise price of $2.00 per share, in exchange for waiver and forbearance of certain terms under the Debentures, the details of which are set forth on Forms 8-K filed by the Company on April 6, 2026 and April 21, 2026.
Current report
In addition, we entered into an ELOC Purchase Agreement with Arena whereby, we may, subject to various terms and conditions, including, without limitation that we maintain an effective registration statement covering shares issuable pursuant to the ELOC Agreement, at our discretion, direct Arena to purchase up to $50.0 million of shares of our common stock under the ELOC Agreement from time-to-time. The purchase price per share for the shares of common stock that we may elect to sell to Arena under the ELOC Agreement will fluctuate based on the market prices of our common stock for each purchase made pursuant to the ELOC Agreement, if any. Accordingly, it is not currently possible to predict the number of shares that will be sold to Arena, the actual purchase price per share to be paid by Arena for those shares, if any, or the actual gross proceeds to be raised in connection with those sales. As of the date hereof, we have not drawn down on the ELOC Purchase Agreement.
Current report
The extent to which we rely on Arena and/or the Debenture Investors as a source of funding will depend on a number of factors including, the prevailing market price of our common stock and the extent to which we are able to secure working and other capital from other sources. If obtaining sufficient funding from ELOC Agreement were to prove unavailable or prohibitively dilutive, we may need to secure another source of funding in order to satisfy our working and other capital needs. Even if we were to sell to Arena all of the shares of common stock available for sale to Arena under the ELOC Agreement and conduct the remaining closings pursuant to the Debenture Purchase Agreement, we may still need additional capital to fully implement our business, operating and development plans. Should the financing we require to sustain our working capital needs be unavailable or prohibitively expensive when we require it, the consequences may be a material adverse effect on our business, operating results, financial condition and prospects.
Current report
Net cash used in investing activities for the year ended December 31, 2025 was $3.0 million, which primarily resulted from $2.0 million of loan receivables from related party and $1.0 million of long-term prepayment.
Current report
Net cash provided by financing activities during the year ended December 31, 2025 was $11.9 million, which was primarily due to proceeds from issuance of common stock, gain on debt settlement and issuance of convertible debt.
Removed paragraphs (4)
Previous report
Cost of Sales
Previous report
Cost of sales includes costs associated with generating revenue within our company-owned retail locations and through wholesale and online platform.
Previous report
General and administrative expenses include store-related expenses as well as our corporate headquarters’ expenses.
Previous report
**Other Income (Expense) –**Other income or expense primarily includes interest expense. Interest expense was $0.2 million for the year ended December 31, 2024 compared to $0.1 million for the year ended December 31, 2023, an increase of $0.1 million. The increase was primarily due to increase in high interest rate for the monies borrowed during 2024.
Reworded paragraphs (13)
Previous wording
Founded in 2015 by Jay Kim, our Chief Executive Officer, Mr. Kim and his team launched Reborn Coffee with the vision of using the finest pure ingredients and pristine water. We currently serve customers through our 10 retail stores located in California, 1 store in Korea, and 1 store in Malaysia.
Current wording
Founded in 2015 by Jay Kim, our Chief Executive Officer, Mr. Kim and his team launched Reborn Coffee with the vision of using the finest pure ingredients and pristine water. We currently serve customers through our 9 retail stores and 1 franchisee located in California, 1 store in Korea, and 1 store in Malaysia.
Previous wording
We have the following twelve retail coffee locations as of December 31, 2024:
Current wording
We have the following ten retail coffee locations as of December 31, 2025:
Previous wording
Retail store revenues are recognized when payment is tendered at the point of sale. Retail store revenues are reported net of sales, use or other transaction taxes that are collected from customers and remitted to taxing authorities. Sales taxes that are payable are recorded as accrued as other current liabilities. Retails store revenue makes up approximately [98]% of our total revenue.
Current wording
Retail store revenues are recognized at the point of sale when payment is tendered. Retail store revenues are reported net of sales, use, or other transaction taxes collected from customers and remitted to taxing authorities. Sales taxes payable are recorded as accrued liabilities within other current liabilities. Retail store revenue represents approximately 73.5% of the Company’s total revenue.
Previous wording
Wholesale and online revenues are recognized when the products are delivered, and title passes to customers or to the wholesale distributors. When customers pick up the products at our warehouse, or the products are delivered to the wholesale distributors, the title of the products passes and revenue is recognized. Wholesale revenues make up between [4% to 6%] of our total revenue.
Current wording
Wholesale and online revenues are recognized when products are delivered and title passes to the customer or to wholesale distributors. When customers pick up products at the Company’s warehouse or when products are delivered to wholesale distributors, title transfers and revenue is recognized at that time. Wholesale and online revenues represent approximately 1.4% of the Company’s total revenue.
Previous wording
**Net Revenues –**Revenues were approximately $5.9 million for the year ended December 31, 2024, compared to $5.5 million for the year ended December 31, 2023, representing an increase of approximately $0.4 million, or 7.6%. The increase in sales for the periods was primarily driven by the opening of new locations, and to the continued focus on marketing efforts to grow brand recognition.
Current wording
**Net Revenues –**Revenues were approximately $8.1 million for the year ended December 31, 2025, compared to $5.9 million for the year ended December 31, 2024, representing an increase of approximately $2.1 million, or 36.5%. The increase in sales for the period was primarily driven by new stream of service income from Reborn logistics and the license income along with the continued focus on marketing efforts to grow brand recognition.
Previous wording
**Product, Food and Drink Costs (stores) –**Product, food and drink costs were approximately $2.1 million for the year ended December 31, 2024 compared to $1.8 million for the comparable period in 2023, representing an increase of approximately $0.3 million, or 15.7%. The increase in costs was partially driven by the opening of new locations and the overall increase in sales for the period.
Current wording
**Product, Food and Drink Costs (stores) –**Product, food and drink costs were approximately $2.4 million for the year ended December 31, 2025 compared to $2.2 million for the comparable period in 2024, representing an increase of approximately $0.2 million, or 7.8%. The increase in costs was mainly driven by the increase of product costs and the overall increase in sales for the period.
Previous wording
**General and administrative expenses –**General and administrative expenses were approximately $8.3 million for the year ended December 31, 2024 compared to $8.2 million for the comparable period in the prior year, representing an increase of approximately $0.1 million, or 1.2%. The increase was mainly caused by increased occupancy expenses and labor costs with opening of new locations.
Current wording
***General and Administrative Expenses –***General and administrative expenses were approximately $7.8 million for the year ended December 31, 2025 compared to $6.9 million for the comparable period in the prior year, representing an increase of approximately $0.9 million, or 13.0%. The increase was mainly caused by increased occupancy expenses and labor costs from the store locations.
Previous wording
We have a history of operating losses and negative cash flow in operating activities. We have incurred recurring net losses, including net losses from operations before income taxes of $4.8 million and $4.7 million for the years ended December 31, 2024 and 2023, respectively. We used $3.5 million and $3.2 million cash for operating activities during the years ended December 31, 2024 and 2023, respectively. These factors raise substantial doubt as to our ability to continue as a going concern, and our independent registered public accounting firm has included a going concern explanatory paragraph in our audit report for 2024.
Current wording
We have a history of operating losses and negative cash flow in operating activities. We have incurred recurring net losses, including net losses from operations before income taxes of $8.9 million and $4.8 million for the years ended December 31, 2025 and 2024, respectively. We used $6.5 million and $3.5 million cash for operating activities during the years ended December 31, 2025 and 2024, respectively. These factors raise substantial doubt as to our ability to continue as a going concern, and our independent registered public accounting firm has included a going concern explanatory paragraph in our audit report for 2025.
Previous wording
To support our existing and planned business model, we need to raise additional capital to fund our future operations. We have not experienced any difficulty in raising funds through loans, and have not experienced any liquidity problems in settling payables in the normal course of business and repaying loans when they fall due. Successful renewal of our loans, however, is subject to numerous risks and uncertainties. In addition, the increasingly competitive industry conditions under which we operate may negatively impacted our results of operations and cash flows. Additional financing is anticipated to fund our operations in near future. However, other than the ELOC Agreement and the Arena Debenture Transaction, there are no current agreements or understandings with regard to the form, time or amount of such financing and there is no assurance that any of this financing can be obtained or that we can continue as a going concern.
Current wording
To support our existing and planned business model, we need to raise additional capital to fund our future operations. We have not experienced any difficulty in raising funds through loans and have not experienced any liquidity problems in settling payables in the normal course of business and repaying loans when they fall due. Successful renewal of our loans, however, is subject to numerous risks and uncertainties. In addition, the increasingly competitive industry conditions under which we operate may negatively impact on our results of operations and cash flows. Additional financing is anticipated to fund our operations in near future. However, other than the ELOC Agreement and the Arena Debenture Transaction, there are no current agreements or understandings with regard to the form, time or amount of such financing and there is no assurance that any of these financing can be obtained or that we can continue as a going concern.
Previous wording
Net cash used in operating activities during the year ended December 31, 2023 was approximately $3.2 million, which resulted from net loss of $4.7 million, non-cash charges of $0.3 million for stock compensation, $0.3 million for operating lease and $0.3 million for depreciation, and net cash inflows of $0.7 million from changes in operating assets and liabilities.
Current wording
Net cash used in operating activities during the year ended December 31, 2025 was approximately $6.5 million, which mainly resulted from net loss of $9.1 million, non-cash charges of $1.5 million for stock compensation, $0.4 million for depreciation, $1.1 million debt discount expense, $1.6 million asset impairment loss and net cash inflows of $2.5 million from changes in operating assets and liabilities.
Previous wording
Net cash used in investing activities for the years ended December 31, 2024 and 2023 was $1.0 million and $2.4 million, respectively. These expenditures in each period are primarily related to purchases of property and equipment in connection with current and future location openings and maintaining our existing locations.
Current wording
Net cash used in investing activities for the year ended December 31, 2024 was $1.0 million. The expenditure is primarily related to purchases of property and equipment in connection with current and future location openings and maintaining our existing locations.
Previous wording
Net cash provided by financing activities during the year ended December 31, 2024 was $4.4 million, which was primarily due to proceeds from issuances of common stock and off-set by repayments of loans payable. Net cash provided by financing activities during the year ended December 31, 2023 was $2.7 million, which was primarily from proceeds from the credit line and loans.
Current wording
Net cash provided by financing activities during the year ended December 31, 2024 was $4.4 million, which was primarily due to proceeds from issuances of common stock and off-set by repayments of loans payable.
Previous wording
Pursuant to the SBA Loan Agreement, we borrowed an aggregate principal amount of the EIDL Loan of $500,000, with proceeds to be used for working capital purposes. Interest accrues at the rate of 3.75% per annum and will accrue only on funds actually advanced from the date of each advance. Installment payments, including principal and interest, are due monthly beginning May 16, 2021 (twelve months from the date of the SBA Loan Agreement) in the amount of $731. The balance of principal and interest is payable thirty years from the date of the SBA Loan. In connection therewith, we also received a $10,000 grant, which does not have to be repaid. During the year ended December 31, 2020, $10,000 was recorded in Economy injury disaster loan (EIDL) grant income in the Statements of Operations. The schedule of payments on this loan was later deferred to commence 24 months from the date of loan and we have paid the payments since May 2022.
Current wording
Pursuant to the SBA Loan Agreement, we borrowed an aggregate principal amount of the EIDL Loan of $500,000, with proceeds to be used for working capital purposes. Interest accrues at the rate of 3.75% per annum and will accrue only on funds actually advanced from the date of each advance. Installment payments, including principal and interest, are due monthly beginning May 16, 2021 (twelve months from the date of the SBA Loan Agreement) in the amount of $731. The balance of principal and interest is payable thirty years from the date of the SBA Loan. In connection with this, we also received a $10,000 grant, which does not have to be repaid. During the year ended December 31, 2020, $10,000 was recorded in Economy injury disaster loan (EIDL) grant income in the Statements of Operations. The schedule of payments on this loan was later deferred to commence 24 months from the date of loan and we have paid the payments since May 2022.