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| PART I—FINANCIAL INFORMATION |
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| ITEM 1 · Financial Statements (Unaudited) |
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| Consolidated Balance Sheets as of September 30, 2025, and December 31, 2024 | 5 |
| Consolidated Statements of Income for the three and nine months ended September 30, 2025 and 2024 | 6 |
| Consolidated Statements of Comprehensive Income for the three and nine months ended September 30, 2025 and 2024 | 7 |
| Consolidated Statements of Cash Flows for the nine months ended September 30, 2025 and 2024 | 8 |
| Consolidated Statements of Changes in Stockholders’ Equity for the three months ended September 30, 2025 and 2024 | 9 |
| Consolidated Statements of Changes in Stockholders’ Equity for the nine months ended September 30, 2025 and 2024 | 10 |
| Notes to Consolidated Financial Statements | 11 |
| ITEM 2 | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 29 |
| ITEM 3 | Quantitative and Qualitative Disclosures about Market Risk | 44 |
| ITEM 4 | Controls and Procedures | 44 |
| PART II—OTHER INFORMATION |
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| ITEM 1 | Legal Proceedings | 45 |
| ITEM 1A | Risk Factors | 45 |
| ITEM 2 | Unregistered Sales of Equity Securities and Use of Proceeds | 45 |
| ITEM 3 | Defaults Upon Senior Securities | 45 |
| ITEM 4 | Mine Safety Disclosures | 45 |
| ITEM 5 | Other Information | 45 |
| ITEM 6 | Exhibits | 46 |
| Signatures | 47 | |
Cautionary Note Regarding Forward-Looking Statements
This Quarterly Report on Form 10-Q for the quarter ended September 30, 2025 (this “Quarterly Report”), contains forward-looking statements within the meaning of the federal securities laws. Forward-looking statements may generally be identified by the use of words such as “anticipate,” “believe,” “expect,” “intend,” “plan,” and “will” or, in each case, their negative, or other variations or comparable terminology. These forward-looking statements include all matters that are not historical facts. By their nature, forward-looking statements involve risks and uncertainties because they relate to events, and depend on circumstances, that may or may not occur in the future. As a result, actual events may differ materially from those expressed in, or suggested by, the forward-looking statements. Any forward-looking statement made by Turning Point Brands, Inc. (“TPB”), in this Quarterly Report on Form 10-Q speaks only as of the date hereof. New risks and uncertainties come up from time to time, and it is impossible for TPB to predict these events or how they may affect it. TPB has no obligation, and does not intend, to update any forward-looking statements after the date hereof, except as required by federal securities laws. Factors that could cause these differences include, but are not limited to:
| ● | declining sales of tobacco products, and expected continuing decline of sales in the tobacco industry overall; |
| ● | our dependence on a small number of third-party suppliers and producers; |
| ● | the possibility that we will be unable to identify or contract with new suppliers or producers in the event of a supply or product disruption, as well as other supply chain concerns, including delays in product shipments and increases in freight cost; |
| ● | the possibility that our licenses to use certain brands or trademarks will be terminated, challenged or restricted; |
| ● | failure to maintain consumer brand recognition and loyalty of our customers and in anticipating and responding to changes in consumer preferences and purchase behavior; |
| ● | our reliance on relationships with several large retailers and national chains for distribution of our products; |
| ● | intense competition and our ability to compete effectively; |
| ● | competition from illicit sources and the damage caused by illicit products to our brand equity; |
| ● | contamination of our tobacco supply or products; |
| ● | uncertainty and continued evolution of the markets for our products; |
| ● | complications with the design or implementation of our new enterprise resource planning system could adversely impact our business and operations; |
| ● | recalls of our products; |
| ● | substantial and increasing regulation and changes in U.S. Food and Drug Administration (“FDA”) enforcement priorities; |
| ● | regulation or marketing denials of our products by the FDA, which has broad regulatory powers; |
| ● | many of our products contain nicotine, which is considered to be a highly addictive substance; |
| ● | requirement to maintain compliance with master settlement agreement escrow account; |
| ● | possible significant increases in federal, state and local municipal tobacco- and nicotine-related taxes; |
| ● | our products are marketed pursuant to a policy of FDA enforcement priorities which could change, and our products could become subject to increased regulatory burdens by the FDA; |
| ● | our products are subject to developing and unpredictable regulation, such as court actions that impact obligations; |
| ● | increase in the taxation of our products could adversely affect our business; |
| ● | sensitivity of end-customers to increased sales taxes and economic conditions, including as a result of inflation and other declines in purchasing power; |
| ● | possible increasing international control and regulation; |
| ● | failure to comply with environmental, health and safety regulations; |
| ● | imposition of significant tariffs on imports into the U.S.; |
| ● | the scientific community’s lack of information regarding the long-term health effects of certain substances contained in some of our products; |
| ● | significant product liability litigation; |
| ● | our amount of indebtedness; |
| ● | our credit rating and ability to access well-functioning capital markets; |
| ● | the terms of our indebtedness, which may restrict our current and future operations; |
| ● | our ability to establish and maintain effective internal controls over financial reporting; |
| ● | identification of material weaknesses in our internal control over financial reporting, which, if not remediated appropriately or timely, could result in loss of investor confidence and adversely impact our stock price; |
| ● | our certificate of incorporation and bylaws, as well as Delaware law and certain regulations, could discourage or prohibit acquisition bids or merger proposals, which may adversely affect the market price of our common stock; |
| ● | our certificate of incorporation limits the ownership of our common stock by individuals and entities that are Restricted Investors (as defined in our Certificate of Incorporation). These restrictions may affect the liquidity of our common stock and may result in Restricted Investors being required to sell or redeem their shares at a loss or relinquish their voting, dividend and distribution rights; |
| ● | future sales of our common stock in the public market could reduce our stock price, and any additional capital raised by us through the sale of equity or convertible securities may dilute your ownership in us; |
| ● | we may issue preferred stock whose terms could adversely affect the voting power or value of our common stock; |
| ● | our business may be damaged by events outside of our or our suppliers’ control, such as the impact of epidemics or pandemics, political upheavals, or natural disasters; |
| ● | adverse impact of climate change and legal and regulatory requirements related to climate change and environmental sustainability; |
| ● | our reliance on information technology; |
| ● | cybersecurity and privacy breaches, including due to artificial intelligence; |
| ● | failure to manage our growth; |
| ● | failure to successfully identify, negotiate and complete suitable acquisition opportunities, integrate our acquisitions or otherwise be unable to benefit from pursuing acquisitions; |
| ● | fluctuations in our results; |
| ● | exchange rate fluctuations; |
| ● | adverse U.S. and global economic conditions; |
| ● | departure of key management personnel or our inability to attract and retain talent; |
| ● | infringement on or misappropriation of our intellectual property; |
| ● | third-party claims that we infringe on their intellectual property; and |
| ● | impairment of intangible assets, including trademarks and goodwill. |
PART I—FINANCIAL INFORMATION
Item 1. Financial Statements
