Laird Superfood, Inc.
For the period ended Mar 31, 2026. Filed May 14, 2026.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2026 · Filed May 14, 2026
LSF$2.22-2.6%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-09-30; filed 2025-11-10.
0001437749-25-034126
Item 2. Management’s Discussion and Analysis of Financial Conditions and Results of OperationsCurrent report: 10-Q
Period ended 2026-03-31; filed 2026-05-14.
0001437749-26-017096
Item 2. Management’s Discussion and Analysis of Financial Conditions 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 73 previous paragraphs and 56 current paragraphs.
13 unchanged; 16 reworded; 27 added; 42 removed; 2 previous and 0 current paragraphs rearranged.
Tables are not compared: 22 previous and 13 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 (27)
Current report
Recent Developments
Current report
The Navitas Acquisition
Current report
On the Navitas Closing Date, we completed the Navitas Acquisition, pursuant to the terms of the Navitas Acquisition Agreement following the receipt of approval from our stockholders, we acquired (i) all of the issued and outstanding units of Navitas from the Navitas Sellers and (ii) all of the issued and outstanding capital stock of GSC, from Encore for a purchase price of $38.5 million in cash, subject to customary purchase price adjustments, including a working capital adjustment. GSC is a holding company with no operations whose purpose is to hold units of Navitas.
Current report
The Nexus Investment
Current report
On the Navitas Closing Date and concurrently with the closing of the Navitas Acquisition, we completed the transactions contemplated by the Investment Agreement entered into by and among the Company and the Investor, with the Investor being an affiliate of Nexus, pursuant to which the Investor purchased an aggregate of 50,000 initial shares (the “Initial Shares”) of Series A Preferred Stock (“Series A Preferred Stock”) at a purchase price of $1,000 per share for gross proceeds of $50.0 million at closing (the “Nexus Investment”). The net proceeds from the Nexus Investment were subsequently used to complete the Navitas Acquisition (the Nexus Investment together with the Navitas Acquisition, the “Transactions”). For additional information regarding the Investment Agreement, see the information under the heading “Liquidity and Capital Resources.”
Current report
Board Appointments
Current report
We approved changes to our Board in connection with the Transactions. As of the Navitas Closing Date, the number of directors serving on the Board was increased to nine, and we appointed Doug Behrens, Michael Cohen, Kayla Dean Obia, and Kristin Patrick as representatives nominated by Nexus (the “Nexus Designees”), with Grant LaMontagne remaining on the Board and being considered the fifth Nexus Designee. In the future, the number of Nexus representatives will adjust proportionately to Nexus’s ownership thresholds, subject to applicable law and stock exchange rules.
Current report
The Terrasoul Acquisition
Current report
On the Terrasoul Closing Date, we completed the Terrasoul Acquisition for a purchase price of (i) $48.0 million in cash, subject to customary purchase price adjustments, and (ii) contingent consideration of up to $5.0 million in cash payable upon the achievement of specified performance-based milestones following the Terrasoul Closing Date. Terrasoul is a vertically integrated, branded superfoods platform offering a portfolio of products including nuts, seeds, dried fruits, powders, baking ingredients, and functional beverage mix-ins, sourced globally and processed and packaged in-house. We acquired Terrasoul to expand our product portfolio, broaden our distribution footprint across e-commerce, foodservice, and retail channels, and further our strategy of building a scaled platform in the superfoods and functional nutrition category.
Current report
The Subsequent Issuance
Current report
On the Terrasoul Closing Date, we concurrently completed the Subsequent Issuance pursuant to the exercise of our option under the Investment Agreement to require the Investor to purchase the Additional Shares, as approved by a majority of the disinterested directors of the Board on March 27, 2026. The net proceeds from the Subsequent Issuance were used to fund the Terrasoul Acquisition. An aggregate of 16,806,722 shares of Common Stock may be issued upon conversion of the shares of Series A Preferred Stock issued in the Subsequent Issuance. For additional information regarding the Investment Agreement, see the information under the heading “Liquidity and Capital Resources.”
Current report
There have been no material changes to our strategy or key factors affecting our future performance from those described in Item 7 of the 2025 Form 10-K.
Current report
The components of our results of operations are described in Item 7 of the 2025 Form 10-K and have not changed during the three months ended March 31, 2026.
Current report
Comparison ofQ1 2026 and Q1 2025
Current report
The increase in net sales during Q1 2026 was driven primarily by the acquisition of Navitas, which contributed $1.6 million of net sales during the quarter. The wholesale channel grew 37%, which was driven by the addition of Navitas wholesale revenues, distribution expansion, product assortment expansion in grocery and club stores, and velocity growth in our key categories. The e-commerce channel grew 4% year-over-year, driven by the addition of Navitas e-commerce sales, and strong Amazon sales growth, partially offset by a decline in DTC sales.
Current report
Gross margin contracted 8.6 percentage points to 33.3% in Q1 2026 from 41.9% in the prior year period. Approximately 5.4 percentage points year-over-year was attributable to unfavorable channel and product mix, inflationary commodity costs, as well the impact of import tariffs on certain input costs. Approximately 3.2 percentage points of this contraction was driven by a timing-related inventory costing benefit in the prior year period that did not recur.
Current report
The increase in general and administrative expenses during Q1 2026 was primarily driven by $1.3 million of costs incurred related to the Navitas Acquisition, $0.1 million of amortization expense related to Navitas acquisition intangible assets, and increased personnel costs.
Current report
The income tax benefit during Q1 2026 was driven by a discrete, non-recurring release of our valuation allowance in connection with the Navitas Acquisition, whereby approximately $4.7 million of net deferred tax liabilities were acquired. The income tax expense in the prior year related to state and local income taxes.
Current report
The increase in cash used in operating activities for Q1 2026 was driven primarily by the payment of costs incurred in relation to the Navitas Acquisition, as well as strategic investment into working capital.
Current report
On March 12, 2026, we completed the Transactions, pursuant to which (i) the Investor purchased the Initial Shares of Series A Preferred Stock at a purchase price of $1,000 per share for gross proceeds of $50.0 million at closing and (ii) the Company acquired Navitas for a purchase price of $40.9 million. Pursuant to the terms of the Investment Agreement, the Company had the option, subject to certain conditions, to require the Investor to purchase the Additional Shares, provided that the decision to require the Investor to purchase the Additional Shares be approved by a majority of the disinterested directors of the Board and any funding of the Additional Shares be used to fund substantially concurrent strategic acquisitions.
Current report
As of March 31, 2026, we had no significant unused sources of liquid assets outside of our working capital, aside from any potential future proceeds from the issuance of the Additional Shares following the Nexus Investment.
Current report
On April 20, 2026, we exercised our option to require the Investor to purchase the Additional Shares in connection with the Terrasoul Acquisition. Upon closing the transaction, we had approximately $8.0 million of additional cash that can be used to support the working capital of the combined enterprise.
Current report
Business Combinations
Current report
We account for business combinations under the acquisition method in accordance with ASC 805. Consideration transferred is allocated to the assets acquired and liabilities assumed at their acquisition-date fair values, with any excess recorded as goodwill. Acquisition-related transaction costs are expensed as incurred and included in general and administrative expenses.
Current report
Determining the fair value of acquired identifiable intangible assets — principally brand names, customer and distributor relationships, and product portfolios — requires significant management judgment. We typically engage independent valuation specialists and apply the income approach (including the multi-period excess earnings and relief-from-royalty methods), the market approach, or the cost approach, as appropriate. Key assumptions include projected revenue growth and margins, customer and distributor attrition rates, royalty rates, contributory asset charges, useful lives, and discount rates. Changes in these assumptions could result in materially different fair values, with corresponding effects on intangible assets, goodwill, deferred income taxes, and future amortization expense.
Current report
The initial accounting for a business combination may be incomplete at the reporting date. In such cases, we record provisional amounts and adjust them during the measurement period (not to exceed one year from the acquisition date) as new information about acquisition-date facts and circumstances becomes available.
Current report
During the three months ended March 31, 2026, we completed the acquisition of Navitas LLC and recorded a preliminary allocation of the approximately $40.9 million purchase price, including $20.0 million of identifiable intangible assets and $16.7 million of goodwill. The Navitas allocation is preliminary and remains subject to measurement-period adjustments. The accounting for our subsequent acquisition of Terrasoul, completed on April 21, 2026, is incomplete. See Notes 2 and 15 for additional information.
Removed paragraphs (42)
Previous report
Financial Highlights
Previous report
Net sales increased to $36.5 million for the nine months ended September 30, 2025 ("YTD 2025"), from $31.7 million for the nine months ended September 30, 2024 ("YTD 2024"). Wholesale net sales in YTD 2025 increased by 40% compared to YTD 2024, driven by velocity growth and distribution expansion. E-commerce channel sales for YTD 2025 were relatively flat compared to YTD 2024.
Previous report
We believe that our future performance will depend on many factors, including the following:
Previous report
Ability to Grow Our Customer Base in both E-commerce and Traditional Wholesale Distribution Channels at a Reasonable Cost
Previous report
We are continuously growing our customer base through our e-commerce channels, as well as by expanding our presence in our wholesale channel through a variety of physical retail outlets and geographical regions. We typically attract new customers in our e-commerce channel through our direct websites,lairdsuperfood.comandpickybars.com, and throughAmazon.com. We also seek to attract new e-commerce customers through paid and unpaid social media, search, display, and traditional media. Our products are also sold through a growing number of retail outlets. Customers in our wholesale channel include grocery chains, natural food outlets, club stores, and food service customers. Attracting new customers in physical retail outlets depends on, among other things, paid promotions through retailers, display, and traditional media. We believe an ability to consistently attract and retain customers at a reasonable cost relative to projected life-time value will be a key factor affecting future performance.
Previous report
Ability to Manage Co-Manufacturer and Third-Party Logistics Relationships
Previous report
Our production and logistics are executed by third parties, and our performance is highly dependent on the ability of these partners to produce and deliver our products timely, to our standards, and at a reasonable cost.
Previous report
Ability to Drive Repeat Usage of Our Products
Previous report
Repeat customers who consistently re-order our products are critical to our business. The pace of our growth will be affected by our ability to maintain and establish long-term relationships with existing and new customers to drive repeat orders.
Previous report
Ability to Expand Our Product Lines
Previous report
Our goal is to expand our product lines over time to increase our growth opportunity and reduce product-specific risks through diversification into multiple products, each designed around daily use. Our pace of growth will be partially affected by the cadence and magnitude of new product launches over time.
Previous report
Ability to Expand Gross Margins
Previous report
Our overall profitability will be impacted by our ability to expand gross margins through effective sourcing of raw materials, controlling input and shipping costs, controlling the impacts of inflationary market factors, import tariffs and other trade policies, as well as managing co-packer relationships.
Previous report
Ability to Expand Operating Margins
Previous report
Our ability to expand operating margins will be impacted by our ability to cover fixed general and administrative costs and variable sales and marketing costs with higher revenues and gross profit dollars.
Previous report
Ability to Manage Our Global Supply Chain
Previous report
Our ability to grow and meet future demand will be affected by our ability to adequately plan for and source inventory from a variety of suppliers located inside and outside the United States. We may encounter difficulties in sourcing products.
Previous report
Ability to Optimize Key Components of Working Capital
Previous report
Our ability to maintain positive cash flows will be partially impacted by our ability to effectively manage all the key working capital components that could influence our cash conversion cycle.
Previous report
Sales, net
Previous report
We sell our products through two channels: wholesale and e-commerce. Through our wholesale channel, we sell our products to distributors and retail outlets which, in turn, sell to end consumers. Through our e-commerce channel, we derive revenue from the sale of our products directly to consumers through our direct websites,lairdsuperfood.com andpickybars.com, as well as third-party e-commerce platforms such asAmazon.com.
Previous report
Cost of Goods Sold
Previous report
Cost of goods sold includes the cost of raw materials and packaging, co-packing tolling fees, inbound and outbound freight costs, import duties and tariffs, indirect labor, third party labor to store and ship our products, and overhead costs incurred in the storage and distribution of products sold in the period.
Previous report
Operating Expenses
Previous report
Our operating expenses consist of general and administrative, research and product development, and sales and marketing expenses, including non-production personnel costs.
Previous report
Income Taxes
Previous report
Due to our history of operating losses and expectation of future operating losses, we do not expect any significant federal income tax expenses and benefits for the foreseeable future. We will continue to owe state and local income taxes.
Previous report
Comparison ofQ3 2025 and Q3 2024
Previous report
The increase in net sales during Q3 2025 was fueled by distribution expansion in the Wholesale channel and slightly decreased promotional trade spend across all channels. E-commerce channel sales decreased by 11% year-over-year, primarily due to softness in the direct-to-consumer platform resulting from lower new-customer acquisition, partially offset by growth in sales on Amazon.com.
Previous report
The decrease in gross profit in Q3 2025 compared to the prior year period was driven by commodity cost inflation and channel mix, as well as the non-recurrence of a supplier settlement benefit recorded in the prior year period, which accounted for approximately 3 points of the 6.5 points of margin contraction to 36.5% in Q3 2025, from 43.0% in the prior year period.
Previous report
The general and administrative expenses were relatively flat during Q3 2025, with impairment charges largely offset by decreases in personnel costs and professional fees.
Previous report
The increase in sales and marketing expenses during Q3 2025 was driven by marketing and advertising costs, as well as increased selling costs due to increased sales volume.
Previous report
Comparison ofYTD 2025*** and***YTD 2024
Previous report
The increase in net sales during YTD 2025 was driven by distribution expansion in grocery and club stores, and velocity growth in our key categories, partially offset by increased promotional trade spend to support a 40% increase in wholesale channel sales year-over-year. E-commerce channel sales were relatively flat year-over-year, with softness in the DTC channel due to lower new customer sales partially offset by growth in sales on Amazon.com.
Previous report
The increase in cost of goods sold during YTD 2025 was driven by growth in sales volume, channel mix, and higher commodity costs, as well as the non-recurrence of a supplier settlement benefit recorded in the prior year period.
Previous report
The increase in gross profit in YTD 2025 compared to the prior year period was driven by increased sales volume. Gross margin contracted 2.3 points to 39.3% in YTD 2025 compared to 41.7% in the prior year period, which was due to the non-recurrence of the supplier settlement benefit recorded in the prior year period, as well as channel mix and commodity cost inflation.
Previous report
The increase in general and administrative expenses during YTD 2025 was primarily driven by impairment charges, partially offset by decreased personnel costs and professional fees.
Previous report
The increase in cash used in operating activities for YTD 2025 was driven by strategic investment into working capital. This investment was made (i) to meet higher demand for our products, (ii) to address the out-of-stocks experienced at the end of 2024, and (iii) to forward purchase inventory in anticipation of potential tariffs on the import of raw materials that we source outside of the United States, particularly in Southeast Asia. As we continue to sell down this forward-purchased inventory during the balance of 2025 and into 2026, we expect our cash balance to normalize and further increase by the end of the 2025 fiscal year.
Previous report
Emerging Growth Company Status
Previous report
As a company with less than $1.235 billion in annual gross revenue during our last fiscal year, we qualify as an “emerging growth company” as defined in the Jumpstart our Business Startups Act of 2012 (the “JOBS Act”). An emerging growth company may take advantage of specified reduced reporting and other burdens that are otherwise applicable generally to public companies. These provisions include:
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Reworded paragraphs (16)
Previous wording
The following discussion and analysis of the financial condition and results of operations of Laird Superfood, Inc. (together with its wholly owned subsidiary on a consolidated basis, the "Company," "Laird Superfood," "our," "us," or "we") is a supplement to and should be read in conjunction with the unaudited consolidated condensed financial statements and related notes thereto included elsewhere in this Quarterly Report on Form 10-Q and with our Annual Report on Form 10-K for the year ended December 31, 2024 (the "2024 Form 10-K"). This discussion contains forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those discussed below. Factors that could cause or contribute to such differences include, but are not limited to, those identified below and those discussed in the section titled“Cautionary Note Regarding Forward-Looking Statements”* included elsewhere in this Quarterly Report on Form 10-Q and the section titled*“Risk Factors”* included herein and in the 2024 Form 10-K.*
Current wording
The following discussion and analysis of the financial condition and results of operations of Laird Superfood, Inc. (together with its wholly owned subsidiaries on a consolidated basis, the "Company," "Laird Superfood," "our," "us," or "we") is a supplement to and should be read in conjunction with the unaudited consolidated condensed financial statements and related notes thereto included elsewhere in this Quarterly Report on Form 10-Q and with our Annual Report on Form 10-K for the year ended December 31, 2025 (the "2025 Form 10-K"). This discussion contains forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those discussed below. Factors that could cause or contribute to such differences include, but are not limited to, those identified below and those discussed in the section titled“Cautionary Note Regarding Forward-Looking Statements”* included elsewhere in this Quarterly Report on Form 10-Q and the section titled*“Risk Factors”* included herein and in the 2025 Form 10-K.*
Previous wording
Laird Superfood creates clean, minimally processed, functional foods, many of which incorporate adaptogens which may be beneficial in reducing stress, improving energy levels, enhancing mental performance, mood regulation, and immune system support. Our primary products include (i) coffee creamers, (ii) hydration and beverage enhancing products, (iii) snacks and other food items, and (iv) coffee, tea, and hot chocolate products. Consumer preferences within the evolving food and beverage industry are shifting away from sugar-laden food and beverage products, as well as those containing highly processed and artificial ingredients. Our long-term goal is to build and scale a widely recognized brand that authentically focuses on recognizable ingredients, nutritional density, and functionality, which we believe will allow us to maximize penetration of a multi-billion-dollar opportunity in the grocery market. We generate revenue through two channels: e-commerce and wholesale.
Current wording
Laird Superfood creates clean, minimally processed, functional foods, many of which incorporate adaptogens which may be beneficial in reducing stress, improving energy levels, enhancing mental performance, mood regulation, and immune system support. Our primary products include (i) coffee solutions and (ii) functional foods. Consumer preferences within the evolving food and beverage industry are shifting away from sugar-laden food and beverage products, as well as those containing highly processed and artificial ingredients. Our long-term goal is to build and scale a widely recognized brand that authentically focuses on recognizable ingredients, nutritional density, and functionality, which we believe will allow us to maximize penetration of a multi-billion-dollar opportunity in the grocery market. We generate revenue through two channels: e-commerce and wholesale.
Previous wording
Our e-commerce channel consists of (i) our Direct-to-consumer ("DTC") business, which includes sales throughlairdsuperfood.comandpickybars.com, and (ii)Amazon.com.Lairdsuperfood.com andpickybars.com offer an authentic brand experience for our consumers that drive engagement through educational content. These platforms also provide us with direct consumer feedback for future product development. We view our proprietary database of customers ordering directly from our website as a strategic asset, as it enhances our ability to develop long-term relationships with these customers. We believe the content on our websites allows Laird Superfood to educate our consumers on the benefits of our products and ingredients, while providing a positive customer experience. We believe this experience leads to higher retention rates among repeat customers and subscribers, as evidenced by the fact that repeat customers and subscribers accounted for approximately 88% of DTC sales for the three and nine months ended September 30, 2025 and 2024.
Current wording
Our e-commerce channel consists of (i) our direct-to-consumer ("DTC") business, which includes sales through lairdsuperfood.com, navitasorganics.com, and pickybars.com, and (ii) Amazon.com. Our websites offer an authentic brand experience for our consumers that drive engagement through educational content. These platforms also provide us with direct consumer feedback for future product development. We view our proprietary database of customers ordering directly from our website as a strategic asset, as it enhances our ability to develop long-term relationships with these customers. We believe the content on our websites allows Laird Superfood to educate our consumers on the benefits of our products and ingredients, while providing a positive customer experience. We believe this experience leads to higher retention rates among repeat customers and subscribers, as evidenced by the fact that repeat customers accounted for approximately 77% of DTC sales for the three months ended March 31, 2026 and 2025.
Previous wording
For the three and nine months ended September 30, 2025, the e-commerce channel made up 47% and 51% of our net sales, respectively, compared to 58% and 59%, respectively, for the three and nine months ended September 30, 2024. For the three and nine months ended September 30, 2025, the wholesale channel made up 53% and 49% of our net sales, respectively, compared to 42% and 41% for the three and nine months ended September 30, 2024. We expect that, over time, our wholesale channel will overtake our e-commerce channel as a percentage of net sales, as we continue to execute our strategy to expand our retail distribution footprint. As our business continues to shift toward wholesale, quarter-to-quarter variability may increase due to the timing of larger orders from key customers, however, long-term, we remain confident in the underlying demand trends in this channel.
Current wording
For the three months ended March 31, 2026 and 2025, the e-commerce channel made up 46% and 53% of our net sales, respectively. For the three months ended March 31, 2026 and 2025, the wholesale channel made up 54% and 47% of our net sales, respectively. The shift towards Wholesale is consistent with our strategy to expand our retail distribution footprint. As our business continues to shift toward wholesale, quarter-to-quarter variability may increase due to the timing of larger orders from key customers, however, long-term, we remain confident in the underlying demand trends in this channel.
Previous wording
Net sales increased to $12.9 million for the three months ended September 30, 2025 ("Q3 2025"), from $11.8 million for the three months ended September 30, 2024 ("Q3 2024"). Wholesale net sales in Q3 2025 increased by 39% compared to Q3 2024 driven primarily by distribution expansion. E-commerce channel sales for Q3 2025 decreased by 11% compared to Q3 2024, primarily due to softness in the direct-to-consumer platform resulting from lower new-customer acquisition, partially offset by growth in sales on Amazon.com.
Current wording
Net sales increased to $13.9 million for the three months ended March 31, 2026 ("Q1 2026"), from $11.7 million for the three months ended March 31, 2025 ("Q1 2025"). Wholesale net sales in Q1 2026 increased by 37% compared to Q1 2025 driven primarily by distribution expansion and improved velocities at shelf. E-commerce channel sales for Q1 2026 increased by 4% compared to Q1 2025, primarily due to growth on Amazon.
Previous wording
The increase in cost of goods sold during Q3 2025 was driven primarily by the growth in gross sales volume and commodity cost inflation, as well as the non-recurrence of a supplier settlement benefit recorded in the prior year period.
Current wording
The increase in cost of goods sold during Q1 2026 was driven primarily by growth in sales volume, inflationary commodity costs, and tariffs.
Previous wording
The increase in sales and marketing expenses during YTD 2025 was driven by increased selling costs due to increased sales volume.
Current wording
The increase in sales and marketing expenses during Q1 2026 was driven by media spend, agency fees, and selling costs on higher sales volume.
Previous wording
Other income is composed of interest income and expense, rental income, and other non-operating gains and losses. The decrease in other income during Q3 2025 was driven by decreases in dividend income on money market funds, as the amounts carried in those accounts decreased, and the termination of the Picky Bars, LLC sublease in the fourth quarter of 2024.
Current wording
Other income is composed of interest income and expense, rental income, and other non-operating gains and losses. The decrease in other income during Q1 2026 was driven by decreases in dividend income on money market funds, as the amounts carried in those accounts decreased on average.
Previous wording
The following table shows a summary of our cash flows for the nine months ended September 30, 2025 and 2024:
Current wording
The following table shows a summary of our cash flows for the three months ended March 31, 2026 and 2025:
Previous wording
Cash used in investing activities for YTD 2025 consisted of purchases of long-lived capital assets.
Current wording
Cash used in investing activities for Q1 2026 consisted primarily of consideration paid in the acquisition of Navitas.
Previous wording
Cash used in financing activities for YTD 2025 consisted of payroll taxes paid related to net issuances of stock awards, offset in part by stock option exercises.
Current wording
Cash provided by financing activities for Q1 2026 consisted primarily of the proceeds from the private placement of Series A Preferred Stock, as well as stock option exercises, offset in part by payroll taxes paid related to net issuances of stock awards.
Previous wording
As of September 30, 2025, we had an accumulated deficit of $109.6 million, which includes operating losses of $1.6 million and $1.7 million for YTD 2025 and YTD 2024, respectively. We may incur additional operating losses as we execute our strategy to invest in the growth of our business, reinvesting any incremental profit into future top-line sales growth while holding cash reserves largely flat. We will continue to seek opportunities to optimize spending, expand gross margins, and free up cash flow through efficient working capital management. We have historically financed our operations and capital expenditures through private placements of our common stock, our initial public offering, our prior lines of credit, term loans, and from our core operating activities. Our historical uses of cash have primarily consisted of cash used in operating activities and working capital needs.
Current wording
As of March 31, 2026, we had an accumulated deficit of $109.6 million. We may incur additional operating losses as we execute our strategy to invest in the growth of our business, reinvesting any incremental profit into future top-line sales growth while holding cash reserves largely flat. We will continue to seek opportunities to optimize spending, expand gross margins, and free up cash flow through efficient working capital management. We have historically financed our operations and capital expenditures through private placements of our common stock, our initial public offering, our prior lines of credit, term loans, and from our core operating activities. Our historical uses of cash have primarily consisted of cash used in operating activities and working capital needs.
Previous wording
As of September 30, 2025 and December 31, 2024, we had $5.3 million and $8.5 million, respectively, of cash-on-hand, and total net working capital of $12.4 million and $12.0 million, respectively, for the same periods. As of September 30, 2025, we had access to up to $1.3 million of advances under our factoring Agreement, of which none had been utilized as of the date of this report. We have no significant unused sources of liquid assets outside of our working capital.
Current wording
As of March 31, 2026 and December 31, 2025, we had $10.5 million and $5.3 million, respectively, of cash-on-hand, and total net working capital of $25.7 million and $11.1 million, respectively, for the same periods. As of March 31, 2026, we had access to up to $2.0 million of advances under our factoring Agreement, of which none had been utilized as of the date of this report.
Previous wording
We continue to monitor macroeconomic trends and uncertainties such inflation of commodity costs, the effects of tariffs, and the potential imposition of modified or additional tariffs, which may have adverse effects on net sales and margins. As a result of the tariffs announced by the U.S. presidential administration, and potential tariff modifications or the imposition of tariffs or export controls by other countries, we have experienced some commodity cost volatility, and anticipate that there could be increased supply chain challenges and consumer and economic uncertainty due to rapid changes in global trade policies in the future. Based on preliminary analysis of the potential effects of the announced tariffs and these other factors, we do not expect these factors to result in a material negative effect on our net sales or profitability for the remainder of fiscal year 2025. To date, we have elected to acquire additional inventory in advance of anticipated future tariff implementations, which has impacted our cash balances as of September 30, 2025, but which is not expected to meaningfully impact our cash balances for the balance of the 2025 fiscal year. However, we are continuing to evaluate these factors and their potential effects as well as our ability to potentially offset all or a portion of cost increases through pricing actions and cost savings efforts for fiscal year 2026 planning. Economic pressures on customers and consumers, including the challenges of high inflation and the effects of increased tariffs, may negatively affect our net sales and profitability in the future.
Current wording
We continue to monitor macroeconomic trends and uncertainties such as inflation of commodity costs, the effects of tariffs, and the potential imposition of modified or additional tariffs, which may have adverse effects on net sales and margins. As a result of the tariffs announced by the U.S. presidential administration, and potential tariff modifications or the imposition of tariffs or export controls by other countries, we have experienced some commodity cost volatility and anticipate that there could be increased supply chain challenges and consumer and economic uncertainty due to rapid changes in global trade policies in the future. Based on preliminary analysis of the potential effects of the announced tariffs and these other factors, we do not expect these factors to result in a material negative effect on our net sales or profitability in the near future. To date, we have elected to acquire additional inventory in advance of anticipated future tariff implementations, which has impacted our cash balances as of March 31, 2026, but which is not expected to meaningfully impact our cash balances long-term. However, we are continuing to evaluate these factors and their potential effects as well as our ability to potentially offset all or a portion of cost increases through pricing actions and cost savings efforts for fiscal year 2026 planning. Economic pressures on customers and consumers, including the challenges of high inflation and the effects of increased tariffs, may negatively affect our net sales and profitability in the future.
Previous wording
Based on our current business plans, we believe that our existing cash balances, including our anticipated cash flow from operations, will be sufficient to finance our operations and meet our foreseeable cash requirements through at least the next twelve months. In the future, we may raise funds by issuing debt or equity securities, or securities convertible into or exchangeable for our common stock. Such financing and other potential financing may result in dilution to stockholders, reduction in the market price of our common stock, imposition of debt covenants and repayment obligations, or other restrictions that may adversely affect our business. In addition, we may seek additional capital due to favorable market conditions or strategic considerations even if we believe we have sufficient funds for our current or future operating plans. However, we may be unable to raise additional funds or enter into such other arrangements when needed, on favorable terms, or at all.
Current wording
Based on our current business plans, we believe that our existing cash balances, including our anticipated cash flow from operations, will be sufficient to finance our operations and meet our foreseeable cash requirements through at least the next twelve months. In the future, we may raise funds by issuing debt or equity securities, or securities convertible into or exchangeable for our common stock. Such financing and other potential financing may result in dilution to shareholders, reduction in the market price of our common stock, imposition of debt covenants and repayment obligations, or other restrictions that may adversely affect our business. In addition, we may seek additional capital due to favorable market conditions or strategic considerations even if we believe we have sufficient funds for our current or future operating plans. However, we may be unable to raise additional funds or enter into such other arrangements when needed, on favorable terms, or at all.
Previous wording
The preparation of financial statements and related disclosures in conformity with U.S. generally accepted accounting principles and our management's discussion and analysis of our financial condition and operating results require our management to make judgments, assumptions and estimates that affect the amounts reported. Note 1, “Summary of Significant Accounting Policies” of the Notes to the Unaudited Consolidated Condensed Financial Statements in Part I, Item 1 of this Quarterly Report on Form 10-Q and in the Notes to Consolidated Financial Statements in Part II, Item 8 of the 2024 Form 10-K describe the significant accounting policies and methods used in the preparation of our financial statements. There have been no material changes to our critical accounting estimates since the 2024 Form 10-K.
Current wording
There have been no material changes to our critical accounting estimates from those disclosed in Item 7 of the 2025 Form 10-K, aside from the following:
Rearranged previous paragraphs (2)
Previous report — wording carried elsewhere
For the periods indicated, the following table sets forth results of operations and the increase or decrease therewith:
Previous report — wording carried elsewhere
Other income is composed of interest income and expense, rental income, and other non-operating gains and losses. The decrease in other income during YTD 2025 was driven by decreases in dividend income on money market funds, as the amounts carried in those accounts decreased, and the termination of the Picky Bars, LLC sublease in the fourth quarter of 2024.