Vita Coco Company, Inc.
For the period ended Mar 31, 2026. Filed Apr 29, 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 Apr 29, 2026
COCO$62.45-1.9%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 2025-10-29.
0001628280-25-046935
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-03-31; filed 2026-04-29.
0001482981-26-000120
Item 2. 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 116 previous paragraphs and 111 current paragraphs.
70 unchanged; 28 reworded; 12 added; 18 removed; 0 previous and 1 current paragraphs rearranged.
Tables are not compared: 9 previous and 9 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 (12)
Current report
•Our global supply chain is subject to risks arising from geopolitical instability, including the ongoing military conflict involving Iran, as well as volatility in interest rates, foreign exchange rates, and our cost of goods including raw materials, factory costs, and transportation costs. The extent and duration of these conditions, and their ultimate impact on our business, results of operations, financial condition, and liquidity, cannot be determined with precision. For a further discussion of the risks and challenges posed by these events, please see Part I, Item 1A. “Risk Factors” of this Form 10-Q and our Form 10-K.
Current report
•On February 20, 2026, the U.S. Supreme Court ruled that certain tariffs imposed under the International Emergency Economic Powers Act ("IEEPA") were unlawful. The U.S. Customs and Border Protection opened a portal on April 20, 2026 for tariff refund claims. The Company has filed refund claims for approximately $15.6 million of tariffs paid in 2025. The timing of any refunds and whether all claims will be accepted are uncertain. Accordingly, no recovery has been recognized in the accompanying financial statements. The administration has announced its intent to impose additional tariffs under other statutory authorities. While new tariffs announced to date have not materially impacted us, the duration, scope, and impact of future tariff policies remain uncertain and could materially and adversely affect our business, financial condition, and results of operations. We will continue to monitor the evolving tariff environment and may pursue pricing adjustments, sourcing modifications, and other cost-mitigation measures, but there can be no assurance that we will fully mitigate the impact of future tariff changes or related economic effects.
Current report
For the three months ended March 31, 2026, the primary driver of the consolidated net sales increase of 37.3% was strong Vita Coco Coconut Water volume growth in both the Americas and International segments. Vita Coco Coconut Water net sales increased 41.6%, underpinned by a case equivalents ("CE") volume increase of 32.0% driven by increased demand and the slight timing shift of a significant retailer promotion to the first quarter in 2026 and improved net pricing. In 2025, the retailer promotion fell more heavily in the second quarter. Private Label net sales increased 28.1% driven predominantly by growth in the International segment. Other category growth was 5.4%.
Current report
Net sales in the Americas segment increased $35.6 million, or 31.6%. The increase was primarily driven by CE volume growth of 29.4% of Vita Coco Coconut Water, with slower growth rates in Private Label and Other.
Current report
Vita Coco Coconut Water net sales increased $31.9 million, or 37.1%, primarily driven by CE volume growth of 29.4% due to increased demand coupled with pricing benefits from higher front line prices implemented in the quarter and the earlier timing of a retailer promotion as compared to timing in 2025.
Current report
Private Label net sales increased $3.2 million, or 15.1%, to $24.4 million for the three months ended March 31, 2026, from $21.2 million for the three months ended March 31, 2025, due to a CE volume increase of 17.6%. Regained regions offset the loss of regions that initially started in the first quarter of 2025.
Current report
Net sales from Other products increased by $0.4 million, or 8.4%, to $5.7 million for the three months ended March 31, 2026 from $5.3 million for the three months ended March 31, 2025, primarily due to the increased CE volume related to coconut milk as well as shipping for the full quarter of Vita Coco Treats in the U.S. in the 2026 period versus a partial quarter in the prior year period, associated with the national launch in 2025.
Current report
For the three months ended March 31, 2026, consolidated gross profit increased $23.7 million, or 49.3%, primarily driven by increased sales, increased pricing, and lower ocean freight rates, partially offset by higher finished goods and domestic logistics costs along with legacy tariff impacts associated with inventory sold during the period compared to the prior year period. Gross margin was 39.9% compared to 36.7% in the prior year period. The increase resulted from higher pricing and lower ocean freight rates, slightly offset by the impact of higher-cost inventory flowing through cost of goods sold.
Current report
For the three months ended March 31, 2026, SG&A increased $9.4 million, or 32.8%, compared to the three months ended March 31, 2025.The increase was primarily driven by higher people‑related expenses of $3.6 million, reflecting increased headcount and stock‑based compensation, as well as a $3.6 million increase in marketing expense to support sales growth initiatives and expansion into new markets. In addition, distributor‑related expenses increased $2.0 million.
Current report
Other (Expense) Income, Net
Current report
Foreign Currency (Loss) Gain
Current report
For the three months ended March 31, 2026, interest income, net remained consistent compared to the prior year period.
Removed paragraphs (18)
Previous report
•Uncertainty in the macroeconomic environment resulting from geopolitical and economic instability (including the effects of current wars and other international conflicts) and variability in interest rates, foreign exchange rates, tariffs and other import related fees, and inflation and instability on transportation costs may affect our global supply chain. Additionally, as further discussed below, the extent and duration of tariffs imposed by the U.S. government on other countries and reciprocal tariffs placed on U.S. goods in response thereto remains uncertain and may depend on various factors, including negotiations and relationships between the U.S. and affected countries, tariff exemptions, negative sentiment toward U.S. companies and products, and availability of domestic alternatives in our supply chain. It is not currently possible to ascertain the overall impact of these macroeconomic uncertainties on our business, results of operations, financial condition or liquidity. Future events and effects related to these macroeconomic uncertainties cannot be determined with precision and actual results could significantly differ from estimates or forecasts. For a further discussion of the risks and challenges posed by these events, please see Part I, Item 1A. “Risk Factors” of the Form 10-K.
Previous report
For the three months ended September 30, 2025, the primary driver of the consolidated net sales increase of 37.2% was strong Vita Coco Coconut Water volume growth. Vita Coco Coconut Water net sales increased 41.8%, underpinned by a case equivalents ("CE") volume increase of 31.2%. Other category growth of 99.9% was driven by the continued U.S. rollout of Vita Coco Treats. Private Label net sales increased 5.7% driven by growth in the International segment. For the nine months ended September 30, 2025, the consolidated net sales increase of 24.0% was driven by Vita Coco Coconut Water, which had a 31.1% net sales increase, with a case equivalents CE volume increase of 25.8%. Other category growth of 95.6% was driven by the continued U.S. rollout of Vita Coco Treats. This was partially offset by Private Label net sales decline of 11.8% resulting from the loss of Private Label coconut water service regions for multiple customers in the U.S. in addition to the transition out of Private Label coconut oil sales to a major customer that began in the first quarter of 2024.
Previous report
Net sales in the Americas segment increased $39.5 million, or 35.2%, to $151.7 million for the three months ended September 30, 2025 from $112.2 million for the three months ended September 30, 2024. The increase was primarily driven by CE volume growth of 30.3% of Vita Coco Coconut Water, partially offset by a decrease in volume due to the loss of Private Label coconut water service regions for several customers beginning in the first half of 2025. For the nine months ended September 30, 2025, Americas net sales increased $73.4 million, or 22.1%, to $406.3 million from $332.8 million for the nine months ended September 30, 2024. The increase was primarily driven by CE volume growth of 24.8% of Vita Coco Coconut Water, partially offset by the Private Label decline.
Previous report
Vita Coco Coconut Water net sales increased $38.4 million, or 40.9%, to $132.4 million for the three months ended September 30, 2025, from $94.0 million for the three months ended September 30, 2024. The increase was the result of CE volume growth of 30.3% due to increased demand coupled with pricing benefits from higher front line price increases implemented in the quarter. Vita Coco Coconut Water net sales increased $77.0 million, or 29.4%, to $339.0 million for the nine months ended September 30, 2025, from $262.0 million for the nine months ended September 30, 2024. The increase was the result of CE volume growth of 24.8% due to strong consumer demand coupled with the impact of the aforementioned price increases.
Previous report
Private Label net sales decreased $2.1 million, or 12.9%, to $14.4 million for the three months ended September 30, 2025, from $16.5 million for the three months ended September 30, 2024, due to a decrease in the Private Label business as outlined above, resulting in a CE volume decrease of 11.7%. Private Label net sales decreased $13.7 million, or 21.4%, to $50.2 million for the nine months ended September 30, 2025, from $63.9 million for the nine months ended September 30, 2024. The decrease was the result of CE volume decline of 16.6% due to the aforementioned losses of Private Label coconut oil and coconut water business.
Previous report
Net sales from Other products increased by $3.2 million, or 182.5%, to $4.9 million for the three months ended September 30, 2025 from $1.7 million for the three months ended September 30, 2024, primarily due to the continued national rollout of Vita Coco Treats in the U.S. Net sales from Other products increased by $10.1 million, or 146.4%, to $17.0 million for the nine months ended September 30, 2025 from $6.9 million for the nine months ended September 30, 2024, driven by CE volume increase of 211.6%, driven by the continued rollout of Vita Coco Treats.
Previous report
For the three months ended September 30, 2025, consolidated gross profit increased $17.1 million, or 33.2%, to $68.7 million, from $51.6 million for the three months ended September 30, 2024, primarily driven by higher CE volume and increased pricing. The increase was partially offset by increased rates for finished goods and tariff costs which altogether resulted in gross margin decline. For the nine months ended September 30, 2025, consolidated gross profit increased $20.5 million, or 13.0%, to $178.0 million, from $157.5 million for the nine months ended September 30, 2024, also primarily driven by higher CE volume and increased pricing, partially offset by increased rates for finished goods and transportation costs and the impact of tariffs. Gross margin decline for the nine months as compared to prior year resulted from higher finished goods and ocean freight costs in addition to the impact of tariffs, which were partially offset by branded coconut water pricing and favorable product mix.
Previous report
For the three months ended September 30, 2025, SG&A increased $9.8 million, or 31.6%, versus the three months ended September 30, 2024. This was primarily driven by an increase of $4.3 million in people-related expenses, which includes increased headcount, bonus expenses and stock based compensation. Additionally, there was a $2.8 million increase in marketing expense primarily due to new product awareness campaigns for Vita Coco Treats and increased sales promotions costs, an increase of $1.2 million in higher reserves for bad debt, and $0.4 million related to an overlap of rent expense for the new New York office with the prior New York office. During the nine months ended September 30, 2025, SG&A increased $17.7 million, or 20.2%, versus the nine months ended September 30, 2024. The increase was primarily driven by an increase of $8.9 million in people-related expenses, $5.8 million in marketing expense due to new product awareness campaigns for Vita Coco Treats and sales promotions costs, $2.0 million of higher reserves for bad debt expenses, and $1.1 million related to the overlap of rent expense for the new New York office with the prior New York office. The increases were partially offset by a reduction of $2.5 million in sales related expenses.
Previous report
Other Income (Expense), Net
Previous report
Foreign Currency Gain/(Loss)
Previous report
For the three months ended September 30, 2025, interest income decreased $0.1 million compared to September 30, 2024 primarily due to lower interest rates in the 2025 period compared to the 2024 period. For the nine months ended September 30, 2025, interest income decreased $0.2 million as compared to September 30, 2024. The decrease in interest income was due to lower interest rates compared to prior year.
Previous report
Other Income
Previous report
For the nine months ended September 30, 2025, Other income of $0.2 million is due to the sale of intellectual property.
Previous report
(c)The amounts for the nine months ended September 30, 2024 relate to an expense waiver of certain costs incurred during the November 9, 2023 block trade. The Company did not receive any proceeds from the sale of the shares. For additional information regarding the expense waiver for the nine months ended September 30, 2024, see Note 15, Related Party Transactions, in our condensed consolidated financial statements included in this Quarterly Report on Form 10-Q.
Previous report
Debt
Previous report
We had an immaterial amount of debt outstanding as of September 30, 2025 and December 31, 2024, which was related to vehicle loans.
Previous report
Vehicle Loans
Previous report
We periodically enter into vehicle loans. Interest rates on these vehicle loans range from 4.56% to 5.68%. The outstanding balance on the vehicle loans as of September 30, 2025 was immaterial.
Reworded paragraphs (28)
Previous wording
Our branded portfolio is led by our Vita Coco brand, which is the leader in the coconut water category in the United States, and also includes coconut oil, juice, and milk offerings. Our other brands include Ever & Ever, a sustainably packaged water, and PWR LIFT, a protein-infused fitness drink. We also previously offered Runa, a plant-based energy drink inspired by the guayusa plant native to Ecuador, which we ceased selling in December 2023 ("Runa"). We supply Private Label products to key retailers in both the coconut water and coconut oil categories. Additionally, we generate revenue from bulk product sales to beverage and food companies.
Current wording
Our branded portfolio is led by our Vita Coco brand, which is the leader in the coconut water category in the United States, and also includes coconut oil, juice, and milk offerings. Our portfolio also includes PWR LIFT, a protein-infused fitness drink. Additionally, we supply Private Label products to key retailers in both the coconut water and coconut oil categories and generate revenue from bulk product sales to beverage and food companies.
Previous wording
As of September 30, 2025, we source our products from a diversified global network of approximately 20 factories and co-packers, supported by coconut farmers across seven countries. As we do not own any of these facilities, our supply chain is a fixed asset-lite model designed to better service our customers and react to changes in the market or consumer preferences.
Current wording
As of March 31, 2026, we source our products from a diversified global network of approximately 16 factories, supported by coconut farmers across six countries. As we do not own any of these facilities, our supply chain is a fixed asset-lite model designed to better service our customers and react to changes in the market or consumer preferences.
Previous wording
We believe that our performance and future success depend on a number of factors that present significant opportunities for us. There have been no material changes to such factors from those described in the Form 10-K under the heading “Key Factors Affecting our Performance” and the changes noted below. Those factors also pose risks and challenges, including those discussed in Part I, Item 1A. “Risk Factors” of the Form 10-K.
Current wording
We believe that our performance and future success depend on a number of factors that present significant opportunities for us. For changes to such factors from those described in the Form 10-K under the heading “Key Factors Affecting our Performance” please see below and the risks and challenges discussed in Part I, Item 1A. “Risk Factors” of this Form 10-Q and our the Form 10-K.
Previous wording
•The U.S. government implemented a 10% baseline tariff, plus country-specific rates, effective April 2, 2025, with revised reciprocal tariffs announced in early August 2025, of approximately 20% (including the baseline tariff) for Asian countries from which we source, and 50% for Brazil. We source to the U.S. primarily from the Philippines and Brazil, with additional supply from Thailand, Vietnam, Malaysia, Sri Lanka, Canada, Mexico, and Indonesia; however, currently, our Mexico and Canada imports remain exempt under the United States-Mexico-Canada Agreement (“USMCA”). The tariffs are being challenged in the U.S. legal system and will be reviewed by the Supreme Court in November 2025. The tariffs currently remain in effect, and we are assuming for purposes of our business operations that the tariffs will be in effect indefinitely at a current blended tariff rate of approximately 23% based on end-of-quarter sourcing. It has been suggested that in individual country trade deals, waivers for tariffs may be granted for natural resources not available in the U.S. at scale to meet U.S. demand. We believe this classification could be applicable to coconut water and we are lobbying to encourage that coconut water is included in any trade agreements with our sourcing countries. The uncertainty around the long-term tariff rates presents significant challenges to our operations and supply chain, and may result in future results being significantly different than any outlook given. The uncertainty could also cause disturbances in ocean shipping capacity and create inflationary effects on our costs. We are monitoring the evolving tariff landscape and pursuing pricing adjustments, sourcing strategy modifications, and other cost-mitigation measures. However, there can be no assurance that we will be able to fully mitigate the impacts of such tariffs or that the imposition of tariffs, and the resulting economic impact on the U.S. market and consumer, will not materially affect our financial results. The overall impact on our business related to tariffs depends on multiple factors, including the timing, duration and size of any tariffs, future changes to tariff rates, scope, or enforcement of such tariffs, reciprocal measures by impacted trade partners, inflationary effects, changes to consumer purchasing behavior, and the effectiveness of our responses in managing these challenges. The tariffs, any retaliatory measures, or other trade restrictions, could materially and adversely affect our business.
Current wording
•The U.S. government implemented a 10% baseline tariff plus country-specific reciprocal rates effective April 2, 2025, with revised rates announced in early August 2025 of approximately 20% for Asian sourcing countries and 50% for Brazil. We source to the U.S. primarily from the Philippines and Brazil, with additional supply from Thailand, Vietnam, Malaysia, Sri Lanka, Canada, Mexico, and Indonesia. Our Mexico and Canada imports currently remain exempt under the United States-Mexico-Canada Agreement (“USMCA”). In November 2025, the White House granted relief from reciprocal tariffs for certain agricultural products, including the tariff codes applicable to coconut water products, which represent the majority of our portfolio, and waived incremental tariffs on coconut water imports from Brazil. These actions significantly reduced our tariff burden after November 21, 2025, although certain miscellaneous tariffs remain in effect.
Previous wording
•Our sales to one of our major customers include branded and Private Label product. As discussed in the Form 10-K, the Private Label coconut oil business with this customer discontinued in early 2024 and we expect Private Label coconut water net sales in 2025 with this customer to be impacted by the loss of some regions, which started primarily in the second quarter of 2025. During the third quarter of 2025, we were requested to restart supply for one of these lost regions in early 2026.
Current wording
•Our sales to one of our major customers include branded and Private Label product. As discussed in the Form 10-K, the Private Label coconut oil business with this customer discontinued in early 2024 and we also experienced an impact in Private Label coconut water sales in 2025 with this customer due to the loss of some regions that we previously serviced for this customer. In early 2026, at the request of this customer, we restarted supply to one of those lost regions. We will continue to service their needs if we are asked and it aligns with our long-term targets. For a further discussion of the risks and challenges posed by these events, please see Part I, Item 1A. “Risk Factors” of the Form 10-K.
Previous wording
We provide trade promotions and sales discounts to its customers and distributors. Since these sales promotions and sales discounts do not meet the criteria for a distinct good or service, they are primarily accounted for as a reduction of revenue and include payments to customers and distributors for performing activities on our behalf, such as payments for in-store displays, payments to gain distribution of new products, payments for shelf space and discounts to promote lower retail prices. The accompanying condensed consolidated financial statements include accruals for these promotions and discounts. The accruals are made for invoices that have not yet been received as of the end of the reporting period and are recorded as a reduction of sales, and are based on contract terms and our historical experience with similar programs and require management judgment with respect to estimating customer and consumer participation and performance levels.
Current wording
We provide trade promotions and sales discounts to our customers and distributors. Since these sales promotions and sales discounts do not meet the criteria for a distinct good or service, they are primarily accounted for as a reduction of revenue and include payments to customers and distributors for performing activities on our behalf, such as payments for in-store displays, payments to gain distribution of new products, payments for shelf space and discounts to promote lower retail prices. The accompanying condensed consolidated financial statements include accruals for these promotions and discounts. The accruals are made for invoices that have not yet been received as of the end of the reporting period and are recorded as a reduction of sales, and are based on contract terms and our historical experience with similar programs and require management judgment with respect to estimating customer and consumer participation and performance levels.
Previous wording
•Other—This product category consists of all other products, which includes Vita Coco product extensions beyond coconut water, consisting of coconut milk products, including Vita Coco Treats; Ever & Ever and PWR LIFT product offerings; Vita Coco coconut oil sold internationally; and other revenue transactions (e.g., bulk product sales). For these products, control is transferred upon customer receipt, at which point the Company recognizes the transaction price for the product as revenue.
Current wording
•Other—This product category consists of all other products, which includes Vita Coco product extensions beyond coconut water, consisting of coconut milk products, including Vita Coco Treats; and PWR LIFT product offerings; Vita Coco coconut oil sold internationally; and other revenue transactions (e.g., bulk product sales).
Previous wording
Comparison of the Three and Nine Months Ended September 30, 2025 and 2024
Current wording
Comparison of the Three Months Ended March 31, 2026 and 2025
Previous wording
The following table summarizes our results of operations for the three and nine months ended September 30, 2025 and 2024, respectively:
Current wording
The following table summarizes our results of operations for the three months ended March 31, 2026 and 2025, respectively:
Previous wording
The following table provides a comparative summary of the percentage change in our volume in CE for the three and nine months ended September 30, 2025 compared to the three and nine months ended September 30, 2024, by operating segment and product category:
Current wording
The following table provides a comparative summary of the percentage change in our volume in CE for the three months ended March 31, 2026 compared to the three months ended March 31, 2025, by operating segment and product category:
Previous wording
International net sales increased by $9.9 million, or 48.1%, to $30.6 million for the three months ended September 30, 2025, from $20.7 million for the three months ended September 30, 2024. The growth was primarily driven by a 44.1% increase in CE volume, reflecting strong performance in Germany and the United Kingdom, partially offset by softness in China. For the nine months ended September 30, 2025, International net sales increased by $19.8 million, or 35.5%, to $75.7 million, up from $55.9 million for the nine months ended September 30, 2024. The increase was largely attributable to CE volume growth of 32.2%, led by Germany and the United Kingdom, partially offset by softness in China.
Current wording
International net sales increased $13.3 million, or 72.5%, for the three months ended March 31, 2026, from the three months ended March 31, 2025. The growth was primarily driven by a 50.2% increase in CE volume, reflecting strong performance in Germany and the United Kingdom, partially offset by softness in China.
Previous wording
Vita Coco Coconut Water net sales increased by $7.1 million, or 47.4%, to $21.9 million, for the three months ended September 30, 2025, from $14.9 million, for the three months ended September 30, 2024. The increase was primarily driven by higher volume in Europe due to strong demand for our products, along with some favorable pricing and foreign exchange rate benefits. Vita Coco Coconut Water net sales increased by $16.5 million, or 42.9%, to $55.0 million for the nine months ended September 30, 2025, from $38.5 million, for the nine months ended September 30, 2024. The increase was primarily driven by strong CE volume growth in Europe coupled with pricing benefits.
Current wording
Vita Coco Coconut Water net sales increased by $9.3 million, or 70.9%, to $22.5 million, for the three months ended March 31, 2026, from $13.2 million, for the three months ended March 31, 2025. The increase was primarily driven by higher volume in Europe due to strong demand for our products, along with net pricing benefits and favorable foreign exchange rates.
Previous wording
Private Label net sales increased $3.3 million, or 69.5%, to $8.1 million for the three months ended September 30, 2025 from $4.8 million for the three months ended September 30, 2024. The increase was driven primarily by Private Label coconut water CE volume growth in Europe. Private Label net sales increased $4.4 million, or 29.5%, to $19.1 million for the nine months ended September 30, 2025 from $14.8 million for the nine months ended September 30, 2024. The increase was driven primarily by CE volume growth in Europe Private Label coconut water sales.
Current wording
Private Label net sales increased $4.1 million, or 85.7%, to $8.8 million for the three months ended March 31, 2026 from $4.8 million for the three months ended March 31, 2025. The increase was driven primarily by Private Label coconut water CE volume growth in Europe.
Previous wording
Net sales from Other products decreased 47.5% and 39.1% for the three and nine months ended September 30, 2025, respectively, compared to the same periods in the prior year, primarily driven by the decrease in sales of Vita Coco coconut oil.
Current wording
Net sales from Other products decreased $0.1 million, or 36.6% for the three months ended March 31, 2026, compared to the same period in the prior year.
Previous wording
On a consolidated basis, cost of goods sold increased $32.3 million, or 39.7%, to $113.6 million for the three months ended September 30, 2025, from $81.3 million for the three months ended September 30, 2024. On a consolidated and segment basis, the increase was primarily driven by higher CE volume, higher rates for finished goods, and tariffs, partially offset by lower year on year ocean freight. Cost of goods sold increased by $72.7 million, or 31.5%, to $304.0 million for the nine months ended September 30, 2025, from $231.2 million for the nine months ended September 30, 2024. On a consolidated basis, the increase was primarily related to increased CE volume, higher finished goods and the impact of tariffs.
Current wording
On a consolidated basis, cost of goods sold increased $25.1 million, or 30.3%, for the three months ended March 31, 2026, compared to the three months ended March 31, 2025. On a consolidated and segment basis, the increase was primarily driven by higher CE volume, higher finished goods and domestic logistics costs, as well as legacy tariff impacts, partially offset by lower ocean freight costs.
Previous wording
For the three months ended September 30, 2025 and 2024, we recorded gains of $2.4 million and $2.6 million, respectively, for the mark-to-market changes in fair value on the outstanding derivative instruments for forward foreign currency exchange contracts, with the largest gain for the three months ended September 30, 2025 related to the hedging contracts for the BRL and THB. For the nine months ended September 30, 2025 and 2024, we recorded gains of $6.3 million and losses of $5.9 million, respectively, for the mark-to-market changes in fair value on the outstanding derivative instruments for forward foreign currency exchange contracts, with the largest gain for the nine months ended September 30, 2025 related to the hedging contracts for the BRL and THB, partially offset by the loss on hedging contracts for the GBP and EUR.
Current wording
For each of the three months ended March 31, 2026 and 2025, we recorded gains of $2.8 million for the mark-to-market changes in fair value on the outstanding derivative instruments for forward foreign currency exchange contracts, with the largest gain for the three months ended March 31, 2026 related to the hedging contracts for the Brazilian Real.
Previous wording
For the three months ended September 30, 2025, the change in foreign currency loss was $2.0 million as compared to September 30, 2024. For the nine months ended September 30, 2025, the change in foreign currency loss was $0.8 million as compared to September 30, 2024. The change in all periods was a result of movements in various foreign currency exchange rates related to transactions denominated in currencies other than the functional currency. See "Quantitative and Qualitative Disclosures about Market Risk -Foreign Currency Exchange Risk" for further information.
Current wording
For the three months ended March 31, 2026, we recorded a $0.5 million foreign currency loss compared to a foreign currency gain of $0.6 million in the three months ended March 31, 2025. The variance was a result of movements in various foreign currency exchange rates related to transactions denominated in currencies other than the functional currency. See "Quantitative and Qualitative Disclosures about Market Risk -Foreign Currency Exchange Risk" for further information.
Previous wording
For the nine months ended September 30, 2025 and 2024, our effective tax rate was 20.9% and 23.9%, respectively. The effective tax rate for the current period is lower than the U.S. statutory rate of 21% primarily as a result of discrete items recorded during the period. The effective tax rate for the period ending September 30, 2024 was higher than the U.S. statutory rate of 21% primarily as a result of state income taxes for the U.S. entity. The change in effective tax rates between the periods is primarily driven by the jurisdictional mix of the Company’s pre-tax profits and the windfall benefit of stock compensation exercises.
Current wording
For the three months ended March 31, 2026 and 2025, our effective tax rate was 18.6% and 22.5%, respectively. The effective tax rate for the current period is lower than the U.S. statutory rate of 21% primarily as a result of discrete items recorded during the period. The effective tax rate for the period ending March 31, 2025 was higher than the U.S. statutory rate of 21% primarily as a result of state income taxes for the U.S. entity. The change in effective tax rates between the periods is primarily attributable to the impact of discrete items compared to the prior year period and geographical mix of earnings.
Previous wording
(d)The three and nine months ended September 30, 2025 includes $0.6 million and $1.8 million, respectively, related to a one-time 2023 incentive program that is measured based on full-year 2025 performance structured differently from our other ongoing employee incentive programs, $0.4 million and $1.1 million, respectively, of overlapping rent expense related to our New York City office and $0.2 million of impairment loss related to the sale of Runa. The three months ended September 30, 2025 also includes $0.1 million of provision for credit losses related to the partially recovered prepaid inventory from a supplier recorded in the first half of 2025 (refer to the Form 10-K and the Form 10-Q for the quarterly period ended June 30, 2025 for further details). In the nine months ended September 30, 2025, these amounts were offset by $0.1 million of partial recoveries of prepaid inventory from a supplier (refer to the Form 10-K for further details) and a gain of $0.2 million from a sale of intellectual property.
Current wording
(c)The three months ended March 31, 2025 other adjustments include $0.6 million related to a one-time 2023 incentive program that is measured based on full-year 2025 performance and is structured differently from our other ongoing employee incentive programs, and $0.4 million of non-cash rent charges related to our new New York City office that overlap with our current New York City office rent charges. These amounts were offset by $0.1 million of partial recoveries of prepaid inventory from a supplier (refer to the 2025 Form 10-K for further details) and a gain of $0.2 million from a sale of intellectual property.
Previous wording
Since our inception, we have financed our operations primarily through cash generated from our business operations and proceeds on borrowings through our credit facilities and term loans. We had $203.7 million and $164.7 million of cash and cash equivalents as of September 30, 2025 and December 31, 2024, respectively. From time to time, we may supplement our liquidity needs with incremental borrowing capacity under the 2020 Credit Facility.
Current wording
Since our inception, we have financed our operations primarily through cash generated from our business operations and proceeds on borrowings through our credit facilities and term loans. We had $201.9 million and $196.9 million of cash and cash equivalents as of March 31, 2026 and December 31, 2025, respectively. From time to time, we may supplement our liquidity needs with incremental borrowing capacity under the Credit Facility.
Previous wording
Considering recent market conditions and our business assumptions, we have reevaluated our operating cash flows and cash requirements and believe that current cash, cash equivalents, future cash flows from operating activities and cash available under our 2020 Credit Facility will be sufficient to meet our anticipated cash needs, including working capital needs, capital expenditures and contractual obligations for at least 12 months from the issuance date of the condensed consolidated financial statements included herein and the foreseeable future.
Current wording
Considering recent market conditions and our business assumptions, we have reevaluated our operating cash flows and cash requirements and believe that current cash, cash equivalents, future cash flows from operating activities and cash available under our Credit Facility will be sufficient to meet our anticipated cash needs, including working capital needs, capital expenditures and contractual obligations for at least 12 months from the issuance date of the condensed consolidated financial statements included herein and the foreseeable future.
Previous wording
During the nine months ended September 30, 2025, cash provided by operating activities increased $15.1 million compared to the nine months ended September 30, 2024. The higher cash generation was driven by the increase in net income after adjusting for non-cash items and working capital improvement primarily due to higher cash spent for inventory purchases in the quarter ended September 30, 2024.
Current wording
During the three months ended March 31, 2026, cash provided by operating activities increased $25.4 million compared to the three months ended March 31, 2025. The higher cash generation was driven by the $13.6 million increase in net income after adjusting for non-cash items and approximately $11.8 million working capital improvement.
Previous wording
During the nine months ended September 30, 2025, cash used in investing activities was $4.9 million compared to $0.8 million for the nine months ended September 30, 2024. The increase was primarily due to leasehold improvements related to the new New York, London, and Singapore offices.
Current wording
During the three months ended March 31, 2026, cash used in investing activities was $0.5 million compared to $0.6 million for the three months ended March 31, 2025. The decrease was primarily due to the absence of leasehold improvements related spend on our new offices during the three months ended March 31, 2025 partly offset by higher expenditures on new software implementations during the current quarter.
Previous wording
During the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024, net cash used by financing activities decreased by $2.4 million, primarily driven by lower volume of share repurchases in the nine months ended September 30, 2025 compared to the prior year period offset by increased proceeds from the exercise of stock options. See Note 10, Stockholders' Equity, in our condensed consolidated financial statements included in this Quarterly Report on Form 10-Q, for further discussion on share repurchases.
Current wording
During the three months ended March 31, 2026 compared to the three months ended March 31, 2025, net cash used by financing activities increased by $8.8 million, primarily driven by higher volume and price of share repurchases in the three months ended March 31, 2026 compared to the prior year period, partially offset by increased proceeds from the exercise of stock options. See Note 10, Stockholders' Equity, in our condensed consolidated financial statements included in this Quarterly Report on Form 10-Q, for further discussion on share repurchases.
Previous wording
In May 2020, the Company entered into the 2020 Credit Facility, which currently provides for committed borrowings of $60 million. On February 14, 2025, the 2020 Credit Facility was amended, extending the maturity five years to February 13, 2030.
Current wording
In May 2020, the Company entered into the Credit Facility, which currently provides for committed borrowings of $60 million. On February 14, 2025, the Credit Facility was amended, extending the maturity five years to February 13, 2030.
Previous wording
Starting in December 2022, borrowings on the 2020 Credit Facility bear interest at rates based on either: 1) a fluctuating rate per annum determined to be the sum of Daily Simple SOFR plus the Spread; or 2) a fixed rate per annum determined to be the sum of the Term SOFR plus the Spread. The Spread ranges from 1.00% to 1.75%, which is based on the Company’s leverage ratio (as defined in the credit agreement) for the immediately preceding fiscal quarter as defined in the credit agreement. In addition, the Company was subject to unused commitment fees ranging from 0.10% and 0.20% on the unused amount of the line of credit in the year ended December 31, 2024, with the rate based on the Company’s leverage ratio (as defined in the credit agreement). As of February 14, 2025, the unused commitment fees range from 0.13% and 0.23% on the unused amount of the line of credit, with the rate being based on the Company’s leverage ratio (as defined in the credit agreement).
Current wording
Starting in December 2022, borrowings on the Credit Facility bear interest at rates based on either: 1) a fluctuating rate per annum determined to be the sum of Daily Simple SOFR plus the Spread; or 2) a fixed rate per annum determined to be the sum of the Term SOFR plus the Spread. The Spread ranges from 1.00% to 1.75%, which is based on the Company’s leverage ratio (as defined in the credit agreement) for the immediately preceding fiscal quarter as defined in the credit agreement. In addition, through February 13, 2025, the Company was subject to an unused commitment fee ranging from 0.10% and 0.20% on the unused amount of the line of credit, with the rate based on the Company’s leverage ratio (as defined in the credit agreement). Starting February 14, 2025, the unused commitment fees ranged from 0.13% and 0.23% on the unused amount of the line of credit, with the rate being based on the Company’s leverage ratio (as defined in the credit agreement).
Previous wording
The outstanding balance on the Revolving Facility was zero as of September 30, 2025 and December 31, 2024, respectively. As of September 30, 2025, we were compliant with all financial covenants.
Current wording
There were no drawn amounts on the Credit Facility as of March 31, 2026 and December 31, 2025, respectively. As of March 31, 2026, we were compliant with all financial covenants.
Previous wording
Our critical accounting policies are described under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Policies and Significant Judgments and Estimates” in the Form 10-K and the notes to the unaudited condensed consolidated financial statements included in this Quarterly Report on Form 10-Q. During the nine months ended September 30, 2025, there were no material changes to our critical accounting policies from those discussed in the Form 10-K.
Current wording
Our critical accounting policies are described under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Policies and Significant Judgments and Estimates” in the Form 10-K and the notes to the unaudited condensed consolidated financial statements included in this Quarterly Report on Form 10-Q. During the three months ended March 31, 2026, there were no material changes to our critical accounting policies from those discussed in the Form 10-K.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
For these products, control is transferred upon customer receipt, at which point the Company recognizes the transaction price for the product as revenue.