Healthier Choices Management Corp.
For the period ended Jun 30, 2026. Filed Aug 19, 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.
Jun 30, 2026 · Filed Aug 19, 2026
HCMCStored price and day change unavailable
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2026-03-31; filed 2026-05-14.
0001493152-26-022965
ITEM 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-06-30; filed 2026-08-19.
0001493152-26-039201
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 43 previous paragraphs and 48 current paragraphs.
31 unchanged; 12 reworded; 3 added; 0 removed; 0 previous and 2 current paragraphs rearranged.
Tables are not compared: 3 previous and 4 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 (3)
Current report
On June 26, 2026, the Company received $50,000 in cash proceeds from Pinz Capital Special Opportunities Fund, LP in connection with a convertible promissory note. The formal loan agreement was executed on July 6, 2026. The note matures May 5, 2030, bears interest at 12% per annum, payable in kind, with principal and interest due in ten equal monthly installments beginning on the third anniversary of issuance, subject to earlier conversion. The proceeds from this note provided additional liquidity to support the Company’s operations.
Current report
Total other (expense) income, net was approximately $9,000 for the three months ended June 30, 2026, which was primarily attributable to interest expense. Total other (expense) income, net was $12,000 for the three months ended June 30, 2025, consisting of interest income of $9,000 and other miscellaneous income of $3,000.
Current report
Total operating expenses decreased by approximately $3.1 million to $1.1 million for the six months ended June 30, 2026 compared to $4.2 million for the same period in 2025. After giving effect to the reclassification of payroll expense of $328,373 resulting from the termination of the TSA and mutual release of obligations with HCWC, total net operating expenses were $722,019 for the six months ended June 30, 2026, representing a decrease of approximately $3.5 million from the same period in 2025. The decrease was driven by a $2.2 million reduction in stock-based compensation expense and a $0.9 million reduction in payroll and benefits, professional fees, and bank service fees. In addition, the reclassification of payroll expense of approximately $0.3 million resulted from the termination of the TSA and mutual release of obligations with HCWC, as management determined that payroll costs incurred by HCMC during the period primarily benefited HCWC and should be allocated to HCWC, reducing operating expenses by $328,373 for the six months ended June 30, 2026.
Reworded paragraphs (12)
Previous wording
As disclosed in Note 1 to the condensed consolidated financial statements, the Company entered into a Distribution Agreement on November 27, 2025, to commercialize a new product line, Quitcubes, utilizing the Company’s NatureTine™ ingredient. The distributor is responsible for marketing, customer fulfillment, and website management, while the Company is responsible for manufacturing. The launch was originally anticipated in the first quarter of 2026 but was delayed as the Company established the necessary operational infrastructure. As a result, the Company recorded no net sales from Quitcubes for the three months ended March 31, 2026. Subsequent to quarter end, the Company has made significant progress and expects the official commercial launch to occur in June 2026. Management believes the successful launch of Quitcubes is critical to generating future revenue and addressing the Company’s recurring losses.
Current wording
As disclosed in Note 1 to the condensed consolidated financial statements, the Company entered into a Distribution Agreement on November 27, 2025, to commercialize a new product line, Quitcubes, utilizing the Company’s NatureTine™ ingredient. The distributor is responsible for marketing, customer fulfillment, and website management, while the Company is responsible for manufacturing. The launch was originally anticipated in the first quarter of 2026 but was delayed as the Company established the necessary operational infrastructure. As a result, the Company recorded no net sales from Quitcubes for the three and six months ended June 30, 2026. Subsequent to quarter end, the Company has made significant progress and expects the official commercial launch to occur in the third quarter of 2026. Management believes the successful launch of Quitcubes is critical to generating future revenue and addressing the Company’s recurring losses.
Previous wording
The Company currently and historically has reported net losses and cash outflows from operations. As of March 31, 2026, the Company had cash and cash equivalent of approximately $1.1 million and negative working capital of $0.8 million. The Company’s liquidity needs through March 31, 2026 have been satisfied through financing agreement with private lenders.
Current wording
The Company currently and historically has reported net losses and cash outflows from operations. As of June 30, 2026, the Company had cash and cash equivalent of approximately $1.2 million and negative working capital of $0.7 million. The Company’s liquidity needs through June 30, 2026 have been satisfied through financing agreement with private lenders.
Previous wording
Management believes that the Company’s cash on hand, together with the availability of up to $4.5 million in additional draws under the Sabby Loan Agreement, will enable the Company to meet its obligations and capital requirements for at least twelve months from the date these financial statements are issued. Accordingly, no adjustment has been made to the financial statements to account for this uncertainty.
Current wording
Management believes that the Company’s cash on hand, together with the availability of up to $4.5 million in additional draws under the Sabby Loan Agreement, and the $50,000 in proceeds received on June 26, 2026 (with the formal loan agreement executed on July 6, 2026), will enable the Company to meet its obligations and capital requirements for at least twelve months from the date these financial statements are issued. Accordingly, no adjustment has been made to the financial statements to account for this uncertainty.
Previous wording
Total operating expenses decreased by $1.4 million to $0.8 million for the three months ended March 31, 2026, compared to $2.2 million for the same period in 2025. The decrease was primarily attributable to a $1.1 million reduction in stock-based compensation expense, as well as a $0.3 million decrease in professional fees, payroll and benefits, and insurance expense.
Current wording
Total operating expenses decreased by approximately $1.7 million to $0.2 million for the three months ended June 30, 2026 compared to $2.0 million for the same period in 2025. After giving effect to the reclassification of payroll expense of $328,373 resulting from the termination of the TSA and mutual release of obligations with HCWC, total net operating expenses were $(84,606) for the three months ended June 30, 2026, representing a decrease of approximately $2.1 million from the same period in 2025. The decrease was driven by a $1.1 million reduction in stock-based compensation expense and a $0.7 million reduction in payroll and benefits, professional fees, and taxes, licenses and permits. In addition, the reclassification of shared payroll expense of approximately $0.3 million resulted from the termination of the TSA and mutual release of obligations with HCWC, as management determined that payroll costs incurred by HCMC during the period primarily benefited HCWC and should be allocated to HCWC, reducing operating expenses by $328,373 for the three months ended June 30, 2026.
Previous wording
Total other income (expense), net $20,000 for the three months ended March 31, 2026 was mainly attributable to interest income of approximately $7,000 and $13,000 miscellaneous income. Total other income (expense), net of $14,000 for the three months ended March 31, 2025 consists of $23,000 loss on asset disposal offset by net interest income of $9,000.
Current wording
Total other income (expense), net was approximately $10,000 for the six months ended June 30, 2026, primarily attributable to a miscellaneous income of approximately $12,000 and partially offset by interest expense of approximately $2,000. Total other income (expense), net was $2,000 for the six months ended June 30, 2025, consisting of $22,000 loss on asset disposal, offset by net interest income of $17,000 and other miscellaneous income of $3,000.
Previous wording
The following table and the discussion present the Company’s cash activities on continuing basis for three months ended March 31, 2026 and 2025:
Current wording
The following table and the discussion present the Company’s cash activities on continuing basis for six months ended June 30, 2026 and 2025:
Previous wording
Our net cash used in operating activities of approximately $0.6 million for the three months ended March 31, 2026 resulted from a net loss of $0.8 million, offset by a non-cash adjustment of approximately $13,000 and a net cash change of $0.2 million from changes in operating assets and liabilities. Our net cash used in operating activities of approximately $1.0 million for the three months ended March 31, 2025 resulted from a net loss of $2.2 million, offset by a non-cash adjustment of $1.2 million and a net cash change of $40,000 from changes in operating assets and liabilities.
Current wording
Our net cash used in operating activities of approximately $0.6 million for the six months ended June 30, 2026 resulted from a net loss of $0.7 million, offset by a non-cash adjustment of $36,000 and a net increase of $55,000 from changes in operating assets and liabilities. Our net cash used in operating activities of approximately $2.0 million for the six months ended June 30, 2025 resulted from a net loss of $4.2 million, offset by a non-cash adjustment of $2.3 million and a net cash change of $0.1 million from changes in operating assets and liabilities.
Previous wording
There was no cash used in investing activities for the three months ended March 31, 2026 and 2025.
Current wording
There was no cash used in investing activities for the six months ended June 30, 2026 and 2025.
Previous wording
The net cash provided by financing activities of $0.6 million for the three months ended March 31, 2026 is primarily due to $0.1 million net transfers from HCWC and $0.5 million cash proceeds from Sabby loan advance. The net cash provided by financing activities of $0.5 million for the three months ended March 31, 2025 is primarily due to $1.0 million net transfer from HCWC and $0.5 million cash payment of the credit line.
Current wording
The net cash provided by financing activities of $0.7 million for the six months ended June 30, 2026 is primarily due $0.1 million net transfers from HCWC, and $0.5 million cash proceeds from Sabby loan advance, and $50,000 cash proceeds from convertible note received on June 26, 2026 (with the formal loan agreement executed on July 6, 2026). The net cash provided by financing activities of $1.5 million for the six months ended June 30, 2025 is primarily due to $1.9 million net transfers from HCWC and $0.4 million cash payment of the credit line.
Previous wording
Our cash balances are kept liquid to support our growing acquisition and infrastructure needs for operational expansion. Most of our cash and cash equivalent are concentrated in one financial institution and is generally in excess of the FDIC insurance limit. The Company has not experienced any losses on its cash. The following table presents the Company’s cash position as of March 31, 2026 and December 31, 2025.
Current wording
Our cash balances are kept liquid to support our operations. Most of our cash and cash equivalent are concentrated in one financial institution and is generally in excess of the FDIC insurance limit. The Company has not experienced any losses on its cash. The following table presents the Company’s cash position as of June 30, 2026 and December 31, 2025.
Previous wording
The Company reported a net loss from continuing operation of $0.8 million for the three months ended March 31, 2026. The Company also had negative working capital of $0.8 million. The Company expects to continue incurring losses for the foreseeable future.
Current wording
The Company reported a net loss from continuing operation of $0.7 million for the six months ended June 30, 2026. The Company also had negative working capital of $0.7 million. The Company expects to continue incurring losses for the foreseeable future.
Previous wording
The Company anticipates its current cash and its ability to draw up to $4.5 million under the Sabby Loan Agreement will be sufficient to meet projected operating expenses for the foreseeable future through at least twelve months from the issuance of the condensed consolidated financial statements.
Current wording
The Company anticipates its current cash and its ability to draw from the $5 million credit line with private lender will be sufficient to meet projected operating expenses for the foreseeable future through at least twelve months from the issuance of the consolidated financial statements.
Rearranged current paragraphs (2)
Current report — wording carried from elsewhere
The following table sets forth our unaudited condensed consolidated Statements of Operations for the six months ended June 30, 2026 and 2025 that is used in the following discussions of our results of operations:
Current report — wording carried from elsewhere
Net sales and cost of sales were de minimis for the six months ended June 30, 2026 and 2025. The Company closed all its brick-and-mortar retail vape stores, as management had shifted its retail sales focus to the wholesale and online channel. The sales and cost of sales for the six months ended June 30, 2026 and 2025 continued to be significantly impacted by the inability to bring new products to market via distribution.