Axil Brands, Inc.
For the period ended Nov 30, 2025. Filed Jan 8, 2026.
View on SEC.govAbout this filing
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.
Nov 30, 2025 · Filed Jan 8, 2026
AXIL$5.16-0.6%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-08-31; filed 2025-10-07.
0001520138-25-000299
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-11-30; filed 2026-01-08.
0001520138-26-000006
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 49 previous paragraphs and 59 current paragraphs.
31 unchanged; 14 reworded; 11 added; 4 removed; 0 previous and 3 current paragraphs rearranged.
Tables are not compared: 2 previous and 2 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 (11)
Current report
Our overall business strategy centers on building strong market awareness of our products across multiple sales channels. We primarily drive revenue and brand recognition through targeted online marketing and advertising campaigns. This awareness is designed to create a multiplier effect. By expanding the number of points of sale both online and offline we aim to capture more sales and customers for every dollar spent on advertising. We aim to optimize customer acquisition by converting the market awareness generated through paid campaigns into purchases across a broader range of retail and distribution locations.
Current report
In addition to growing our overall distribution and retail footprint, the Company has reached a significant milestone in its wholesale channel strategy by securing several strategic supply agreements with leading national retail chains. These agreements have already generated multiple purchase orders with fulfillment anticipated in the first half of calendar 2026. While there can be no assurance that additional purchase orders will be received or regarding the timing or volume of fulfillment, we expect this expanded national retail presence to drive meaningful revenue growth and significantly enhance brand visibility among a much wider customer base.
Current report
In December 2025, we announced our securement of a new nationwide retail distribution partnership with a major U.S. retailer, positioning a next-generation hearing-protection offering for broad in-store availability beginning in the third quarter of fiscal 2026.
Current report
For the Six Months Ended November 30, 2025 Compared to the Six Months Ended November 30, 2024
Current report
Net sales increased by $1,407,231 or 10.4% from $13,583,846 in the six months ended November 30, 2024 to $14,991,077 for the six months ended November 30, 2025. The increase in net sales was primarily driven by a material order from a leading national membership-based retail chain partially offset by the timing of Thanksgiving sales events.
Current report
The overall cost of sales increased by $887,755 or 22.6% from $3,932,151 in the six months ended November 30, 2024 to $4,819,906 in the six months ended November 30, 2025. Cost of sales as a percentage of net revenues for the six months ended November 30, 2025 was 32.2% as compared to 28.9% for the comparable period in 2024. The increase in cost of sales, as a percentage of sales, was primarily attributable to an increase in sales to distributors in our hair and skin care products bearing lower margins, and an increase in sales with a leading national membership-based retail chain, which carried tighter margins compared to our direct-to-consumer business.
Current report
Gross profit for the six months ended November 30, 2025 and 2024 was $10,171,171 and $9,651,695, respectively. Gross profit as a percentage of sales for the six months ended November 30, 2025, was 67.8% as compared to 71.1% for the comparable period in 2024. The decrease in the gross profit margin for the six months ended November 30, 2025 was primarily due to lower margins related to a material order with a leading national membership-based retail chain.
Current report
Operating expenses consisted of marketing and selling expenses, compensation and related taxes, professional and consulting fees, and general and administrative costs. Operating expenses decreased by $263,164 or 2.9% from $9,119,526 in the six months ended November 30, 2024 to $8,856,362 in the six months ended November 30, 2025. Operating expenses as a percentage of net revenues for the six months ended November 30, 2025, were 59.1% compared to 67.1% for the six months ended November 30, 2024. Included in operating expenses were non-cash stock-based compensation of $380,234 and $602,464 in the six months ended November 30, 2025 and 2024, respectively. The decrease in operating expenses was primarily driven by lower sales and marketing costs correlated to a shift from direct-to-consumer sales to our expansion of retail distribution channels, higher operating efficiency through lower professional and consulting fees, in addition to lower stock-based compensation expense, partially offset by the forgiveness of accounts payable of approximately $220,000 that occurred in the six months ended November 30, 2024 and did not recur.
Current report
Income from operations for the six months ended November 30, 2025, was $1,314,809 compared to income of $532,169 for the six months ended November 30, 2024. The increase in income from operations of $782,640 or 147.1% was primarily related to the decrease in stock-based compensation and gained efficiencies within the Company resulting in reduced operating expenses, partially offset by a forgiveness of accounts payable of approximately $220,000 that did not recur in the six months ended November 30, 2025.
Current report
Adjusted EBITDA increased by $643,433 or 54.2% from $1,186,275 in the six months ended November 30, 2024 to $1,829,708 in the six months ended November 30, 2025. Adjusted EBITDA as a percentage of sales, net for the six months ended November 30, 2025 and 2024, were 12.2% and 8.7%, respectively. Adjusted EBITDA increased primarily due to improved operating efficiency partially offset by a forgiveness of accounts payable of approximately $220,000 that did not recur in the current period.
Current report
Net cash provided by operating activities for the six months ended November 30, 2025, was $195,607, compared to $1,904,174 for the six months ended November 30, 2024. The decrease was driven primarily by a significant inventory purchase associated with a material order from a leading national membership-based retailer.
Removed paragraphs (4)
Previous report
Our overall business strategy is to establish market awareness of our products through our direct-to-consumer campaigns. Our strategy centers on driving growth by expanding market share within existing channels and developing new ones through both online and traditional platforms. Our primary focus is optimizing our e-commerce strategies, building sales teams to meet the needs of distribution channels, and enhancing value through strategic partnerships. We are also working to expand our offline retail presence and enter into new international markets. We believe the increase in awareness will allow us to increase distribution and gain customers through our distribution partners’ retail establishments, with the goal of helping us achieve growth in market share and diversify our sales channels; however, we cannot provide any assurances that such increases will occur, or that we will realize the anticipated benefits of our actions.
Previous report
The Company entered into a strategic supply arrangement with a leading national membership-based retail chain, marking a significant milestone in our wholesale channel expansion strategy. Under this agreement, the retailer placed a substantial initial purchase order, with fulfillment beginning in the first quarter of fiscal 2026 and expected to be completed in the second quarter of fiscal 2026. While there can be no assurances that additional purchase orders will be placed or as to the timing of the fulfillment of any orders, this development has and is anticipated to continue to drive meaningful revenue growth and enhance brand visibility across a broader customer base.
Previous report
Our results of operations are summarized below.
Previous report
Net cash used in operating activities for the three months ended August 31, 2025, was $739,194, compared to net cash provided by operating activities of $897,318 for the three months ended August 31, 2024. The decrease was related to a material order from a leading national membership-based retail chain, which we began fulfilling in the first quarter of fiscal 2026 and we expect to complete in the second quarter of fiscal 2026. This resulted in a significant inventory purchase, and a material increase in accounts receivable, as the order was placed near the end of the quarter.
Reworded paragraphs (14)
Previous wording
Net sales for the three months ended August 31, 2025 increased by $1,004,946 or 17.2%, as compared to the three months ended August 31, 2024. The increase in net sales was primarily driven by a material order from a leading national membership-based retail chain. The order generated significant incremental revenue and positioned us for additional shipments in subsequent periods.
Current wording
Net sales increased by $402,285 or 5.2% from $7,732,574 in the three months ended November 30, 2024 as compared to $8,134,859 for the three months ended November 30, 2025. The increase in net sales was primarily driven by a material order from a leading national membership-based retail chain partially offset by the timing of Thanksgiving sales events.
Previous wording
Cost of sales includes the cost of products, freight-in costs, and depreciation related to fixed assets that are used in the production and distribution process to bring goods to their saleable condition and location. For the three months ended August 31, 2025, the overall cost of sales increased by $523,660 or 30.8%, as compared to the three months ended August 31, 2024. Cost of sales as a percentage of net revenues for the three months ended August 31, 2025 was 32.4% as compared to 29.0% for the three months ended August 31, 2024. Cost of sales increased as a percentage of revenue primarily due to a material order with a leading national membership-based retail chain, which carried tighter margins compared to our direct-to-consumer business.
Current wording
Cost of sales includes the cost of products, freight-in costs, customs duties, and depreciation related to fixed assets that are used in the production and distribution process to bring goods to their saleable condition and location. The overall cost of sales increased by $364,095 or 16.3% from $2,234,527 in three months ended November 30, 2024 to $2,598,622 in the three months ended November 30, 2025. Cost of sales as a percentage of net revenues for the three months ended November 30, 2025 was 31.9% as compared to 28.9% for the three months ended November 30, 2024. Cost of sales increased as a percentage of revenue primarily due to a material order with a leading national membership-based retail chain, which carried tighter margins compared to our direct-to-consumer business.
Previous wording
Gross profit increased by $481,286 or 11.6% from $4,153,648 in the three months ended August 31, 2024 to $4,634,934 for the three months ended August 31, 2025. Gross profit as a percentage of sales for the three months ended August 31, 2025 was 67.6%, as compared to 71.0% for the three months ended August 31, 2024 Gross profit increased due to higher sales volumes, partially offset by lower margins related to a material order with a leading national membership-based retail chain.
Current wording
Gross profit increased by $38,190 or 0.7% from $5,498,047 in the three months ended November 30, 2024 to $5,536,237 for the three months ended November 30, 2025. Gross profit as a percentage of sales for the three months ended November 30, 2025 was 68.1%, as compared to 71.1% for the three months ended November 30, 2024. Gross profit increased due to higher sales volumes, partially offset by lower margins related to a material order with a leading national membership-based retail chain.
Previous wording
Operating expenses decreased by $71,154 or 1.7% from $4,294,350 in the three months ended August 31, 2024 to $4,223,196 in the three months ended August 31, 2025. Operating expenses as a percentage of net revenues for the three months ended August 31, 2025 was 61.6% compared to 73.4% for the three months ended August 31, 2024. Included in operating expenses were non-cash stock-based compensation of $199,212 and $297,864 in the three months ended August 31, 2025 and 2024, respectively. The decrease in operating expenses was primarily driven by lower professional and consulting fees, reflecting reduced reliance on external consultants as part of our efforts to enhance operating efficiency.
Current wording
Operating expenses consisted of marketing and selling expenses, compensation and related taxes, professional and consulting fees, and general and administrative costs. Operating expenses decreased by $192,010 or 4.0% from $4,825,176 in the three months ended November 30, 2024 to $4,633,166 in the three months ended November 30, 2025. Operating expenses as a percentage of net revenues for the three months ended November 30, 2025 was 57.0% compared to 62.4% for the three months ended November 30, 2024. Included in operating expenses were non-cash stock-based compensation of $181,022 and $304,600 in the three months ended November 30, 2025 and 2024, respectively. The decrease in operating expenses was primarily driven by lower sales and marketing costs correlated to a shift from direct-to-consumer sales to our expansion of retail distribution channels, higher operating efficiency through lower professional and consulting fees, in addition to lower stock-based compensation expense, partially offset by the forgiveness of accounts payable of approximately $220,000 that occurred in the three months ended November 30, 2024 and did not recur.
Previous wording
Income from operations for the three months ended August 31, 2025, was $411,738 compared to a loss from operations of $140,702 for the three months ended August 31, 2024. The increase in income from operations of $552,440 or 392.6% was primarily related to the increase in unit sales and the resulting contribution to gross profit, in addition to gained efficiencies within the Company resulting in reduced operating expenses.
Current wording
Income from operations for the three months ended November 30, 2025, was $903,071 compared to $672,871 for the three months ended November 30, 2024. The increase in income from operations of $230,200 or 34.2% was primarily related to the decrease in stock-based compensation and gained efficiencies within the Company resulting in reduced operating expenses, partially offset by a forgiveness of accounts payable of approximately $220,000 that did not recur in the three months ended November 30, 2025.
Previous wording
For the three months ended August 31, 2025, provision for income tax expense was $115,058. For the three months ended August 31, 2024, we had an income tax of $0.
Current wording
For the three months ended November 30, 2025, provision for income tax expense was $233,115. For the three months ended November 30, 2024, we had a provision for income tax expense of $67,250.
Previous wording
As a result of the above, we reported a net income of $334,294 and net loss of $109,805 for the three months ended August 31, 2025 and 2024, respectively.
Current wording
As a result of the above, we reported a net income of $704,883 and $633,706 for the three months ended November 30, 2025 and 2024, respectively.
Previous wording
Adjusted EBITDA increased by $502,032 or 291.3% from $172,323 for the three months ended August 31, 2024 to $674,355 for the three months ended August 31, 2025. Adjusted EBITDA as a percentage of sales, net for the three months ended August 31, 2025 and 2024, was 9.8% and 2.9%, respectively. Adjusted EBITDA increased primarily due to the increase in gross profit related to higher volume of units sold.
Current wording
Adjusted EBITDA increased by $141,401 or 13.9% from $1,013,952 for the three months ended November 30, 2024 to $1,155,353 for the three months ended November 30, 2025. Adjusted EBITDA as a percentage of sales, net for the three months ended November 30, 2025 and 2024, was 14.2% and 13.1%, respectively. Adjusted EBITDA increased primarily due to improved operating efficiency partially offset by a forgiveness of accounts payable of approximately $220,000 that did not recur in the current period.
Previous wording
Basic and diluted earnings per share for the three months ended August 31, 2025 were $0.05 and $0.04, respectively, compared to basic and diluted loss per share of $0.02 for the three months ended August 31, 2024.
Current wording
Basic and diluted earnings per share for the three months ended November 30, 2025 were $0.10 and $0.09, respectively, compared to basic and diluted earnings per share of $0.10 and $0.08, respectively, for the three months ended November 30, 2024.
Previous wording
Cash Flows for the three months ended August 31, 2025 and 2024
Current wording
Cash Flows for the six months ended November 30, 2025 and 2024
Previous wording
Net cash flows used in investing activities for the three months ended August 31, 2025 was $94,497 due to the purchase of intangibles and property and equipment for our business. For the three months ended August 31, 2024, net cash flows used in investing activities was $41,840, attributable to the cash used in the purchase of intangibles relating to our expansion into new product lines.
Current wording
Net cash flows used in investing activities for the six months ended November 30, 2025 and 2024, was $135,341 and $107,623, respectively, due to the purchase of intangibles and property and equipment for our business.
Previous wording
Net cash flows provided by financing activities for the three months ended August 31, 2025 was $150,461 primarily related to net advances made from a related party of $151,491. Net cash provided by financing activities for the three months ended August 31, 2024 was $39,370 primarily related to net advances from a related party of $41,707.
Current wording
Net cash flows provided by financing activities for the six months ended November 30, 2025 was $145,848 primarily related to net advances made from a related party of $147,772. Net cash provided by financing activities for the six months ended November 30, 2024 was $163,470 primarily related to net advances from a related party of $166,722.
Previous wording
As of August 31, 2025, we had a secured Economic Injury Disaster Loan outstanding, administered pursuant to the CARES Act in the principal amount of $139,199, with a maturity date of May 18, 2050. The Company continues to pay interest and principal on the loan.
Current wording
As of November 30, 2025, we had a secured Economic Injury Disaster Loan outstanding, administered pursuant to the CARES Act in the principal amount of $138,305, with a maturity date of May 18, 2050. The Company continues to pay interest and principal on the loan.
Previous wording
The Company has a policy of providing an allowance for credit losses based on its best estimate of the amount of probable credit losses in its existing accounts receivable. The Company periodically reviews its accounts receivable to determine whether an allowance is necessary based on an analysis of past due accounts and other factors that may indicate that the realization of an account may be in doubt. Account balances deemed to be uncollectible are charged to bad debt expense and included in the allowance after all means of collection have been exhausted and the potential for recovery is considered remote.
Current wording
The Company has a policy of providing an allowance for credit losses based on its best estimate of the amount of probable credit losses in its existing accounts receivable. The Company periodically reviews its accounts receivable to determine whether an allowance is necessary based on an analysis of past due accounts and other factors that may indicate that the realization of an account may be in doubt. Account balances deemed to be uncollectible are charged to provision for credit losses and included in the allowance after all means of collection have been exhausted and the potential for recovery is considered remote.
Rearranged current paragraphs (3)
Current report — wording carried from elsewhere
For the six months ended November 30, 2025, provision for income tax expense was $348,173. For the six months ended November 30, 2024, provision for income tax expense was $67,250.
Current report — wording carried from elsewhere
As a result of the above, we reported a net income of $1,039,177 and $523,901 for the six months ended November 30, 2025 and 2024, respectively.
Current report — wording carried from elsewhere
Basic and diluted earnings per share for the six months ended November 30, 2025 were $0.16 and $0.13, respectively, compared to basic and diluted earnings per share of $0.08 and $0.06, respectively, for the six months ended November 30, 2024.