Bark, Inc.

Previous wording

The following discussion and analysis provides information which management believes is relevant to an assessment and understanding of our condensed consolidated results of operations and financial condition. The discussion should be read in conjunction with the unaudited condensed consolidated financial statements and notes thereto contained in this Quarterly Report on Form 10-Q and the audited consolidated financial statements and notes thereto for the year ended March 31, 2026 contained in the Annual Report on Form 10-K filed with the SEC on June 10, 2026. This discussion contains forward-looking statements and involves numerous risks and uncertainties, including, but not limited to, those described in the “Risk Factors” section of this Quarterly Report on Form 10-Q. Actual results may differ materially from those contained in any forward-looking statements. Unless the context otherwise requires, references to “we”, “us”, “our”, “the Company” and “BARK” are intended to mean the business and operations of BARK, Inc. and its subsidiaries. The unaudited condensed consolidated financial statements for the three months ended June 30, 2026 and 2025, respectively, present the financial position and results of operations of BARK, Inc. and its wholly-owned subsidiaries.

Current wording

The following discussion and analysis provides information which management believes is relevant to an assessment and understanding of our condensed consolidated results of operations and financial condition. The discussion should be read in conjunction with the unaudited condensed consolidated financial statements and notes thereto contained in this Quarterly Report on Form 10-Q and the audited consolidated financial statements and notes thereto for the year ended March 31, 2026 contained in the Annual Report on Form 10-K filed with the SEC on June 10, 2026. This discussion contains forward-looking statements and involves numerous risks and uncertainties, including, but not limited to, those described in the “Risk Factors” section of this Quarterly Report on Form 10-Q. Actual results may differ materially from those contained in any forward-looking statements. Unless the context otherwise requires, references to “we”, “us”, “our”, “the Company” and “BARK” are intended to mean the business and operations of BARK, Inc. and its subsidiaries. The unaudited condensed consolidated financial statements for the three and six months ended September 30, 2026 and 2025, respectively, present the financial position and results of operations of BARK, Inc. and its wholly-owned subsidiaries.

Previous wording

On February 20, 2026, the U.S. Supreme Court held that tariffs imposed under the International Emergency Economic Powers Act ("IEEPA") were unconstitutional. On April 20, 2026, CBP launched its Consolidated Administration and Processing of Entries ("CAPE") portal to process refund claims.

Current wording

(“CBP”) launched its Consolidated Administration and Processing of Entries (“CAPE”) portal to process refund claims for unliquidated and recently liquidated entries, and on June 29, 2026, CBP expanded the portal to accept claims for certain reconciliation entries.

Previous wording

None of the IEEPA tariffs paid by the Company were passed through to our customers or are owed to our vendors or suppliers. The Company will pursue all actions necessary to recover the remaining amounts of IEEPA tariffs paid by the Company.

Current wording

The Company did not pass any of the IEEPA tariffs it paid to its customers, and none of the refunded amounts are owed to our vendors or suppliers. On October 6, 2026, CBP launched the third phase of CAPE, which allows importers that are plaintiffs in pending litigation before the U.S. Court of International Trade to obtain refunds on finally liquidated entries. The Company will pursue all actions necessary to recover the remaining IEEPA tariffs it has paid.

Previous wording

We cannot predict the duration or magnitude of such impacts. Please refer to the “Cautionary Note Regarding Forward-Looking Statements” and the “Risk Factors” in this Quarterly Report on Form 10-Q.

Current wording

The timing and amount of any additional refunds the Company may receive are uncertain, and the Company cannot predict when or to what extent they will be realized. Please refer to “Cautionary Note Regarding Forward-Looking Statements” and “Risk Factors” in this Quarterly Report on Form 10-Q.

Previous wording

(1) Direct to Consumer Gross Profit and Direct to Consumer Gross Margin do not include the revenue or cost of goods sold from BARK Air. Direct to Consumer gross margin includes a $5.2 million tariff refund related to fiscal year 2026.

Current wording

(1) Direct to Consumer Gross Profit and Direct to Consumer Gross Margin do not include the revenue or cost of revenue from BARK Air. Direct to Consumer gross margin for the six months ended September 30, 2026 includes a $5.2 million tariff refund related to fiscal year 2026.

Previous wording

We define Subscriber Retention as the number of active subscriptions during a particular month divided by the number of active subscriptions for the prior month. An active subscription excludes new subscriptions, i.e. subscriptions with an initial shipment in a particular month. To calculate the Subscriber for any quarterly period, we average the monthly rates, weighted by each month's beginning subscription base. Subscriber Retention excludes BARK Air. We use Subscriber Retention to assess the durability of our subscription base.

Current wording

We define Subscriber Retention as the number of active subscriptions during a particular month divided by the number of active subscriptions for the prior month. An active subscription excludes new subscriptions, i.e. subscriptions with an initial shipment in a particular month. To calculate the Subscriber Retention for any quarterly period, we average the monthly rates, weighted by each month's beginning subscription base. Subscriber Retention excludes BARK Air. We use Subscriber Retention to assess the durability of our subscription base.

Previous wording

We also sell our BarkBox and Super Chewer toys and BARK-branded treats and chews in retail stores and other e-tailers, significantly broadening our customer reach and raising awareness of the BARK brand. BARK products are currently sold in over 50,000 retail doors, including Target, Walmart, TJ Maxx, Costco and PetSmart. Additionally, we sell our products on other online platforms including Amazon, Chewy and TikTok.

Current wording

We also sell our BarkBox and Super Chewer toys and BARK-branded treats and chews in retail stores and other e-tailers, significantly broadening our customer reach and raising awareness of the BARK brand. BARK products are currently sold in over 50,000 retail doors, including Costco, Target, TJX, and Walmart. Additionally, we sell our products on other online platforms including Amazon, Chewy and TikTok.

Previous wording

Announced in April 2024, BARK Air is a first-of-its kind air travel experience tailored to dogs. The Company is partnered with several charter companies offering premium flights for customers and their dogs. Interested parties can book flights at dogsflyfirst.com. Our charter partners are responsible for all aircraft, pilots, maintenance, and insurance, allowing BARK to focus on creating a great travel experience for dogs and their people worldwide. We believe this initiative exemplifies the Company’s dog-first approach to curating the best products and services.

Current wording

The Company is partnered with several charter companies offering premium flights for customers and their dogs. Our charter partners are responsible for all aircraft, pilots, maintenance, and insurance, allowing BARK to focus on creating a great travel experience for dogs and their people worldwide. Revenue generated by BARK Air is currently reflected in our DTC segment.

Previous wording

Interest expense primarily consists of interest incurred under our 2025 Convertible Notes (as defined below), and amortization of debt issuance costs.

Current wording

Interest expense consisted of interest incurred under our 2025 Convertible Notes (as defined below), and amortization of related debt issuance costs. The 2025 Convertible Notes were repaid in November 2025 and we have no outstanding indebtedness during the three and six months ended September 30, 2026.

Previous wording

(1) Direct to Consumer includes revenue and cost of goods sold from BARK Air.

Current wording

(1) Direct to Consumer includes revenue and cost of revenue from BARK Air.

Previous wording

Direct to Consumer and Commerce gross profit decreased by$9.6 million and $2.8 million, respectivelyfor the three months ended June 30, 2026 compared to the three months ended June 30, 2025. The decrease in Direct to Consumer gross profit is primarily attributable to a decrease in revenue. The decrease in Commerce gross profit attributable to lower revenue in the quarter.

Current wording

Direct to Consumer gross profit decreased by$10.8 millionfor the three months ended September 30, 2026 compared to the three months ended September 30, 2025. The decrease in Direct to Consumer gross profit is primarily attributable to a decrease in net revenue due to a decrease in Total Orders. Commerce gross profit increased by $0.4 millionfor the three months ended September 30, 2026 compared to the three months ended September 30, 2025. The increase in Commerce gross profit is attributable to higher net revenue in the quarter to existing retail customers.

Previous wording

Gross profit as a percentage of revenue increased 10.5% for the three months ended June 30, 2026 compared to the three months ended June 30, 2025.

Current wording

Gross profit as a percentage of net revenue increased 100 basis points for the three months ended September 30, 2026 compared to the three months ended September 30, 2025.

Previous wording

(1) Direct to Consumer excludes revenue and cost of goods sold from BARK Air.

Current wording

(1) Direct to Consumer excludes revenue and cost of revenue from BARK Air.

Previous wording

Advertising and marketing expense decreased by $5.7 million, or 37.4%, for the three months ended June 30, 2026 compared to the three months ended June 30, 2025. The decrease is primarily attributable to decreased Direct to Consumer marketing spend.

Current wording

Advertising and marketing expense decreased by $5.0 million, or 32.5%, for the three months ended September 30, 2026 compared to the three months ended September 30, 2025. The decrease is primarily attributable to decreased Direct to Consumer marketing spend.

Previous wording

Interest income decreased by $0.5 million, or 67.5%, for the three months ended June 30, 2026 compared to the three months ended June 30, 2025. The decrease in interest income is due to an overall decrease in cash in interest-bearing deposit accounts.

Current wording

Interest income decreased by $0.1 million, or 15.5%, for the three months ended September 30, 2026 compared to the three months ended September 30, 2025. The decrease was primarily due to a $0.6 million decline in interest earned on our cash and cash equivalents due to an overall decrease in cash in interest-bearing deposit accounts, partially offset by $0.5 million of interest income recognized on IEEPA tariff refunds receivable.

Previous wording

Direct to Consumer revenue decreasedby $22.5 million, or 25.2%, for the three months ended June 30, 2026 compared to the three months ended June 30, 2025. This decrease was primarily driven by a 28.0%, or 0.8 million decrease in Total Orders. The decrease was partially offset by an increase in revenue from BARK Air of $0.9 million. Total BARK Air revenue was $3.2 million or 4.8% of Direct to Consumer revenue.

Current wording

Direct to Consumer net revenue decreasedby$42.8 million, or 25.0%, for the six months ended September 30, 2026 compared to the six months ended September 30, 2025. This decrease was primarily driven by a 27.48%, or 1 million decrease in Total Orders. The decrease was partially offset by an increase in revenue from BARK Air of $0.8 million. Total BARK Air revenue was $6.7 million or 5.2% of Direct to Consumer net revenue.

Previous wording

We report our financial results in accordance with U.S. GAAP. However, management believes that Adjusted Net Loss, Adjusted Net Loss Margin, Adjusted Net Loss Per Common Share, Adjusted EBITDA, Adjusted EBITDA Margin, and Free Cash Flow, all non-GAAP financial measures (together the “Non-GAAP Measures”), provide investors with additional useful information in evaluating our performance.

Current wording

We report our financial results in accordance with U.S. GAAP. However, management believes that Adjusted EBITDA, Adjusted EBITDA Margin, and Free Cash Flow, all non-GAAP financial measures (together the “Non-GAAP Measures”), provide investors with additional useful information in evaluating our performance.

Previous wording

We calculate Adjusted EBITDA as net loss, adjusted to exclude: (1) interest income, (2) interest expense, (3) depreciation and amortization, (4) stock-based compensation expense, (5) change in fair value of warrants and derivatives, (6) capitalized cloud computing amortization, (7) sales and use tax income, (8) restructuring charges related to reduction in force payments, (9) litigation expenses (consisting of legal and related fees for a specific proceeding that is outside of our ordinary course of business), (10) warehouse restructuring costs, (11) non-cash impairment of previously capitalized software and cloud computing implementation costs, (12) technology modernization costs, and (13) other items (as defined below).

Current wording

We calculate Adjusted EBITDA as net loss, adjusted to exclude: (1) interest income, (2) interest expense, (3) depreciation and amortization expense, (4) stock-based compensation expense, (5) change in fair value of warrants and derivatives, (6) capitalized cloud computing amortization, (7) sales and use tax income, (8) restructuring charges related to reduction in force payments, (9) litigation expenses (consisting of legal and related fees for a specific proceeding that is outside of our ordinary course of business), (10) warehouse restructuring costs, (11) non-cash impairment of previously capitalized software and cloud computing implementation costs, (12) technology modernization costs, (13) IEEPA tariffs, and (14) other items (as defined below).

Previous wording

(1)Sales and use tax (income) expense relates to recording a liability for sales and use tax we did not collect from our customers. Historically, we had collected state or local sales, use, or other similar taxes in certain jurisdictions in which we only had physical presence. On June 21, 2018, the U.S. Supreme Court decided, in South Dakota v. Wayfair, Inc., that state and local jurisdictions may, at least in certain circumstances, enforce a sales and use tax collection obligation on remote vendors that have no physical presence in such jurisdiction. A number of states have positioned themselves to require sales and use tax collection by remote vendors and/or by online marketplaces. The details and effective dates of these collection requirements vary from state to state and accordingly, we recorded a liability in those periods in which we created economic nexus based on each state’s requirements. Accordingly, we now collect, remit, and report sales tax in all states that impose a sales tax. Subsequently, as certain of these liabilities are waived by tax authorities or the applicable statute of limitations expires, the related accrued liability is reversed.

Current wording

(2)Sales and use tax income relates to recording a liability for sales and use tax we did not collect from our customers. Historically, we had collected state or local sales, use, or other similar taxes in certain jurisdictions in which we only had physical presence. On June 21, 2018, the U.S. Supreme Court decided, in South Dakota v. Wayfair, Inc., that state and local jurisdictions may, at least in certain circumstances, enforce a sales and use tax collection obligation on remote vendors that have no physical presence in such jurisdiction. A number of states have positioned themselves to require sales and use tax collection by remote vendors and/or by online marketplaces. The details and effective dates of these collection requirements vary from state to state and accordingly, we recorded a liability in those periods in which we created economic nexus based on each state’s requirements. We now collect, remit, and report sales tax in all states that impose a sales tax. Subsequently, as certain of these liabilities are waived by tax authorities or the applicable statute of limitations expires, the related accrued liability is reversed.

Previous wording

(2)Litigation expenses related to a shareholder class action complaint, see Part II, Item 1. Legal Proceedings.

Current wording

(4)Litigation expenses related to a shareholder class action complaint, see Part II, Item 1. Legal Proceedings.

Previous wording

(3)Includes consulting fees related to technology transformation activities, and payroll costs for employees that dedicate significant time to this project. We believe that these costs are discrete and non-recurring in nature, as they mainly relate to a one-time unification of our product offerings on our new commerce platform. As such, they are not normal, recurring operating expenses and are not reflective of ongoing trends in the cost of doing business.

Current wording

(6)Includes consulting fees related to technology transformation activities, and payroll costs for employees that dedicate significant time to this project. We believe that these costs are discrete and non-recurring in nature, as they mainly relate to a one-time unification of our product offerings on our new commerce platform. As such, they are not normal, recurring operating expenses and are not reflective of ongoing trends in the cost of doing business.

Previous wording

(4) For the three months ended June 30, 2026, other items is comprised of executive transition costs including recruiting costs of $0.2 million. For the three months ended June 30, 2025, other items is comprised of costs associated with the share repurchase program of less than $0.1 million.

Current wording

(8)Other items consisted primarily of executive transition costs, including recruiting costs, of $0.1 million for each of the three months ended September 30, 2026 and 2025, and $0.4 million and $0.1 million for the six months ended September 30, 2026 and 2025, respectively, as well as less than $0.1 million of share repurchase program costs in the six months ended September 30, 2025.

Previous wording

Since inception, we have funded our operations with proceeds from sales of our capital stock and proceeds from borrowings in addition to cash generated by our operations. As of June 30, 2026, we had cash and cash equivalents of approximately $16.1 million. We expect that our cash and cash equivalents, together with cash provided by our operating activities and proceeds from borrowings, will be sufficient to fund our operations for at least the next 12 months. We are required to comply with certain financial and non-financial covenants related to our borrowing agreements, which we expect to be in compliance with during the next 12 months. Our future capital requirements will depend on many factors, including our pace of new and existing customer growth and our investments in partnerships and unexplored channels. We may be required to seek additional equity or debt financing.

Current wording

We fund our operations with cash generated by our businesses. As of September 30, 2026, we had cash and cash equivalents of approximately $19.0 million. We expect that our cash and cash equivalents, together with cash provided by our operating activities and proceeds from borrowings, will be sufficient to fund our operations for at least the next 12 months. We are required to comply with certain financial and non-financial covenants related to our borrowing agreements, which we expect to be in compliance with during the next 12 months. Our future capital requirements will depend on many factors, including our pace of new and existing customer growth and our investments in partnerships and unexplored channels. We may be required to seek additional equity or debt financing.

Previous wording

The following table summarizes our cash flows for the three months ended June 30, 2026 and 2025:

Current wording

The following table summarizes our cash flows for the six months ended September 30, 2026 and 2025:

Previous wording

For the three months ended June 30, 2026, net cash used in operating activities was $3.5 million. The $3.5 million of net cash used in operating activities consisted of net gain of $0.7 million adjusted for non-cash charges totaling$5.0 million and a net decrease of $9.3 million in our net operating assets and liabilities. The non-cash charges primarily consisted of$2.8 million for stock based compensation, and depreciation and amortization of $1.8 million. The decrease in our net operating assets and liabilities was primarily driven by an decrease in inventory of $3.9 million, an increase in accounts receivable of $8.0 million and a net decrease in accounts payable and accrued expenses of $3.5 million.

Current wording

For the six months ended September 30, 2026, net cash provided by operating activities was $1.2 million. The $1.2 million of net cash provided by operating activities consisted of a net loss of $3.1 million adjusted for non-cash charges totaling$10.0 million and a net increase of $5.7 million in our net operating assets and liabilities. The non-cash charges primarily consisted of$4.9 million for stock-based compensation and depreciation and amortization of $3.5 million. The increase in our net operating assets and liabilities was primarily driven by an increase in accounts receivable of $8.0 million and a decrease in deferred revenue of $4.6 million, partially offset by a decrease in inventory of $4.0 million and a net increase in accounts payable and accrued expenses of $4.1 million.

Previous wording

For the three months ended June 30, 2025, net cash used in operating activities was $5.4 million. The $5.4 million of net cash used in operating activities consisted of net loss of $7.0 million adjusted for non-cash charges totaling$6.8 million and a net increase of $5.2 million in our net operating assets and liabilities. The non-cash charges primarily consisted of$3.6 million for stock based compensation, and depreciation and amortization of $2.5 million. The increase in our net operating assets and liabilities was primarily driven by an increase in inventory of $10.3 million, offset by a increase in accounts payable and accrued expenses of $5.8 million.

Current wording

For thesix months ended September 30, 2025, net cash used in operating activities was $23.5 million. The $23.5 million of net cash used in operating activities consisted of a net loss of $17.7 million adjusted for non-cash charges totaling $15.8 million and a net increase of $21.6 million in our net operating assets and liabilities. The non-cash charges primarily consisted of $7.3 million for stock-based compensation and depreciation and amortization of $5.1 million. The increase in our net operating assets and liabilities was primarily driven by an increase in inventory of $13.8 million and an increase in accounts receivable of $7.5 million, partially offset by a net increase in accounts payable and accrued expenses of $4.3 million.

Previous wording

For the three months ended June 30, 2026, net cash used in investing activities was $0.1 million, primarily due to software development costs and capital expenditures.

Current wording

For thesix months ended September 30, 2026 and September 30, 2025, net cash used in investing activities was $0.1 million and $2.6 million, respectively, primarily due to capital expenditures.

Previous wording

Cash flows used in Operating Activities

Current wording

Cash flows used in Financing Activities

Previous wording

For the three months ended June 30, 2026, net cash provided by financing activities was $0.8 million, primarily due to the sale of common stock of $2.0 million, offset by tax payments related to the issuance of common stock of $1.0 million and repurchases of common stock of $0.2 million.

Current wording

For the six months ended September 30, 2026, net cash used in financing activities was $1.6 million, primarily due to repurchases of common stock of$2.3 million and tax payments related to the issuance of common stock of$1.3 million, partially offset by proceeds from the issuance of common stock of$2.0 million.