BranchOut Food Inc.
For the period ended Jun 30, 2025. Filed Aug 13, 2025.
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.
Jun 30, 2025 · Filed Aug 13, 2025
BOF$1.68-2.3%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-03-31; filed 2025-05-15.
0001641172-25-010566
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-06-30; filed 2025-08-13.
0001641172-25-023605
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 51 previous paragraphs and 81 current paragraphs.
31 unchanged; 15 reworded; 31 added; 5 removed; 0 previous and 4 current paragraphs rearranged.
Tables are not compared: 5 previous and 8 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 (31)
Current report
BranchOut Food Inc., is reimagining how the world eats fruits and vegetables. We are engaged in the development, marketing, sale and distribution of plant-based, dehydrated fruit and vegetable snacks and powders manufactured in a 50,000 square foot production facility that we lease in Pisco, Peru (the “Peru Facility”). At the Peru Facility, utilizing proprietary GentleDry™ Technology, we are able to turn fresh fruits and vegetables into clean, crunchy snacks and industrial ingredients within just 10 days.
Current report
GentleDry™ Technology is an advanced dehydration platform licensed to us exclusively by EnWave Corporation for certain fruits and vegetables. This technology allows us to develop differentiated fruit and vegetable products using optimized GentleDry™ settings that preserve taste, texture, color, and nutrients.
Current report
We believe GentleDry™ is superior to traditional freeze-dry processing because it retains:
Current report
Additionally, our process speed is faster, making us more energy efficient; our food doesn’t oxidize, preserving the flavor and color; and our technology is protected by more than 17 patents.
Current report
Gross margin increased primarily due to the transition of manufacturing operations from third-party suppliers to our facility located in Pisco, Peru. This insourcing initiative created greater control over production processes, improved product quality, reduced contract manufacturing costs, and improved overall efficiency shortening the production cycle and allowing for faster order fulfillment. As production continues to scale, we expect further margin expansion from manufacturing existing products more efficiently and from our enhanced ability to bring new products to market more quickly.
Current report
Idle capacity increased due to the opening of the production facility located in Pisco, Peru. In December 2024 operations commenced at the facility. As our factory scales, idle capacity will decrease. Commissions increased due to increased sales.
Current report
Salaries and wages for the three months ended June 30, 2025, was $436,163, compared to $349,597 for the three months ended June 30, 2024, an increase of $86,566, or 25%. This increase was primarily attributable to $28,494 of amortization of stock options issued to employees for services performed.
Current report
Professional fees for the three months ended June 30, 2025, was $323,062, compared to $304,376 for the three months ended June 30, 2024, an increase of $18,686, or 6%. The modest increase primarily reflects normal fluctuations in legal, consulting, and accounting expenses and does not represent a significant change in the level of professional services utilized.
Current report
Shipping and handling
Current report
Shipping and handling for the three months ended June 30, 2025, was $157,807, compared to $88,384 for the three months ended June 30, 2024, an increase of $69,423 or 79%. This increase was primarily attributable to an increase in sales volumes.
Current report
Advertising and promotions
Current report
Advertising and promotions for the three months ended June 30, 2025, was $250,576, compared to $57,059 for the three months ended June 30, 2024, an increase of $193,517, or 339%. Advertising and promotions expenses increased for the three months ended June 30, 2025, mostly due to increased in-store product demos with one of our largest customers.
Current report
Net loss for the three months ended June 30, 2025, was $1,603,156, compared to $942,554 for the three months ended June 30, 2024, an increase of $660,602, or 70%. The increased net loss was due to scaling up production at our in-house manufacturing facility. Our objective is to achieve 100% utilization, which we believe will allow us to leverage fixed costs, improve operating efficiency, and capture additional gross margin benefits as production volumes grow.
Current report
Results of Operations for the Six Months Ended June 30, 2025, and 2024
Current report
Net Revenue
Current report
Our cost of goods sold for the six months ended June 30, 2025, was $5,334,286, compared to $2,397,655 for the six months ended June 30, 2024, an increase of $2,936,631, or 122%. Cost of goods sold increased primarily due to increased sales during the six months ended June 30, 2025. As a result of the foregoing, we had gross profit of $1,158,974, representing gross margins of 17.8%, for the six months ended June 30, 2025, as compared to a gross margin of $432,347, of 15.3%, for the six months ended June 30, 2024.
Current report
Gross margin increased primarily due to the transition of manufacturing operations from third-party suppliers to our facility located in Pisco, Peru. This insourcing initiative created greater control over production processes, improved product quality, reduced contract manufacturing costs, and improved overall efficiency shortening the production cycle and allowing for faster order fulfillment. As production continues to scale, we expect further margin expansion from manufacturing existing products more efficiently and from our enhanced ability to bring new products to market more quickly.
Current report
General and Administrative
Current report
Our general and administrative expense for the six months ended June 30, 2025, was $1,307,047, compared to $349,912 for the six months ended June 30, 2024, an increase of $957,135, or 274%. The largest components of our general and administrative expenses are plant idle capacity, rent, travel, and commissions, as shown below.
Current report
Idle capacity increased due to the opening of the production facility located in Pisco, Peru. In December 2024 operations commenced at the facility. As our factory scales, idle capacity will decrease. Rent increase is related to the Pisco, Peru production facility. Travel increased due to the opening of the facility in Peru and sales initiatives to expand production distribution. Commissions increased due to increased sales.
Current report
Salaries and Wages
Current report
Professional Fees
Current report
Shipping and handling
Current report
Shipping and handling for the six months ended June 30, 2025, was $264,352, compared to $192,821 for the six months ended June 30, 2024, an increase of $71,531 or 37%. This increase was primarily attributable to an increase in sales volumes.
Current report
Advertising and promotions
Current report
Advertising and promotions for the six months ended June 30, 2025, was $307,635, compared to $98,204 for the six months ended June 30, 2024, an increase of $209,431, or 213%. Advertising and promotions expenses increased for the six months ended June 30, 2025, compared to the corresponding period in 2024, mostly due to increased in-store product demos with one of our largest customers.
Current report
Other Income (Expense)
Current report
Net loss
Current report
Net loss for the six months ended June 30, 2025, was $2,521,538, compared to $1,993,521 for the six months ended June 30, 2024, an increase of $528,017, or 26%. The increased net loss was due to scaling up production at our in-house manufacturing facility. Our objective is to achieve 100% utilization, which we believe will allow us to leverage fixed costs, improve operating efficiency, and capture additional gross margin benefits as production volumes grow.
Current report
Effect of Exchange Rate Changes on Cash
Current report
For the six months ended June 30, 2025, the effect of exchange rate changes on cash and cash equivalents primarily reflects the translation impact from fluctuations in the value of the Peruvian sol relative to the U.S. dollar. During the period, the sol experienced modest depreciation against the U.S. dollar, resulting in a gain on foreign currency translation of $28,763 compared to $58 in the comparative period.
Removed paragraphs (5)
Previous report
We were incorporated as AvoChips Inc., an Oregon corporation, on February 21, 2017, and on November 2, 2017, we converted into Avochips, LLC, an Oregon limited liability company. On November 19, 2021, we converted from an Oregon limited liability company into BranchOut Food Inc., a Nevada corporation.
Previous report
We are engaged in the development, marketing, sale, and distribution of plant-based, dehydrated fruit and vegetable snacks and powders. Our products have historically been manufactured for us by two contract manufacturers, one based in the Republic of Chile, and the other in the Republic of Peru, which housed our large-scale continuous through-put dehydration machine that completed its first production run in the first quarter of 2023. Our dehydrated fruit and vegetable products are produced using a new proprietary dehydration technology licensed by us from a third party. Our customers are primarily located throughout the United States. In 2024, we decided to initiate our own production facility in Peru to become vertically integrated. We recently completed the build out of the new facility, which commenced operations in December 2024, and utilizes three large-scale REV machines (a REV 60, REV 100 and REV 120)thatwe recently purchased from EnWave, as well as, a small REV 10 R&D machine that is being used for product development and customer sample purposes. We expect operating margins to be further improved in 2025, as we become more vertically integrated with the transition of more of our production from third party contract manufacturers to internal production.
Previous report
Using our licensed technology platform, we believe our lines of branded, private-label and industrial ingredient products positively address current consumer trends. In our experience, conventional dehydration methods, such as freeze-drying and air drying, tend to degrade most fruit and vegetables through oxidation, browning/color degradation, nutritional content reduction and/or flavor loss. As a result, certain highly sensitive fruits, such as avocados and bananas, have not previously been successfully offered as a dehydrated base for consumer products. We believe that our licensed technology platform and process is the only way to produce quality avocado and banana-based snack and powdered products. Additionally, we believe our licensed technology platform produces superior products when using other fruits and vegetables when compared to conventional drying and dehydration technologies. We license technology, consisting of a portfolio of patents, and purchased production machines, from EnWave, and we have been granted the exclusive rights to use the licensed technology platform as applied to several products in Peru, and avocado based products in the United States. In addition, BranchOut has the nonexclusive rights to use the licensed technology platform for other products.
Previous report
Advertising and marketing expenses increased for the three months ended March 31, 2025, compared to the corresponding period in 2024, as we increased our marketing efforts in the current period, given greater available resources. Our rent increased primarily due to leases entered into in the latter half of the prior year, as we began to develop our operating facility in Peru, which resulted in increased travel expenses for the same reason. Sales commissions decreased as we focused most of our resources on servicing our largest customer. We expect commissions to increase as we grow. Storage, shipping and handling expenses increased primarily due to increased international shipping rates and increased production that was driven by our increased sales.
Previous report
Net loss for the three months ended March 31, 2025 was $918,382, compared to $1,050,967 for the three months ended March 31, 2024, a decrease of $132,585, or 13%. The decreased net loss was primarily due to increased gross profits and a $521,954 decrease in stock-based compensation, as partially offset by $366,043 of increased general and administrative expenses.
Reworded paragraphs (15)
Previous wording
As of March 31, 2025, we had a cash balance of $2,386,381, a working capital deficit of $2,736,656 and had incurred recurring losses from operations resulting in an accumulated deficit of $18,480,439. Although we anticipate that our results of operations will improve substantially as a result of the recent launch of our new facility in Peru, there can be no assurance in that regard. If we continue to generate substantial operating losses, we will not have sufficient funds to sustain our operations for the next twelve months and we will need to raise additional cash to fund our operations. These factors raise substantial doubt about our ability to continue as a going concern.
Current wording
As of June 30, 2025, we had a cash balance of $641,129, a positive working capital of $662,217, and had incurred recurring losses from operations resulting in an accumulated deficit of $20,083,595. Although we anticipate that our results of operations will improve substantially as a result of the recent launch of our new facility in Peru, there can be no assurance in that regard. If we continue to generate substantial operating losses, we will not have sufficient funds to sustain our operations for the next twelve months and we will need to raise additional cash to fund our operations. These factors raise substantial doubt about our ability to continue as a going concern.
Previous wording
On April 26, 2024, we formed BranchOut Food Sucursal Peru for the purpose of developing a production facility to produce our products in Peru. On May 10, 2024 we entered into a ten-year lease for our 50,000 square-foot food processing plant located in Peru (the “Peru Facility”). The lease of the Peru Facility requires us to make monthly lease payments of $8,000 in the first two years of the lease, $20,000 in the third year of the lease, $22,000 in the fourth year of the lease, $24,000 in the fourth year of the lease, and $25,000 thereafter. The lease also has a 10-year renewal option, and a buy-out option under which we may purchase the facility for $1,865,456. We began manufacturing products at the Peru Facility in December of 2024, and produced approximately $1,450,000 of products during the first quarter of 2025.
Current wording
On May 10, 2024, we entered into a ten-year lease for the 50,000 square-foot Peru Facility, which commenced operations in December of 2024. The lease of the Peru Facility requires monthly lease payments of $8,000 in the first two years of the lease, $20,000 in the third year of the lease, $22,000 in the fourth year of the lease, $24,000 in the fourth year of the lease, and $25,000 thereafter. The lease also has a 10-year renewal option, and a buy-out option under which the Company plans to exercise the buy-out option and purchase the Peru Facility for $1,865,456.
Previous wording
In connection with our lease of the Peru Facility, we paid $275,000 on May 10, 2024, $80,000 during the fourth quarter of 2024, and another $456,000 during the first quarter of 2025 as part of the purchase of a first position mortgage receivable in the amount of $1,267,000, which is secured by the Peru Facility and was owed by the landlord of the Peru Facility to its former tenant. The remaining $456,000 is due and payable in monthly installments of $152,000 through June 23, 2025, at which time an additional $55,604 of interest is due, based on a 9% financing rate.
Current wording
In connection with the lease of the Peru Facility, we purchased a first position mortgage receivable in the amount of $1,267,000, which is secured by the Peru Facility and was owed by the landlord of the Peru Facility to its former tenant, for a purchase price of $1,267,000, of which payments were made in various installments totaling $355,000 as of December 31, 2024 and $912,000 during the six months ended June 30, 2025.
Previous wording
Our net revenue for the three months ended March 31, 2025 was $3,193,522, compared to $1,467,016 for the three months ended March 31, 2024, an increase of $1,726,506, or 118%. The increase in revenue was primarily due to increased sales to our two largest customers during the three months ended March 31, 2025.
Current wording
Our net revenue for the three months ended June 30, 2025, was $3,299,738, compared to $1,362,986 for the three months ended June 30, 2024, an increase of $1,936,752, or 142%. The increase in revenue was primarily due to increased sales to our largest customer during the three months ended June 30, 2025.
Previous wording
Our cost of goods sold for the three months ended March 31, 2025 was $2,641,007, compared to $1,183,428 for the three months ended March 31, 2024, an increase of $1,457,579, or 123%. Cost of goods sold increased primarily due to increased sales during the three months ended March 31, 2025. As a result of the foregoing, we had gross profit of $552,515, representing gross margins of 17%, for the three months ended March 31, 2025 as compared to a gross profit of $283,588, or gross margins of 19%, for the three months ended March 31, 2024. Our gross profit margin decreased slightly due primarily to costs incurred transitioning the production of our products to the Peru Facility. We anticipate that our margins will increase as we ramp up production and utilize more of the facility’s capacity. Cost of goods sold included depreciation expense for the three months ended March 31, 2025 of $152,262, compared to $55,823 for the three months ended March 31, 2024, an increase of $96,439, or 173%.
Current wording
Our cost of goods sold for the three months ended June 30, 2025, was $2,693,279, compared to $1,214,227 for the three months ended June 30, 2024, an increase of $1,479,052, or 122%. Cost of goods sold increased primarily due to increased sales during the three months ended June 30, 2025. We had gross profit of $606,459, representing gross margins of 18.4%, for the three months ended June 30, 2025, as compared to a gross profit of $148,759, or 10.9%, for the three months ended June 30, 2024.
Previous wording
Our general and administrative expense for the three months ended March 31, 2025 was $685,779, compared to $319,736 for the three months ended March 31, 2024, an increase of $366,043, or 114%. The largest components of our general and administrative expenses are advertising and marketing, rent, travel, commissions, and storage, shipping and handling expense, as shown below.
Current wording
Our general and administrative expense for the three months ended June 30, 2025, was $784,872, compared to $175,758 for the three months ended June 30, 2024, an increase of $609,114, or 347%. The largest components of our general and administrative expenses are plant idle capacity, rent, travel, and commissions, as shown below.
Previous wording
In the three months ended March 31, 2025, other expense was $235,842 on a net basis, consisting of $240,978 of interest expense, as partially offset by $5,136 of interest income. For the three months ended March 31, 2024, other expense was $25,867 on a net basis, consisting of $28,744 of interest expense, as partially offset by $2,877 of interest income. Other expense increased by $209,975, or 812%, primarily due to interest on increased outstanding debt as we funded our expansion into Peru during 2024.
Current wording
In the three months ended June 30, 2025, other expense was $257,135 on a net basis, consisting of $263,735 of interest expense, as partially offset by $6,600 of interest income. For the three months ended June 30, 2024, other expense was $116,139 on a net basis, consisting of $118,957 of interest expense, as partially offset by $2,818 of interest income. Other expense increased by $140,996, or 121%, primarily due to the increase of interest on the Kaufman Convertible Note and Notes Payable with related parties.
Previous wording
Salaries and wages for the three months ended March 31, 2025 was $314,242, compared to $598,286 for the three months ended March 31, 2024, a decrease of $284,044, or 47%. This decrease was primarily attributable to $376,384 of non-cash, stock-based compensation related to stock options awarded during the prior period, compared to $4,024 of non-cash, stock-based compensation related to stock options awarded during the current period.
Current wording
Salaries and wages for the six months ended June 30, 2025, was $750,405, compared to $947,883 for the six months ended June 30, 2024, a decrease of $197,478, or 21%. This decrease was primarily attributable to $394,135 of non-cash, stock-based compensation for the six months ended June 30, 2024, compared to $81,097 of non-cash, stock-based compensation related to stock options awarded during the current period.
Previous wording
Professional fees for the three months ended March 31, 2025 was $235,034, compared to $390,666 for the three months ended March 31, 2024, a decrease of $155,632, or 40%. This decrease was primarily attributable to $149,594 of non-cash, stock-based compensation for the three months ended March 31, 2024 that were not incurred during the current period.
Current wording
Professional fees for the six months ended June 30, 2025, was $558,096, compared to $695,042 for the six months ended June 30, 2024, a decrease of $136,946, or 20%. This decrease was primarily attributable to $290,085 of non-cash, stock-based compensation for the six months ended June 30, 2024.
Previous wording
As of March 31, 2025, we had negative working capital of $2,736,656. We have incurred net losses since our inception and we anticipate net losses and negative operating cash flows for the near future, and we may not be profitable or realize growth in the value of our assets. To date, our primary sources of capital have been cash generated from the sales of our products, common stock sales, and debt and equity financing. As of March 31, 2025, we had cash of $2,386,381, total liabilities of $10,230,144, and an accumulated deficit of $18,480,439. As of December 31, 2024, we had cash of $2,329,452, total liabilities of $10,514,292, and an accumulated deficit of $17,562,057.
Current wording
As of June 30, 2025, we had working capital of $662,217. We have incurred net losses since our inception and we anticipate net losses and negative operating cash flows for the near future, and we may not be profitable or realize growth in the value of our assets. To date, our primary sources of capital have been cash generated from the sales of our products, common stock sales, and debt and equity financing. As of June 30, 2025, we had cash of $641,129, total liabilities of $9,608,777, and an accumulated deficit of $20,083,595. As of December 31, 2024, we had cash of $2,329,452, total liabilities of $10,514,292, and an accumulated deficit of $17,562,057.
Previous wording
Comparison of the Three Months Ended March 31, 2025 and the Three Months Ended March 31, 2024
Current wording
Comparison of the Six Months Ended June 30, 2025, and the Six Months Ended June 30, 2024
Previous wording
Net cash used in operating activities was $1,927,122 for the three months ended March 31, 2025, compared to $503,578 for the three months ended March 31, 2024, an increase of $1,423,544, or 283%. The increase was primarily due to our increased accounts receivable as of March 31, 2025.
Current wording
Net cash used in operating activities was $3,942,856 for the six months ended June 30, 2025, compared to $1,357,463 for the six months ended June 30, 2024, an increase of $2,610,442, or 190%. The increase was primarily due to a $1,440,275 increase in accounts receivable due to increased sales volumes and a $548,367 increase in prepaid inventory to secure raw materials.
Previous wording
Net cash used in investing activities was $377,841 for the three months ended March 31, 2025, compared to $40,100 for the three months ended March 31, 2024, an increase of $337,741, or 842%. This increase was primarily attributable to $377,841 of property and equipment purchases, compared to $50,000 of property and equipment purchases, as partially offset by $9,900 of advances received on notes receivable, in the comparative period.
Current wording
Net cash used in investing activities was $491,332 for the six months ended June 30, 2025, compared to $566,431 for the six months ended June 30, 2024, a decrease of $75,099, or 13%. This decrease was primarily attributable to $491,332 of equipment purchases, compared to $576,331 of equipment purchases, as partially offset by $9,900 of advances received on notes receivable, in the comparative period.
Previous wording
Net cash provided by financing activities was $2,353,683 for the three months ended March 31, 2025, compared to $137,589 for the three months ended March 31, 2024, an increase of $2,216,094, or 1,611%. Our increased cash provided by financing activities was primarily from $2,445,605 of increased net proceeds received on the sale of common stock, net of $15,610 of offering costs, and $115,765 of decreased debt repayments, as partially offset by $345,000 of decreased proceeds received from related party debt financing and $276 of increased principal payments on finance leases.
Current wording
Net cash provided by financing activities was $2,717,102 for the six months ended June 30, 2025, compared to $2,202,108 for the six months ended June 30, 2024, an increase of $514,994, or 23%. Our increased cash provided by financing activities was primarily from $2,423,058 proceeds from the sale of common stock and $1,173,157 from the exercise of warrants, offset by $847,917 of principal repayments on notes payable.
Previous wording
Our financial results are affected by the selection and application of accounting policies and methods. In the three-month period ended March 31, 2025 there were no changes to the application of critical accounting policies disclosed in our Annual Report on Form 10-K for the year ended December 31, 2024.
Current wording
Our financial results are affected by the selection and application of accounting policies and methods. As of April 1, 2025, we changed our manufacturing cost allocation methodology from kilograms produced, to machine hours used in production, to improve costing as we scale product mix and invest in research and development. The change resulted in an immaterial impact to the valuation of inventory and resulting costs of goods sold from our Annual Report on Form 10-K for the year ended December 31, 2024.
Rearranged current paragraphs (4)
Current report — wording carried from elsewhere
The following table summarizes selected items from the statement of operations for the six months ended June 30, 2025, and 2024, respectively.
Current report — wording carried from elsewhere
Our net revenue for the six months ended June 30, 2025, was $6,493,260, compared to $2,830,002 for the six months ended June 30, 2024, an increase of $3,663,258, or 129%. The increase in revenue was primarily due to increased sales to our two largest customers during the six months ended June 30, 2025.
Current report — wording carried from elsewhere
Cost of Goods Sold and Gross Profit
Current report — wording carried from elsewhere
In the six months ended June 30, 2025, other expense was $492,977 on a net basis, consisting of $504,713 of interest expense, as partially offset by $11,736 of interest income. For the six months ended June 30, 2024, other expense was $142,006 on a net basis, consisting of $147,701 of interest expense, as partially offset by $5,695 of interest income. Other expense increased by $350,971, or 247%, primarily due to interest on the Kaufman Convertible Note and Notes Payable with related parties.