Solo Brands, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(amounts in thousands)

NOTE 1 –Significant Accounting Policies

Included below are selected significant accounting policies. Refer to Note 2 - Significant Accounting Policies, within the annual consolidated financial statements in the Company’s 2024 Form 10-K for the full list of significant accounting policies.

Basis of Presentation

The unaudited consolidated financial statements contained herein have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) and the rules of the Securities and Exchange Commission (the “SEC”). Accordingly, these unaudited consolidated financial statements do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring adjustments) necessary for a fair statement of the results of operations, financial position and cash flows for the periods presented have been reflected. The unaudited consolidated financial statements include those of our wholly-owned and majority-owned subsidiaries and the entity consolidated under the variable interest entity model. Intercompany balances and transactions are eliminated in consolidation. These unaudited consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements included in the 2024 Form 10-K. Certain prior period amounts have been conformed to the current period’s presentation.

Reverse Stock Split

On July 8, 2025, the Company filed a Certificate of Amendment to its Amended and Restated Certificate of Incorporation with the Secretary of State of the State of Delaware to effect a reverse stock split of all issued and outstanding shares of the Company’s common stock at a ratio of 1-for-40. The reverse stock split did not change the par value or the authorized number of shares of the Company’s common stock. The Company’s condensed consolidated financial statements present the retroactive effect of the reverse stock split on the Company’s Class A and Class B common stock and per share amounts for all periods presented.

Going Concern Evaluation

The consolidated financial statements have been prepared in accordance with U.S. GAAP assuming the Company will continue as a going concern. The going concern assumption contemplates the realization of assets and satisfaction of liabilities in the normal course of business. As of the filing dates of the Company’s Annual Report on Form 10-K for the year ended December 31, 2024 and Quarterly Report on Form 10-Q for the three months ended March 31, 2025, the Company concluded that substantial doubt existed about the Company’s ability to continue as a going concern for one year following the issuance of each of the financial statements as a result of the Company’s net losses, accumulated deficit and liquidity position, as well as the Company’s noncompliance with certain financial covenants under the credit agreement governing the 2021 Revolving Credit Facility (as defined herein) and the 2021 Term Loan (as defined herein) as of March 31, 2025.

On June 13, 2025, the Company entered into Amendment No. 4 to Credit Agreement and Limited Waiver and Amendment No. 1 to Security Agreement (the “2025 Refinancing Amendment”), which amends the credit agreement dated as of May 12, 2021 (as amended by Amendment No. 1, dated as of June 2, 2021, Amendment No. 2, dated as of September 1, 2021, Amendment No. 3, dated as of May 22, 2023, the “Credit Agreement” and as further amended by the 2025 Refinancing Amendment, the “Amended Credit Agreement”), by and among the Borrower, JPMorgan Chase Bank, N.A., as administrative agent, collateral agent and letter of credit issuer, and the lenders party thereto.

The 2025 Refinancing Amendment amended the Credit Agreement to, among other things, effect a restructuring of all revolving loans and term loans then outstanding. The 2025 Refinancing Amendment resulted in extended maturities, lower short-term cash requirements as a result of the Company’s ability to make certain interest payments in-kind, and deferral with respect to compliance with certain financial covenants for a certain period of time, as further described below. As a result, the 2025 Refinancing Amendment provided the Company with financial flexibility and a longer runway to continue the Company’s efforts to stabilize and transform the business. Following the 2025 Refinancing Amendment, the Company’s plans continue to be focused on improving its financial results and liquidity through a variety of cost saving and operational improvements throughout 2025 and beyond as further discussed in Note 2, Restructuring, Contract Termination and Impairment Charges.

As a result of the factors noted above, the substantial doubt surrounding the Company’s ability to continue as a going concern that was raised as of the issuance date of the December 31, 2024 and March 31, 2025 financial statements was alleviated. The Company is required to meet a Credit Agreement Adjusted EBITDA floor of $25 million for the twelve months ended December 31, 2025. In addition, the Company must comply with other financial covenants under the 2025 Refinancing Amendment, including a minimum fixed charge coverage ratio, a maximum leverage ratio and a minimum liquidity amount, with first full measurement period for such financial covenants to occur in the third quarter of 2026, as well as other non-financial covenants. While the 2025 Refinancing Amendment included amended financial covenants, as described in further detail in Note 11, Debt, Net, the Company expects to be in compliance with such covenants and believes its cash, cash equivalents and cash from operating activities will be sufficient to fund the Company’s obligations for at least the next twelve months following the issuance of these financial statements.

If the Company fails to realize the expected benefits from its cost saving and operational improvement initiatives, if the Company’s liquidity condition deteriorates, or if the Company pursues potential growth opportunities that are not successful, the Company’s business, operating results and financial condition could be materially adversely impacted and could result in the violation of its financial and nonfinancial covenants, which may require it to seek additional funds from issuances of equity or debt, including from additional credit facilities or loans from other sources. There is no guarantee that such sources will be available when needed, or at all.

Use of Estimates

The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, and expenses during the reporting period and disclosure of contingent assets and liabilities at the date of the consolidated financial statements. Estimates and assumptions about future events and their effects cannot be made with certainty. Estimates may change as new events occur when additional information becomes available and if the operating environment changes. Actual results could differ from estimates.

Debt Issuance Costs

Debt issuance costs related to term debt are recorded as a direct deduction from the carrying value of the associated debt liability on the consolidated balance sheets. The costs are amortized using the effective interest rate method over the term of the related debt. Debt issuance costs related to revolving loans are recorded within other non-current assets and amortized straight-line over the term of the related debt. Amortization of debt issuance costs are recorded as a component of interest expense, net on the consolidated statements of operations and comprehensive income (loss). Costs incurred in connection with an expected refinancing, restructuring or debt issuance are capitalized and recorded within other non-current assets. Upon completion of the transaction, such costs are reclassified to their appropriate presentation based on the nature of the resulting debt instrument.

Restructuring, Contract Termination and Impairment Charges

Restructuring, contract termination and impairment charges are primarily comprised of severance and employee-related benefits, contract termination fees and asset impairment charges. We recognize employee severance costs as a liability at estimated fair value, at the time of communication to employees, unless future service is required, in which case the costs are recognized ratably over the future service period. Contract termination fees include costs incurred to terminate a contract and the impacts to related assets or liabilities associated with these contracts. Asset impairment charges include impairments of long-lived assets and goodwill, as addressed in Note 2 - Significant Accounting Policies, in the 2024 Form 10-K. Restructuring, contract termination and asset impairment activities are recognized when they are incurred and included in restructuring, contract termination and impairment charges on the consolidated statements of operations and comprehensive income (loss).

Commitments and Contingencies

From time to time, the Company is involved in various legal proceedings. While the Company intends to prosecute and defend any lawsuit vigorously, the Company presently believes that the ultimate outcome of any currently pending legal proceeding will not have any material adverse effect on its financial position, cash flows, or results of operations. However, litigation is subject to inherent uncertainties and unfavorable rulings could occur. An unfavorable ruling could include monetary damages, which could impact the Company’s business and the results of operations for the period in which the ruling occurs or future periods. Based on the information available, the Company evaluates the likelihood of potential outcomes. The Company records the appropriate liability when the amount is deemed probable and reasonably estimable. In addition, the Company does not accrue for estimated legal fees and other directly related costs as they are expensed as incurred. The consolidated balance sheets do not include a liability for any potential obligations as of September 30, 2025 or December 31, 2024.

Recently Issued Accounting Pronouncements - Not Yet Adopted

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, that requires presentation of specific categories of reconciling items, as well as reconciling items that meet a quantitative threshold, in the reconciliation between the income tax provision and the income tax provision using statutory tax rates. The ASU also requires disclosure of income taxes paid disaggregated by jurisdiction with separate disclosure of income taxes paid to individual jurisdictions that meet a quantitative threshold. The amendments in this accounting standard are effective for fiscal years beginning after December 15, 2024, on a prospective basis. Early adoption and retrospective application are permitted. The adoption of this standard is not expected to have a material impact on the Company’s consolidated financial statements but will require certain additional disclosures in the Company’s financial statements for the year ending December 31, 2025.

In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40), expanding disclosure requirements related to certain income statement expenses. The ASU also requires tabular disclosure of certain operating expenses disaggregated into categories, such as purchases of inventory, employee compensation, and depreciation. The FASB subsequently issued ASU 2025-01, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40) to clarify the effective date of ASU 2024-03. The guidance is effective for fiscal years beginning after December 15, 2026, on a prospective basis, with retrospective application being optional. The adoption of this standard is not expected to have a material impact on the Company’s consolidated financial statements but will require certain additional disclosures.

NOTE 2 -Restructuring, Contract Termination and Impairment Charges

2025 Restructuring Activity

In 2025, management and the Board of Directors of the Company engaged strategic consulting firms to assist the Company with improving financial results from its operations. This operational improvement effort involved the engagement of restructuring, legal and investment banking consultants to perform financial planning, forecasting and project management activities. Certain of these strategic consulting firms assisted in developing operational plans for the near- and long-term, as well as having assisted and continuing to assist in identifying cost saving initiatives to reduce the operational expenses of the Company and aid in the development of enhanced internal reporting to deliver timely insight to management. Expenses related to these strategic consulting firms recognized within restructuring were $0.5 million and $7.0 million for the three and nine months ended September 30, 2025, respectively.

The cost saving initiatives identified and executed upon in the nine months ended September 30, 2025 have been designed to reduce operational expenditures over the long-term. The key cost saving initiatives and operational planning activities undertaken in the nine months ended September 30, 2025 in excess of $0.5 million, for which the Company recorded the related charges to restructuring, contract termination and impairment charges on the consolidated statements of operations and comprehensive income (loss) as applicable, were as follows (all amounts listed are year to date, with the amounts for the three months ended September 30, 2025 included in the table below):

•Restructuring

◦retention payments to key personnel to support the sustainment of operations and focus on cost saving and operational improvements, resulting in a restructuring charge of $5.7 million;

◦reduction in force (“RIF”) of management and non-management personnel in an effort to align headcount with the operational needs of the business, resulting in a moderate decline in related expenses in the short term, with the significance of the savings anticipated to be recognized in future periods, resulting in a restructuring charge of $1.0 million;

◦expenses related to the strategic consulting firms discussed above, resulting in a restructuring charge of $7.0 million;

•Contract Terminations

•termination of an underperforming licensing agreement in an effort to redeploy the allocated funds for operational purposes, resulting in a charge to contract termination of $2.5 million;

•settlement of a termination fee with a former advertising services vendor, with a previously accrued balance of $5.4 million that was settled for $4.0 million, a $1.4 million benefit to the Company; and

•closure oftwo distribution centers in the first half of 2025 andone distribution center in the third quarter of 2025 to reduce fixed costs in the short term and in future periods, as well as eliminate unnecessary capacity, resulting in charges to restructuring of $1.5 million, contract termination of $0.2 million and impairment of $0.5 million, or an aggregate charge to expense of $2.2 million.

2024 Restructuring Activity

In 2024, the Company underwent a significant change in management and personnel across the organization. The management team engaged in a detailed review of the business and its brand level components, both internally and through the engagement of external strategic partners. Management developed a strategic plan focused on returning the Company back to growth. This strategic plan involved the following activities:

•termination of underperforming marketing agreements with marketing barter partners that no longer aligned with the Company’s current marketing strategy;

•charges related to the IcyBreeze reporting unit stemming from underperformance and management’s determination to revise product design; and

•reorganization of the Oru and ISLE reporting units to eliminate costs and capitalize on potential synergies, through restructuring under a revised management structure, which resulted in severance and other changes.

As a result of these activities, the Company recognized significant charges for restructuring and contract terminations, in addition to asset impairment charges related to IcyBreeze. This plan was completed in the fourth quarter of 2024 and, as such, there are no outstanding liabilities related to this plan as of September 30, 2025.

The components of the restructuring, contract termination and impairment charges, inclusive of the $25.0 million goodwill impairment charge recognized at the Solo Stove reporting unit in the third quarter of 2024, as discussed in Note 8, Goodwill, are as follows (in thousands):

(1)Includes other immaterial amounts that are not outlined in the narrative above.

The changes in restructuring liabilities for the nine months ended September 30, 2025 are as follows:

The following table summarizes the current liabilities related to the restructuring charges:

The Company expects to continue to evaluate and identify additional cost saving initiatives that it may execute in the near term, with potential expenses to be incurred at the onset of said initiative that will be reflected within restructuring, contract termination and/or impairment charges. As of September 30, 2025, the Company is unable to estimate the potential upfront costs of these future cost saving initiatives, due to their preliminary nature.

NOTE 3 –Revenue

The Company primarily engages in direct-to-consumer transactions, which are comprised of product sales directly from the Company’s website, and business-to-business transactions, or retail, which are comprised of product sales to retailers, including where possession of the Company’s products is taken and sold by the retailer in-store or online.

The following table disaggregates net sales by channel (in thousands):

NOTE 4 –Inventory

Inventory consisted of the following (in thousands):

NOTE 5 –Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets consisted of the following (in thousands):

(1) The retainers line item reflects certain vendors requiring advance payments for their services in 2025.

(2) The insurance line item decreased, as a result of the premium payments occurring in the fourth quarter of each year.

NOTE 6 –Property and Equipment, Net

Property and equipment, net consisted of the following:

(1) The buildings and land line items decreased as a result of the disposition of the TerraFlame manufacturing operations (as defined in Note 17, Variable Interest Entities) during the second quarter of 2025, as discussed in Note 17, Variable Interest Entities.

Depreciation expense was $1.4 million and $4.8 million for the three and nine months ended September 30, 2025, compared to $1.4 million and $3.8 million for the three and nine months ended September 30, 2024, respectively. Depreciation expense is recorded to depreciation and amortization expenses on the consolidated statements of operations and comprehensive income (loss).

NOTE 7 –Intangible Assets, Net

Intangible assets consisted of the following (in thousands):

(1) Includes aggregate impairments for brand of $6.5 million, trademarks of $5.4 million, customer relationships of $0.5 million and patents of $6.8 million as of September 30, 2025 and December 31, 2024.

Second and Third Quarters - 2025

In the second and third quarters of 2025, the Company did not identify any triggering events that would indicate the potential for impairment of its held and used long-lived asset groups.

First Quarter - 2025

In the first quarter of 2025, the Company observed the following triggering events for the Company’s held and used long-lived asset groups:

•A sustained decline in the share price of the Company’s Class A common stock as of March 31, 2025; and

•the potential impact of tariff increases.

Long-lived asset groups are determined by the lowest level of independent, identifiable cash flows, for which the Company has determined are its brands and in the case of Chubbies, the owned retail store level. As a result of the identified triggering events, the Company performed a recoverability test for the identified long-lived asset groups. The results of the test indicated that the carrying amounts for the long-lived asset groups were expected to be recoverable.

2024 Impairment Testing

In the third quarter of 2024, the Company observed the following triggering events for the Company’s held and used long-lived asset groups:

•A sustained decline in the share price of the Company’s Class A common stock as of September 30, 2024; and

•Underperformance of the IcyBreeze reporting unit for the third quarter and year to date period ended September 30, 2024;

As a result of the identified triggering events, the Company performed a recoverability test for the identified long-lived asset groups, and the results of the test indicated that the carrying amounts for the long-lived asset group of IcyBreeze were not expected to be recovered. The Company estimated the fair value of the asset group, which included the use of level 3 inputs, of IcyBreeze and wrote down the intangible assets to their estimated fair value, resulting in nominal value assigned to the existing intangible asset(s). See Note 2, Restructuring, Contract Termination and Impairment Charges for impairment considerations as they relate to the property and equipment, net of IcyBreeze.

The Company recorded an aggregate $13.3 million impairment charge to the intangible assets of IcyBreeze as of December 31, 2024. As a result of this impairment charge, the Company also reassessed the useful life of the intangible assets of IcyBreeze. As of December 31, 2024, $0.9 million of value continued to be attributable to the patent intangible asset of IcyBreeze, for which the Company expects to continue to obtain value over its remaining useful life. As such, the remaining useful life of the patent intangible asset was not revised. The impact of the impairment does not have a material impact to amortization expense in any future year.

NOTE 8 –Goodwill

The carrying value of goodwill at our Chubbies reporting unit, the only reporting unit with remaining goodwill, was $73.1 million as of September 30, 2025 and December 31, 2024.

Second and Third Quarters - 2025

In the second and third quarters of 2025, the Company did not identify any triggering events that would indicate the potential for impairment of its remaining goodwill balance.

First Quarter 2025

In the first quarter of 2025, the Company identified indications of impairment, as noted above in Note 7, Intangible Assets, Net. The Company elected to perform a qualitative goodwill analysis (“Step 0”) of the Chubbies reporting unit, which included assessing the economic conditions, industry and market considerations, cost factors, overall financial performance of the reporting unit, prior period fair values and other entity and reporting unit specific events. Based on this assessment, the Company determined that it was more likely than not that the fair value of the Chubbies reporting unit exceeded its respective carrying value as of March 31, 2025.

2024 Impairment Testing

In the third quarter of 2024, the Company observed the following indicators of impairment for the Company’s goodwill, indicating the fair value of one or more of our reporting units more likely than not did not exceed their carrying values:

•A sustained decline in the share price of the Company’s Class A common stock as of September 30, 2024; and

•Underperformance of the IcyBreeze reporting unit for the third quarter and year to date period ended September 30, 2024;

As a result of these impairment indicators, the Company determined it appropriate to perform an interim quantitative goodwill impairment test for all of its reporting units as of September 30, 2024. Through the quantitative goodwill impairment test performed as of September 30, 2024, the Company determined that the carrying amounts of the IcyBreeze and Solo Stove reporting units exceeded their respective fair values and goodwill impairment charges of $19.9 million and $25.0 million, respectively, were recognized. The Chubbies reporting unit was determined to have a fair value exceeding its book value by more than 5%.

NOTE 9 –Other Non-Current Assets

Other non-current assets consisted of the following (in thousands):

(1) The capitalized software line item increased, as a result of ongoing capitalization related to the Company’s enterprise resource planning (“ERP”) platform and web platform development for the Solo Stove segment.

(2)See Note 11, Debt, Net for details on the debt issuance costs related to the 2025 Revolving Credit Facility.

NOTE 10 –Accrued Expenses and Other Current Liabilities

Significant accrued expenses and other current liabilities were as follows (in thousands):

(1)The leases line item decreased by $2.1 million, primarily as a result of the termination of the leases for three distribution centers, as discussed in Note 2, Restructuring, Contract Termination and Impairment Charges, in 2025.

(2)The inventory line item decreased by $8.1 million, primarily as a result of timing and invoices received subsequent to December 31, 2024.

NOTE 11 –Debt, Net

Debt, net consisted of the following (in thousands):

Revolving Credit Facility and Term Loan

On May 12, 2021, the Company entered into a credit agreement with a bank (the “2021 Revolving Credit Facility”). On June 2, 2021, September 1, 2021 and May 22, 2023, the Company entered into amendments to the 2021 Revolving Credit Facility, which resulted in an increase in the maximum amount available under the 2021 Revolving Credit Facility to $350 million. The 2021 Revolving Credit Facility was scheduled to mature on May 12, 2026 and had a variable interest rate equal to either the base rate (as defined in the Credit Agreement) or SOFR plus an applicable margin. Interest was due, at a minimum, on a quarterly basis, with principal in respect of the 2021 Revolving Credit Facility, not due until maturity.

The amendment on September 1, 2021 included a provision for the Company to borrow up to $100 million under a term loan (the “2021 Term Loan”), which was in addition to the available capacity on the 2021 Revolving Credit Facility. The 2021 Term Loan was scheduled to mature on May 12, 2026 and had a variable interest rate equal to either the base rate (as defined in the credit agreement) or SOFR plus an applicable margin. Principal payments were due quarterly beginning on December 31, 2021.

During the six months ended June 30, 2025, the Company borrowed an aggregate amount of $277.3 million under the 2021 Revolving Credit Facility, all of which was refinanced with the other outstanding debt obligations in connection with the 2025 Refinancing Amendment.

On June 13, 2025, the Company entered into the 2025 Refinancing Amendment, which provided for (i) refinancing term loans, including the 2021 Term Loan, with an aggregate principal amount of $240 million (“2025 Term Loan”) and (ii) a revolving credit facility with an initial committed amount of $90 million (“2025 Revolving Credit Facility”). The 2025 Revolving Credit Facility includes (i) a sub-limit of $10 million for swing line loans and (ii) a separate sub-limit of $20 million for the issuance of letters of credit.

In connection with the entry into the 2025 Refinancing Amendment, the Company paid down (i) $136.5 million of loans under the 2021 Revolving Credit Facility, and (ii) $32.5 million of the 2021 Term Loan outstanding as of June 13, 2025. Prior to the 2025 Refinancing Amendment, a payment of $0.5 million was made on the 2021 Term Loan for the six months ended June 30, 2025.

Pursuant to the 2025 Refinancing Amendment, the maturity date of the 2025 Revolving Credit Facility and 2025 Term Loan is June 30, 2028. The Company is required to make mandatory amortization payments on the 2025 Term Loan as follows: (a) beginning with the fiscal quarter ending on June 30, 2026, the aggregate outstanding principal amount of 2025 Term Loan as of June 13, 2025 multiplied by 0.25% and (b) beginning with the fiscal quarter ending on June 30, 2027, the aggregate outstanding principal amount of the 2025 Term Loan as of June 13, 2025 multiplied by 1.00%.

Each of the 2025 Revolving Credit Facility and 2025 Term Loan bear interest at (depending on the Company’s election from time to time) either an adjusted term rate defined in the agreement based on SOFR or the base rate defined in the credit agreement, each plus an applicable margin and (ii) the 2025 Term Loan will bear interest at (depending on our election from time to time) either an adjusted term rate defined in the agreement based on SOFR or the base rate defined in the agreement, each plus an applicable margin. The interest is payable in kind (“PIK”), and thus capitalized thereon and increasing the principal balance thereof, (i) on a quarterly basis through March 31, 2026, and (ii) for the period beginning on April 1, 2026 and ending on March 31, 2027 and for which availability under the 2025 Revolving Credit Facility is less than $20.0 million, upon the Company’s election, after which time, it is only payable in cash. PIK capitalized for the three and nine months ended September 30, 2025 was $6.0 million and $7.1 million, respectively. The unfunded portion of the commitments under the 2025 Revolving Credit Facility will accrue an annual commitment fee of 0.50%. The interest rate as of September 30, 2025 on the 2025 Term Loan was 9.8%, which is approximately 200 basis points higher than the rate that would be applicable to the 2025 Revolving Credit Facility in the event there were an outstanding balance.

As a result of the 2025 Refinancing Agreement, the outstanding borrowings with maturities in excess of twelve months from September 30, 2025 on the 2025 Term Loan and 2025 Revolving Credit Facility were reclassified to non-current liabilities from current liabilities.

Subsequent to June 13, 2025 through September 30, 2025, the Company borrowed an aggregate of $19.8 million, with repayments of $19.8 million under the 2025 Revolving Credit Facility. As of September 30, 2025, availability for future draws on the 2025 Revolving Credit Facility based on the borrowing base as of such date was $60.6 million, net of $3.7 million of letters of credit issued and outstanding. Availability under the 2021 Revolving Credit Facility as of December 31, 2024 was $279.6 million, net of $1.4 million of letters of credit issued and outstanding.

In conjunction with the 2025 Refinancing Amendment, the Company incurred $23.8 million of third-party expenses, primarily related to (i) strategic consulting firms, as discussed in Note 2, Restructuring, Contract Termination and Impairment Charges, and (ii) lender fees, of which $4.4 million attributable to the 2025 Revolving Credit Facility was recognized within other non-operating, net. The Company capitalized $6.4 million related to borrowings under the 2025 Revolving Credit Facility, which were recorded to other non-current assets on the consolidated balance sheets and will be amortized on a straight-line basis through the maturity date. The remaining $13.0 million, including $12.1 million of debt issuance costs attributable to the 2025 Term Loan and $0.9 million of previously unamortized issuance costs, were recorded to long-term debt, net on the consolidated balance sheets. Additionally, in connection with the 2025 Refinancing Amendment, the Company issued 121,998 shares of Class A common stock to a certain lender in lieu of a cash consent fee. The fair value of the Class A common stock was approximately $0.8 million as of the refinancing date and was included in total debt issuance costs recorded to long-term debt, net on the consolidated balance sheets.

Long-term debt, net approximates fair value based on the variable nature of interest at market rates using Level 2 inputs within the fair value hierarchy, as defined in Note 2, Significant Accounting Policies, in the 2024 Form 10-K. See Note 15, Fair Value Measurements of this Quarterly Report for the period ended September 30, 2025 for more information regarding the fair value considerations for long-term debt, net.

Interest expense was $7.6 million and $20.7 million, net of interest income, for the three and nine months ended September 30, 2025, respectively, and $3.7 million and $10.4 million for the corresponding periods in 2024, respectively.

The Company was in compliance with all covenants under the Amended Credit Agreement as of September 30, 2025.

As of September 30, 2025, the future maturities of principal amounts of our total debt obligations, excluding finance lease obligations, through maturity and in total, consists of the following:

NOTE 12 –Other Non-Current Liabilities

Significant other non-current liabilities were as follows (in thousands):

(1)Contingent consideration declined, due to alleviation through disposition of the TerraFlame manufacturing operations, as discussed in Note 15, Fair Value Measurements and Note 17, Variable Interest Entities.

NOTE 13 –Equity-Based Compensation

The Company recognized equity-based compensation expense of $0.9 million for both the three and nine months ended September 30, 2025, with the first quarter of 2025 resulting in a net benefit due to forfeitures related to the departure of the former CEO and other key members of management at that time, and expense of $1.9 million and $4.7 million for the corresponding periods in 2024, respectively. Our stock options have contractual terms offour years toten years and become exercisable over athree-year period. Expense related to stock options is recognized on a straight-line basis over the vesting period. Expense related to restricted stock units ("RSUs") issued to eligible employees under the Solo Brands, Inc. 2021 Incentive Award Plan (the “Incentive Award Plan”) is recognized over the vesting period, generally betweentwo years andthree years, with awards prior to 2024 having afour-year vesting period. Expense related to RSUs granted to non-employee directors under the Incentive Award Plan is recognized on a straight-line basis over the vesting period, with newly appointed non-employee directors grants and grants to continuing non-employee directors vesting over aone-year period. Expense related to performance stock units (“PSUs”) is recognized on a straight-line basis from their award date to the end of the performance period, generallytwo years. Expense related to special performance stock units (“SPSUs”) is recognized on a straight-line basis from their award date to the end of the requisite service period ofthree years. Expense related to the Executive Performance Stock Units (“EPSUs”) is recognized over the derived service period.

The following table summarizes equity-based compensation awards granted and forfeited during the nine months ended September 30, 2025:

NOTE 14 –Income Taxes

Provision for Income Taxes

The Company is subject to U.S. federal, state, and local income taxes on the Company's allocable share of taxable income of Solo Stove Holdings, LLC (“Holdings”). The subsidiaries of Holdings are also subject to income taxes in the foreign jurisdictions in which they operate. We are the sole managing member of Holdings, and as a result, consolidate the financial results of Holdings. Holdings is treated as a partnership for U.S. federal and most applicable state and local income tax purposes. As a partnership, Holdings is generally not subject to U.S. federal and certain state and local income taxes. Instead, taxable income or loss is allocated to its members on a pro rata basis. We are subject to U.S. federal income taxes, in addition to state and local income taxes with respect to our allocable share of any taxable income or loss of Holdings, as well as any stand-alone income or loss generated by Solo Brands, Inc. Furthermore, we are subject to income taxes for our Chubbies, Oru Mexico and Solo Stove foreign operations.

Our forecasted annual effective tax rate (“AETR”), as calculated for our tax filing jurisdictions generating earnings, was 23.8% as of September 30, 2025. The effective income tax rate was 2.3% and (7.0)% for the three and nine months ended September 30, 2025, compared to 5.8% and 5.7% for the corresponding periods in 2024. The decrease for the three months and nine months ended September 30, 2025 were primarily driven by a decrease in the valuation allowances recorded on the Solo Brands, Inc. deferred tax assets in the current year period when compared to the same period in the prior year. Our effective income tax rate for the nine months ended September 30, 2025 is negative due to earnings generated on the Chubbies, Oru Mexico and Solo Stove foreign operations.

Income tax expense for the three and nine months ended September 30, 2025 was $(0.6) million and $4.1 million, compared to $6.9 million and $7.4 million of income tax benefit in the corresponding period in 2024. Income taxes represent federal, state, and local income taxes as calculated by our AETR of Chubbies' federal and state tax expense and Oru Mexico and Solo Stove’s foreign tax expense.

The weighted-average ownership interest in Holdings was 66.9% and 63.8% as of September 30, 2025 and 2024, respectively.

Deferred Tax Assets and Liabilities

As of September 30, 2025, the total deferred tax liability related to the basis difference in the Company's investment in Holdings wasnominal, after consideration of the valuation allowance. The total net basis difference currently recorded would reverse upon the eventual sale of its interest in Holdings as a capital loss.

During the nine months ended September 30, 2025, the Company did not recognize any deferred tax assets related to additional tax basis increases generated from expected future payments under the Tax Receivable Agreement, as defined in Note 16 - Income Taxes, to the audited consolidated financial statements included in our 2024 Form 10-K.

The Company evaluates the realizability of its deferred tax assets on a quarterly basis and establishes valuation allowances when it is more likely than not that all or a portion of a deferred tax asset may not be realized. As of September 30, 2025, the Company concluded, based on the weight of all available positive and negative evidence, that not all of the Solo Brands, Inc. deferred tax assets are more likely than not to be realized. During the year ended December 31, 2024, the Company evaluated and concluded that there was significant negative evidence related to the realizability of Oru's deferred tax assets, resulting in the Company recording a full valuation allowance against the deferred tax assets of Oru. As of September 30, 2025, there has been no change in the valuation allowance assessment related to Oru’s deferred tax assets, with a full valuation allowance remaining in place.

Tax Legislation

On July 4, 2025, the U.S. government enacted The One Big Beautiful Bill Act of 2025 which includes, among other provisions, changes to the U.S. corporate income tax system including the allowance of immediate expensing of qualifying research and development expenses and permanent extensions of certain provisions within the Tax Cuts and Jobs Act. Certain provisions are effective beginning in 2026. The Company will continue to evaluate the future impact of these tax law changes on its financial statements; however, the Company believes that due to its sustained losses it will not realize a material benefit from these changes.

NOTE 15 –Fair Value Measurements

The Company has established a fair value hierarchy which prioritizes the inputs to the valuation techniques used to measure fair value into three levels. These levels are determined based on the lowest level input that is significant to the fair value measurement. Levels within the hierarchy are defined within Note 2 - Significant Accounting Policies, in the 2024 Form 10-K.

The following tables present information about the Company’s assets and liabilities measured at fair value on a recurring basis (in thousands):

There were no transfers of financial assets and liabilities measured at fair value between the valuation hierarchy Levels 1, 2 and 3 for the nine months ended September 30, 2025 and year ended December 31, 2024.

The contingent consideration as of December 31, 2024 related to the Company’s acquisition of the TerraFlame business in 2023 and relied on forecasted results through the expected post-closing payment period. The fair value of the contingent consideration was valued using a threshold and cap (capped call) structure. This contingent consideration represented a stand-alone liability that was measured at fair value on a recurring basis at the end of each reporting period using inputs that are unobservable and significant to the overall fair value measurement and were considered a Level 3 estimate.

In connection with the disposition of the TerraFlame manufacturing operations, as described in Note 17, Variable Interest Entities, the Company remeasured the contingent consideration immediately preceding the disposition. As the contingent consideration was fully relieved as of June 30, 2025, no expense was recognized for the three months ended September 30, 2025 with a gain of $0.8 million being recognized for the nine months ended September 30, 2025. For the same periods in 2024, losses of $0.2 million and $1.7 million, respectively, were recognized as a result of the remeasurement of the fair value of the contingent consideration and were recorded to selling, general and administrative expenses on the consolidated statements of operations and comprehensive income (loss).

Financial Assets and Liabilities not Measured at Fair Value

Financial assets and liabilities that are not measured at fair value on a recurring basis on our consolidated balance sheets include cash and cash equivalents, restricted cash, accounts and notes receivable, net and notes payable and other debt. The fair value of the Company's cash and cash equivalents, accounts receivable, net and accounts payable approximate their carrying values due to the short-term nature of the instruments and are classified as Level 1 measurement in the fair value hierarchy.

With the 2025 Refinancing Amendment, as discussed in Note 11, Debt, Net, the outstanding debt of the Company is recorded at carrying value, less associated debt issuance costs, which the Company believes approximates fair value based on the variable nature of interest at market rates using Level 2 inputs.

NOTE 16 –Net Income (Loss) Per Share

Basic net income (loss) per share of Class A common stock is computed by dividing net income (loss) attributable to Solo Brands, Inc. by the weighted average number of shares of Class A common stock outstanding during the period. Diluted net income (loss) per share of Class A common stock is computed by dividing net income (loss) attributable to Solo Brands, Inc. by the weighted average number of shares of Class A common stock outstanding adjusted to give effect to potentially dilutive securities. The weighted average number of shares has been retrospectively adjusted as a result of the 1-for-40 reverse stock split effected in the third quarter of 2025. See Note 1, Significant Accounting Policies for additional information.

The following table sets forth the calculation of the basic and diluted net income (loss) per share for the Company’s Class A common stock (in thousands, except per share data):

NOTE 17 -Variable Interest Entities

Consolidated Variable Interest Entities (“VIE”)

As of September 30, 2025 and December 31, 2024, we consolidatedone entity that is a VIE, that relates to a manufacturing entity for Oru, for which we are the primary beneficiary. Through a management agreement governing the entity, we manage the entity and handle all day-to-day operating decisions. Accordingly, we have the decision-making power over the activities that most significantly impact the economic performance of our VIE and an obligation to absorb losses or receive benefits from the VIE that could potentially be significant to the VIE. These decisions and significant activities include, but are not limited to, manufacturing schedules, production processes, units of production and types of products. The Company is contractually obligated to provide financial support to the VIE.

Total assets of the VIE included on the consolidated balance sheet as of September 30, 2025 and December 31, 2024 were $2.6 million and $2.2 million, respectively. Total liabilities of the VIE included on the consolidated balance sheets as of September 30, 2025 and December 31, 2024 were $3.1 million and $2.8 million, respectively.

The VIE’s assets may only be used to settle the VIE’s obligations and may not be used for other consolidated entities. The VIE’s liabilities are non-recourse to the general credit of the Company’s other consolidated entities.

Unconsolidated VIE

In June 2025, the Company disposed of 100% of the equity interests of the subsidiaries operating the TerraFlame business, which included disposition of the TerraFlame fixed assets (collectively, the “TerraFlame manufacturing operations”)to the individuals who originally sold to the Company the equity interests in those subsidiaries in 2023 (“Former Sellers”). Further, in connection with the disposition, the Company made a $2.5 million cash payment to the Former Sellers, in consideration for the termination of the Equity Purchase Agreement executed in 2023 and satisfaction of the remaining contingent consideration, which had a fair value of $6.4 million as of the date of the transaction.

The purpose of the transaction was for the Company to maintain exclusive rights to TerraFlame intellectual property and the right to distribute TerraFlame products, while reducing costs to operate the business, and to allow the Former Sellers the opportunity to use the fixed assets of the TerraFlame business, which primarily consist of a manufacturing facility, the related equipment to produce TerraFlame and other concrete based products and the TerraFlame assembled workforce in Mexico, to pursue other business opportunities. Thus, the Company retained the intellectual property and all finished goods of TerraFlame, as it will continue to be the exclusive distributor of TerraFlame products. In line with the transaction, the Company and the Former Sellers executed a supply agreement in which the Former Sellers have agreed to continue to manufacture TerraFlame products and sell these products to the Company at cost plus a specified margin, as well as a required annual minimum purchase commitment of $0.8 million.

In addition to the gain of $0.7 million recognized on remeasurement of the contingent consideration as of June 12, 2025, as discussed in Note 15, Fair Value Measurements, the Company recognized a loss of $1.4 million upon deconsolidation as of June 30, 2025, which was recorded to other operating expenses on the consolidated statements of operations and comprehensive income (loss). The assets transferred to the Former Sellers, which had a net book value of $5.5 million, were deconsolidated from the consolidated balance sheets as of June 30, 2025 and the remaining contingent consideration, which had a fair value of $6.4 million as of the transaction date, was relieved.

The Company performed a VIE analysis and determined that TerraFlame was a VIE, but that the Company is not its primary beneficiary. The Former Sellers have the power due to their (i)100% equity ownership of the VIE, (ii) ability to direct the VIE and (iii) make all significant decisions that impact the economic performance of the VIE. The Company’s maximum exposure to loss to the unconsolidated VIE is limited to the annual minimum purchase commitment of $0.8 million.

NOTE 18 -Segments

The Company conducts its worldwide operations through separate business segments, each of which represents major product lines. Operations are conducted in the U.S. and various foreign countries, primarily in Europe, Canada and Australia. Segment reporting is based upon the “management approach,” i.e., how we organize operating segments for which separate financial information is (1) available and (2) evaluated regularly by the Chief Operating Decision Maker (“CODM”) in deciding how to allocate resources and in assessing performance. Our CODM is our Chief Executive Officer.

The Company’stwo reportable segments are as follows:

(1)While certain assets and manufacturing operations of the TerraFlame business were transferred to the Former Sellers during the second quarter of 2025, the Company will continue to be sole distributor of TerraFlame products and will recognize the resulting profit or loss from the Company’s distribution activities within the Solo Stove reporting units.

Remaining operating segments that did not meet the criteria necessary to be considered a reportable segment are aggregated into All Other.

Our CODM relies on internal management reporting that analyzes our segments’ EBITDA, which he utilizes to evaluate performance and allocate resources. As segment assets are not reported to or used by the CODM to measure business performance or allocate resources, total segment assets are not presented below.

The following table presents the percentage of net sales attributable to the Company’stwo reportable segments:

A single customer contributed greater than 10% of consolidated net sales for the three months ended September 30, 2024, with net sales of $10.1 million, from which both the Solo Stove and Chubbies segments generated net sales activity. The three and nine months ended September 30, 2025 and the nine months ended September 30, 2024 did not have any customers who contributed 10% or greater to consolidated net sales for the respective period.

Our sales to foreign customers, mostly attributable to the Solo Stove segment, were $3.9 million and $16.2 million for the three and nine months ended September 30, 2025 and $7.6 million and $23.3 million for the three and nine months ended September 30, 2024, respectively. The following table presents the percentage of international net sales attributable to ourtwo reportable segments:

Net sales to no individual country outside the U.S. accounted for more than 10% of net sales for the three and nine months ended September 30, 2025 and 2024.

1 Includes net sales of our operating segments that did not meet the requirements to be considered a reportable segment, which includes net sales of Oru, ISLE and IcyBreeze (through date of wind-down), as well as the consolidating elimination entries that are not specific to our reportable segments.

2 Includes expenses for seller fees, shipping and fulfillment, along with certain fixed and other variable expenses incurred in the normal course of business.

3 Includes corporate general and administrative service expenses of $5.9 million and $18.6 million and $5.9 million and $23.1 million for the three and nine months ended September 30, 2025 and 2024, respectively, with the remaining non-segment operating expenses being primarily fixed costs.

Net sales exclude all intercompany sales between our reportable segments and All Other, as well as related profits, which were not material for the nine months ended September 30, 2025 and 2024.

NOTE 19 -Related Parties

The Company occasionally enters into transactions with related parties in the normal course of business. One related party, which is wholly owned by an employee of Solo Brands and this employee’s immediate family, purchases merchandise from Solo Brands to sell in a certain geographical market. There were no significant sales or expenses associated with related parties for the three and nine months ended September 30, 2025 or 2024.

Amounts receivable from this related party were nominal as of September 30, 2025 and $1.1 million as of December 31, 2024. The accounts receivable associated with this related party is included in accounts receivable, net on the consolidated balance sheets. There were no significant liabilities due to related parties as of September 30, 2025 and December 31, 2024.