Charlotte's Web (CWBHF) investor relations material

Executive summary

• Q3 2025 revenue was $11.5M, down 8.6% year-over-year, mainly due to B2B model changes and lower B2B sales, partially offset by DTC growth.

• Net loss for Q3 2025 was $5.8M ($0.04/share), flat compared to Q3 2024, with a year-to-date net loss of $18.3M, improved from $26.5M prior year.

• Gross margin for Q3 2025 was 38.9%, down from 53.0% in Q3 2024, impacted by a B2B chargeback reserve and higher production costs.

• The MLB Promotional Rights Agreement was terminated, resulting in a $2.3M gain and reduced future obligations.

• The company invested in R&D, launched CBN gummies, expanded sleep and cognitive wellness products, and formed a Scientific Advisory Board.

Financial highlights

• Q3 2025 revenue: $11.5M (down 8.6% YoY); nine months revenue: $36.6M (down 1.2% YoY).

• Gross profit for Q3 2025: $4.5M (38.9% margin); nine months: $16.7M (45.7% margin).

• SG&A expenses for Q3 2025: $9.7M (down 23.3% YoY); nine months: $31.4M (down 26.5% YoY).

• Cash and equivalents at September 30, 2025: $9.8M; working capital: $25.6M; total assets: $81.6M; total liabilities: $72.4M.

• Adjusted EBITDA improved to $(2.1)M from $(3.9)M YoY.

Outlook and guidance

• Management expects further SG&A reductions, improved efficiency, and annualized cost savings of ~$9M in 2026.

• Gross margin is expected to rebound to the 50% range in Q4 2025 as in-house production scales.

• Liquidity is expected to be sufficient for the next 12 months, with ongoing cost control and potential capital raises.

• Multiple pathways to positive cash flow in 2026 are supported by a leaner cost structure and steady demand.

• Regulatory changes in several states may impact product formulations, labeling, and revenue.