Xcel Brands (XELB) investor relations material

Executive summary

• Closed a $2 million net equity offering in Q3 2025, with $935,000 invested by insiders; $250,000 used to pay down debt, remainder for working capital.

• Net revenue for Q3 2025 was $1.12 million, down from $1.91 million year-over-year, mainly due to lower licensing revenue and the absence of prior year inventory sales.

• Reported a GAAP net loss of $7.9 million for Q3 2025 and $14.7 million year-to-date, including non-cash charges.

• Significant cost reductions implemented, lowering direct operating expenses to an expected run rate below $9 million per year.

• Launched new influencer-led brands, diversifying into food, kitchen, home, and pet products, and shifting supply chains toward domestic production.

Financial highlights

• Q3 2025 net revenue: $1.12 million, down $0.79 million year-over-year; net licensing revenues were $1.1 million.

• Q3 2025 net loss: $7.9 million ($2.02/share); Q3 2024 net loss: $9.2 million ($3.92/share).

• Adjusted EBITDA for Q3 2025: $(0.65) million, a 38% improvement year-over-year.

• Year-to-date net loss was $14.7 million ($5.06/share), versus $15.3 million ($6.82/share) prior year.

• Direct operating costs for Q3 were $2.2 million, down 23% year-over-year; nine-month costs were $6.3 million, down 36%.

Outlook and guidance

• Management anticipates revenue growth in Q4 2025 and beyond from new influencer-led brand launches and product introductions.

• Expansion into new categories and sales channels planned for 2026, especially for Christie Brinkley and Sea Wonder brands.

• No formal 2026 revenue guidance provided, but analyst reports suggest significant upside if brand launches succeed.

• Substantial doubt remains about the ability to meet financial obligations within twelve months without additional funding.

• Management continues to focus on cost optimization and strategic financing to address liquidity needs.