cbdMD (YCBD) Q2 2025 earnings summary

Executive summary

• Achieved key milestones including conversion of Series A preferred stock, reverse stock split, and cost structure optimization, strengthening capital structure and regaining NYSE American compliance.

• Net sales for Q2 FY25 were $4.7 million, up 8.6–9% year-over-year but down 7–7.9% sequentially; six-month sales rose 1% to $9.9 million.

• Operating loss narrowed to $485,000–$500,000 from $1.5–$1.6 million year-over-year; net loss improved to $480,000–$1.5 million from $3–$4 million.

• Focused on driving revenue growth, achieving profitability, and expanding distribution for Herbal Oasis/Oasis beverage line.

• Positioned for strategic opportunities, including M&A, with a clean balance sheet and increased shareholder confidence.

Financial highlights

• Gross profit margin for Q2 FY25 was 62–62.3%, up from 59% year-over-year.

• SG&A/operating expenses decreased to $3.5 million from $4.1 million year-over-year, reflecting cost-saving initiatives.

• Adjusted EBITDA loss narrowed to $197,000–$200,000 from $680,000–$700,000 year-over-year.

• Cash and equivalents were $1.7–$1.8 million at March 31, 2025, with a working capital deficit of $3.7 million, largely due to $6.7 million in accrued dividends converted to equity post-quarter.

• All Series A Preferred Stock and accrued dividends converted to common stock in May 2025, eliminating future dividend obligations.

Outlook and guidance

• Management remains committed to delivering profitability in FY25 and expects Herbal Oasis/Oasis to contribute meaningfully to revenue in the back half of the year.

• Liquidity outlook remains sufficient through at least the end of fiscal 2026, with modeled cash burn and working capital needs under control.

• Focus remains on revenue growth through product innovation, expanded distribution, and international markets.

• Company believes it will regain compliance with NYSE American listing standards after equity conversion, assuming continued performance.