BAB, Inc. Reports Results for 2nd Quarter FY 2025

Rhea-AI Summary

BAB Inc (OTCQB: BABB) reported its Q2 FY2025 financial results, with revenues of $808,000 and net income of $154,000 ($0.02 per share), compared to revenues of $883,000 and net income of $146,000 ($0.02 per share) in Q2 FY2024.

For the six months ended May 31, 2025, the company achieved revenues of $1.57 million and net income of $271,000 ($0.04 per share), versus revenues of $1.72 million and net income of $244,000 ($0.03 per share) in the same period of 2024. The revenue decrease was primarily attributed to lower marketing fund expenses, which has no impact on net income due to accounting offset.

Operating expenses decreased to $608,000 in Q2 FY2025 from $696,000 in Q2 FY2024, with notable reductions in marketing fund expenses, professional services, and employee benefits.

Positive

• Net income increased 5.9% to $154,292 in Q2 2025
• Six-month net income grew 10.8% to $270,559
• Operating expenses reduced by 12.7% in Q2 2025
• Income from operations improved 7.7% to $200,758 in Q2

Negative

• Q2 2025 revenues declined 8.4% to $808,486
• Franchise and area development fee revenue dropped 61.1%
• Six-month revenues decreased 8.9% to $1.57 million
• Royalty fees from franchised stores slightly decreased by 0.3%

DEERFIELD, Ill., July 03, 2025 (GLOBE NEWSWIRE) -- BAB, Inc. (OTCQB: BABB), announced its financial results for the second quarter ended May 31, 2025.

For the quarter ended May 31, 2025 BAB had revenues of $808,000 and net income of $154,000, or $0.02 per share earnings, versus revenues of $883,000 and net income of $146,000, or a $0.02 per share, for the same quarter last year. Our total revenue for the three months ended May 31, 2025 decreased compared to the prior period primarily due to a decrease in marketing fund expenses, which drive the recognition of marketing fund revenue. Under U.S. GAAP, we recognize marketing fund revenue at the time the related marketing fund expenses are incurred. As marketing fund revenue and expense directly offset each other in any given period, the decline has no impact on net income.

For the six months ended May 31, 2025, revenues were $1,566,000 and net income was $271,000, or $0.04 per share, versus revenues of $1,719,000 and net income of $244,000, or $0.03 per share for the same period in 2024. Our total revenue for the six months ended May 31, 2025 decreased compared to the prior period primarily due to a decrease in marketing fund expenses, which drive the recognition of marketing fund revenue. Under U.S. GAAP, we recognize marketing fund revenue at the time the related marketing fund expenses are incurred. As marketing fund revenue and expense directly offset each other in any given period, the decline has no impact on net income.

Total operating expenses for the three months ended May 31, 2025, were $608,000, versus $696,000, in 2024. The change in operating expenses for the quarter May 31, 2025 was primarily due to a decrease in marketing fund expenses of $80,000, a decrease in professional services of $15,000, employee benefits of $14,000 and a decrease in occupancy expense of $6,000, offset by an increase in payroll of $7,000 an increase in other expenses of $20,000. Total operating expenses for the six months ended May 31, 2025 were $1,218,000 versus $1,410,000 for May 31, 2024. Marketing expenses accounted for $122,000 of the decrease for the six months of 2025 compared to same period 2024. The Marketing Department is planning on increased spending in the third and fourth quarters of fiscal 2025 as they complete scheduled marketing projects. In addition, in the six months for May 31, 2025 there was a decrease of $35,000 in employee benefit expense, a decrease in professional fees of $16,000 and a decrease in other expenses of $19,000 versus 2024.

BAB, Inc. franchises and licenses Big Apple Bagels®, My Favorite Muffin®, SweetDuet® frozen yogurt and Brewster’s® Coffee. The Company’s stock is traded on the OTCQB under the symbol BABB and its website can be visited at www.babcorp.com.

Certain statements in this press release constitute forward-looking statements or statements which may be deemed or construed to be forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The words “forecast,” “estimate,” “project,” “intend,” “expect,” “should,” “would,” “believe” and similar expressions and all statements which are not historical facts are intended to identify forward-looking statements. These forward-looking statements involve and are subject to known and unknown risks, uncertainties and other factors which could cause the company’s actual results, performance (financial or operating), or achievements to differ from the future results, performance (financial or operating), or achievements expressed or implied by such forward-looking statements. The above factors are more fully discussed in the company’s SEC filings.

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Contact:	BAB, Inc. Michael K. Murtaugh (847) 948-7520 Fax: (847) 405-8140 www.babcorp.com

BAB, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
	Quarter Ended												Six Months Ended
	05/31/25				05/31/24				% Change				05/31/25				05/31/24				% Change
REVENUES
Royalty fees from franchised stores	$511,879				$513,474					-0.3	%		$969,073				$973,163					-0.4	%
Franchise and area development fee revenue		3,583				9,215				-61.1	%			12,166				19,461				-37.5	%
Licensing fees and other income		65,975				53,513				23.3	%			140,353				160,101				-12.3	%
Marketing Fund Revenue		227,049				306,636				-26.0	%			444,095				566,047				-21.5	%
Total Revenue		808,486				882,838				-8.4	%			1,565,687				1,718,772				-8.9	%
OPERATING COSTS AND EXPENSES
Selling, general and administrative		379,698				388,771				-2.3	%			771,694				842,334				-8.4	%
Depreciation and amortization		981				981				0.0	%			1,961				1,961				0.0	%
Marketing Fund Expenses		227,049				306,636				-26.0	%			444,095				566,047				-21.5	%
Total Expense		607,728				696,388				-12.7	%			1,217,750				1,410,342				-13.7	%
Income from operations		200,758				186,450				7.7	%			347,937				308,430				12.8	%
Interest expense		-				-				-				-				-				-
Interest/other income		13,734				16,735				-17.9	%			28,622				32,260				-11.3	%
Income taxes		(60,200	)			(57,500	)			4.7	%			(106,000	)			(96,500	)			9.8	%
NET INCOME	$154,292				$145,685					5.9	%		$270,559				$244,190					10.8	%
Earnings per share - basic and diluted	$0.02				$0.02				N/M				$0.04				$0.03				N/M
Average number of shares outstanding		7,263,508				7,263,508								7,263,508				7,263,508

FAQ

What were BAB Inc's (BABB) earnings per share in Q2 2025?

BAB Inc reported earnings of $0.02 per share in Q2 2025, unchanged from the same quarter last year.

How much revenue did BAB Inc (BABB) generate in Q2 2025?

BAB Inc generated $808,486 in total revenue for Q2 2025, an 8.4% decrease from $882,838 in Q2 2024.

What caused the revenue decline for BAB Inc (BABB) in Q2 2025?

The revenue decline was primarily due to a decrease in marketing fund expenses, which drives the recognition of marketing fund revenue. This decrease has no impact on net income due to accounting offset.

How did BAB Inc's (BABB) operating expenses change in Q2 2025?

Operating expenses decreased by 12.7% to $607,728 in Q2 2025, mainly due to reduced marketing fund expenses ($80,000), professional services ($15,000), and employee benefits ($14,000).

What was BAB Inc's (BABB) net income for the first six months of 2025?

BAB Inc reported a net income of $270,559 ($0.04 per share) for the first six months of 2025, a 10.8% increase from $244,190 ($0.03 per share) in the same period of 2024.