[NT 10-Q] CHARLES & COLVARD LTD SEC Filing

Rhea-AI Filing Summary

Charles & Colvard, Ltd. filed a Form 12b-25 to announce it will not file its Quarterly Report on Form 10-Q for the quarter ended September 30, 2025 on time. The company cites the need for more time to complete procedures related to delinquent annual financial statements, with ongoing litigation and shareholder activism diverting management attention and resources, and it does not expect to meet the five-day grace period. Based on prior disclosures, the upcoming report is expected to state that material weaknesses in internal control over financial reporting remain and that certain factors raise substantial doubt about the company’s ability to continue as a going concern. The company is executing cost reductions, including headcount and executive salary cuts, supplier reevaluation, and inventory repurposing, and expects net sales to decline and a net loss for the quarter versus the same period in 2024.

Positive

• None.

Negative

• Significant filing delays and noncompliance: The company will not file its Form 10-Q for the quarter ended September 30, 2025 on time, does not expect to use the five-day grace period successfully, and has not filed its Form 10-K for the year ended June 30, 2025.
• Going-concern uncertainty: The company expects to disclose that certain factors raise substantial doubt about its ability to continue as a going concern in the upcoming Form 10-Q.
• Material weaknesses in internal controls: The company expects to report that material weaknesses in internal control over financial reporting continue to exist.
• Deteriorating operating performance: Consistent with prior quarters, the company expects net sales for the quarter ended September 30, 2025 to decrease versus the prior-year quarter and to report a net loss.
• Operational and governance strain: Ongoing litigation and shareholder activism have diverted management time and resources, contributing to delays in financial reporting.

Insights

Equity & Credit Risk Analyst

Late 10-Q, going-concern doubts, and ongoing losses signal elevated risk.

Charles & Colvard has delayed its Form 10-Q for the quarter ended September 30, 2025 and does not expect to file within the usual five-day grace window. Management links the delay to work on delinquent annual financial statements and notes that litigation and shareholder activism have absorbed resources and time.

The company expects the eventual filing to disclose continued material weaknesses in internal control over financial reporting and factors that raise substantial doubt about its ability to continue as a going concern. It also anticipates lower net sales and a net loss for the quarter compared with the same period in 2024, consistent with weak results through the fiscal year ended June 30, 2025.

To respond, the company is cutting costs through headcount reductions, executive salary cuts, supplier reevaluation, and inventory repurposing. The combination of filing delays, internal control weaknesses, going-concern language, and ongoing operating losses would typically be viewed as a materially negative development for both equity and credit stakeholders.

		SEC FILE NUMBER
	UNITED STATES	000-23329
	SECURITIES AND EXCHANGE COMMISSION	CUSIP
	Washington, D.C. 20549	159765205

FORM 12b-25

NOTIFICATION OF LATE FILING

(Check one):		¨    Form 10-K ¨  Form 20-F ¨  Form 11-K x Form 10-Q ¨ Form 10-D ¨  Form N-CEN ¨    Form N-CSR
		For Period Ended: September 30, 2025
		¨   Transition Report on Form 10-K
		¨   Transition Report on Form 20-F
		¨   Transition Report on Form 11-K
		¨   Transition Report on Form 10-Q
		For the Transition Period Ended: _____________
Nothing in this form shall be construed to imply that the Commission has verified any information contained herein.

If the notification relates to a portion of the filing checked above, identify the Item(s) to which the notification relates:

PART I — REGISTRANT INFORMATION

Charles & Colvard, Ltd.

Full Name of Registrant

N/A

Former Name if Applicable

170 Southport Drive

Address of Principal Executive Office (Street and Number)

Morrisville, NC 27560

City, State and Zip Code

PART II — RULES 12b-25(b) AND (c)

If the subject report could not be filed without unreasonable effort or expense and the registrant seeks relief pursuant to Rule 12b-25(b), the following should be completed. (Check box if appropriate)

¨	(a)	The reasons described in reasonable detail in Part III of this form could not be eliminated without unreasonable effort or expense;
	(b)	The subject annual report, semi-annual report, transition report on Form 10-K, Form 20-F, Form 11-K, Form N-CEN, or N-CSR, or portion thereof, will be filed on or before the fifteenth calendar day following the prescribed due date; or the subject quarterly report of transition report on Form 10-Q or subject distribution report on Form 10-D, or portion thereof, will be filed on or before the fifth calendar day following the prescribed date; and
	(c)	The accountant's statement or other exhibit required by Rule 12b-25(c) has been attached if applicable.

PART III — NARRATIVE

State below in reasonable detail the reasons why Form 10-K, 20-F, 11-K, 10-Q, 10-D, N-CEN, N-CSR, or the transition report portion thereof, could not be filed within the prescribed time period.

Charles & Colvard, Ltd. (the “Company”) is filing this Notification of Late Filing on Form 12b-25 with respect to its Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2025 (the “Q1 FY2026 Form 10-Q”). The Company was unable to file its Q1 FY2026 Form 10-Q within the prescribed time period without unreasonable effort or expense because it requires additional time to complete procedures relating to its delinquent annual financial statements. Ongoing litigation and shareholder activism diverted valuable Company resources and management time, contributing to the delay.

While the Company intends to file the Q1 FY2026 Form 10-Q as soon as practicable, the Company does not anticipate being able to file its Q1 FY2026 Form 10-Q within the five-day grace period provided by Rule 12b-25 under the Securities Exchange Act of 1934, as amended.

Based on the currently available information, and consistent with the Company’s disclosure in its Annual Report on Form 10-K for the fiscal year ended June 30, 2024, its Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2024, its Quarterly Report on Form 10-Q for the fiscal quarter ended December 31, 2024, and its Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2025, the Company expects to disclose in its Q1 FY2026 Form 10-Q, that (1) certain material weaknesses exist in internal controls over financial reporting, and (2) certain factors raise substantial doubt about the Company’s ability to continue as a going concern. In response to this and the continued challenging economic environment, the Company continues to reduce spend across the board in order to stabilize and right-size its business as noted below in Part IV. The Company has implemented a cost reduction strategy that includes a decrease in headcount and related payroll, executive salary reductions, reevaluation of its supplier base, and inventory repurposing – all through the fiscal year ended June 30, 2025, and continuing in the quarter ended September 30, 2025.

PART IV — OTHER INFORMATION

(1) Name and telephone number of person to contact in regard to this notification

	Clint J. Pete		(919)		468-0399
	(Name)		(Area Code)		(Telephone Number)

(2)	Have all other periodic reports required under Section 13 or 15(d) of the Securities Exchange Act of 1934 or Section 30 of the Investment Company Act of 1940 during the preceding 12 months or for such shorter period that the registrant was required to file such report(s) been filed? If answer is no, identify report(s).
	Yes ¨ No x Form 10-K for the year ended June 30, 2025
(3)	Is it anticipated that any significant change in results of operations from the corresponding period for the last fiscal year will be reflected by the earnings statements to be included in the subject report or portion thereof?
	Yes x No ¨
	If so, attach an explanation of the anticipated change, both narratively and quantitatively, and, if appropriate, state the reasons why a reasonable estimate of the results cannot be made. Consistent with the Company’s results for the first, second and third quarters of the fiscal year ended June 30, 2025, and the anticipated results for the fiscal year ended June 30, 2025, the Company expects net sales for the quarter ended September 30, 2025 to decrease compared to net sales for the quarter ended September 30, 2024. Further, consistent with the Company’s results for the first, second and third quarters of the fiscal year ended June 30, 2025, and the anticipated results for the fiscal year ended June 30, 2025, the Company expects to report a net loss for the quarter ended September 30, 2025. A reasonable net loss estimate for the quarter ended September 30, 2025 cannot be made at this time until the completion of the quarter-end financial statement review process for the quarter ended September 30, 2025. The foregoing estimates are preliminary and unaudited. While the Company does not expect any significant changes to the aforementioned estimates, such estimates remain subject to change pending the completion of the financial statement review. Forward-Looking Statements This filing contains a number of forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Words such as “plan,” “expect,” “will,” “working,” and variations of such words and similar future or conditional expressions are intended to identify forward-looking statements. These forward-looking statements include, but are not limited to, statements regarding our beliefs and expectations relating to the filing of the Form 10-K for the year ended June 30, 2025 and the Q1 FY2026 Form 10-Q and the estimated reporting of financial results. These forward-looking statements are not guarantees of future results and are subject to a number of risks and uncertainties, many of which are difficult to predict and beyond our control. Actual results could differ materially from those contemplated by the forward-looking statements as a result of certain factors detailed in the Company’s filings with the Securities and Exchange Commission. The Company disclaims and does not undertake any obligation to update or revise any forward-looking statement in this report, except as required by applicable law or regulation.

Charles & Colvard, Ltd.

(Name of Registrant as Specified in Charter)

has caused this notification to be signed on its behalf by the undersigned hereunto duly authorized.

Date: November 17, 2025	By:	/s/ Clint J. Pete
	Name:	Clint J. Pete
	Title:	Chief Financial Officer

FAQ

Why did Charles & Colvard (CTHR) file a Form 12b-25 for its Q1 FY2026 10-Q?

Charles & Colvard filed Form 12b-25 because it could not file its Quarterly Report on Form 10-Q for the quarter ended September 30, 2025 on time without unreasonable effort or expense. The company needs more time to complete procedures related to delinquent annual financial statements, and litigation and shareholder activism have diverted resources and management attention.

Will Charles & Colvard (CTHR) file its September 30, 2025 Form 10-Q within the five-day grace period?

No. The company explicitly states that while it intends to file the Form 10-Q as soon as practicable, it does not anticipate being able to file it within the five-day grace period provided by Rule 12b-25.

What financial condition does Charles & Colvard (CTHR) expect to disclose in the delayed 10-Q?

The company expects to disclose that material weaknesses in internal controls over financial reporting exist and that certain factors raise substantial doubt about its ability to continue as a going concern. It also expects decreased net sales and a net loss for the quarter ended September 30, 2025 compared with the same period in 2024.

Is Charles & Colvard (CTHR) current on its other SEC reports?

No. The company indicates that not all required periodic reports have been filed; specifically, it notes that the Form 10-K for the year ended June 30, 2025 has not been filed.

What cost-cutting measures is Charles & Colvard (CTHR) taking in response to its challenges?

The company reports a cost reduction strategy that includes decreasing headcount and related payroll, implementing executive salary reductions, reevaluating its supplier base, and repurposing inventory through the fiscal year ended June 30, 2025 and into the quarter ended September 30, 2025.

How does Charles & Colvard (CTHR) describe its expected results for the quarter ended September 30, 2025?

Consistent with results in earlier quarters of the fiscal year ended June 30, 2025, the company expects net sales for the quarter ended September 30, 2025 to decrease compared to the same quarter in 2024 and expects to report a net loss, with estimates described as preliminary and unaudited.