Solo Brands issues going-concern warning in Q3
Solo Brands disclosed substantial doubt about its ability to continue as a going concern, despite covenant compliance at September 30.
Sentiment and the balance of points
Rhea-AI Sentiment reads the wording of the document, how positive or negative its language is on a 1 to 5 scale. The balance of points shown with the takes weighs what the document actually discloses, so the two can disagree, for example when a trial that missed its main goal is described in upbeat language.
Form Type
10-Q
Rhea-AI Filing Summary
Solo Brands, Inc. (SBDS) reported third-quarter 2026 net sales of $43.7 million, down 17.6% from $53.0 million a year earlier, and a consolidated net loss of $20.8 million compared with $22.9 million. Gross profit was $27.7 million, while gross margin rose to 63.4% from 60.0%.
For the nine months ended September 30, 2026, net sales were $195.1 million, down 12.4%, and consolidated net loss narrowed to $30.6 million from $62.3 million. Operating activities provided $26.0 million of cash, compared with $53.0 million used in the prior-year period. At September 30, cash was $40.2 million and debt, net of issuance costs, was $256.4 million. The company recorded $6.0 million in restructuring, contract termination and impairment charges for the quarter.
Solo Brands was compliant with all credit covenants at September 30, but disclosed substantial doubt about its ability to continue as a going concern within one year after issuance of the statements. Management said operating variability could affect its ability to meet the maximum total leverage ratio covenant; its plans were not considered probable of occurring or of mitigating covenant noncompliance, and did not fully alleviate the substantial doubt.
2 points · 0 major1 major · 2 points
How this balance works
Rhea-AI gives every point it takes from this document a weight. Minor counts 1, Moderate 3 and Major 9, so one Major point outweighs several Minor ones. The bar adds up the weights on each side, and when neither side holds more than 65% of the total the balance reads Mixed.
It reads the document as published, with the same rules for every company, and it does not look at what the market expected or at how the stock traded, so a point can be objectively good on a day the stock falls.
Rhea-AI Sentiment measures something else, the tone of the wording.
Positive
- Moderate pointNine-month consolidated net loss narrowed to $30.6 million from $62.3 million.
- Moderate pointOperating cash flow was $26.0 million provided, versus $53.0 million used.
Negative
- Major pointManagement disclosed substantial doubt about continuing as a going concern within one year.
- Moderate pointThird-quarter net sales fell 17.6% to $43.7 million.
Key Figures
Third-quarter net sales: $43.7 million
Third-quarter consolidated net loss: $20.8 million loss
Gross profit margin: 63.4%
+5 more
8 metrics
Third-quarter net sales
$43.7 million
Three months ended September 30, 2026; $53.0 million in 2025
Third-quarter consolidated net loss
$20.8 million loss
Three months ended September 30, 2026; $22.9 million loss in 2025
Gross profit margin
63.4%
Three months ended September 30, 2026; 60.0% in 2025
Nine-month net sales
$195.1 million
Nine months ended September 30, 2026; $222.5 million in 2025
Nine-month consolidated net loss
$30.6 million loss
Nine months ended September 30, 2026; $62.3 million loss in 2025
Net cash from operating activities
$26.0 million provided
Nine months ended September 30, 2026; $53.0 million used in 2025
Debt principal and fair value
$264.4 million principal; $226.8 million fair value
As of September 30, 2026
Revolving credit availability
$50.3 million
Available for future draws as of September 30, 2026, net of $5.8 million of letters of credit
Key Terms
going concern, payable in kind (PIK), Total Leverage Ratio, Fixed Charge Coverage Ratio, +1 more
5 terms
going concern financial
"substantial doubt about the Company’s ability to continue as a going concern"
Going concern is the accounting assumption that a company will keep operating and meeting its obligations for the foreseeable future. The phrase matters most when a company or its auditors disclose substantial doubt about it, a formal warning that the business may not have enough resources to continue without raising money, restructuring, or selling assets. That language in a filing or press release signals elevated financial risk.
payable in kind (PIK) financial
"interest was payable in kind (“PIK”)"
Total Leverage Ratio financial
"defined in the 2025 Credit Agreement as the Total Leverage Ratio"
Fixed Charge Coverage Ratio financial
"defined in the 2025 Credit Agreement as the Fixed Charge Coverage Ratio"
A fixed charge coverage ratio measures how well a company's operating income can cover its fixed, recurring obligations like interest payments and lease costs. Think of it as a safety margin — the higher the number, the more comfortably a business can pay steady bills from its normal earnings, which matters to investors because it signals financial stability, lower default risk, and greater ability to withstand revenue dips.
variable interest entity financial
"consolidated one entity that is a VIE"
A variable interest entity (VIE) is a company structure where one party controls another company’s operations and economic outcomes through contracts or special arrangements instead of owning a majority of its voting shares. For investors, VIEs matter because the controlling party’s financial results, debts and risks can appear in the controller’s reports even though ownership looks separate, so understanding VIEs helps assess true exposure, governance limits and transparency—like spotting a puppet controlled by strings rather than direct ownership.
FAQ
AI-generated questions and answers. How Rhea-AI works. Not financial advice.
What were SBDS's third-quarter 2026 sales and net loss?
SBDS reported third-quarter 2026 net sales of $43.7 million and a consolidated net loss of $20.8 million. In third-quarter 2025, net sales were $53.0 million and consolidated net loss was $22.9 million.
Why did SBDS report substantial doubt about going concern?
Management said variability in operating performance could affect its forecast and its ability to maintain compliance with the maximum total leverage ratio covenant over the next year. SBDS was compliant with all covenants at September 30, 2026; management's mitigation plans did not fully alleviate the substantial doubt.
When does SBDS's credit agreement mature, and how much revolving credit was available?
The 2025 Term Loan and 2025 Revolving Credit Facility mature on June 30, 2028. At September 30, 2026, availability for future draws under the revolving facility was $50.3 million, net of $5.8 million of letters of credit issued and outstanding.
AI-generated analysis. How Rhea-AI works. Not financial advice.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
For the quarterly period ended September 30, 2026
or
For the transition period from ___________ to ___________
Commission File Number 001-40979
(Exact Name of Registrant as Specified in its Charter)
| State or Other Jurisdiction of Incorporation or Organization | I.R.S. Employer Identification No. | ||||||||||
| Address of Principal Executive Offices | Zip Code | ||||||||||
(817 ) 900-2664
Registrant’s Telephone Number, Including Area Code
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||
| N/A | N/A | N/A | ||||||
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer | ☐ | Smaller reporting company | |||||||||
Accelerated filer | ☐ | Emerging growth company | |||||||||
☒ | |||||||||||
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒
As of November 6, 2026, there were 2,580,206 shares of the registrant’s Class A common stock, $0.001 par value per share, outstanding.
| TABLE OF CONTENTS | |||||
| Page | |||||
FORWARD-LOOKING STATEMENTS | i | ||||
Where You Can Find More Information | i | ||||
PART I. FINANCIAL INFORMATION | 1 | ||||
Item 1. Financial Statements | 1 | ||||
Consolidated Balance Sheets (Unaudited) | 1 | ||||
Consolidated Statements of Operations and Comprehensive Income (Loss) (Unaudited) | 2 | ||||
Consolidated Statements of Cash Flows (Unaudited) | 3 | ||||
Consolidated Statements of Equity (Deficit) (Unaudited) | 4 | ||||
Notes to the Consolidated Financial Statements (Unaudited) | 6 | ||||
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations | 18 | ||||
Item 3. Quantitative and Qualitative Disclosures About Market Risk | 29 | ||||
Item 4. Controls and Procedures | 30 | ||||
PART II. OTHER INFORMATION | 31 | ||||
Item 1. Legal Proceedings | 31 | ||||
Item 1A. Risk Factors | 31 | ||||
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds | 31 | ||||
Item 3. Defaults Upon Senior Securities | 31 | ||||
Item 4. Mine Safety Disclosures | 31 | ||||
Item 5. Other Information | 31 | ||||
Item 6. Exhibits | 32 | ||||
Signatures | 33 | ||||
FORWARD-LOOKING STATEMENTS
This Quarterly Report on Form 10-Q (this “Quarterly Report”) of Solo Brands, Inc. (the “Company,” “we,” “our,” or “us”) contains forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements other than statements of historical facts contained in this Quarterly Report may be forward-looking statements. In some cases, you can identify forward-looking statements by terms such as “may,” “will,” “should,” “expects,” “plans,” “anticipates,” “could,” “intends,” “targets,” “projects,” “contemplates,” “believes,” “estimates,” “forecasts,” “predicts,” “potential” or “continue” or the negative of these terms or other similar expressions. Forward-looking statements contained in this Quarterly Report include, but are not limited to statements regarding our future ability to continue as a going concern, our ability to transform our business, improve our liquidity and long-term capital structure, including through the continued execution of cost saving and operational improvements, our future results of operations and financial position, the effect of tariffs, industry and business trends, business strategy, plans, restocking trends, market growth, compliance with debt covenants and our objectives for future operations.
The forward-looking statements in this Quarterly Report are only predictions. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our business, financial condition and results of operations. Forward-looking statements involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements, including, but not limited to, our future ability to continue as a going concern; our ability to realize expected benefits from our strategic plans; our ability to implement any restructuring and cost-reduction efforts; our limited liquidity; our ability to mitigate the impact of new and increased tariffs and similar restrictions on our business; our reliance on third-party manufacturers, which operate mostly outside of the U.S., and problems with, or the loss of, our suppliers or an inability to obtain raw materials; our dependence on cash generated from operations to support our business and our growth initiatives; our ability to relist to a national exchange; risks associated with fluctuations in the price of our Class A common stock; risks associated with our indebtedness, including the limits imposed by our indebtedness to invest in the ongoing needs of our business; our ability to maintain and strengthen our brand to generate and maintain ongoing demand for our products; our ability to design, develop and introduce new products; our ability to manage our future growth effectively; our ability to expand into additional markets; risks associated with our international operations; our inability to sustain historic growth rates; our ability to cost-effectively attract new customers and retain our existing customers; the highly competitive market in which we operate; our failure to maintain product quality and product performance at an acceptable cost; the impact of product liability and warranty claims and product recalls, including write-offs; geopolitical actions, natural disasters, or pandemics; the ability of our largest stockholders to influence corporate matters; and the important factors discussed in Part I, Item 1A. “Risk Factors” in the Annual Report on Form 10-K for the year ended December 31, 2025 (“2025 Form 10-K”) filed with the U.S. Securities and Exchange Commission (the “SEC”), and in Part II, Item 1A. “Risk Factors” in this Quarterly Report, as any such factors may be updated from time to time in its other filings with the SEC. The forward-looking statements in this Quarterly Report are based upon information available to us as of the date of this Quarterly Report, and while we believe such information forms a reasonable basis for such statements, such information may be limited or incomplete, and our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information. These statements are inherently uncertain and investors are cautioned not to unduly rely upon these statements.
You should read this Quarterly Report and the documents that we reference in this Quarterly Report and have filed as exhibits to this Quarterly Report with the understanding that our actual future results, performance and achievements may be materially different from what we expect. We qualify all of our forward-looking statements by these cautionary statements. These forward-looking statements speak only as of the date of this Quarterly Report. Except as required by applicable law, we do not plan to publicly update or revise any forward-looking statements contained in this Quarterly Report, whether as a result of any new information, future events or otherwise.
WHERE YOU CAN FIND MORE INFORMATION
We may use our website as a distribution channel of material information about the Company, including through press releases, investor presentations, and notices of upcoming events. We intend to utilize the investor relations section of our website at https://investors.solobrands.com as a channel of distribution to reach public investors and as a means of disclosing material non-public information for complying with disclosure obligations under Regulation FD. We also intend to use certain social media channels, including, but not limited to, X, Facebook, Instagram, TikTok and LinkedIn, as a means of communicating with the public, our customers and investors about our Company, our products, and other matters. While not all of the information that the Company posts to its website and brand-related social media channels may be deemed to be of a material nature, some information may be, and we therefore encourage investors, the media, and others interested in our Company to review the information we make public in these locations.
All periodic and current reports, registration statements and other filings that we have filed or furnished to the SEC, including our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act, are available free of charge from the SEC’s website (www.sec.gov) and on our website at https://investors.solobrands.com. Such documents are available as soon as reasonably practicable after electronic filing of the material with the SEC.
Any reference to our website or social media channels does not constitute incorporation by reference of the information contained on or available through our website, and you should not consider such information to be a part of the periodic and current reports, registration statements or other filings that we file or furnish with the SEC from time to time.
i
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
SOLO BRANDS, INC.
Consolidated Balance Sheets
(Unaudited)
| (In thousands, except number of shares and par value) | September 30, 2026 | December 31, 2025 | |||||||||
| ASSETS | |||||||||||
| Current assets | |||||||||||
| Cash and cash equivalents | $ | $ | |||||||||
Accounts receivable, net of allowance for credit losses of $ | |||||||||||
| Inventory | |||||||||||
| Prepaid expenses and other current assets | |||||||||||
| Total current assets | |||||||||||
| Non-current assets | |||||||||||
| Property and equipment, net | |||||||||||
| Intangible assets, net | |||||||||||
| Goodwill | |||||||||||
| Operating lease right-of-use assets | |||||||||||
| Other non-current assets | |||||||||||
| Total non-current assets | |||||||||||
| Total assets | $ | $ | |||||||||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | |||||||||||
| Current liabilities | |||||||||||
| Accounts payable | $ | $ | |||||||||
| Accrued expenses and other current liabilities | |||||||||||
| Deferred revenue | |||||||||||
Current portion of long-term debt | |||||||||||
| Total current liabilities | |||||||||||
| Non-current liabilities | |||||||||||
| Long-term debt, net | |||||||||||
| Deferred tax liability | |||||||||||
| Operating lease liabilities | |||||||||||
| Other non-current liabilities | |||||||||||
| Total non-current liabilities | |||||||||||
Commitments and contingencies (Note 1) | |||||||||||
| Shareholders’ equity | |||||||||||
Class A common stock, par value $ | |||||||||||
Class B common stock, par value $ | |||||||||||
| Additional paid-in capital | |||||||||||
| Retained earnings (accumulated deficit) | ( | ( | |||||||||
| Accumulated other comprehensive income (loss) | ( | ( | |||||||||
Treasury stock, | ( | ( | |||||||||
| Equity attributable to Solo Brands, Inc. | |||||||||||
| Equity attributable to noncontrolling interests | |||||||||||
| Total equity | |||||||||||
| Total liabilities and equity | $ | $ | |||||||||
See Notes to Consolidated Financial Statements (Unaudited)
1
SOLO BRANDS, INC.
Consolidated Statements of Operations and Comprehensive Income (Loss)
(Unaudited)
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
(In thousands, except per share data) | 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||
| Net sales | $ | $ | $ | $ | |||||||||||||||||||
| Cost of goods sold | |||||||||||||||||||||||
| Gross profit | |||||||||||||||||||||||
| Operating expenses | |||||||||||||||||||||||
| Selling, general & administrative expenses | |||||||||||||||||||||||
| Depreciation and amortization expenses | |||||||||||||||||||||||
| Restructuring, contract termination and impairment charges | |||||||||||||||||||||||
| Other operating expenses | |||||||||||||||||||||||
| Total operating expenses | |||||||||||||||||||||||
| Income (loss) from operations | ( | ( | ( | ( | |||||||||||||||||||
| Non-operating (income) expense | |||||||||||||||||||||||
| Interest expense, net | |||||||||||||||||||||||
| Other non-operating (income) expense | ( | ( | ( | ||||||||||||||||||||
| Total non-operating (income) expense | |||||||||||||||||||||||
| Income (loss) before income taxes | ( | ( | ( | ( | |||||||||||||||||||
| Income tax expense (benefit) | ( | ( | ( | ||||||||||||||||||||
| Net income (loss) | ( | ( | ( | ( | |||||||||||||||||||
| Less: net income (loss) attributable to noncontrolling interests | ( | ( | |||||||||||||||||||||
| Net income (loss) attributable to Solo Brands, Inc. | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||
| Other comprehensive income (loss) | |||||||||||||||||||||||
| Foreign currency translation, net of tax | $ | $ | $ | ( | $ | ||||||||||||||||||
| Comprehensive income (loss) | ( | ( | ( | ( | |||||||||||||||||||
| Less: other comprehensive income (loss) attributable to noncontrolling interests | ( | ||||||||||||||||||||||
| Less: net income (loss) attributable to noncontrolling interests | ( | ( | |||||||||||||||||||||
| Comprehensive income (loss) attributable to Solo Brands, Inc. | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||
| Net income (loss) per share of Class A common stock | |||||||||||||||||||||||
Basic and diluted | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||
| Weighted-average Class A common stock outstanding | |||||||||||||||||||||||
Basic and diluted | |||||||||||||||||||||||
See Notes to Consolidated Financial Statements (Unaudited)
2
SOLO BRANDS, INC.
Consolidated Statements of Cash Flows
(Unaudited)
| Nine Months Ended September 30, | |||||||||||
| (In thousands) | 2026 | 2025 | |||||||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | |||||||||||
| Net income (loss) | $ | ( | $ | ( | |||||||
| Adjustments to reconcile net income (loss) to net cash and cash equivalents (used in) provided by operating activities | |||||||||||
| Depreciation and amortization | |||||||||||
| Interest expense payable in kind | |||||||||||
| Noncash operating lease expense | |||||||||||
| Amortization of debt issuance costs | |||||||||||
Equity-based compensation, net | |||||||||||
Loss on disposition of the TerraFlame manufacturing operations | |||||||||||
| Inventory charges associated with restructuring and consolidation activities | |||||||||||
Restructuring, contract termination and impairment charges | ( | ||||||||||
Other | |||||||||||
| Change in fair value of contingent consideration | ( | ||||||||||
| Deferred income taxes | ( | ( | |||||||||
| Changes in assets and liabilities | |||||||||||
| Accounts receivable | |||||||||||
| Inventory | |||||||||||
| Prepaid expenses and other current assets | ( | ||||||||||
| Accounts payable | ( | ( | |||||||||
| Accrued expenses and other current liabilities | ( | ( | |||||||||
| Deferred revenue | ( | ( | |||||||||
Operating lease liabilities | ( | ( | |||||||||
| Other non-current assets and liabilities | |||||||||||
| Net cash provided by (used in) operating activities | ( | ||||||||||
| CASH FLOWS FROM INVESTING ACTIVITIES: | |||||||||||
| Capital expenditures | ( | ( | |||||||||
| Net cash provided by (used in) investing activities | ( | ( | |||||||||
| CASH FLOWS FROM FINANCING ACTIVITIES: | |||||||||||
Proceeds from revolving credit facilities and term loans | |||||||||||
Repayments of revolving credit facilities and term loans | ( | ( | |||||||||
Debt issuance costs paid | ( | ||||||||||
| Net consideration paid to Former Sellers of TerraFlame | ( | ||||||||||
| Surrender of stock to settle taxes on restricted stock awards | ( | ( | |||||||||
| Net cash provided by (used in) financing activities | ( | ||||||||||
| Effect of exchange rate changes on cash | ( | ||||||||||
| Net change in cash and cash equivalents | |||||||||||
| Cash and cash equivalents balance, beginning of period | |||||||||||
| Cash and cash equivalents balance, end of period | $ | $ | |||||||||
See Notes to Consolidated Financial Statements (Unaudited)
3
SOLO BRANDS, INC.
Consolidated Statements of Equity (Deficit)
(Unaudited)
| Class A Common Stock | Class B Common Stock | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (In thousands) | Shares | Amount | Shares | Amount | Additional Paid-in Capital | Retained Earnings (Accumulated Deficit) | Accumulated Other Comprehensive Income (Loss) | Treasury Stock | Non-controlling Interest | Total Shareholders’ Equity | |||||||||||||||||||||||||||||||||||||||||||||||||
| Balance at December 31, 2025 | $ | $ | $ | $ | ( | $ | ( | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||||||||||||||||||
| Net income (loss) | — | — | — | — | — | ( | — | — | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||||
| Equity-based compensation, net of income tax expense (benefit) | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Conversion of Class B Common Stock | ( | ( | — | — | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Other comprehensive income (loss) | — | — | — | — | — | — | ( | — | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||||
| Surrender of stock to settle taxes on equity awards | — | — | — | — | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||||
| Vested equity-based compensation | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Balance at March 31, 2026 | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Net income (loss) | — | — | — | — | — | ( | — | — | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||||
| Equity-based compensation, net of income tax expense (benefit) | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Other comprehensive income (loss) | — | — | — | — | — | — | ( | — | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||||
| Surrender of stock to settle taxes on equity awards | — | — | — | — | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||||
| Vested equity-based compensation | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Balance at June 30, 2026 | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Net income (loss) | — | — | — | — | — | ( | — | — | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||||
| Equity-based compensation, net of income tax expense (benefit) | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Surrender of stock to settle taxes on equity awards | — | — | — | — | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||||
| Vested equity-based compensation | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Balance at September 30, 2026 | $ | $ | $ | $ | ( | $ | ( | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||||||||||||||||||
See Notes to Consolidated Financial Statements (Unaudited)
4
SOLO BRANDS, INC.
Consolidated Statements of Equity (Deficit)
(Unaudited)
| Class A Common Stock | Class B Common Stock | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (In thousands) | Shares | Amount | Shares | Amount | Additional Paid-in Capital | Retained Earnings (Accumulated Deficit) | Accumulated Other Comprehensive Income (Loss) | Treasury Stock | Non-controlling Interest | Total Shareholders’ Equity | |||||||||||||||||||||||||||||||||||||||||||||||||
| Balance at December 31, 2024 | $ | $ | $ | $ | ( | $ | ( | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||||||||||||||||||
| Net income (loss) | — | — | — | — | — | ( | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||
| Equity-based compensation, net of income tax expense (benefit) | — | — | — | — | — | — | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Surrender of stock to settle taxes on equity awards | — | — | — | — | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||||
| Vested equity-based compensation and re-allocation of ownership percentage | — | — | — | ( | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Balance at March 31, 2025 | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Net income (loss) | — | — | — | — | — | ( | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||
| Equity-based compensation, net of income tax expense (benefit) | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Other comprehensive income (loss) | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Surrender of stock to settle taxes on equity awards | — | — | — | — | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||||
| Issuance of Class A common stock in lieu of cash lender consent fee | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Other | — | — | — | — | ( | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Vested equity-based compensation and re-allocation of ownership percentage | — | — | — | — | — | — | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Balance at June 30, 2025 | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Net income (loss) | — | — | — | — | — | ( | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||
| Equity-based compensation, net of income tax expense (benefit) | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Other comprehensive income (loss) | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Surrender of stock to settle taxes on equity awards | — | — | — | — | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||||
| Vested equity-based compensation and re-allocation of ownership percentage | — | — | — | — | — | — | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Balance at September 30, 2025 | $ | $ | $ | $ | ( | $ | ( | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||||||||||||||||||
See Notes to Consolidated Financial Statements (Unaudited)
5
SOLO BRANDS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(amounts in thousands)
(Unaudited)
NOTE 1 – Organization and Basis of Presentation
Organization
Solo Brands, Inc. and its subsidiaries (the “Company,” “we,” “our,” or “us”) is a branded outdoor lifestyle company that develops, markets, and sells products across outdoor cooking, outdoor recreation, casual apparel, and watersports categories. The Company’s portfolio includes Solo Stove, which offers fire pits, griddles, coolers, and related accessories; Chubbies, which offers casual apparel, activewear, and swimwear; and its Watersports brands, including International Surf Ventures (“ISLE”), which offers inflatable and hard paddle boards and related accessories, and Oru Kayak (“Oru”), which offers folding kayaks and accessories. The Company’s products are sold through direct-to-consumer channels, retail partners, and distributors in the United States and internationally.
Basis of Presentation
The unaudited consolidated financial statements contained herein have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) and the rules of the United States Securities and Exchange Commission (“SEC”). Accordingly, these unaudited consolidated financial statements do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring adjustments) necessary for a fair statement of the results of operations, financial position and cash flows for the periods presented have been reflected. The unaudited consolidated financial statements include those of our wholly-owned and majority-owned subsidiaries and an entity consolidated under the variable interest entity model. Intercompany balances and transactions are eliminated in consolidation. Our business is affected by the general seasonal trends reflecting our portfolio of outdoor lifestyle products; therefore, results of operations for the three and nine months ended September 30, 2026 are not necessarily indicative of results to be expected for other quarterly periods or for the full year.
These unaudited consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2025 (the “2025 Form 10-K”). Certain prior period amounts have been conformed to the current period’s presentation. Included below are selected significant accounting policies. Refer to Note 2 - Significant Accounting Policies, within the 2025 Form 10-K for the full list of significant accounting policies.
Reverse Stock Split
On July 8, 2025, the Company filed a Certificate of Amendment to its Amended and Restated Certificate of Incorporation with the Secretary of State of the State of Delaware to effect a reverse stock split of all issued and outstanding shares of the Company’s common stock at a ratio of 1-for-40. The reverse stock split did not change the par value or the authorized number of shares of the Company’s common stock. The Company’s consolidated financial statements present the retroactive effect of the reverse stock split on the Company’s Class A and Class B common stock and per share amounts for all periods presented.
Corporate Simplification
On December 17, 2025, as part of the Corporate Simplification transactions, we entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Solo Stove Holdings, LLC (“Holdings”) and Solo Merger Sub LLC (“Merger Sub”), a subsidiary of Solo Brands, Inc. and SP SS Blocker Purchaser, LLC (“Blocker”), formed for the sole purpose of merging with and into Holdings. Pursuant to the Merger Agreement, effective January 1, 2026 (the “Effective Time”), Merger Sub merged with and into Holdings, with Holdings continuing as the surviving entity (the “Merger”) as a wholly owned subsidiary of Solo Brands, Inc., as described further in Note 11, Income Taxes and Note 12, Equity.
The Company’s ownership interest in Holdings was 100.0 % and 66.9 % as of September 30, 2026 and 2025, respectively.
Tariffs
On February 20, 2026, the U.S. Supreme Court held in Learning Resources, Inc. v. Trump that the International Emergency Economic Powers Act (“IEEPA”) does not authorize a U.S. President to impose tariffs during peacetime national emergencies and that the challenge to the legality of the incremental tariffs was within the exclusive jurisdiction of the U.S. Court of International Trade (“CIT”), thus affirming a prior decision of the CIT that the U.S. President lacked authority to impose incremental tariffs. The Company filed a lawsuit in the CIT challenging the legality of incremental tariffs and the Company sought to recover the incremental tariffs paid in 2025 and 2026.
The Company began receiving refunds in May 2026 and elected to recognize these tariff refunds in accordance with gain contingency accounting under ASC 450-30, Gain Contingencies. Refunds are initially recorded as a reduction to the carrying value of inventory to the extent the related goods remain on hand, and are recognized as a reduction to cost of goods sold as that inventory is sold. Interest received is recorded as interest income within interest expense, net.
During the three and nine months ended September 30, 2026, the Company received $0.6 million and $10.5 million, respectively, in IEEPA tariff refunds. Of the total IEEPA tariff refund amounts, during the three and nine months ended September 30, 2026, $3.0 million and $8.9 million were recorded as a reduction to cost of goods sold, respectively, and $0.0 million and $0.3 million were recorded as interest income within interest
6
expense, net, respectively, on the unaudited consolidated statements of operations and comprehensive income (loss). As of September 30, 2026, $1.3 million was recorded as a reduction to inventory on the unaudited consolidated balance sheets.
The Company filed for $10.5 million of IEEPA tariff refunds and, as of September 30, 2026, the Company has received the full amount. The Company continues to monitor developments related to these IEEPA tariff refunds and assess the potential impact on its consolidated financial statements.
Going Concern
The unaudited consolidated financial statements have been prepared in accordance with U.S. GAAP assuming the Company will continue as a going concern. The going concern assumption contemplates the realization of assets and satisfaction of liabilities in the normal course of business.
On June 13, 2025, the Company entered into Amendment No. 4 to the Credit Agreement and Limited Waiver and Amendment No. 1 to Security Agreement (the “2025 Credit Agreement”), which amended the credit agreement dated May 12, 2021 (as amended, the “Credit Agreement”) by and among the Company, JPMorgan Chase Bank, N.A., as administrative agent, and the lenders party thereto. The 2025 Credit Agreement restructured the Company’s outstanding revolving and term loans, extended certain maturities, reduced near-term cash interest requirements through the ability to make certain interest payments in-kind and deferred compliance with certain financial covenants for a defined period of time. The 2025 Credit Agreement matures on June 30, 2028.
Beginning with the quarter ended September 30, 2026, the Company was required to comply with additional financial covenants under the 2025 Credit Agreement, including leverage, fixed charge coverage and minimum liquidity requirements, as described further in Note 10, Debt, Net. As of September 30, 2026, the Company was in compliance with all covenants under the 2025 Credit Agreement.
In evaluating its ability to continue as a going concern for the twelve months following the issuance of these unaudited consolidated financial statements, management projects compliance with these financial covenants. However, the risks associated with variability in the Company’s operating performance could affect management’s forecast and whether the Company is able to maintain compliance with the maximum total leverage ratio covenant over the next year. Accordingly, there is substantial doubt about the Company’s ability to continue as a going concern within one year after the issuance of these unaudited consolidated financial statements.
Management has developed plans intended to mitigate these downside risk conditions, including optimization of the Company's distribution and fulfillment network, reductions in cost of goods sold, reductions in marketing spend and other fixed operating costs, and prioritization of available cash towards debt and other obligations. Certain of these cost savings and operational initiatives are discussed in Note 2, Restructuring, Contract Termination and Impairment Charges. However, these plans are not entirely within the Company’s control and cannot be assessed as being probable of occurring or of mitigating noncompliance with the maximum total leverage ratio covenant. Accordingly, the plans to mitigate these downside risk conditions do not fully alleviate the substantial doubt about the Company’s ability to continue as a going concern for at least the twelve months following the issuance of these unaudited consolidated financial statements.
If the Company does not achieve the expected benefits from these operational initiatives or if operating results or liquidity deteriorate, the Company could be required to seek additional capital through equity or debt financing or other sources. The Company is evaluating strategies to address the possible covenant noncompliance, which includes seeking an amendment or waiver of the maximum total leverage ratio covenant from the lenders under the 2025 Credit Agreement, refinancing or restructuring the debt, issuing new debt or equity, or entering into other financing arrangements. There can be no assurance that such financing, amendment, waiver or other relief from the lenders would be available on acceptable terms, or at all. Similarly, there can be no assurance that the Company will be able to refinance or restructure its debt, or execute any further cost savings or operational improvements.
If the Company is not in compliance with the maximum total leverage ratio covenant as of the end of any such test period and the failure is not cured or waived, an event of default would occur under the 2025 Credit Agreement. Upon the determination of an event of default under the 2025 Credit Agreement, the lenders could elect to declare all amounts outstanding under the 2025 Credit Agreement immediately due and payable and exercise other remedies as set forth in the 2025 Credit Agreement. If the maturity of the debt were accelerated, the Company would not have sufficient liquidity to repay it.
The unaudited consolidated financial statements do not include any adjustments to the carrying amounts and classification of assets, liabilities, and reporting expenses that may be necessary if the Company were unable to continue as a going concern.
Use of Estimates
The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, and expenses during the reporting period and disclosure of contingent assets and liabilities at the date of the consolidated financial statements. Estimates and assumptions about future events and their effects cannot be made with certainty. Estimates may change as new events occur when additional information becomes available and if our operating environment changes. Actual results could differ from our estimates.
Debt Issuance Costs
Debt issuance costs related to term debt are recorded as a direct deduction from the carrying value of the associated debt liability on the consolidated balance sheets. The costs are amortized using the effective interest rate method over the term of the related debt. Debt issuance costs related to revolving loans are recorded within other non-current assets and amortized straight-line over the term of the related debt. Amortization of debt
7
issuance costs is recorded as a component of interest expense, net on the consolidated statements of operations and comprehensive income (loss). Costs incurred in connection with an expected refinancing, restructuring or debt issuance are capitalized and recorded within other non-current assets.
Restructuring, Contract Termination and Impairment Charges
Restructuring, contract termination and impairment charges are primarily comprised of severance and employee-related benefits, contract termination fees and impairment charges. We recognize employee severance costs as a liability at estimated fair value, at the time of communication to affected employees, unless future service is required, in which case the costs are recognized ratably over the future service period. Contract termination fees include costs incurred to terminate a contract and the impacts to related assets or liabilities associated with these contracts. Asset impairment charges include impairments of long-lived assets, including intangible assets and goodwill, as addressed in Note 2 - Significant Accounting Policies, in the 2025 Form 10-K. Restructuring, contract termination and asset impairment activities are recognized when they are incurred and included in restructuring, contract termination and impairment charges on the unaudited consolidated statements of operations and comprehensive income (loss).
Commitments and Contingencies
From time to time, the Company is involved in various legal proceedings. While the Company intends to prosecute and defend any lawsuit vigorously, the Company presently believes that the ultimate outcome of any currently pending legal proceeding will not have any material adverse effect on its financial position, cash flows, or results of operations. However, litigation is subject to inherent uncertainties and unfavorable rulings could occur. An unfavorable ruling could include monetary damages, which could impact the Company’s business and the results of operations for the period in which the ruling occurs or future periods. Based on the information available, the Company evaluates the likelihood of potential outcomes. The Company records the appropriate liability when the amount is deemed probable and reasonably estimable. In addition, the Company does not accrue for estimated legal fees and other directly related costs as they are expensed as incurred. The unaudited consolidated balance sheets do not include a liability for any potential obligations as of September 30, 2026 or December 31, 2025.
Recently Issued Accounting Pronouncements - Not Yet Adopted
In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40), that requires the disclosure of certain amounts included in certain expense captions on the face of the income statement. The FASB subsequently issued ASU 2025-01, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40) to clarify the effective date of ASU 2024-03. The guidance is effective for annual periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. Early adoption is permitted. The adoption of this standard is not expected to have a material impact on the Company’s consolidated financial statements, but will require certain additional disclosures. The Company does not expect to early adopt at this time.
In September 2025, the FASB issued ASU 2025-06, Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software. ASU 2025-06 modernizes the accounting for internal-use software by removing all references to prescriptive and sequential software development stages. ASU 2025-06 requires entities to begin capitalizing software costs when management authorizes and commits to funding the software project, and it is probable that the project will be completed and the software will be used for its intended purpose. ASU 2025-06 is effective for fiscal years beginning after December 15, 2027, and for interim periods within those fiscal years, with early adoption permitted. The adoption of this standard is not expected to have a material impact on the Company’s consolidated financial statements. The Company does not expect to early adopt at this time.
NOTE 2 – Restructuring, Contract Termination and Impairment Charges
2026 Restructuring Activity
The components of the restructuring, contract termination and impairment charges are as follows (in thousands):
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| Restructuring charges | $ | $ | $ | $ | |||||||||||||||||||
| Impairment charges | |||||||||||||||||||||||
| Contract termination charges (benefit) | ( | ||||||||||||||||||||||
| Total restructuring, contract termination and impairment charges | $ | $ | $ | $ | |||||||||||||||||||
The cost saving initiatives identified and executed upon during the nine months ended September 30, 2026 were designed to reduce operational expenditures over the long-term. The key cost saving initiatives and operational planning activities undertaken during the nine months ended September 30, 2026 were as follows:
•Restructuring
•expenses related to strategic consulting firms assisting in financial planning and project management activities, resulting in a restructuring charge of $2.1 million;
•retention payments to key personnel to support the sustainment of operations and focus on cost saving and operational improvements, resulting in recognition of restructuring charges of $1.2 million during the period;
8
•reduction in force (“RIF”) of management and non-management personnel in an effort to align headcount with the operational needs of the business resulting in a moderate decline in related expenses in the short term, with the significance of the savings anticipated to be recognized in future periods, resulting in a restructuring charge of $0.3 million; and
•see Facility Closures below for additional restructuring charges.
•Impairment Charges
•impairment of an underperforming retail store, resulting in a right-of-use (“ROU”) lease asset impairment charge of $0.7 million and impairment of property and equipment of $0.2 million, or an aggregate charge to expense of $0.9 million; and
•see Facility Closures below for additional impairment charges.
•Contract Termination
•early termination of the Company’s Salt Lake City distribution center lease to reduce fixed costs in the short term and in future periods, which resulted in a contract termination benefit of $0.2 million upon recognition of the lease modification.
•Facility Closures
•closure of Oru’s manufacturing facility to reduce fixed costs in the short term and in future periods, as well as eliminate the Company’s only manufacturing operation, resulting in recognition of restructuring charges of $0.6 million during the period related to severance and facility exit costs and impairment charges of $0.8 million, or an aggregate charge to expense of $1.4 million. Refer to Note 4, Inventory for additional information on a related inventory write-down recorded during the period; and
•closure of two distribution centers to reduce fixed costs in the short term and in future periods, resulting in the recognition of restructuring charges of $0.9 million, impairment of a ROU lease asset of $1.3 million, and impairment of property and equipment of $0.1 million, or an aggregate charge to expense of $2.3 million.
2025 Restructuring Activity
In 2025, management, along with our Board of Directors, engaged strategic consulting firms to assist with improving our financial results. This operational improvement involved the engagement of restructuring, legal and investment banking consultants to perform financial planning, forecasting and project management activities. Certain of these strategic consulting firms assisted and continue to assist in developing operational plans for the near- and long-term, as well as identifying cost saving initiatives to reduce our operational expenses and aid in the development of enhanced internal reporting to deliver timely insight to management.
The cost saving initiatives identified and executed upon during the nine months ended September 30, 2025 were designed to reduce operational expenditures over the long-term. The key cost saving initiatives and operational planning activities undertaken during the nine months ended September 30, 2025 were as follows:
•Restructuring
•retention payments to key personnel to support the sustainment of operations and focus on cost saving and operational improvements, resulting in a restructuring charge of $5.7 million;
•RIF of management and non-management personnel in an effort to align headcount with the operational needs of the business resulting in a moderate decline in related expenses in the short term, with the significance of the savings anticipated to be recognized in future periods, resulting in a restructuring charge of $1.0 million; and
•expenses related to the strategic consulting firms discussed above, resulting in a restructuring charge of $7.0 million.
•Contract Terminations
•termination of an underperforming licensing agreement in an effort to redeploy the allocated funds for operational purposes, resulting in a charge to contract termination of $2.5 million; and
•settlement of a termination fee with a former advertising services vendor, with a previously accrued balance of $5.4 million that was settled for $4.0 million, a $1.4 million benefit to the Company.
•Facility Closures
•closure of two distribution centers to reduce fixed costs in the short term and in future periods, as well as eliminate unnecessary capacity, resulting in restructuring charges of $1.5 million, impairment charges of $0.5 million, and contract termination of $0.2 million, or an aggregate charge to expense of $2.2 million.
The Company expects to continue to evaluate and identify additional cost-saving initiatives that it may execute in the near term, with potential expenses to be incurred at the onset of said initiative that will be reflected within restructuring, contract termination and/or impairment charges. As of September 30, 2026, the Company is unable to estimate the potential upfront costs of these future cost saving initiatives, due to their preliminary nature.
NOTE 3 – Revenue
The Company primarily engages in direct-to-consumer transactions, which are comprised of product sales directly from the Company’s website, and business-to-business transactions, or retail, which are comprised of product sales to retailers, including where possession of the Company’s products is taken and sold by the retailer in-store or online.
9
The following table disaggregates net sales by channel (in thousands):
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| Direct-to-consumer | $ | $ | $ | $ | |||||||||||||||||||
| Retail | |||||||||||||||||||||||
| Net sales | $ | $ | $ | $ | |||||||||||||||||||
The following table disaggregates net sales by product (in thousands):
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
Fire pits, griddles, coolers, and related accessories | $ | $ | $ | $ | |||||||||||||||||||
Apparel, activewear, and swimwear | |||||||||||||||||||||||
Paddle boards, kayaks, and related accessories | |||||||||||||||||||||||
| Other | |||||||||||||||||||||||
| Net sales | $ | $ | $ | $ | |||||||||||||||||||
The following table disaggregates net sales by geographic region (in thousands):
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| United States | $ | $ | $ | $ | |||||||||||||||||||
| International | |||||||||||||||||||||||
| Net sales | $ | $ | $ | $ | |||||||||||||||||||
NOTE 4 – Inventory
Inventory consisted of the following (in thousands):
| September 30, 2026 | December 31, 2025 | ||||||||||
Finished products on hand, net of inventory obsolescence reserve of $ | $ | $ | |||||||||
| Finished products in transit | |||||||||||
Raw materials(1) | |||||||||||
| Inventory | $ | $ | |||||||||
(1)During the nine months ended September 30, 2026, the Company recognized inventory writedowns of $1.6 million, largely due to a $1.4 million inventory writedown of raw materials related to the closure of the Oru manufacturing facility within cost of goods sold on the unaudited consolidated statements of operations and comprehensive income (loss). See Note 2, Restructuring, Contract Termination and Impairment Charges for additional information on the Oru manufacturing facility closure.
NOTE 5 – Prepaid Expenses and Other Current Assets
Prepaid expenses and other current assets consisted of the following (in thousands):
| September 30, 2026 | December 31, 2025 | ||||||||||
| Inventory deposits | $ | $ | |||||||||
| Income tax receivables | |||||||||||
| Software | |||||||||||
| Payroll | |||||||||||
| Insurance | |||||||||||
| Other | |||||||||||
| Prepaid expenses and other current assets | $ | $ | |||||||||
10
NOTE 6 – Property and Equipment, Net
Property and equipment, net consisted of the following (in thousands):
| September 30, 2026 | December 31, 2025 | ||||||||||
| Machinery | $ | $ | |||||||||
| Leasehold improvements | |||||||||||
| Buildings | |||||||||||
| Furniture and fixtures | |||||||||||
| Software and website development | |||||||||||
| Computer and other equipment | |||||||||||
| Land | |||||||||||
| Construction in progress | |||||||||||
| Property and equipment, gross | |||||||||||
| Accumulated depreciation | ( | ( | |||||||||
| Property and equipment, net | $ | $ | |||||||||
Depreciation and amortization expense for property and equipment was $1.7 million and $5.1 million for the three and nine months ended September 30, 2026, respectively, compared to $1.8 million and $5.7 million for the three and nine months ended September 30, 2025, respectively.
During the three and nine months ended September 30, 2026, the Company recognized impairments of property and equipment, net, of $0.3 million and $1.1 million, respectively, which was related to property and equipment associated with the impairment of two ROU leases during the three and nine months ended September 30, 2026, and the closure of the Oru manufacturing facility for the nine months ended September 30, 2026. See Note 2, Restructuring, Contract Termination and Impairment Charges for additional information.
NOTE 7 – Intangible Assets, Net
Intangible assets consisted of the following (in thousands):
| September 30, 2026 | December 31, 2025 | ||||||||||
| Gross carrying value | |||||||||||
| Brands | $ | $ | |||||||||
| Trademarks | |||||||||||
| Customer relationships | |||||||||||
Patents | |||||||||||
| Intangible assets, gross | |||||||||||
Accumulated amortization and impairments(1) | |||||||||||
| Brands | ( | ( | |||||||||
| Trademarks | ( | ( | |||||||||
| Customer relationships | ( | ( | |||||||||
| Patents | ( | ( | |||||||||
Accumulated amortization and impairments(1) | ( | ( | |||||||||
| Intangible assets, net | $ | $ | |||||||||
(1) Includes aggregate impairments for brand of $77.3 7.1 0.5 6.8
NOTE 8 – Goodwill
The carrying value of goodwill at our Chubbies reporting unit, the only reporting unit with remaining goodwill, was $73.1
11
NOTE 9 – Accrued Expenses and Other Current Liabilities
Significant accrued expenses and other current liabilities were as follows (in thousands):
| September 30, 2026 | December 31, 2025 | ||||||||||
| Leases | $ | $ | |||||||||
| Inventory | |||||||||||
Income taxes(1) | |||||||||||
| Payroll | |||||||||||
| Allowance for sales returns and rebates | |||||||||||
| Non-income taxes | |||||||||||
Warranty | |||||||||||
| Other | |||||||||||
| Accrued expenses and other current liabilities | $ | $ | |||||||||
(1) The decrease in income taxes is primarily related to the Corporate Simplification, see Note 11, Income Taxes for further information.
NOTE 10 – Debt, Net
Debt, net consisted of the following (in thousands):
| September 30, 2026 | December 31, 2025 | ||||||||||
Term loans | $ | $ | |||||||||
| Unamortized debt issuance costs | ( | ( | |||||||||
Long-term debt, net | |||||||||||
Plus: current portion of long-term debt | |||||||||||
| Total debt, net of debt issuance costs | $ | $ | |||||||||
Revolving Credit Facility and Term Loan
On June 13, 2025, the Company entered into Amendment No. 4 to Credit Agreement and Limited Waiver and Amendment No. 1 to Security Agreement (the “2025 Credit Agreement”) with JPMorgan Chase Bank, N.A., the Lenders and L/C Issuers party thereto (each as defined therein) and the other parties thereto. The 2025 Credit Agreement consists of (i) a term loan with an aggregate principal amount of $240 million (“2025 Term Loan”) and (ii) a revolving credit facility with an initial committed amount of $90 million (“2025 Revolving Credit Facility”). The 2025 Revolving Credit Facility includes (i) a sub-limit of $10 million for swing line loans and (ii) a separate sub-limit of $20 million for the issuance of letters of credit.
Pursuant to the 2025 Credit Agreement, the maturity date of the 2025 Revolving Credit Facility and 2025 Term Loan is June 30, 2028. The Company commenced mandatory quarterly principal payments on the 2025 Term Loan during the fiscal quarter ending on June 30, 2026, based on the aggregate outstanding principal amount of 2025 Term Loan as of June 13, 2025 multiplied by 0.25 %. We are required to make quarterly principal payments beginning with the fiscal quarter ending on June 30, 2027, based on the aggregate outstanding principal amount of the 2025 Term Loan as of June 13, 2025 multiplied by 1.00 %.
Each of the 2025 Revolving Credit Facility and 2025 Term Loan bears interest at (depending on the Company’s election from time to time) either an adjusted term rate defined in the agreement based on SOFR or the base rate defined in the 2025 Credit Agreement, each plus an applicable margin. The interest was payable in kind (“PIK”), and thus capitalized thereon and increasing the principal balance thereof, on a quarterly basis through March 31, 2026. The interest is PIK (i) for the period beginning on April 1, 2026 and ending on March 31, 2027, upon the Company’s election, and (ii) after March 31, 2027, it is only payable in cash. The Company elected not to PIK interest for the three months ended June 30, 2026 and to PIK interest for the three months ended September 30, 2026. PIK capitalized for the three and nine months ended September 30, 2026 was $6.1 million and $11.9 million, respectively. As of September 30, 2026, the interest rate on the 2025 Term Loan was 9.57 %, and the weighted-average interest rates on the 2025 Term Loan and 2025 Revolving Credit Facility for the nine months ended September 30, 2026 were 9.22 % and 7.16 %, respectively. The unfunded portion of the commitments under the 2025 Revolving Credit Facility will accrue an annual commitment fee of 0.50 %.
As of September 30, 2026, availability for future draws on the 2025 Revolving Credit Facility based on the borrowing base as of such date was $50.3 million, net of $5.8 million of letters of credit issued and outstanding.
Pursuant to the 2025 Credit Agreement, the Company is required to comply with the following financial covenants:
•a maximum debt-to-EBITDA ratio, defined in the 2025 Credit Agreement as the Total Leverage Ratio and determined as of the last day of each fiscal quarter with EBITDA annualized for the most recent fiscal quarter, of 9.50 for the fiscal quarter ended September 30, 2026; 9.00 8.25
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2027; 7.50 7.00
•a minimum EBITDA-to-fixed charges ratio, defined in the 2025 Credit Agreement as the Fixed Charge Coverage Ratio, and determined as of the last day of each fiscal quarter with EBITDA annualized for the most recent fiscal quarter, of 0.70 0.75 0.80 1.00
•a minimum unrestricted cash plus undrawn availability on the 2025 Revolving Credit Facility amount, defined as Minimum Liquidity in the 2025 Credit Agreement, of $10 million average minimum liquidity covenant for the first three calendar months of each fiscal year and a $20 million average minimum liquidity covenant for the last nine calendar months of each fiscal year, which in each case as applicable, is tested on a monthly basis.
As of September 30, 2026, the Company was in compliance with all covenants under the 2025 Credit Agreement. For purposes of the above covenants, EBITDA is calculated as set forth in the 2025 Credit Agreement.
As of September 30, 2026, the future maturities of principal amounts of our total debt obligations through maturity consist of the following:
| Years Ending December 31, | Amount | ||||
| 2026 (remaining three months) | $ | ||||
| 2027 | |||||
| 2028 | |||||
| Total | $ | ||||
NOTE 11 – Income Taxes
Corporate Simplification
On December 17, 2025, the Company entered into the Merger Agreement with Holdings, Merger Sub and Blocker. Pursuant to the Merger Agreement, effective January 1, 2026, Merger Sub merged with and into Holdings, with Holdings surviving as a wholly owned subsidiary of the Company. The Merger was part of a series of internal legal reorganization transactions undertaken to simplify the Company’s organizational structure and eliminate its umbrella partnership-C corporation (UP-C) structure (the “Corporate Simplification”).
In connection with the Corporate Simplification, the Company separately assessed its valuation allowance, inclusive of realization of deferred tax liabilities within the consolidated group, including those associated with the Chubbies segment, to support the realizability of deferred tax assets. This resulted in the reduction of a portion of the Company’s existing valuation allowance and a corresponding recognition of an income tax benefit of $6.6
Provision for Income Taxes
The income tax expense included in the consolidated statement of operations is based upon the estimated effective tax rate for the year, adjusted for the impact of discrete items which are accounted for in the period in which they occur.
The Company’s income tax expense (benefit) and effective income tax rate is as follows (in thousands, except for percentages):
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| Income (loss) before income taxes | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||
| Income tax expense (benefit) | ( | ( | ( | ||||||||||||||||||||
| Effective income tax rate | % | % | % | ( | % | ||||||||||||||||||
The change in effective income tax rate for the three months ended September 30, 2026 compared to the three months ended September 30, 2025 was primarily driven by a prior period tax refund received and recorded in the current period. The change in the effective income tax rate for the nine months ended September 30, 2026 compared to nine months ended September 30, 2025 was primarily driven by the effects of the Corporate Simplification and related valuation release, as well as a tax refund received and recorded in the current period that was related to a prior period.
NOTE 12 – Equity
Corporate Simplification
As a result of the Corporate Simplification, described in further detail in Note 11, Income Taxes, all issued and outstanding LLC Units of Holdings (other than those held by the Company or Blocker) were cancelled and converted into shares of the Company’s Class A common stock, and all outstanding shares of the Company’s Class B common stock were retired and cancelled. Following the Merger, Holdings is a wholly-owned subsidiary of the Company, and no LLC Units or Class B common stock remain outstanding.
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The Corporate Simplification was accounted for as a transaction between entities under common control. As a result, the noncontrolling interest attributable to the former LLC Unit holders was reclassified to additional paid-in capital in the Company’s unaudited consolidated statements of equity (deficit) as of the effective date of January 1, 2026.
NOTE 13 – Fair Value Measurements
Financial Assets and Liabilities not Measured at Fair Value
Financial assets and liabilities that are not measured at fair value on a recurring basis on our consolidated balance sheets include cash and cash equivalents, restricted cash, accounts receivable, net, accounts payable, and debt. The fair value of the Company's cash and cash equivalents, accounts receivable, net and accounts payable approximate their carrying values due to the short-term nature of the instruments.
The Company’s outstanding debt under the 2025 Credit Agreement, as discussed in Note 10, Debt, Net, is recorded at principal amounts. The 2025 Term Loan’s principal balance includes PIK and its carrying value is reduced by unamortized debt issuance costs.
As of September 30, 2026, the Company transferred its outstanding debt under the Term Loan Facility and the Revolving Credit Facility from Level 2 to Level 3 in the fair value hierarchy. The fair value of the outstanding debt was calculated based on an expected cash flow approach, which probability weights performing and non-performing scenarios using recovery rate assumptions. Because these assumptions are key components to the valuation and are unobservable inputs, the measurement is classified as Level 3. As of September 30, 2026, the Company’s debt had an aggregate principal amount of $264.4 million and a fair value amount of $226.8 million. As of December 31, 2025, the principal amount of the Company's outstanding debt was $253.1
NOTE 14 – Net Income (Loss) Per Class A Common Stock
Basic net income (loss) per share of Class A common stock is computed by dividing net income (loss) attributable to Solo Brands, Inc. by the weighted average number of shares of Class A common stock outstanding during the period. Diluted net income (loss) per share of Class A common stock is computed by dividing net income (loss) attributable to Solo Brands, Inc. by the weighted average number of shares of Class A common stock outstanding adjusted to give effect to potentially dilutive securities. The weighted average number of shares has been retrospectively adjusted as a result of the 1-for-40 reverse stock split effected in the third quarter of 2025. See Note 1, Organization and Basis of Presentation for additional information.
The following table sets forth the calculation of the basic and diluted net income (loss) per share for the Company’s Class A common stock (in thousands, except per share data):
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
Net income (loss) | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||
| Less: net income (loss) attributable to non-controlling interests | ( | ( | |||||||||||||||||||||
Net income (loss) attributable to Solo Brands, Inc. | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||
Weighted average shares of Class A common stock outstanding - basic and diluted | |||||||||||||||||||||||
Net income (loss) per share of Class A common stock outstanding - basic and diluted | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||
NOTE 15 – Variable Interest Entities
Consolidated Variable Interest Entities (“VIE”)
As of September 30, 2026 and December 31, 2025, we consolidated one
In June 2026, the Company initiated the process for closing the Oru manufacturing facility which resulted in an impairment of the VIE’s property and equipment, net, of $0.3 million. See Note 2, Restructuring, Contract Termination and Impairment Charges for more information. There was no change to the VIE determination as a result of this closure as of September 30, 2026.
Total assets of the VIE included on the consolidated balance sheets as of September 30, 2026 and December 31, 2025 were $1.4 million and $1.5 million, respectively. Total liabilities of the VIE included on the consolidated balance sheets as of September 30, 2026 and December 31, 2025
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were $0.2 million and $0.2 million, respectively, and excludes an intercompany note payable to the Company of $3.1 million and $2.5 million, respectively, which is eliminated in consolidation.
The VIE’s assets may only be used to settle the VIE’s obligations and may not be used for other consolidated entities. The VIE’s liabilities are non-recourse to the general credit of the Company’s other consolidated entities.
Unconsolidated VIE
NOTE 16 – Segments
The Company conducts its worldwide operations through operating segments, each of which represents major product lines. Operations are conducted in the U.S. and various foreign locations, primarily in Europe, Canada, and Asia-Pacific. Segment reporting is based upon the “management approach,” i.e., how we organize operating segments for which separate financial information is (i) available and (ii) evaluated regularly by the Chief Operating Decision Maker (“CODM”) in deciding how to allocate resources and in assessing performance. Our CODM is our Chief Executive Officer.
During the three months ended June 30, 2026, the ISLE and Oru operating segments were revised into one operating and reportable segment, Watersports, to align with how separate financial information is evaluated by the CODM, and how that information is used to assess performance and allocate resources.
The Company’s revised three reportable segments are as follows:
| Reportable Segment | Key Brands | Description of Primary Products | ||||||||||||
| Solo Stove | Solo Stove and TerraFlame(1) | Fire pits, griddles, coolers, and related accessories | ||||||||||||
| Chubbies | Chubbies and Cheekies | Premium casual apparel, activewear, and swimwear | ||||||||||||
| Watersports | ISLE and Oru | Inflatable and hard paddle boards, folding kayaks, and related accessories | ||||||||||||
(1) While certain assets and manufacturing operations of the TerraFlame business were disposed of during the second quarter of 2025, the Company continues to be sole distributor of TerraFlame products and recognizes the resulting profit or loss from the Company’s distribution activities within the Solo Stove reportable segment.
All prior period comparative segment information has been recast to reflect our segment determination made as of June 30, 2026.
IcyBreeze, which was wound down during the fourth quarter of 2024 and whose brand name has been discontinued, did not meet the criteria necessary to be considered a reportable segment. IcyBreeze’s trailing results are included within All Other for the three and nine months ended September 30, 2025.
Our CODM relies on internal management reporting that analyzes our segments’ adjusted EBITDA, which he utilizes to assess performance as compared to historical results and budget and forecast amounts, and allocate capital and investment in new products. The CODM also uses segment adjusted EBITDA to determine product pricing and strategy, and marketing spending relative to revenue returns. As segment assets are not reported to or used by the CODM to measure business performance or allocate resources, total segment assets are not presented below.
We define segment adjusted EBITDA as net income (loss) before interest expense, income taxes, depreciation and amortization expenses, restructuring, contract termination and impairment charges, equity-based compensation expense, and other costs that are believed by management to be non-operating in nature and not representative of the Company’s core operating performance, including business optimization and expansion expense, changes in fair value of contingent earn-out liability, management transition costs, and costs associated with the refinancing amendment.
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The following tables present segment information for net sales, significant expenses and the reconciliation of segment adjusted EBITDA to consolidated income (loss) before taxes (in thousands):
| Three Months Ended September 30, 2026 | Three Months Ended September 30, 2025 | ||||||||||||||||||||||||||||||||||||||||||||||
| Solo Stove | Chubbies | Watersports | Total | Solo Stove | Chubbies | Watersports | Total | ||||||||||||||||||||||||||||||||||||||||
| Net sales | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
| Reconciliation to consolidated net sales: | |||||||||||||||||||||||||||||||||||||||||||||||
| All other | |||||||||||||||||||||||||||||||||||||||||||||||
| Consolidated net sales | $ | $ | |||||||||||||||||||||||||||||||||||||||||||||
| Cost of goods sold | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||||
| Marketing expense | |||||||||||||||||||||||||||||||||||||||||||||||
| Employee-related compensation | |||||||||||||||||||||||||||||||||||||||||||||||
Other segment operating expenses(1) | |||||||||||||||||||||||||||||||||||||||||||||||
| Segment adjusted EBITDA | $ | $ | $ | $ | $ | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||||||||
All other segment adjusted EBITDA(2) | |||||||||||||||||||||||||||||||||||||||||||||||
Corporate and other non-segment operating expenses(3) | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||
| Restructuring, contract termination and impairment charges | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||
| Depreciation and amortization expenses | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||
| Interest expense, net | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||
| Other non-operating income (expense) | |||||||||||||||||||||||||||||||||||||||||||||||
| Income (loss) before income taxes | $ | ( | $ | ( | |||||||||||||||||||||||||||||||||||||||||||
| Depreciation and amortization expenses (disaggregated): | |||||||||||||||||||||||||||||||||||||||||||||||
| Solo Stove | $ | $ | |||||||||||||||||||||||||||||||||||||||||||||
| Chubbies | |||||||||||||||||||||||||||||||||||||||||||||||
| Watersports | |||||||||||||||||||||||||||||||||||||||||||||||
| All Other | |||||||||||||||||||||||||||||||||||||||||||||||
| Depreciation and amortization expenses | $ | $ | |||||||||||||||||||||||||||||||||||||||||||||
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| Nine Months Ended September 30, 2026 | Nine Months Ended September 30, 2025 | ||||||||||||||||||||||||||||||||||||||||||||||
| Solo Stove | Chubbies | Watersports | Total | Solo Stove | Chubbies | Watersports | Total | ||||||||||||||||||||||||||||||||||||||||
| Net sales | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
| Reconciliation to consolidated net sales: | |||||||||||||||||||||||||||||||||||||||||||||||
| All other | |||||||||||||||||||||||||||||||||||||||||||||||
| Consolidated net sales | $ | $ | |||||||||||||||||||||||||||||||||||||||||||||
Cost of goods sold(4) | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||||
| Marketing expense | |||||||||||||||||||||||||||||||||||||||||||||||
| Employee-related compensation | |||||||||||||||||||||||||||||||||||||||||||||||
Other segment operating expenses(1) | |||||||||||||||||||||||||||||||||||||||||||||||
| Segment adjusted EBITDA | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
All other Segment adjusted EBITDA(2) | ( | ||||||||||||||||||||||||||||||||||||||||||||||
Corporate and other non-segment operating expenses(3)(4) | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||
| Restructuring, contract termination and impairment charges | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||
| Depreciation and amortization expenses | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||
| Interest expense, net | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||
| Other non-operating income (expense) | ( | ||||||||||||||||||||||||||||||||||||||||||||||
| Income (loss) before income taxes | $ | ( | $ | ( | |||||||||||||||||||||||||||||||||||||||||||
| Depreciation and amortization expenses (disaggregated): | |||||||||||||||||||||||||||||||||||||||||||||||
| Solo Stove | $ | $ | |||||||||||||||||||||||||||||||||||||||||||||
| Chubbies | |||||||||||||||||||||||||||||||||||||||||||||||
| Watersports | |||||||||||||||||||||||||||||||||||||||||||||||
| All Other | |||||||||||||||||||||||||||||||||||||||||||||||
| Depreciation and amortization expenses | $ | $ | |||||||||||||||||||||||||||||||||||||||||||||
(1)Includes expenses for seller fees, shipping and fulfillment, along with certain fixed and other variable expenses incurred in the normal course of business.
(2)Includes net sales and expenses of our operating segments that did not meet the requirements to be considered a reportable segment, which includes the results of IcyBreeze for the three and nine months ended September 30, 2025, as well as the consolidating elimination entries that are not specific to our reportable segments.
(3)Includes corporate general and administrative service expenses of $5.2 million and $16.9 million for the three and nine months ended September 30, 2026, respectively, and $5.9 million and $18.6 million for the three and nine months ended September 30, 2025, respectively, with the remaining non-segment operating expenses being primarily fixed costs.
(4)Cost of goods sold excludes $1.6 million of inventory charges associated with restructuring and consolidation activities for the nine months ended September 30, 2026, largely the result of a $1.4
Net sales exclude all intercompany sales between our reportable segments and All Other, as well as related profits, which were not material for the three and nine months ended September 30, 2026 and 2025.
NOTE 17 – Related Parties
The Company occasionally enters into transactions with related parties in the normal course of business. One related party, which is wholly owned by an employee of Solo Brands and this employee’s immediate family, purchases merchandise from Solo Brands to sell in a certain geographical market, which is included in net sales on the unaudited consolidated statements of operations and comprehensive income (loss). As of September 30, 2026, this employee is no longer affiliated with the Company and the customer is no longer considered a related party. There were nominal
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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
In the following discussion, references to “we,” “us,” “our,” the “Company,” and similar references mean Solo Brands, Inc. and its consolidated subsidiaries, unless the context otherwise requires. The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our unaudited consolidated financial statements and the related notes to those statements included elsewhere in this Quarterly Report, as well as our audited consolidated financial statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025 (the “2025 Form 10-K”). Some of the numbers included herein have been rounded for the convenience of the presentation. In addition to historical consolidated financial information, the following discussion and analysis contains forward-looking statements that involve risks, uncertainties and assumptions. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of many factors, including those discussed under Part I, Item 1A, “Risk Factors” of our 2025 Form 10-K, Part II, Item 1A, “Risk Factors” in our Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2026, and elsewhere in this Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2026 (“Quarterly Report”). See further our “Forward-Looking Statements” in this Quarterly Report.
Overview
Solo Brands, Inc. is a branded outdoor lifestyle company that develops, markets, and sells products across outdoor cooking, outdoor recreation, casual apparel, and watersports categories. Our portfolio includes Solo Stove, which offers fire pits, griddles, coolers, and related accessories; Chubbies, which offers casual apparel, activewear, and swimwear; and our Watersports brands, including International Surf Ventures (“ISLE”), which offers inflatable and hard paddle boards and related accessories, and Oru Kayak (“Oru”), which offers folding kayaks and accessories. We are headquartered in Grapevine, Texas. Our products are sold through direct-to-consumer (“DTC”) channels, retail partners, and distributors in the United States and internationally.
During the three months ended June 30, 2026, the ISLE and Oru operating segments were revised into one operating and reportable segment, Watersports, to align with how separate financial information is evaluated by the CODM, and how that information is used to assess performance and allocate resources. Our revised reportable segments are: (i) Solo Stove, (ii) Chubbies, and (iii) Watersports.
IcyBreeze, which was wound down during the fourth quarter of 2024 and whose brand name has been discontinued, did not meet the criteria necessary to be considered a reportable segment. IcyBreeze’s trailing results are included within our consolidated results for the three and nine months ended September 30, 2025. In 2025, the Company completed the disposition of the manufacturing operations for the TerraFlame brand. However, we continue to own the intellectual property of TerraFlame, as well as sole distribution rights of TerraFlame branded products.
Net sales decreased to $43.7 million and $195.1 million for the three and nine months ended September 30, 2026, respectively, from $53.0 million and $222.5 million for the three and nine months ended September 30, 2025, respectively. These decreases in net sales were driven by the decline in net sales within the Solo Stove and Chubbies segments, which were primarily within the DTC channel at each segment. For the nine month period, these decreases were partially offset by higher retail net sales in the Watersports segment.
While net sales decreased for the three and nine months ended September 30, 2026 compared to the three and nine months ended September 30, 2025, loss from operations improved to $14.4 million and $15.6 million for the three and nine months ended September 30, 2026, respectively, compared to $16.2 million and $36.7 million for the three and nine months ended September 30, 2025, respectively. These changes were primarily driven by effective management of operating expenses to align with the decline in net sales, particularly advertising and marketing costs, but also including payroll and distribution costs rightsizing.
Corporate Simplification
On December 17, 2025, as part of the Corporate Simplification transactions, we entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Solo Stove Holdings, LLC (“Holdings”) and Solo Merger Sub LLC (“Merger Sub”), a subsidiary of Solo Brands, Inc. and SP SS Blocker Purchaser, LLC (“Blocker”), formed for the sole purpose of merging with and into Holdings. Pursuant to the Merger Agreement, effective January 1, 2026 (the “Effective Time”), Merger Sub merged with and into Holdings, with Holdings continuing as the surviving entity (the “Merger”) as a wholly owned subsidiary of Solo Brands, Inc.
Pursuant to the Merger Agreement, at the Effective Time, each of the common units of Holdings (“LLC Units”) beneficially owned by members of Holdings were cancelled and converted automatically into a right to receive one share of our Class A common stock, except for any LLC Units beneficially owned by either Solo Brands, Inc. or Blocker, which were cancelled for no consideration in accordance with the Merger Agreement and Holdings’ Amended and Restated Limited Liability Company Agreement (the “LLC Agreement”). At the Effective Time, the limited liability company interests of Merger Sub were converted into LLC units of the surviving entity, resulting in Holdings continuing as our wholly owned subsidiary. In addition, immediately following the Effective Time, all of the issued and outstanding shares of our Class B common stock were retired and cancelled in accordance with our Amended and Restated Certificate of Incorporation and the LLC Agreement. As a result, upon completion of the Merger, there were no LLC Units or shares of Class B common stock of the Company outstanding.
The Merger and related transactions did not terminate or otherwise accelerate our obligations under the Tax Receivable Agreement, dated as of October 27, 2021, by and among us, Holdings and the other parties from time-to-time party thereto. However, as a result of the Merger, we expect the total future potential cash payments due under the Tax Receivable Agreement to be generally limited.
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Economic Factors Affecting our Performance
Tariffs
On February 20, 2026, the U.S. Supreme Court held in Learning Resources, Inc. v. Trump that the International Emergency Economic Powers Act (“IEEPA”) does not authorize a U.S. President to impose tariffs during peacetime national emergencies and that the challenge to the legality of the incremental tariffs was within the exclusive jurisdiction of the U.S. Court of International Trade (“CIT”), thus affirming a prior decision of the CIT that the U.S. President lacked authority to impose incremental tariffs. We filed a lawsuit in the CIT challenging the legality of incremental tariffs and sought to recover the incremental tariffs paid in 2025 and 2026.
We began receiving refunds in May 2026 and elected to recognize these tariff refunds in accordance with gain contingency accounting under ASC 450-30, Gain Contingencies. Refunds are initially recorded as a reduction to the carrying value of inventory to the extent the related goods remain on hand, and are recognized as a reduction to cost of goods sold as that inventory is sold. Interest received is recorded as interest income within interest expense, net.
During the three and nine months ended September 30, 2026, we received $0.6 million and $10.5 million, respectively, in IEEPA tariff refunds. Of the total IEEPA refund amounts, during the three and nine months ended September 30, 2026, $3.0 million and $8.9 million were recorded as a reduction to cost of goods sold, respectively, and $0.0 million and $0.3 million were recorded as interest income within interest expense, net, respectively, on the unaudited consolidated statements of operations and comprehensive income (loss). As of September 30, 2026, $1.3 million was recorded as a reduction to inventory on the unaudited consolidated balance sheets.
We filed for $10.5 million of IEEPA tariff refunds and, as of September 30, 2026, we have received the full amount. We continue to monitor developments related to these IEEPA tariff refunds and assess the potential impact on our consolidated financial statements.
Macroeconomic Factors
Current macroeconomic factors, including overall economic and political uncertainty and unrest, financial and capital markets instability, new or increasing tariffs, high interest rates and high inflation, remain very dynamic and highly uncertain. The effects of the macroeconomic environment could further reduce our net sales or negatively impact our gross profit margin, net income (loss), or cash flows.
Other Key Factors Affecting Our Financial Condition and Results of Operations
Trends in Seasonality
Our business is affected by the general seasonal trends reflecting our portfolio of outdoor lifestyle products, and our net sales have historically been highest in the second quarter and the fourth quarter. The timing of net sales within our retail channel can fluctuate depending on the seasonal needs of our retail customers.
2026 Restructuring Activity
The cost saving initiatives identified and executed upon during the nine months ended September 30, 2026 were designed to reduce operational expenditures over the long-term. The key cost saving initiatives and operational planning activities undertaken during the nine months ended September 30, 2026 were as follows:
•Restructuring
•expenses related to strategic consulting firms assisting in financial planning and project management activities;
•retention payments to key personnel to support the sustainment of operations and focus on cost saving and operational improvements; and
•reduction in force (“RIF”) of management and non-management personnel in an effort to align headcount with the operational needs of the business resulting in a moderate decline in related expenses in the short term, with the significance of the savings anticipated to be recognized in future periods.
•Impairment Charges
•impairment of an underperforming retail store
•Contract Termination
•early termination of our Salt Lake City distribution center lease to reduce fixed costs in the short term and in future periods.
•Facility Closures
•closure of Oru’s manufacturing facility to reduce fixed costs in the short term and in future periods, as well as eliminate our only manufacturing operation.
•closure of two distribution centers to reduce fixed costs in the short term and in future periods
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While these activities were intended to provide future benefit to us, most of these activities required up-front cash outlays. In order to fund these cash outlays, we used cash from operations and borrowings under the current revolving credit facility. The following table outlines the cash outlays and the period in which they occurred (in thousands):
| Activity | Cash Outlay | Period | ||||||||||||
| Retention payments to key personnel | $ | 2,231 | Q2 2026 | |||||||||||
| Reduction in force | 344 | Q1 and Q2 2026 | ||||||||||||
| Contract termination | 73 | Q2 2026 | ||||||||||||
| Engagement of strategic consulting firms | 1,991 | Q1 - Q3 2026 | ||||||||||||
| Facility closures | 792 | Q2 and Q3 2026 | ||||||||||||
2025 Restructuring Activity
In 2025, management, along with our Board of Directors, engaged strategic consulting firms to assist with improving our financial results. This operational improvement involved the engagement of restructuring, legal and investment banking consultants to perform financial planning, forecasting and project management activities. Certain of these strategic consulting firms assisted and continued to assist in developing operational plans for the near- and long-term throughout 2025, as well as identified cost-saving initiatives to reduce our operational expenses and aid in the development of enhanced internal reporting to deliver timely insight to management.
The cost saving initiatives identified and executed during the nine months ended September 30, 2025 were designed to reduce operational expenditures over the long-term. The key cost saving initiatives and operational planning activities undertaken during the nine months ended September 30, 2025 were as follows:
•Restructuring
•retention payments to key personnel to support the sustainment of operations and focus on cost saving and operational improvements;
•RIF of management and non-management personnel in an effort to align headcount with the operational needs of the business resulting in a moderate decline in related expenses in the short term, with the significance of the savings anticipated to be recognized in future periods; and
•expenses related to the strategic consulting firms discussed above.
•Contract Terminations
•termination of an underperforming licensing agreement in an effort to redeploy the allocated funds for operational purposes; and
•settlement of a termination fee with a former advertising services vendor.
•Facility Closures
•closure of two distribution centers to reduce fixed costs in the short term and in future periods, as well as eliminate unnecessary capacity.
While these activities were intended to provide future benefit to us, most of these activities required up-front cash outlays. In order to fund these cash outlays, we used cash from operations and borrowings under the prior revolving credit facility. The following table outlines the cash outlays and the period in which they occurred (in thousands):
| Activity | Cash Outlay | Period | ||||||||||||
| Retention payments to key personnel | $ | 5,655 | Q2 2025 | |||||||||||
| Reduction in force | 914 | Fiscal year 2025 | ||||||||||||
| Engagement of strategic consulting firms | 7,187 | Fiscal year 2025 | ||||||||||||
| Facility closures | 976 | Q1 & Q3 2025 | ||||||||||||
The 2025 restructuring activity was concluded in the fourth quarter of 2025.
Components of Our Results of Operations
Net Sales
Net sales are comprised of DTC and retail channel sales to retail partners. Net sales within all channels reflect the impact of partial shipments, product returns, and discounts for certain sales programs or promotions.
Gross Profit and Gross Profit Margin
Gross profit reflects net sales less cost of goods sold, which primarily includes the purchase cost of our products from our third-party manufacturers, inbound freight and duties, net of IEEPA tariff refunds, costs related to manufacturing of certain of our products (prior to the closure of our remaining manufacturing facility), product quality testing and inspection costs, and depreciation on molds and equipment that we own.
20
Operating Expenses
Operating expenses consist of the following items:
•Selling, General & Administrative Expenses - Selling, general & administrative expenses consist primarily of marketing costs, wages, equity-based compensation expense, benefits costs, costs of our warehousing and logistics operations, costs of operating on third-party DTC marketplaces, professional fees and services, costs of shipping product to our customers and general corporate expenses.
•Depreciation and Amortization Expenses - Depreciation and amortization expenses consist of depreciation of property and equipment and amortization of definite-lived intangible assets.
•Restructuring, Contract Termination and Impairment Charges - Restructuring, contract termination and impairment charges consist of severance and employee-related benefits, contract termination fees and asset impairment charges.
•Other Operating Expenses - Other operating expenses include certain costs incurred as a result of being a public company, acquisition-related expenses, business optimization and expansion expenses and management transition costs, including severance.
Interest Expense, Net
Interest expense, net consists primarily of interest expense on our revolving credit facilities and term loans.
Consolidated Income Taxes
Effective as of January 1, 2026 and subsequent to the Corporate Simplification, income taxes represent the federal, foreign, state and local income taxes of the consolidated filing group of Solo Brands, Inc. and its subsidiaries. The Corporate Simplification allows us to net the tax benefit (loss) generated by Solo Brands, Inc. and our wholly owned subsidiaries, Chubbies and Oru, whereas prior to the effective date separate returns were required for each respective brand. As a result, we expect that future periods will incur lower income tax expense in periods in which any of these brands generate a loss which would offset income generated by other brands.
Prior to the Corporate Simplification, income taxes represented federal, state, and local income taxes on our allocable share of taxable income of Holdings, as well as Oru’s and Chubbies’ federal and state taxable income, and our foreign tax expense related to international subsidiaries. Prior to the Corporate Simplification described above, we were the sole managing member of Holdings and, as a result, consolidated the financial results of Holdings. Holdings was treated as a partnership for U.S. federal and most applicable state and local income tax purposes. As a partnership, Holdings was not subject to U.S. federal and certain state and local income taxes. Any taxable income or loss generated by Holdings was passed through to and included in the taxable income or loss of its members, including us, on a pro rata basis. We have been subject to U.S. federal income taxes, in addition to state and local income taxes, with respect to our allocable share of any taxable income or loss of Holdings, as well as any stand-alone income or loss generated by Solo Brands, Inc.
Segment Operating Expenses
Segment operating expenses consist of (1) marketing expenses, (2) employee-related compensation, such as wages and benefits, and (3) other segment operating expenses, which primarily consist of shipping and fulfillment-related expenses.
Consolidated Results for the Three Months Ended September 30, 2026 Compared to the Three Months Ended September 30, 2025
Consolidated Net Sales, Cost of Goods Sold, Gross Profit, and Gross Profit Margin
| Three Months Ended September 30, | Change | ||||||||||||||||||||||
| (dollars in thousands) | 2026 | 2025 | $ | % | |||||||||||||||||||
Net sales | $ | 43,719 | $ | 53,038 | $ | (9,319) | (17.6) | % | |||||||||||||||
| Direct-to-consumer net sales | 33,205 | 42,027 | (8,822) | (21.0) | % | ||||||||||||||||||
| Retail net sales | 10,514 | 11,011 | (497) | (4.5) | % | ||||||||||||||||||
| Cost of goods sold | 16,003 | 21,192 | (5,189) | (24.5) | % | ||||||||||||||||||
Gross profit | $ | 27,716 | $ | 31,846 | $ | (4,130) | (13.0) | % | |||||||||||||||
Gross profit margin (Gross profit as a % of net sales)(1) | 63.4 | % | 60.0 | % | 340 | ||||||||||||||||||
(1)Change in gross profit margin period over period in basis points
Net sales decreased for the three months ended September 30, 2026 compared to the three months ended September 30, 2025, primarily driven by a decrease in net sales across the DTC channel within the Solo Stove segment, as well as the Chubbies and Watersports segments, to a lesser extent.
Cost of goods sold decreased for the three months ended September 30, 2026 compared to the three months ended September 30, 2025, primarily driven by lower net sales.
21
Gross profit decreased for the three months ended September 30, 2026 compared to the three months ended September 30, 2025, as a result of the decrease in net sales, partially offset by the increase in gross profit margin. The increase in gross profit margin was primarily driven by reduced promotional activity and, to a lesser extent, the benefit recognized from prior period IEEPA tariff refunds received during the current period.
Consolidated Operating Expenses
| Three Months Ended September 30, | Change | ||||||||||||||||||||||
| (dollars in thousands) | 2026 | 2025 | $ | % | |||||||||||||||||||
| Selling, general & administrative expenses | $ | 31,596 | $ | 39,495 | $ | (7,899) | (20.0) | % | |||||||||||||||
| Depreciation and amortization expenses | 4,180 | 5,824 | (1,644) | (28.2) | % | ||||||||||||||||||
Restructuring, contract termination and impairment charges | 6,041 | 1,940 | 4,101 | 211.4 | % | ||||||||||||||||||
| Other operating expenses | 320 | 764 | (444) | (58.1) | % | ||||||||||||||||||
Total operating expenses | $ | 42,137 | $ | 48,023 | $ | (5,886) | (12.3) | % | |||||||||||||||
Selling, general & administrative expenses decreased for the three months ended September 30, 2026 compared to the three months ended September 30, 2025, primarily reflective of our leaner operations, which resulted in decreases in payroll, marketing, seller fees, fulfillment, and shipping costs.
Depreciation and amortization expenses decreased for the three months ended September 30, 2026 compared to the three months ended September 30, 2025, primarily due to the impairment of intangible assets during the prior year.
Restructuring, contract termination and impairment charges increased for the three months ended September 30, 2026 compared to the three months ended September 30, 2025, primarily due to impairments of long-lived assets related to a distribution center closure and an underperforming retail store, as well as increases in costs for strategic consulting firms engaged for operational and financial performance improvements, restructuring-related employee costs, and one-time expenses related to distribution center closures.
Consolidated Interest Expense, Net
| Three Months Ended September 30, | Change | ||||||||||||||||||||||
| (dollars in thousands) | 2026 | 2025 | $ | % | |||||||||||||||||||
Interest expense, net | $ | 7,504 | $ | 7,556 | $ | (52) | (0.7) | % | |||||||||||||||
Interest expense, net decreased for the three months ended September 30, 2026 compared to the three months ended September 30, 2025, primarily due to lower weighted-average interest rates, partially offset by higher average borrowings outstanding.
Consolidated Income Taxes
| Three Months Ended September 30, | Change | ||||||||||||||||||||||
| (dollars in thousands) | 2026 | 2025 | $ | % | |||||||||||||||||||
| Income tax expense (benefit) | $ | (1,118) | $ | (552) | $ | (566) | 102.5 | % | |||||||||||||||
Income tax benefit increased for the three months ended September 30, 2026 compared to the three months ended September 30, 2025, primarily driven by a prior period tax refund received and recorded in the current period.
Consolidated Results for the Nine Months Ended September 30, 2026 Compared to the Nine Months Ended September 30, 2025
Consolidated Net Sales, Cost of Goods Sold, Gross Profit, and Gross Profit Margin
| Nine Months Ended September 30, | Change | ||||||||||||||||||||||
| (dollars in thousands) | 2026 | 2025 | $ | % | |||||||||||||||||||
Net sales | $ | 195,060 | $ | 222,547 | $ | (27,487) | (12.4) | % | |||||||||||||||
| Direct-to-consumer net sales | 107,226 | 135,493 | (28,267) | (20.9) | % | ||||||||||||||||||
| Retail net sales | 87,834 | 87,054 | 780 | 0.9 | % | ||||||||||||||||||
| Cost of goods sold | 81,422 | 91,497 | (10,075) | (11.0) | % | ||||||||||||||||||
Gross profit | 113,638 | 131,050 | (17,412) | (13.3) | % | ||||||||||||||||||
Gross profit margin (Gross profit as a % of net sales)(1) | 58.3 | % | 58.9 | % | (60) | ||||||||||||||||||
(1)Change in gross profit margin period over period in basis points
Net sales decreased for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025, primarily the result of the decrease in both DTC and retail channel net sales within the Solo Stove segment, and, to a lesser extent, declines in both channels within the Chubbies segment, partially offset by an increase in retail channel sales within the Watersports segment.
22
Cost of goods sold decreased for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025, primarily driven by lower net sales, reduced promotional activity and the benefit recognized from prior period IEEPA tariff refunds received during the current period, partially offset by change in channel mix and a raw material inventory write-off related to the closure of Oru’s manufacturing facility.
Gross profit decreased for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025, largely as a result of the decrease in net sales and, to a lesser degree, the decrease in gross profit margin. The decrease in gross profit margin was driven by change in channel mix and a raw material inventory write-off related to the closure of Oru’s manufacturing facility, partially offset by lower promotional activity and the benefit recognized from prior period IEEPA tariff refunds received during the current period.
Consolidated Operating Expenses
| Nine Months Ended September 30, | Change | ||||||||||||||||||||||
| (dollars in thousands) | 2026 | 2025 | $ | % | |||||||||||||||||||
| Selling, general and administrative expenses | $ | 107,410 | $ | 126,171 | $ | (18,761) | (14.9) | % | |||||||||||||||
| Depreciation and amortization expenses | 12,622 | 19,107 | (6,485) | (33.9) | % | ||||||||||||||||||
Restructuring, contract termination and impairment charges | 8,241 | 18,030 | (9,789) | (54.3) | % | ||||||||||||||||||
| Other operating expenses | 1,010 | 4,397 | (3,387) | (77.0) | % | ||||||||||||||||||
Total operating expenses | $ | 129,283 | $ | 167,705 | $ | (38,422) | (22.9) | % | |||||||||||||||
Selling, general & administrative expenses decreased for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025, primarily reflective of our leaner operations, which resulted in decreases in payroll, marketing, seller fees, and shipping costs.
Depreciation and amortization expenses decreased for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025, primarily due to the impairment of intangible assets during the prior year.
Restructuring, contract termination and impairment charges decreased for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025, primarily due to decreased costs associated with strategic consulting firms for operational performance improvements, restructuring-related employee costs, and the termination of an underperforming licensing agreement compared to the prior year period. These decreases were partially offset by impairments of long-lived assets related to a distribution center closure, an underperforming retail store, and the closure of Oru’s manufacturing facility in the current period.
Other operating expenses decreased for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025, primarily due to higher strategic consulting engagements in the prior year period, and the loss recognized from the disposition of the TerraFlame manufacturing operations in the second quarter of 2025.
Consolidated Interest Expense, Net
| Nine Months Ended September 30, | Change | ||||||||||||||||||||||
| (dollars in thousands) | 2026 | 2025 | $ | % | |||||||||||||||||||
Interest expense, net | $ | 22,884 | $ | 19,115 | $ | 3,769 | 19.7 | % | |||||||||||||||
Interest expense, net increased for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025, primarily due to an increase in amortization of debt issuance costs, higher weighted-average interest rates, and decreased interest income, partially offset by lower average borrowings outstanding.
Consolidated Income Taxes
| Nine Months Ended September 30, | Change | ||||||||||||||||||||||
| (dollars in thousands) | 2026 | 2025 | $ | % | |||||||||||||||||||
| Income tax expense (benefit) | $ | (7,598) | $ | 4,068 | $ | (11,666) | * | ||||||||||||||||
*not meaningful
Income tax benefit for the nine months ended September 30, 2026 compared to income tax expense for the nine months ended September 30, 2025, was primarily driven by the effects of the Corporate Simplification and related valuation release, as well as a prior period tax refund received and recorded in the current period.
23
Segment Results
The discussion below is presented for Solo Stove, Chubbies, and Watersports reporting segments.
Solo Stove Segment Results for the Three Months Ended September 30, 2026 Compared to the Three Months Ended September 30, 2025
| Three Months Ended September 30, | Change | ||||||||||||||||||||||
| (dollars in thousands) | 2026 | 2025 | $ | % | |||||||||||||||||||
Net sales | $ | 24,673 | $ | 30,792 | $ | (6,119) | (19.9) | % | |||||||||||||||
| Direct-to-consumer net sales | 18,615 | 23,787 | (5,172) | (21.7) | % | ||||||||||||||||||
| Retail net sales | 6,058 | 7,005 | (947) | (13.5) | % | ||||||||||||||||||
Cost of goods sold | 9,457 | 11,958 | (2,501) | (20.9) | % | ||||||||||||||||||
Segment operating expenses | 12,885 | 17,471 | (4,586) | (26.2) | % | ||||||||||||||||||
| Marketing expenses | 4,377 | 6,676 | (2,299) | (34.4) | % | ||||||||||||||||||
| Employee-related compensation | 1,902 | 2,348 | (446) | (19.0) | % | ||||||||||||||||||
| Other segment operating expenses | 6,606 | 8,447 | (1,841) | (21.8) | % | ||||||||||||||||||
Net sales decreased for the three months ended September 30, 2026 compared to the three months ended September 30, 2025, reflecting lower unit volumes in core fire pits partially mitigated by new product introductions, as well as softness in the retail channel.
Cost of goods sold decreased for the three months ended September 30, 2026 compared to the three months ended September 30, 2025, primarily in line with the decrease in net sales..
Segment operating expenses decreased for the three months ended September 30, 2026 compared to the three months ended September 30, 2025, primarily the result of a decrease in brand-level marketing expenses and payroll as we streamline operations to be more in line with reduced sales and a decrease in other segment operating expenses driven by a decrease in seller fees and shipping expenses, both stemming from the decline in DTC channel net sales.
Solo Stove Segment Results for the Nine Months Ended September 30, 2026 Compared to the Nine Months Ended September 30, 2025
| Nine Months Ended September 30, | Change | ||||||||||||||||||||||
| (dollars in thousands) | 2026 | 2025 | $ | % | |||||||||||||||||||
Net sales | $ | 73,383 | $ | 95,218 | $ | (21,835) | (22.9) | % | |||||||||||||||
| Direct-to-consumer net sales | 55,937 | 70,940 | (15,003) | (21.1) | % | ||||||||||||||||||
| Retail net sales | 17,446 | 24,278 | (6,832) | (28.1) | % | ||||||||||||||||||
Cost of goods sold | 28,001 | 37,158 | (9,157) | (24.6) | % | ||||||||||||||||||
Segment operating expenses | 41,089 | 54,789 | (13,700) | (25.0) | % | ||||||||||||||||||
| Marketing expenses | 15,456 | 21,476 | (6,020) | (28.0) | % | ||||||||||||||||||
| Employee-related compensation | 5,882 | 8,471 | (2,589) | (30.6) | % | ||||||||||||||||||
| Other segment operating expenses | 19,751 | 24,842 | (5,091) | (20.5) | % | ||||||||||||||||||
Net sales decreased for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025, reflecting lower unit volumes in core fire pits partially mitigated by new product introductions, as well as softness in the retail channel.
Cost of goods sold decreased for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025, primarily in line with the decrease in net sales and benefited from prior period IEEPA tariff refunds received during the current period.
Segment operating expenses decreased for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025, primarily the result of a decrease in brand-level marketing expenses and payroll as we streamline operations to be more in line with reduced sales and a decrease in other segment operating expenses driven by a decrease in seller fees and shipping expenses, both stemming from the decline in DTC channel net sales.
24
Chubbies Segment Results for the Three Months Ended September 30, 2026 Compared to the Three Months Ended September 30, 2025
| Three Months Ended September 30, | Change | ||||||||||||||||||||||
| (dollars in thousands) | 2026 | 2025 | $ | % | |||||||||||||||||||
Net sales | $ | 13,705 | $ | 16,478 | $ | (2,773) | (16.8) | % | |||||||||||||||
| Direct-to-consumer net sales | 10,608 | 12,272 | (1,664) | (13.6) | % | ||||||||||||||||||
| Retail net sales | 3,097 | 4,206 | (1,109) | (26.4) | % | ||||||||||||||||||
Cost of goods sold | 4,031 | 6,592 | (2,561) | (38.9) | % | ||||||||||||||||||
Segment operating expenses | 9,512 | 11,117 | (1,605) | (14.4) | % | ||||||||||||||||||
| Marketing expenses | 2,957 | 2,928 | 29 | 1.0 | % | ||||||||||||||||||
| Employee-related compensation | 2,123 | 3,210 | (1,087) | (33.9) | % | ||||||||||||||||||
| Other segment operating expenses | 4,432 | 4,979 | (547) | (11.0) | % | ||||||||||||||||||
Net sales decreased for the three months ended September 30, 2026 compared to the three months ended September 30, 2025, reflecting variability in customer demand within both the DTC and retail channels.
Cost of goods sold decreased for the three months ended September 30, 2026 compared to the three months ended September 30, 2025, primarily due to lower sales and the benefit from prior period IEEPA tariff refunds received during the current period.
Segment operating expenses decreased for the three months ended September 30, 2026 compared to the three months ended September 30, 2025, primarily driven by a decrease in payroll.
Chubbies Segment Results for the Nine Months Ended September 30, 2026 Compared to the Nine Months Ended September 30, 2025
| Nine Months Ended September 30, | Change | ||||||||||||||||||||||
| (dollars in thousands) | 2026 | 2025 | $ | % | |||||||||||||||||||
Net sales | $ | 91,028 | $ | 103,622 | $ | (12,594) | (12.2) | % | |||||||||||||||
| Direct-to-consumer net sales | 40,470 | 49,206 | (8,736) | (17.8) | % | ||||||||||||||||||
| Retail net sales | 50,558 | 54,416 | (3,858) | (7.1) | % | ||||||||||||||||||
Cost of goods sold | 33,421 | 42,591 | (9,170) | (21.5) | % | ||||||||||||||||||
Segment operating expenses | 37,360 | 39,490 | (2,130) | (5.4) | % | ||||||||||||||||||
| Marketing expenses | 11,709 | 10,453 | 1,256 | 12.0 | % | ||||||||||||||||||
| Employee-related compensation | 7,385 | 10,054 | (2,669) | (26.5) | % | ||||||||||||||||||
| Other segment operating expenses | 18,266 | 18,983 | (717) | (3.8) | % | ||||||||||||||||||
Net sales decreased for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025, reflecting variability in customer demand within both the DTC and retail channels.
Cost of goods sold decreased for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025, primarily due to lower sales and the benefit from prior period IEEPA tariff refunds received during the current period.
Segment operating expenses decreased for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025, primarily driven by a decrease in payroll, partially offset by an increase in marketing expenses.
25
Watersports Segment Results for the Three Months Ended September 30, 2026 Compared to the Three Months Ended September 30, 2025
| Three Months Ended September 30, | Change | ||||||||||||||||||||||
| (dollars in thousands) | 2026 | 2025 | $ | % | |||||||||||||||||||
Net sales | $ | 5,341 | $ | 5,768 | $ | (427) | (7.4) | % | |||||||||||||||
| Direct-to-consumer net sales | 3,982 | 5,968 | (1,986) | (33.3) | % | ||||||||||||||||||
| Retail net sales | 1,359 | (200) | 1,559 | * | |||||||||||||||||||
Cost of goods sold | 2,344 | 2,642 | (298) | (11.3) | % | ||||||||||||||||||
Segment operating expenses | 2,519 | 2,646 | (127) | (4.8) | % | ||||||||||||||||||
| Marketing expenses | 826 | 824 | 2 | 0.2 | % | ||||||||||||||||||
| Employee-related compensation | 253 | 491 | (238) | (48.5) | % | ||||||||||||||||||
| Other segment operating expenses | 1,440 | 1,331 | 109 | 8.2 | % | ||||||||||||||||||
*not meaningful
Net sales decreased for the three months ended September 30, 2026 compared to the three months ended September 30, 2025, reflecting softer sales on less promotional activity within the DTC channel, partially offset by increased customer demand within the retail channel.
Cost of goods sold decreased for the three months ended September 30, 2026 compared to the three months ended September 30, 2025, primarily the result of the decrease in net sales and change in channel mix.
Segment operating expenses decreased for the three months ended September 30, 2026 compared to the three months ended September 30, 2025, primarily due to a decrease in payroll.
Watersports Segment Results for the Nine Months Ended September 30, 2026 Compared to the Nine Months Ended September 30, 2025
| Nine Months Ended September 30, | Change | ||||||||||||||||||||||
| (dollars in thousands) | 2026 | 2025 | $ | % | |||||||||||||||||||
Net sales | $ | 30,649 | $ | 23,141 | $ | 7,508 | 32.4 | % | |||||||||||||||
| Direct-to-consumer net sales | 10,819 | 15,347 | (4,528) | (29.5) | % | ||||||||||||||||||
| Retail net sales | 19,830 | 7,794 | 12,036 | 154.4 | % | ||||||||||||||||||
Cost of goods sold | 18,405 | 11,189 | 7,216 | 64.5 | % | ||||||||||||||||||
Segment operating expenses | 6,915 | 9,111 | (2,196) | (24.1) | % | ||||||||||||||||||
| Marketing expenses | 2,389 | 2,776 | (387) | (13.9) | % | ||||||||||||||||||
| Employee-related compensation | 915 | 1,993 | (1,078) | (54.1) | % | ||||||||||||||||||
| Other segment operating expenses | 3,611 | 4,342 | (731) | (16.8) | % | ||||||||||||||||||
Net sales increased for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025, reflecting an expanded partnership with a key customer within the retail channel, partially offset by softer sales on less promotional activity within the DTC channel.
Cost of goods sold increased for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025, primarily the result of the increase in net sales and change in channel mix.
Segment operating expenses decreased for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025, primarily due to a decrease in payroll, coupled with a decrease in other segment operating expenses driven by a decrease in seller fees and shipping expenses, stemming from the decline in DTC channel net sales.
Liquidity and Capital Resources
Our cash requirements are primarily for working capital, payment of restructuring and other fees, and repayment of our current and long-term debt obligations. We expect these and other cash needs to continue as we seek to improve, develop and transform our business. We fund our working capital, which is primarily comprised of inventory and accounts payable, and other cash requirements from cash flows from operating activities, cash on hand, and borrowings under our 2025 Revolving Credit Facility. Our cash flows from operating activities and borrowings under the 2025 Revolving Credit Facility are our principal sources of liquidity. Cash flows from operating activities result primarily from the sales of our portfolio of products. Our future product sales and our cash flows are difficult to predict, and actual sales may not be in line with our forecasts.
26
The Corporate Simplification discussed within the Overview section was intended to limit material liability for cash payments that might otherwise be due in 2026 and beyond, under the terms of the Tax Receivable Agreement, as well as future distributions. For more information on the Corporate Simplification, see the Overview section above.
We maintain the majority of our cash and cash equivalents in bank deposit and overnight sweep accounts with major, highly-rated multi-national and local financial institutions, and our deposits at these institutions exceed insured limits. Market conditions can impact the viability of these institutions, and any inability to access or delay in accessing these funds could adversely affect our business and financial position.
The table below reflects our sources, facilities and availability of liquidity as of September 30, 2026. See below for details on our outstanding debt balance as of September 30, 2026.
| (in thousands) | Utilized | Availability | |||||||||
| Cash and cash equivalents | $ | 40,197 | |||||||||
2025 Revolving Credit Facility | $ | — | 50,261 | ||||||||
2025 Term Loan | 264,438 | — | |||||||||
We must comply with financial covenants under the 2025 Credit Agreement (as defined below), including a minimum fixed charge coverage ratio, a maximum leverage ratio, and a minimum liquidity amount, as well as other non-financial covenants, as described in further detail below and in Note 10, Debt, Net. As of September 30, 2026, we were in compliance with such covenants applicable as of such date under the 2025 Credit Agreement.
Going Concern
In evaluating our ability to continue as a going concern for the twelve months following the issuance of these unaudited consolidated financial statements, management projects compliance with these financial covenants. However, the risks associated with variability in our operating performance could affect management’s forecast and whether we are able to maintain compliance with the maximum total leverage ratio covenant over the next year. Accordingly, there is substantial doubt about our ability to continue as a going concern within one year after the issuance of these unaudited consolidated financial statements.
Management has developed plans intended to mitigate these downside risk conditions, including optimization of the Company's distribution and fulfillment network, reductions in cost of goods sold, reductions in marketing spend and other fixed operating costs, and prioritization of available cash towards debt and other obligations. Certain of these cost savings and operational initiatives are discussed in Note 2, Restructuring, Contract Termination and Impairment Charges. However, these plans are not entirely within the Company’s control and cannot be assessed as being probable of occurring or of mitigating noncompliance with the maximum total leverage ratio covenant. Accordingly, the plans to mitigate these downside risk conditions do not fully alleviate the substantial doubt about our ability to continue as a going concern for at least the twelve months following the issuance of these unaudited consolidated financial statements.
If we do not achieve the expected benefits from these operational initiatives or if operating results or liquidity deteriorate, we could be required to seek additional capital through equity or debt financing or other sources. We are evaluating strategies to address the possible covenant noncompliance, which includes seeking an amendment or waiver of the maximum total leverage ratio covenant from the lenders under the 2025 Credit Agreement, refinancing or restructuring the debt, issuing new debt or equity, or entering into other financing arrangements. There can be no assurance that such financing, amendment, waiver or other relief from the lenders would be available on acceptable terms, or at all. Similarly, there can be no assurance that we will be able to refinance or restructure its debt, or execute any further cost savings or operational improvements.
If we are not in compliance with the maximum total leverage ratio covenant as of the end of any such test period and the failure is not cured or waived, an event of default would occur under the 2025 Credit Agreement. Upon the determination of an event of default under the 2025 Credit Agreement, the lenders could elect to declare all amounts outstanding under the 2025 Credit Agreement immediately due and payable and exercise other remedies as set forth in the 2025 Credit Agreement. If the maturity of the debt were accelerated, we would not have sufficient liquidity to repay it.
Revolving Credit Facilities and Term Loans
On June 13, 2025, we entered into Amendment No. 4 to Credit Agreement and Limited Waiver and Amendment No. 1 to Security Agreement (the “2025 Credit Agreement”) with JPMorgan Chase Bank, N.A., the Lenders and L/C Issuers party thereto (each as defined therein) and the other parties thereto. The 2025 Credit Agreement consists of the following: (i) revolving commitments under the Revolving Credit Facility in an aggregate amount equal to $90 million (the “2025 Revolving Credit Facility”), subject to availability under the borrowing base set forth in the 2025 Credit Agreement; and (ii) refinancing term loans, including our prior term loan (the “2025 Term Loan”) in an aggregate principal amount equal to $240 million. The 2025 Revolving Credit Facility also includes the ability to issue up to $20 million in letters of credit, with $5.8 million of letters of credit issued and outstanding as of September 30, 2026. While our issuance of letters of credit does not increase our borrowings outstanding under the 2025 Revolving Credit Facility, it does reduce the amounts available under the 2025 Revolving Credit Facility.
Under the 2025 Credit Agreement, the maturity date of the 2025 Revolving Credit Facility and the 2025 Term Loan is June 30, 2028. We commenced mandatory quarterly principal payments on the 2025 Term Loan during the fiscal quarter ending on June 30, 2026, based on the aggregate outstanding principal amount of the 2025 Term Loan as of June 13, 2025 multiplied by 0.25%. We are required to make increased quarterly principal payments beginning with the fiscal quarter ending on June 30, 2027, based on the aggregate outstanding principal amount of the 2025 Term Loan as of June 13, 2025 multiplied by 1.00%.
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Each of the 2025 Revolving Credit Facility and the 2025 Term Loan bears interest at (depending on our election from time to time) either an adjusted term rate defined in the agreement based on SOFR or the base rate defined in the 2025 Credit Agreement, each plus an applicable margin. The interest was payable in kind (“PIK”), and thus capitalized thereon and increasing the principal balance thereof, on a quarterly basis through March 31, 2026. The interest is PIK (i) for the period beginning on April 1, 2026 and ending on March 31, 2027, upon our election, and (ii) after March 31, 2027, it is only payable in cash. We elected not to PIK interest for the period beginning April 1, 2026 through June 30, 2026 and elected to PIK interest for the period beginning July 1, 2026 through September 30, 2026. The unfunded portion of the commitments under the 2025 Revolving Credit Facility will accrue an annual commitment fee.
The 2025 Credit Agreement also requires us to comply with additional reporting requirements, including, among others, (i) delivering on the date that is twenty (20) days after the end of the previous calendar month (a) a borrowing base certificate calculating the borrowing base and availability under the 2025 Revolving Credit Facility, (b) a 13-week cash flow forecast for us and our subsidiaries, (c) a liquidity report, and (d) an accounts and inventory report; and (ii) delivering no later than thirty (30) days after the end of the previous calendar month, a key performance indicator report and certain additional reports on our operating plan and other measures, such as Credit Agreement Adjusted EBITDA. In addition, the 2025 Credit Agreement extends the delivery dates for quarterly financial statement deliverables to sixty (60) days after the end of the applicable fiscal quarter.
In addition, pursuant to the 2025 Credit Agreement, we are required to comply with the following financial covenants:
•a maximum debt-to-EBITDA ratio, defined in the 2025 Credit Agreement as the Total Leverage Ratio and determined as of the last day of each fiscal quarter with EBITDA annualized for the most recent fiscal quarter, of 9.50 for the fiscal quarter ended September 30, 2026; 9.00 for the fiscal quarters ending December 31, 2026 and March 31, 2027; 8.25 for the fiscal quarters ending June 30, 2027 and September 30, 2027; 7.50 for the fiscal quarters ending December 31, 2027 and March 31, 2028; and 7.00 for the fiscal quarters ending June 30, 2028 and thereafter;
•a minimum EBITDA-to-fixed charges ratio, defined in the 2025 Credit Agreement as the Fixed Charge Coverage Ratio, and determined as of the last day of each fiscal quarter with EBITDA annualized for the most recent fiscal quarter, of 0.70 for the fiscal quarters ending September 30, 2026, December 31, 2026, and March 31, 2027; 0.75 for the fiscal quarters ending June 30, 2027 and September 30, 2027; 0.80 for the fiscal quarters ending December 31, 2027 and March 31, 2028; and 1.00 for the fiscal quarters ending June 30, 2028 and thereafter; and
•a minimum unrestricted cash plus undrawn availability on the 2025 Revolving Credit Facility amount, defined in the 2025 Credit Agreement as Minimum Liquidity, of $10 million average minimum liquidity covenant for the first three calendar months of each fiscal year and a $20 million average minimum liquidity covenant for the last nine calendar months of each fiscal year, which in each case as applicable, is tested on a monthly basis.
For purposes of the above covenants, EBITDA is calculated as set forth in the 2025 Credit Agreement.
Cash Flows
| Nine Months Ended September 30, | Change | ||||||||||||||||||||||
| (dollars in thousands) | 2026 | 2025 | $ | % | |||||||||||||||||||
Cash flows provided by (used in): | |||||||||||||||||||||||
Operating activities | $ | 26,021 | $ | (53,019) | $ | 79,040 | 149.1 | % | |||||||||||||||
Investing activities | (5,040) | (9,590) | 4,550 | 47.4 | % | ||||||||||||||||||
Financing activities | (728) | 66,775 | (67,503) | (101.1) | % | ||||||||||||||||||
Operating activities
The $79.0 million increase in cash provided by operating activities period over period, was primarily due to a $48.1 million decline in cash usage from changes in operating assets and liabilities (“working capital”), which was driven by accounts payable reductions in the prior year period, and a $30.9 million increase in net income (loss) after non-cash adjustments, primarily driven by a reduction in net loss.
Investing activities
The $4.6 million decrease in cash used in investing activities in the current period when compared to the prior period was due to a decrease in capital expenditures, primarily driven by the implementation of Solo Stove’s web site relaunch in the prior year period.
Financing activities
The $67.5 million increase in cash used in financing activities in the current period when compared to the prior year period was primarily driven by a $70.1 million decrease in cash provided by net debt activity, inclusive of borrowings, repayments and debt issuance costs in relation to the 2025 Credit Agreement in the prior year period.
Contractual Obligations
For information regarding our contractual obligations, see above under “Revolving Credit Facilities and Term Loans,” Note 1, Organization and Basis of Presentation, Note 10, Debt, Net and Note 15, Variable Interest Entities in this Quarterly Report and Note 15, Leases and Part II, Item 7, “Management's Discussion and Analysis of Financial Condition and Results of Operations,” included in our 2025 Form 10-K.
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Critical Accounting Estimates
Our discussion and analysis of our financial condition and results of operations are based upon our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. In preparing the consolidated financial statements, we make estimates and judgments that affect the reported amounts of assets, liabilities, sales, expenses, and related disclosure of contingent assets and liabilities. We re-evaluate our estimates on an ongoing basis. Our estimates are based on historical experience and on various other assumptions that we believe to be reasonable under the circumstances. Because of the uncertainty inherent in these matters, actual results may differ from these estimates and could differ based upon other assumptions or conditions.
See Note 2, Significant Accounting Policies, to the audited consolidated financial statements included in our 2025 Form 10-K for more information about our significant accounting policies, including our critical accounting policies. The critical accounting estimates that reflect our more significant judgments and estimates used in the preparation of our consolidated financial statements are described in Part II, Item 7, “Management's Discussion and Analysis of Financial Condition and Results of Operations,” included in our 2025 Form 10-K. During the nine months ended September 30, 2026, there were no material changes to our critical accounting policies and estimates from those discussed in our 2025 Form 10-K. Within the context of these critical accounting estimates, we are not currently aware of any reasonably likely events or circumstances that would result in materially different amounts being reported.
Recent Accounting Pronouncements
For a description of recent accounting pronouncements, see “Recently Issued Accounting Pronouncements—Not Yet Adopted” in Note 1 - Organization and Basis of Presentation, to the unaudited consolidated financial statements included elsewhere in this Quarterly Report.
JOBS Act
We currently qualify as an “emerging growth company” under the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”). Accordingly, we are provided the option to adopt new or revised accounting guidance either (i) within the same periods as those otherwise applicable to non-emerging growth companies or (ii) within the same time periods as private companies. We have elected to adopt new or revised accounting guidance within the same time period as private companies, unless management determines it is preferable to take advantage of early adoption provisions offered within the applicable guidance. Our utilization of these transition periods may make it difficult to compare our financial statements to those of non-emerging growth companies and other emerging growth companies that have opted out of the transition periods afforded under the JOBS Act. We expect that we will no longer qualify as an emerging growth company as of December 31, 2026.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
We are exposed to market risks in the ordinary course of our business. Market risk represents the risk of loss that may impact our financial position due to adverse changes in financial market prices and rates. Our market risk exposure is primarily the result of fluctuations in interest rates.
Interest Rate Risk
We have a long-term credit facility and separate term loan that bear variable interest rates based on prime, federal funds, or SOFR plus an applicable margin based on our total net leverage ratio. As of September 30, 2026, we had indebtedness of $264.4 million, with an annualized rate of interest of 9.57% under our 2025 Term Loan. A 100 basis point increase in SOFR would increase our interest expense by approximately $2.6 million in any given year.
Inflation Risk
Inflationary factors such as increases in the cost of our products and overhead costs may adversely affect our operating results. Although we do not believe that inflation has had a material impact on our financial position or results of operations to date, a high rate of inflation in the future may have an adverse effect on our ability to maintain current levels of gross margin and SG&A expenses as a percentage of net sales, if the selling prices of our products do not increase with these increased costs.
Commodity Price Risk
The majority of the commodities, components, parts, and accessories used in our manufacturing process, as well as finished goods, are exposed to commodity cost changes. These changes may be affected by several factors, including, for example, demand; inflation; deflation; changing prices; foreign currency fluctuations; tariffs; international conflicts; duties; trade regulatory actions; industry actions; and changes to international trade policies, agreements, and/or regulation, including antidumping and countervailing duties on certain products imported from foreign countries; and competitor activity.
Our primary cost exposures for commodities, components, parts, and accessories used in our products are with stainless steel and aluminum. We believe these materials are readily available from multiple vendors. Certain of these products use petroleum or natural gas as inputs. However, we do not believe there is a significant direct correlation between petroleum or natural gas prices and the costs of our products. The U.S. government has and potentially will continue to impose tariffs on certain foreign goods, particularly steel and aluminum, as well as goods from China. In any given period, we strategically attempt to mitigate potentially unfavorable impacts as a result of changes to the cost of commodities, components, parts, and accessories that affect our product lines through the following initiatives: collaboration with suppliers, reviewing alternative sourcing options, engaging in internal cost reduction efforts, and utilizing tariff exclusions and duty drawback mechanisms, all as appropriate. We do not currently hedge commodity price risk. When appropriate, we may also increase prices on some of our products to offset changes in the cost of commodities,
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components, parts, and accessories. To the extent that commodity and component costs increase and we do not have firm pricing from our suppliers, or our suppliers are not able to honor such prices, and/or our initiatives and/or product price increases are less effective than anticipated and/or do not fully offset cost increases, we may experience a decline in our revenues and/or gross margins, which could materially adversely affect our results of operations and financial condition.
Item 4. Controls and Procedures
Limitations on Effectiveness of Controls and Procedures
In designing and evaluating our disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. In addition, the design of disclosure controls and procedures must reflect the fact that there are resource constraints and that management is required to apply judgment in evaluating the benefits of possible controls and procedures relative to their costs.
Evaluation of Disclosure Controls and Procedures
Our management, with the participation of our principal executive officer and principal financial officer, evaluated, as of the end of the period covered by this Quarterly Report, the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act). Based on that evaluation, our principal executive officer and principal financial officer concluded that, as of September 30, 2026, our disclosure controls and procedures were effective at the reasonable assurance level.
Changes in Internal Control over Financial Reporting
There were no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the quarter ended September 30, 2026 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
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PART II - OTHER INFORMATION
Item 1. Legal Proceedings
Information on the Company’s legal proceedings is set forth under Part I, Item 3. “Legal Proceedings” in our 2025 Form 10-K. There have been no material changes to the legal proceedings as described in the 2025 Form 10-K.
Item 1A. Risk Factors
You should carefully consider the risk factors set forth under Part I, Item 1A. “Risk Factors” in our 2025 Form 10-K and in Part II, Item 1A. “Risk Factors” in our Quarterly Report on Form 10-Q for the quarter ended March 31, 2026 (“Q1 2026 Form 10-Q”), which risk factors are incorporated herein by reference. Such risks could materially affect our business, financial condition, and future results and are not the only risks facing the Company. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition, and operating results. There have been no material changes to the risk factors previously disclosed in our 2025 Form 10-K and Q1 2026 Form 10-Q.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Unregistered Sale of Equity Securities
There were no sales of unregistered securities during the three months ended September 30, 2026.
Item 3. Defaults Upon Senior Securities
None.
Item 4. Mine Safety Disclosures
None.
Item 5. Other Information
(a)None.
(b)None.
(c)During the three months ended September 30, 2026, no director or “officer” (as defined in Rule 16a-1(f) of the Exchange Act) of the Company adopted terminated
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Item 6. Exhibits
| Incorporated by Reference | Filed / Furnished Herewith | |||||||||||||||||||
| Exhibit Number | Exhibit Description | Form | File No. | Exhibit | Filing Date | |||||||||||||||
| 3.1 | Amended and Restated Certificate of Incorporation of Solo Brands, Inc. | S-8 | 333-260826 | 4.1 | 11/5/2021 | |||||||||||||||
| 3.2 | Certificate of Amendment to the Certificate of Incorporation of Solo Brands, Inc. | 8-K | 001-40979 | 3.1 | 05/29/2025 | |||||||||||||||
| 3.3 | Certificate of Amendment to the Certificate of Incorporation of Solo Brands, Inc. | 8-K | 001-40979 | 3.1 | 07/08/2025 | |||||||||||||||
| 3.4 | Amended and Restated Bylaws of Solo Brands, Inc. | S-8 | 333-260826 | 4.2 | 11/5/2021 | |||||||||||||||
| 31.1 | Certification of Chief Executive Officer pursuant to Rule 13a-14(a)/15d-14(a). | * | ||||||||||||||||||
| 31.2 | Certification of Chief Financial Officer pursuant to Rule 13a-14(a)/15d-14(a). | * | ||||||||||||||||||
| 32.1 | Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350. | ** | ||||||||||||||||||
| 32.2 | Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350. | ** | ||||||||||||||||||
| 101.INS | Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document. | * | ||||||||||||||||||
| 101.SCH | Inline XBRL Taxonomy Extension Schema Document | * | ||||||||||||||||||
| 101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document | * | ||||||||||||||||||
| 101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document | * | ||||||||||||||||||
| 101.LAB | Inline XBRL Taxonomy Extension Label Linkbase Document | * | ||||||||||||||||||
| 101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document | * | ||||||||||||||||||
| 104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) | * | ||||||||||||||||||
| * | Filed herewith. | |||||||||||||||||||
| ** | Furnished herewith. | |||||||||||||||||||
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| Solo Brands, Inc. | |||||||||||
| Date: | November 12, 2026 | By: | /s/ John P. Larson | ||||||||
| John P. Larson | |||||||||||
| President and Chief Executive Officer | |||||||||||
| (Principal Executive Officer) | |||||||||||
| Date: | November 12, 2026 | By: | /s/ Laura Coffey | ||||||||
| Laura Coffey | |||||||||||
| Chief Financial Officer | |||||||||||
| (Principal Financial Officer) | |||||||||||
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