Extends Product Footprint in Latin America with PurSteam, Mueller, and Squatty Potty Brands All statements other than statements of historical facts included in this press release that address activities, events or developments that we expect, believe or anticipate will or may occur in the future are forward-looking statements including, in particular, our ability to expand our operations internationally and access new customers. These forward-looking statements are based on management's current expectation ...

Industry & Market Data Certain data in this presentation was obtained from various external sources. Neither Aterian, Inc. (the "Company") nor its affiliates, advisers or representatives have verified such data, with independent sources. Accordingly, neither the Company nor any of its affiliates, advisers or representatives make any representation as to the accuracy or completeness of that data or to update such data after the date of this presentation. Such data involves risks and uncertainties and is subj ...

New digital shelf space opens doors for accelerated consumer access and visibility SUMMIT, N.J., June 18, 2025 (GLOBE NEWSWIRE) -- Aterian, Inc. (Nasdaq: ATER), a consumer products company, today announced the launch of select products from its flagship brands—including Squatty Potty, hOmeLabs, Healing Solutions, Mueller Living, and PurSteam—on Temu, a global e-commerce marketplace with a fast-growing U.S. customer base. Each of these products became available on Temu during the second quarter of 2025. Ater ...

SUMMIT, N.J., June 11, 2025 (GLOBE NEWSWIRE) -- Aterian, Inc. (Nasdaq: ATER), a consumer products company, today announced the national launch of two of its most innovative home appliances - the PurSteam Steam Station Max and the Mueller Living Cordless Portable Vacuum Sealer - now available nationwide across Walmart locations. “These launches reflect Aterian’s broader mission to expand our omni-channel presence by bringing high-quality consumer products to both digital and physical retail platforms,” said ...

Revenue Performance - Net revenue decreased by $4.9 million, or 24.0%, to $15.4 million for the three months ended March 31, 2025, compared to $20.2 million for the same period in 2024[126] - Direct net revenue fell by $5.1 million, or 25.5%, primarily due to SKU rationalization and changes in Amazon's marketing affiliate program[127] - All product categories experienced a reduction in sales compared to the prior year, primarily due to SKU rationalization and softness in consumer demand[128] Profitability and Expenses - Gross profit decreased from 65.1% in Q1 2024 to 61.4% in Q1 2025, attributed mainly to product mix[130] - Cost of goods sold decreased by $1.1 million, from $7.0 million in Q1 2024 to $5.9 million in Q1 2025, primarily due to reduced sales volumes[129] - Sales and distribution expenses decreased by $3.6 million, or 26.9%, from $13.2 million in Q1 2024 to $9.7 million in Q1 2025[131] - General and administrative expenses decreased by 33.9% to $3.5 million for the three months ended March 31, 2025, from $5.2 million in the prior year, driven by reductions in stock-compensation and headcount expenses[136] Operating Loss and Financial Metrics - Operating loss improved by $1.6 million, or 30.0%, from a loss of $5.3 million in Q1 2024 to a loss of $3.7 million in Q1 2025[126] - Adjusted EBITDA for the three months ended March 31, 2025, was $(2.505) million, with an Adjusted EBITDA margin of (16.3)%, compared to $(2.625) million and (13.0)% for the same period in 2024[177] - For the three months ended March 31, 2025, the Contribution margin was $2.051 million, representing 13.4% of net revenue, compared to $2.848 million and 14.1% for the same period in 2024[176] Interest and Debt Management - Interest expense, net decreased by $148, or 45.8%, from $323 in Q1 2024 to $175 in Q1 2025[126] - Interest expense, net decreased by 45.8% to $175,000 for the three months ended March 31, 2025, from $323,000 in the prior year, due to lower average borrowings[137] - The outstanding balance on the MidCap credit facility increased from $6.9 million as of December 31, 2024, to $7.5 million as of March 31, 2025, with $0.7 million available on the facility[161] Cash Flow and Financial Position - Net cash used in operating activities was $3.9 million for the three months ended March 31, 2025, compared to $6,000 in the same period in 2024, reflecting net cash losses from operations[142] - As of March 31, 2025, the company had unrestricted cash of $14.3 million and an accumulated deficit of $715.6 million[150] Strategic Initiatives and Future Outlook - The company is exploring alternative sourcing outside of China to mitigate the impact of new tariffs on imports[120] - The company is proactively evaluating strategies to manage cost increases and potential impacts on revenue and margins due to tariffs[121] - The company announced a fixed cost reduction plan, including a workforce reduction affecting approximately 20 employees, expected to generate annualized savings of approximately $5 to $6 million[155] - The company expects to continue relying on outside capital for its growth strategy, particularly for potential mergers and acquisitions[149] - The company anticipates improvements in financial performance over time, despite ongoing challenges from macroeconomic factors and inflationary pressures[147] Tariff Impact and Risk Management - The U.S. government announced new tariff policies affecting imports from China, which could materially increase import costs and impact consumer demand[163] - The Company is exploring alternative sourcing outside of China and implementing price increases to mitigate the impact of tariffs on its supply chain and margins[164] - The Company performed a recoverability test for asset groups due to new tariffs and concluded that undiscounted future cash flows exceeded carrying amounts, resulting in no impairment recognized as of March 31, 2025[181] - The Company is closely monitoring actual results versus expectations and may need to record intangible impairment charges if future operating results do not materialize as anticipated[182] Share Repurchase and Credit Facility - The Company entered into Amendment No. 3 to its Credit Agreement, allowing for the repurchase of up to $1.5 million of common stock per year from March 25, 2025, through December 22, 2025, subject to liquidity conditions[160] - The Board of Directors authorized a share repurchase program of up to $3.0 million, which may be suspended or discontinued at any time, with no shares repurchased as of May 1, 2025[162]

Financial Data and Key Metrics Changes - For Q1 2025, net revenue was $15.4 million, down from $20.2 million in Q1 2024, reflecting a 24% decline primarily due to SKU rationalization and reduced consumer demand [7][26] - Adjusted EBITDA loss improved slightly to $2.5 million from $2.6 million year-over-year, indicating a focus on profitability despite revenue decline [7][29] - Operating loss narrowed to $3.7 million from $5.3 million in the previous year, an improvement of approximately 30% driven by cost-cutting initiatives [28][29] Business Line Data and Key Metrics Changes - The overall gross margin for Q1 decreased to 61.4% from 65.1% year-over-year, primarily due to product mix changes [27] - Contribution margin for Q1 was 13.4%, down from 14.1% in the previous year, reflecting the reduction in gross margin [28] - Launch revenue for Q1 was $400,000, consistent with the previous year, indicating stability in new product introductions despite broader challenges [26] Market Data and Key Metrics Changes - The company experienced softness in consumer demand, particularly in the latter part of the quarter, which may have impacted sales velocity [7][26] - Inventory levels increased to $18.1 million from $13.7 million at the end of Q4 2024, reflecting preparations for anticipated demand trends [30] Company Strategy and Development Direction - The company is focusing on four strategic initiatives: diversifying manufacturing, expanding into consumables, raising prices, and reducing fixed costs [9][21] - A new goal is to manufacture no more than 30% of goods in China by the end of 2025, accelerating previous targets [11] - The company has paused new product launches from Asia, particularly hard electronic goods, until clarity on the trade environment is achieved [14] Management Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating the current macroeconomic environment and emphasized the importance of agility and resilience [8][20] - The company has withdrawn its 2025 guidance due to current volatility but believes actions taken will position it for growth and profitability beyond 2025 [19][31] - Management remains committed to preserving capital and does not foresee raising equity capital in 2025 [18][32] Other Important Information - The share repurchase program has been paused due to the current environment, but management believes the stock is undervalued [18][50] - The company is targeting $5 million to $6 million in annualized savings from fixed cost reductions, with a significant portion coming from headcount reductions [15][25] Q&A Session Summary Question: Can you talk about your inventory plans in the near and medium term given the China tariffs? - Management indicated that they have been proactive in managing inventory and are well-positioned to produce necessary products for 2025 despite tariff uncertainties [36][37] Question: How have consumers reacted to the pricing changes? - Management noted mixed results in consumer response to price increases, with some products maintaining strong rankings despite price adjustments [42][44] Question: Is there a way to speed up the diversification strategy in manufacturing? - Management committed to accelerating the diversification strategy while ensuring product quality, focusing on consumables and other regions [46]

Financial Data and Key Metrics Changes - For Q1 2025, net revenue was $15.4 million, a decline of 24% from $20.2 million in Q1 2024, primarily due to SKU rationalization and reduced consumer demand [7][26] - Adjusted EBITDA loss slightly improved to $2.5 million from $2.6 million year-over-year, despite a 24% sales reduction [7][29] - Gross margin decreased to 61.4% from 65.1% in the previous year, attributed to product mix changes [27] - Operating loss narrowed to $3.7 million from $5.3 million in the year-ago quarter, an improvement of approximately 30% [28][29] - Net loss for Q1 2025 was $3.9 million, improving by approximately 25% from a loss of $5.2 million in Q1 2024 [29] Business Line Data and Key Metrics Changes - The company launched one new product category in Q1 2025, while suspending new product launches from Asia for the year [26] - Launch revenue was $400,000 in both Q1 2025 and Q1 2024 [26] Market Data and Key Metrics Changes - The company experienced softness in consumer demand, particularly in the latter part of the quarter, which was compounded by reduced Amazon traffic due to changes in its affiliate program [7][8] - Inventory levels increased to $18.1 million from $13.7 million at the end of Q4 2024, reflecting a buildup in anticipation of demand for seasonal products [30] Company Strategy and Development Direction - The company is focusing on four strategic initiatives: accelerating manufacturing diversification, expanding into consumables, implementing strategic pricing adjustments, and reducing fixed costs [10][21] - The goal is to manufacture no more than 30% of goods in China by the end of 2025, accelerating the previous target of below 40% by 2026 [12] - The company has paused its share repurchase program to conserve cash amid the current macroeconomic environment [18] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating the current volatility without raising equity capital in 2025, despite withdrawing guidance for the year due to uncertainty [19][31] - The company believes that the actions taken now will set the foundation for a return to growth and profitability beyond 2025 [32] - Management acknowledged the challenges posed by the tariff environment but emphasized the importance of agility and resilience in their strategy [9][20] Other Important Information - The company is targeting annualized savings of $5 million to $6 million through fixed cost reduction initiatives, with approximately $4 million expected from headcount reductions [16][25] - Cash preservation remains a priority, with cash levels at approximately $14.3 million as of March 31, 2025 [30] Q&A Session Summary Question: Can you talk about your inventory plans in the near and medium term given the 30% China tariffs? - Management indicated that they have been proactive in managing inventory and have not rushed to bring in products from China, focusing instead on securing stable supply chains [35][36] Question: Can you elaborate on your pricing strategy and consumer reactions? - Management noted that the pricing strategy has led to mixed results, with some products experiencing decreased velocity due to price increases, but overall positioning remains strong [41][42] Question: Is there a way to speed up your diversification strategy in manufacturing? - Management committed to accelerating the diversification strategy as quickly as possible while maintaining product quality [45] Question: Will the company be paying any dividends in the future? - Management stated that cash conservation is a priority due to restructuring plans and the current macroeconomic environment, focusing on long-term growth instead [49] Question: Would management consider revising its policy on granting employee stock options? - Management affirmed that stock options are a tool for incentivizing performance and aligning interests with shareholders, and they will continue to evaluate this policy [52][54]

Financial Performance - Net revenue for Q1 2025 was $15.4 million, down 23.5% from $20.2 million in Q1 2024, primarily due to SKU rationalization and changes in Amazon's affiliate program[3] - Gross margin decreased to 61.4% in Q1 2025 from 65.1% in Q1 2024, attributed to a change in product mix[3] - Operating loss narrowed to $(3.7) million in Q1 2025 from $(5.3) million in Q1 2024, with non-cash stock compensation impacting both periods[3] - Net loss improved to $(3.9) million in Q1 2025 compared to $(5.2) million in Q1 2024, reflecting a gain on fair value of warrant liability[3] - Contribution margin for Q1 2024 was $2,848 thousand, representing 14.1% of net revenue, while for Q1 2025, it was $2,051 thousand, or 13.4% of net revenue[33] - Adjusted EBITDA for Q1 2024 was $(2,625) thousand, compared to $(2,505) thousand for Q1 2025, with Adjusted EBITDA as a percentage of net revenue at (13.0)% and (16.3)% respectively[34] - Gross profit for Q1 2024 was $13,168 thousand, while for Q1 2025, it decreased to $9,424 thousand[33] Cash and Liquidity - Total cash balance decreased to $14.3 million as of March 31, 2025, down from $18.0 million at the end of 2024[3] - Cash used in operating activities for Q1 2024 was $(6) thousand, significantly improved from $(3,868) thousand in Q1 2025[21] - Total cash and restricted cash at the end of Q1 2024 was $19,706 thousand, down from $15,838 thousand at the end of Q1 2025[21] - The company reported a foreign currency effect on cash and restricted cash of $(49) thousand in Q1 2024, compared to $123 thousand in Q1 2025[21] Cost Management and Strategy - The company is implementing a cost optimization plan expected to generate annual savings of $5-$6 million, with $5 million anticipated by the end of 2025[6] - The company is strategically raising prices across its product portfolio to mitigate the impact of tariffs and maintain revenue levels[4] Manufacturing and Product Strategy - Aterian aims to manufacture no more than 30% of goods from China by the end of 2025, accelerating efforts to diversify manufacturing locations[9] - The company has paused new product launches from Asia, specifically hard electronic goods, while focusing on tariff-exempt US-sourced consumable products[9] - Aterian has withdrawn its previously issued net revenue and Adjusted EBITDA guidance for 2025 due to significant economic uncertainty[7] - The company aims for a positive 15% net margin for most products within approximately three months of launch[36] Expenses - Sales and distribution expenses for Q1 2024 totaled $13,214 thousand, compared to $9,661 thousand in Q1 2025[38] - Inventory provisions changed by $(976) thousand in Q1 2024, while in Q1 2025, it changed by $86 thousand[21]

Core Insights - Aterian, Inc. announced a cost optimization plan aimed at reducing annual spending by approximately $5 - $6 million, alongside updates on tariff mitigation strategies [1][7]. Financial Performance - For Q1 2025, net revenue was reported at $15.4 million, down from $20.2 million in Q1 2024, primarily due to SKU rationalization and changes in Amazon's affiliate program [5]. - Gross margin decreased to 61.4% from 65.1%, while contribution margin fell to 13.4% from 14.1% [5][34]. - Operating loss improved to $(3.7) million from $(5.3) million, and net loss narrowed to $(3.9) million from $(5.2) million [5][37]. - Total cash balance decreased to $14.3 million from $18.0 million at the end of 2024 [5]. Tariff Mitigation Initiatives - The company is focusing on reducing fixed costs, diversifying manufacturing, and strategically raising prices to mitigate tariff impacts [3][6]. - A new goal has been established to manufacture no more than 30% of goods from China by the end of 2025, an improvement from the previous target of less than 40% by the second half of 2026 [6]. Cost Optimization Plan - The cost optimization plan is expected to generate $5 - $6 million in pre-tax savings, with $5 million anticipated by the end of 2025 [7]. - The company estimates incurring approximately $2.3 million in costs associated with the implementation of this plan [7]. Guidance Commentary - Due to significant uncertainty in the economic landscape, the company has withdrawn its previously issued net revenue and Adjusted EBITDA guidance for 2025 [8].

Core Viewpoint - Aterian, Inc. will release its financial results for Q1 2025 on May 14, 2025, after market close, followed by a conference call to discuss the results [1]. Company Overview - Aterian, Inc. is a technology-enabled consumer products company that focuses on building and acquiring leading e-commerce brands across various categories, including home and kitchen appliances, health and wellness, and air quality devices [2]. - The company sells products primarily through major online marketplaces such as Amazon, Walmart, and Target in the U.S., as well as its own direct-to-consumer websites [2]. - Key brands under Aterian include Squatty Potty, hOmeLabs, Mueller Living, PurSteam, Healing Solutions, and Photo Paper Direct [2].