Austin, Texas, Aug. 20, 2025 (GLOBE NEWSWIRE) -- DBGI Corp. (Ticker: [NASDAQ:DBGI] a publicly traded company specializing in eCommerce and Fashion today announced it will commence trading on The Nasdaq Capital Market ("Nasdaq") under its current ticker symbol “DBGI” on Wednesday, August 20, 2025. The uplisting to Nasdaq marks a key milestone in the Company’s evolution, designed to enhance investor visibility, increase liquidity, and allow Digital Brands Group to pursue its growth strategy. The Company belie ...

Company Overview - DBGI Corp. specializes in eCommerce and Fashion, offering a wide variety of apparel through multiple brands on both direct-to-consumer and wholesale bases [3] - The company operates under a digitally native-first vertical brand model, focusing on personalized content and customer engagement to enhance "closet share" [3] Nasdaq Uplisting - The company announced its uplisting to The Nasdaq Capital Market under the ticker symbol "DBGI," effective August 20, 2025 [1][2] - This transition is aimed at enhancing investor visibility, increasing liquidity, and supporting the company's growth strategy, positioning it for long-term value creation for shareholders [2] Business Model and Strategy - Digital Brands Group continues to operate under its existing business model while leveraging customer data and purchase history to create targeted marketing strategies [3] - The company emphasizes the importance of maintaining its current operational structure while pursuing growth opportunities in the apparel market [2]

[PART I. FINANCIAL INFORMATION](index=4&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [Financial Statements](index=4&type=section&id=ITEM%201.%20Financial%20Statements) The unaudited statements show decreased revenue and a reduced net loss, with equity shifting from a deficit to a surplus due to financing Condensed Consolidated Balance Sheet Highlights (Unaudited) | Account | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Total Assets** | **$27,820,287** | **$19,890,327** | | Total Current Assets | $6,450,666 | $4,697,267 | | Goodwill | $8,973,501 | $8,973,501 | | **Total Liabilities** | **$20,714,167** | **$21,218,868** | | Total Current Liabilities | $19,381,882 | $20,819,878 | | **Total Stockholders' Equity (Deficit)** | **$7,106,120** | **$(1,328,541)** | Condensed Consolidated Statements of Operations Highlights (Unaudited) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | **Net Revenues** | $2,251,379 | $3,396,069 | $4,123,080 | $6,972,656 | | **Gross Profit** | $711,552 | $1,558,677 | $1,584,007 | $3,279,413 | | **Loss from Operations** | $(1,985,217) | $(2,302,235) | $(3,981,777) | $(2,526,880) | | **Net Loss** | **$(2,117,862)** | **$(3,510,480)** | **$(4,207,772)** | **$(4,194,215)** | | **Net Loss per Share** | $(0.81) | $(104.18) | $(1.24) | $(123.10) | - Net cash used in operating activities for H1 2025 was **$(6.1) million**, up from $(2.9) million in H1 2024, while net cash from financing activities rose to **$6.5 million** from $3.0 million[19](index=19&type=chunk)[251](index=251&type=chunk)[254](index=254&type=chunk) [Notes to Unaudited Condensed Consolidated Financial Statements](index=8&type=section&id=Notes%20to%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) Key disclosures detail the alleviation of going concern uncertainty, an asset acquisition, and significant financing activities - Management concluded that **substantial doubt about the Company's ability to continue as a going concern has been alleviated** due to a $16.225 million offering and other capital sources[31](index=31&type=chunk)[33](index=33&type=chunk) - On April 1, 2025, the Company acquired intellectual property from Open Daily Technologies Inc for **344,827 shares of common stock valued at $3,000,000**[82](index=82&type=chunk)[83](index=83&type=chunk) - In February 2025, an offering of common stock and pre-funded warrants raised **net proceeds of $6,642,433**[96](index=96&type=chunk)[98](index=98&type=chunk) - In August 2025, a PIPE offering and warrant exercise generated **gross proceeds of $16,225,000**, improving pro forma stockholders' equity to over $33 million[134](index=134&type=chunk)[138](index=138&type=chunk) - The company is involved in a legal dispute over a retail lease with a **claimed amount of $450,968**, reduced from an initial $1.5 million[129](index=129&type=chunk)[273](index=273&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=32&type=section&id=ITEM%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Revenue declined due to a strategic account drop, but net loss improved from reduced operating expenses and recent financing Results of Operations Comparison (Q2 2025 vs Q2 2024) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Change | | :--- | :--- | :--- | :--- | | Net Revenues | $2.3 million | $3.4 million | $(1.1) million | | Gross Profit | $0.7 million | $1.6 million | $(0.9) million | | Gross Margin | 32% | 46% | (14 pts) | | Operating Expenses | $2.7 million | $3.8 million | $(1.1) million | | Net Loss | $(2.1) million | $(3.5) million | $1.4 million | - The Q2 2025 revenue decrease was primarily due to dropping a large, low-margin wholesale account, with the impact expected to be offset by expanding another wholesale relationship[230](index=230&type=chunk)[231](index=231&type=chunk) - Operating expenses **decreased by $1.2 million** in Q2 2025 year-over-year following significant headcount reductions, with an additional **$0.7 million in savings anticipated**[235](index=235&type=chunk) - As of June 30, 2025, the company had **$6.4 million in outstanding debt**, mainly from promissory notes, PPP loans, and merchant advances[255](index=255&type=chunk) - The company entered into exclusive private label manufacturing agreements with AAA Tuscaloosa and Traffic Holdco for university apparel subsequent to the reporting period[219](index=219&type=chunk)[222](index=222&type=chunk) [Quantitative and Qualitative Disclosures about Market Risk](index=49&type=section&id=ITEM%203%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The company is exempt from market risk disclosures as a smaller reporting company - As a smaller reporting company, Digital Brands Group, Inc. is not required to provide the information for this item[260](index=260&type=chunk) [Controls and Procedures](index=49&type=section&id=ITEM%204.%20Controls%20and%20Procedures) Disclosure controls were deemed ineffective due to material weaknesses in internal controls, with remediation efforts underway - Management concluded that the company's **disclosure controls and procedures were not effective** as of June 30, 2025[262](index=262&type=chunk) - The ineffectiveness stems from **material weaknesses related to inadequate accounting resources and systems**, which are under active remediation[263](index=263&type=chunk)[268](index=268&type=chunk) - No changes occurred during the quarter that materially affected, or are reasonably likely to materially affect, the company's internal control over financial reporting[269](index=269&type=chunk) [PART II. OTHER INFORMATION](index=51&type=section&id=PART%20II.%20OTHER%20INFORMATION) [Legal Proceedings](index=51&type=section&id=ITEM%201.%20Legal%20Proceedings) The company is managing several legal matters, including a disputed lease claim and settled vendor and employee lawsuits - A vendor lawsuit concerning a retail lease has an updated claim of **$450,968**, down from $1.5 million, which the company disputes[273](index=273&type=chunk) - A wrongful termination lawsuit was **settled in May 2025 for a payment of $81,000**[273](index=273&type=chunk) - A lawsuit with vendor Simon Showroom was **settled for $400,000**, with a remaining balance of $130,000 as of June 30, 2025[273](index=273&type=chunk) [Risk Factors](index=52&type=section&id=ITEM%201A.%20Risk%20Factors) The company is not required to provide risk factor disclosures due to its status as a smaller reporting company - The company is not required to provide risk factor information as it qualifies as a "smaller reporting company"[275](index=275&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=52&type=section&id=ITEM%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) Equity sales were conducted under exemptions from registration requirements as detailed in the financial statement notes - Details on unregistered sales of equity are located in Note 7 of the financial statements[276](index=276&type=chunk) - The issuances were made under exemptions from registration pursuant to Section 4(a)(2) of the Securities Act and/or Rule 506 of Regulation D[276](index=276&type=chunk) [Defaults upon Senior Securities](index=52&type=section&id=ITEM%203.%20Defaults%20upon%20Senior%20Securities) No defaults upon senior securities were reported during the period - None[277](index=277&type=chunk) [Mine Safety Disclosures](index=52&type=section&id=ITEM%204.%20Mine%20Safety%20Disclosures) Mine safety disclosures are not applicable to the company's operations - Not applicable[278](index=278&type=chunk) [Other Information](index=52&type=section&id=ITEM%205.%20Other%20Information) No material changes to shareholder processes or insider trading plans were reported for the quarter - During the quarter ended June 30, 2025, no director or officer adopted or terminated a Rule 10b5-1 trading plan[280](index=280&type=chunk) [Exhibits](index=52&type=section&id=ITEM%206.%20Exhibits) A list of filed exhibits includes officer certifications and key material agreements - The report includes a list of filed exhibits, such as CEO/CFO certifications and various material agreements[281](index=281&type=chunk) [Signatures](index=54&type=section&id=SIGNATURES)

Core Viewpoint - Digital Brands Group, Inc. has announced a private investment in public equity (PIPE) financing agreement, raising approximately $11,225,000 after fees and expenses [1][2]. Financing Details - The PIPE financing involves the sale of up to 14,031.25 shares of Series D Convertible Preferred Stock, convertible into common stock at a conversion price of 80% of the lowest closing price over the previous five trading days [2]. - The stated value of the Series D Preferred Stock is $14,031,250, with a cash purchase price of $11,225,000 [2]. Placement Agent - RBW Capital Partners LLC, a division of Dawson James Securities, acted as the placement agent for the PIPE financing [3]. Securities Registration - The securities offered in the PIPE financing have not been registered under the Securities Act of 1933 and are only available to accredited investors [4]. - The company plans to file registration statements with the SEC for the resale of unregistered shares upon conversion of the Series D Preferred Stock [4]. Company Overview - Digital Brands Group specializes in eCommerce and Fashion, offering a variety of apparel through multiple brands on both direct-to-consumer and wholesale bases [6]. - The company focuses on leveraging customer data and purchase history to create personalized content and enhance customer engagement [6].

Financial Performance - For the three months ended March 31, 2025, the company generated net revenues of $1,871,701, a decrease of $1,704,886 (approximately 47.6%) compared to $3,576,587 in the same period of 2024 [192]. - The company reported a net loss of $2,089,910 for the three months ended March 31, 2025, compared to a net loss of $683,735 in 2024, representing an increase in loss of approximately 205.5% [204]. - Gross profit decreased to $872,455 for the three months ended March 31, 2025, down from $1,720,736 in 2024, reflecting a decline of approximately 49.3% [197]. - The company's gross margin was 46.6% for the three months ended March 31, 2025, compared to 48.1% for the same period in 2024, indicating a decrease of 1.5 percentage points [198]. - Cash used in operating activities increased by $3,266,807 to $4,507,347 for the three months ended March 31, 2025, compared to $1,240,540 in 2024 [209]. - The company had cash of $2.2 million as of March 31, 2025, but reported a working capital deficit of $8.2 million [206]. Debt and Financing - Digital Brands Group has an aggregate principal amount of debt outstanding of approximately $6.5 million as of March 31, 2025, which is considered significant for the company's size and revenue base [145]. - The company entered into a securities purchase agreement for a promissory note of $121.9 million, with a 12% interest rate, maturing on October 16, 2025 [177]. - The company issued a second promissory note of $260,000 with an original issue discount of $60,000, maturing on April 22, 2025 [180]. - The February 2025 Offering raised funds through the sale of 11,365,340 units, including common stock and pre-funded warrants, at a purchase price of $0.66 per unit [183]. Operating Expenses - Operating expenses are expected to increase substantially due to acquisitions and compliance costs, but the company anticipates that these expenses as a percentage of revenue will decrease over time [153]. - The company expects to continue incurring additional expenses related to operating as a public company, which will increase overall operating costs [158]. - The company expects to incur additional expenses due to public company operations, including compliance and reporting obligations, which will increase operating costs [171]. - The company’s operating expenses include general and administrative costs, sales and marketing, and fulfillment and shipping expenses [169]. - The company expects to reduce operating expenses by an additional $700,000 over the next 12 months following significant headcount reductions in April and May 2025 [202]. Revenue Growth Strategies - The company aims to achieve near-term free cash flow through cash flow positive acquisitions and the elimination of redundant expenses, with a focus on increasing customer annual spend and lowering acquisition costs [152]. - The company has identified opportunities to drive customer lifetime value (LTV) through targeted marketing and cross-merchandising across its brand portfolio [140]. - The company is transitioning several brands from wholesale to digital direct-to-consumer models, aiming to enhance customer engagement and operational efficiencies [138]. - The company has strategically expanded into omnichannel strategies, blending physical and online channels to enhance customer acquisition and retention [139]. - Digital revenue increased over 80% from the previous quarter despite limited marketing spend in the first quarter of 2025 [196]. Cost Increases - The company has experienced increased costs in raw materials, with fabric prices rising between 10% to 100%, and shipping costs increasing from 25% to 300% depending on various factors [144]. - The company anticipates that changes in tariff policies will lead to increased prices for competitors, enhancing its market share potential [176]. - The company produces over 90% of its products in the USA, significantly limiting tariff exposure and providing a competitive advantage [174]. - The company does not utilize the "de minimis" exemption, which may impact e-commerce retailers and reduce competition in the online apparel market [175]. Cost Management - The company has successfully eliminated several million in expenses within six months of acquiring Bailey, including merging technology contracts and reducing office space costs [152].

Core Insights - Digital Brands Group, Inc. has formed a strategic partnership with Amaze, becoming the first third-party partner to offer its products on the revamped Teespring Marketplace [1][2] - This partnership allows Amaze customers to shop AVO by DSTLD, enhancing the product collection and shopping experience on Teespring Marketplace, which attracts over 1.2 billion unique visitors [2][3] - The collaboration aims to connect fans with styles that reflect their unique tastes, leveraging AI-driven curation and advanced discovery tools to maximize audience reach [3][4] Company Overview - Digital Brands Group offers a variety of apparel through multiple brands on a direct-to-consumer and wholesale basis, focusing on owning the customer's "closet share" by utilizing data and purchase history for personalized content [5] - Amaze is a creator-powered commerce platform that provides tools for seamless product creation and advanced e-commerce solutions, enabling creators to sell products and cultivate audience connections [6]

Financial Performance and Equity - The Company reported stockholders' equity of $19,046, failing to meet the $2,500,000 requirement for Nasdaq listing[23]. - The Company received net proceeds of $2,063,386 from the sale of 105,125 shares of Common Stock between July 1, 2024, and October 22, 2024[25]. - The Offering on October 30, 2024, resulted in gross proceeds of approximately $3,000,000, with net proceeds of approximately $2,555,261 after fees[31]. - The Company reported net proceeds of $278,160 from the sale of 65,236 shares of Common Stock between October 23, 2024, and December 17, 2024[25]. - The Company raised approximately $7,500,000 in gross proceeds from the Offering, before deducting fees and expenses[44]. - The Placement Agent received a cash fee of 8.0% of the aggregate gross proceeds raised in the Offering[44]. - The Company extended the Final Payment due date for settlement agreements with investors to November 4, 2024, totaling $1,789,668.37[24]. - The Company issued a promissory note of $260,000 with an original issue discount of $60,000, maturing on April 22, 2025[36]. - The Company entered into securities purchase agreements to issue 124,673 shares of common stock at $5.00 per share and 482,187 pre-funded warrants at $4.995 each[27]. - The Company issued 26,226 shares in error due to non-compliance with Nasdaq Listing Rule 5635(d), which were subsequently canceled[26]. Business Strategy and Operations - The Company aims to increase its "closet share," defined as the percentage of a customer's clothing units owned from its brands, to drive higher revenue[50]. - The Company plans to actively pursue acquisitions to enhance customer cohorts and deliver customized content[53]. - The Company is transitioning its brands from wholesale to digital direct-to-consumer models to improve margins and customer engagement[47]. - The Company leverages data analytics to create targeted marketing campaigns across its brand portfolio[57]. - The Company has centralized certain administrative functions to improve operational efficiency and reduce costs[58]. - The company plans to increase online revenues significantly by enhancing digital marketing efforts and optimizing website sales opportunities[67]. - The company aims to increase gross margins by ordering larger quantities to reduce upcharges associated with minimum order quantities[67]. - Direct-to-consumer sales are emphasized, allowing the company to eliminate wholesale mark-ups and offer sharper pricing[76]. - The marketing strategy includes paid social media, email marketing, and influencer collaborations to drive customer acquisition and retention[92]. - The company plans to develop and launch a company-wide loyalty program to engage and reward customers across all brands, utilizing reward points for purchases[104]. Product Pricing and Categories - Stateside's T-shirt prices range from $68 to $94, with other tops priced between $98 and $130, and bottoms from $80 to $144[63]. - Sundry's T-shirt prices range from $68 to $98, with other tops priced between $98 and $198, and bottoms from $80 to $228[65]. - DSTLD's denim prices range from $75 to $95, while T-shirts and tops range from $30 to $90, and casual pants from $85 to $109[69]. - Avo launched in late August 2024, with T-shirt prices ranging from $20 to $50 based on bundle size, and discounts of 40% for two units and 60% for three or more[71]. - ACE Studios suits were priced between $295 and $495, with dress shirts ranging from $55 to $65, and casual pants from $85 to $109[73]. - A new product category for 2025 in women's athleisure is planned, targeting a high repeat spend market[75]. Employee Relations and Workforce - As of December 31, 2024, the company had 41 full-time employees and maintains a strong relationship with them, with no labor-related work stoppages reported[112]. - The company emphasizes the importance of a diverse workforce and plans to focus on hiring and retaining underrepresented populations[113]. - The company is committed to the health and wellness of its employees, providing access to various health programs and benefits[114]. - Robust compensation and benefits programs are in place to meet employee needs[115]. Market Competition and Challenges - The company faces significant competition from established brands like Vince, James Perse, and Ralph Lauren, which have greater resources and market recognition[105]. - Quarterly operating results are historically stronger in the second half of the calendar year due to seasonality[106]. - The company is subject to evolving domestic and foreign laws regarding consumer protection, privacy, and data security, which could impose additional compliance burdens[107][108]. Corporate Actions - The Company completed a 2024 Reverse Stock Split at a ratio of 1-for-50, affecting the number of shares but not the authorized shares or voting rights[37]. - The Company entered into a vendor agreement with MavDB Consulting LLC for services valued at $3,000,000, with payment options including cash or shares[34]. - The Company submitted an application to list its common stock on a national securities exchange on February 20, 2025[45].

Core Insights - Digital Brands Group, Inc. has acquired the assets of Open Daily Technologies Inc. to enhance its eCommerce capabilities and improve consumer engagement through innovative virtual shopping solutions [1][4] - The acquisition involves the exchange of 344,827 shares of common stock of Digital Brands Group, indicating a strategic move to strengthen its position in the online retail market [1] Company Overview - Digital Brands Group specializes in eCommerce and fashion, offering a variety of apparel through direct-to-consumer and wholesale channels [5] - The company aims to leverage customer data and purchase history to create personalized shopping experiences, focusing on increasing customer "closet share" [5] Open Daily's Contributions - Open Daily is recognized for its pioneering virtual shopping solutions that enhance online retail experiences, helping brands connect with consumers in more engaging and interactive ways [2][4] - The company's core product offerings include: - Outfit Virtual Shopping, a live shopping platform that replicates in-store experiences [7] - Outfit Voice AI, a multilingual shopping assistant that enhances customer support [7] - Outfit ND-AI, a platform aimed at providing deeper consumer insights through behavioral data [7] Strategic Implications - The acquisition aligns with Digital Brands Group's strategy to expand its presence in the evolving online shopping landscape, integrating interactive commerce solutions to foster meaningful connections with customers [4] - The CEO of Digital Brands Group emphasized the potential to enhance digital retail experiences and improve engagement and sales through Open Daily's technology [5]

Core Viewpoint - Digital Brands Group, Inc. has applied for a listing on a national securities exchange, marking a significant step in its growth strategy following a successful capital raise of $7.5 million [1][2]. Group 1: Company Developments - The CEO of Digital Brands Group, Hil Davis, emphasized that the uplisting is a logical progression in the company's growth journey [2]. - The recent capital raise of $7.5 million is intended to strengthen the company's balance sheet and fund growth initiatives, including Tik Tok Live, digital marketing, and influencer partnerships [2]. - The successful listing of the company's common shares is contingent upon approval from the national securities exchange and meeting all listing criteria [2]. Group 2: Business Model and Strategy - Digital Brands Group operates a diverse range of apparel brands through both direct-to-consumer and wholesale channels, focusing on a digitally native-first vertical brand model [4]. - The company aims to enhance customer engagement by leveraging data and purchase history to create personalized content and looks for specific customer cohorts [4].

Core Viewpoint - Digital Brands Group, Inc. (DBG) has announced a public offering of 11.36 million units at a price of $0.66 per unit, aiming to raise approximately $7.5 million for working capital, corporate purposes, and debt repayment [1][3]. Group 1: Offering Details - The offering consists of units that include a share of common stock and/or a pre-funded warrant to purchase common stock, along with two common stock purchase warrants [1]. - The offering is expected to close on February 18, 2025, subject to customary closing conditions [3]. - RBW Capital Partners LLC, through Dawson James Securities, Inc., is the exclusive placement agent for the offering [2]. Group 2: Company Background - DBG operates a variety of apparel brands through both direct-to-consumer and wholesale channels, focusing on a digitally native-first vertical brand model [5]. - The company aims to enhance customer engagement by leveraging data and purchase history to create personalized content and looks for specific customer cohorts [5].