Financial Performance - Total net revenues for the three months ended September 30, 2025, were $11,984,314, slightly up from $11,983,021 in the same period of 2024[12] - Gross profit for the six months ended September 30, 2025, was $20,776,057, compared to $20,950,911 for the same period in 2024, reflecting a decrease of approximately 0.83%[12] - The company reported a net income of $656,217 for the three months ended September 30, 2025, compared to a net loss of $13,210,753 in the same period of 2024[12] - Operating expenses for the three months ended September 30, 2025, were $9,734,055, down from $16,439,324 in the same period of 2024, a decrease of approximately 41.1%[12] - For the six months ended September 30, 2025, the net loss was $5,053,499 compared to a net loss of $27,188,088 for the same period in 2024[19] - The company reported a net cash provided by operating activities of $(3,452,435) for the six months ended September 30, 2025, compared to $1,071,053 for the same period in 2024[19] - The company reported a gain on the extinguishment of debt amounting to $801,894 for the three months ended September 30, 2025[12] - The company reported a gain on the extinguishment of debt amounting to $801,894 for the six months ended September 30, 2025[19] - The effective tax rate for the three and six months ended September 30, 2025, was 0.0%, primarily due to a full valuation allowance against deferred tax assets[112] Assets and Liabilities - Total current assets increased to $78,301,114 as of September 30, 2025, from $72,148,138 as of March 31, 2025, representing an increase of approximately 8.9%[9] - Total liabilities decreased to $34,857,771 as of September 30, 2025, down from $75,303,066 as of March 31, 2025, indicating a reduction of approximately 53.7%[9] - The company’s total shareholders' equity increased to $235,415,672 as of September 30, 2025, compared to $222,026,563 as of March 31, 2025, reflecting an increase of about 6%[9] - The company’s accumulated deficit increased to $(210,438,277) as of September 30, 2025, compared to $(203,862,034) as of March 31, 2025[9] - Net accounts receivable as of September 30, 2025, was $8,855,910, down from $10,189,011 as of March 31, 2025[78] - Total property and equipment as of September 30, 2025, was $10,684,936, with accumulated depreciation of $3,685,401[79] - Accrued liabilities decreased significantly from $37,413,636 as of March 31, 2025, to $6,729,316 as of September 30, 2025[81] Cash Flow and Investments - Cash flow from investing activities showed a net cash provided of $41,899,318 for the six months ended September 30, 2025, while it was $(2,046,157) for the same period in 2024[19] - The company had a cash balance of $65,669,937 at the end of the period on September 30, 2025, compared to $33,525,409 at the end of the same period in 2024[19] - The total cash at the end of the period was $65,669,937, up from $30,227,796 at the beginning of the period[19] Shareholder Information - Basic income per share from continuing operations was $0.01 for the three months ended September 30, 2025, compared to a loss of $0.06 in the same period of 2024[12] - The weighted average number of shares outstanding for basic income was 117,110,827 for the three months ended September 30, 2025[12] - The net loss attributable to common stockholders for the six months ended September 30, 2025, was $28,744,861, compared to a net loss of $6,576,242 for the same period in 2024[69] - The company repurchased common shares totaling $171,200 during the six months ended September 30, 2025, compared to $460,661 in the same period of 2024[19] Discontinued Operations - The company completed the sale of its Ammunition segment assets for $75 million on April 18, 2025, which is classified as discontinued operations[35] - The Ammunition segment reported net revenues of $752,762 for the six months ended September 30, 2025, significantly down from $38,108,123 for the same period in 2024[74] - The loss from discontinued operations before income taxes for the six months ended September 30, 2025, was $10,883,781, compared to a loss of $6,559,908 for the same period in 2024[74] - The company experienced a loss from discontinued operations of $595,634 for the six months ended September 30, 2025, compared to $9,322,858 in the prior year[19] Stock-Based Compensation - Stock-based compensation for the six months ended September 30, 2025, was $787,826, down from $2,623,031 in the same period of 2024[19] - The company recognized stock-based compensation on a straight-line basis over the vesting periods, measured based on the grant-date fair value of the award[57] - The company granted 377,498 stock awards during the six months ended September 30, 2025, with a value per share of $2.02, while 426,027 shares vested[106] Debt and Financing - The company issued $51 million in notes payable related to a litigation settlement, with a discount of $28,891,590 on those notes[21] - The company issued a $12.0 million unsecured promissory note with an interest rate of 6.50% per annum, due on May 30, 2037[121] - An additional $39.0 million unsecured promissory note was issued with an interest rate of 4.62% per annum, due on May 30, 2035[126] - The company recorded interest expense of $327,820 on the $12.0 million note for the six months ended September 30, 2025[123] - The Company entered into a Revolving Loan agreement with a principal amount of up to $20.0 million, with proceeds usable for working capital and general corporate purposes[132] - As of September 30, 2025, the Company had no outstanding balance on the Revolving Loan[139] Regulatory and Compliance - The SEC Investigation may lead to potential enforcement actions regarding share-based compensation and other disclosures, with no current estimate of loss available[147] - The company is currently evaluating the potential impact of new accounting standards on its consolidated financial statements and disclosures[63] - The company utilizes U.S. GAAP for financial reporting, with all amounts expressed in U.S. dollars[30] - Income taxes are accounted for under the asset and liability method in accordance with ASC 740, including federal, state, and local income taxes currently payable, and deferred taxes[59]

Core Viewpoint - POWW's MSCI ESG rating has been downgraded from BBB to B as of November 4, 2025, indicating a significant decline in its environmental, social, and governance performance [1] Group 1 - The downgrade reflects a negative shift in the company's ESG practices and overall sustainability efforts [1] - MSCI ESG ratings are crucial for investors focusing on sustainable and responsible investment strategies [1]

Core Viewpoint - Outdoor Holding Company, owner of GunBroker.com, will release its financial results for Q2 of the 2026 fiscal year on November 10, 2025 [1]. Group 1: Financial Results Announcement - The financial results will be announced premarket on November 10, 2025 [1]. - A conference call will be held at 9:00 AM ET on the same day to review the financial results and provide updates on corporate developments [2]. - Participants are encouraged to preregister for the call to receive their dial-in number [2][3]. Group 2: Company Overview - Outdoor Holding Company is headquartered in Atlanta, Georgia, and operates subsidiaries that serve outdoor enthusiasts, including GunBroker [4]. - GunBroker.com is the largest online marketplace for firearms, hunting, and related products, facilitating sales through third-party sellers [5]. - The platform promotes responsible ownership of firearms and adheres to federal and state laws regarding the sale of firearms and restricted items [5].

Core Points - Outdoor Holding Company has relocated its corporate headquarters from Scottsdale, Arizona to Atlanta, Georgia to reduce corporate overhead and control indirect costs [1][2] - The relocation is aimed at improving cultural cohesion and corporate efficiencies while striving to grow Adjusted EBITDA over the next 12-18 months [2] - The move will result in a modest headcount reduction, with remaining Arizona-based team members shifting to remote work [2] Company Overview - Outdoor Holding Company is a publicly traded corporation that owns and operates subsidiaries serving outdoor enthusiasts, including GunBroker.com, the largest online marketplace for firearms and related products [3] - GunBroker.com, launched in 1999, serves as a secure platform for third-party sellers to list firearms, ammunition, and related gear, promoting responsible ownership of firearms [4]

Core Viewpoint - The United States District Court for the Northern District of Georgia has ruled in favor of Outdoor Holding Company, confirming GunBroker.com’s status as an online marketplace and validating its policies to protect third-party intellectual property rights [1][2]. Group 1: Legal Outcome - The court granted summary judgment in a contributory trademark infringement case brought by Microtech Knives, Inc. against GunBroker.com [1][2]. - The ruling concluded that GunBroker.com met its obligations to protect intellectual property once notified of potential infringements [1][2]. Group 2: Company Statements - CEO Steve Urvan expressed satisfaction with the court's recognition of GunBroker.com as an online marketplace, similar to platforms like eBay and Etsy, emphasizing the effectiveness of the company's policies [2]. - The decision is expected to eliminate unnecessary legal costs and distractions, allowing the company to focus on growth as a dedicated online marketplace for firearms and outdoor enthusiasts [2]. Group 3: Company Overview - Outdoor Holding Company, based in Scottsdale, Arizona, operates GunBroker.com, the largest online marketplace for firearms and related products [3]. - GunBroker.com facilitates sales by third-party sellers and adheres to federal and state laws governing the sale of firearms and restricted items [3].

Economic Indicators - Stock index futures are showing positive movement with S&P 500 futures up 0.2%, Nasdaq 100 futures up 0.2%, and Dow futures up 0.1% as investors anticipate the retail inflation report [3] - The 10-year Treasury yield remains unchanged at 4.06%, while the 2-year yield is flat at 3.56% [4] - The August Consumer Price Index (CPI) is expected to rise by 0.3% month-over-month, increasing from 0.2% in the previous month, with a year-over-year forecast of 2.9%, up from 2.7% in July [4] Gun Industry - Gun stocks have seen a rise following the shooting of conservative activist Charlie Kirk, with Smith & Wesson up 4.9% in premarket trading after a 6.7% increase on Wednesday [5][7] - American Outdoor Brands closed 5.3% higher and is slightly up in premarket, while Sturm, Ruger closed with a 3% gain and is up 7.4% postmarket [7] - The shooting incident is anticipated to drive demand for stricter gun control laws, historically leading to increased demand for firearms [6] Technology and Robotics - Ant Group has introduced its first humanoid robot, the R1 model, capable of performing various tasks such as serving as a tour guide and sorting medicine [8] - The R1 robot was demonstrated at the 2025 Inclusion Conference in Shanghai, showcasing its ability to handle complex assignments [8] Corporate Developments - Opendoor Technologies shares surged by 40% after the appointment of former Shopify COO Kaz Nejatian as CEO, with co-founders returning to the board [10] - Khosla Ventures and co-founder Eric Wu will invest $40 million in Opendoor through a private placement to support business growth [10]

Core Viewpoint - Outdoor Holding Company has regained compliance with Nasdaq Listing Rule 5620(a) following its 2025 Annual Meeting of Stockholders, where all matters presented by the Board of Directors were approved [1][2]. Company Overview - Outdoor Holding Company is a publicly traded corporation based in Scottsdale, Arizona, that owns and operates subsidiaries catering to outdoor enthusiasts, including GunBroker.com, the largest online marketplace for firearms and related products [3]. GunBroker.com Overview - GunBroker.com serves as the largest online marketplace for firearms, hunting, and related products, facilitating sales through third-party sellers while adhering to federal and state laws governing firearm sales [4]. Annual Meeting Highlights - The Annual Meeting resulted in the election of five directors, ratification of the independent accounting firm, approval of a long-term incentive plan, and a proposal for a reverse stock split at a ratio between 1-for-5 and 1-for-10 [6]. - The meeting also included advisory votes on executive compensation and the frequency of future advisory votes [6]. Management's Focus - The management team, led by CEO Steve Urvan, aims to accelerate growth in the core online business and enhance long-term stockholder value, supported by a newly elected board of experienced veterans [2].

[PART I - FINANCIAL INFORMATION](index=3&type=section&id=PART%20I%20-%20FINANCIAL%20INFORMATION) [ITEM 1. FINANCIAL STATEMENTS](index=3&type=section&id=ITEM%201.%20FINANCIAL%20STATEMENTS) This section presents the unaudited condensed consolidated financial statements for Outdoor Holding Company, including the balance sheets, statements of operations, shareholders' equity, and cash flows, along with detailed notes explaining significant accounting policies, discontinued operations, and other financial disclosures for the period ended June 30, 2025 [Condensed Consolidated Balance Sheets](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) The balance sheet shows a decrease in total assets from **$297.3 million** to **$269.5 million** and a significant reduction in total liabilities from **$75.3 million** to **$47.0 million** between March 31, 2025, and June 30, 2025. Shareholders' equity slightly increased to **$222.5 million** Table: Condensed Consolidated Balance Sheets | Metric | June 30, 2025 (Unaudited) | March 31, 2025 | | :-------------------------------- | :------------------------ | :------------- | | **ASSETS** | | | | Cash and cash equivalents | $63,363,812 | $30,227,796 | | Total Current Assets | $74,486,175 | $72,148,138 | | Total Assets | $269,467,322 | $297,329,629 | | **LIABILITIES AND SHAREHOLDERS' EQUITY** | | | | Total Current Liabilities | $22,725,627 | $62,092,917 | | Total Liabilities | $46,961,667 | $75,303,066 | | Total Shareholders' Equity | $222,505,655 | $222,026,563 | [Condensed Consolidated Statements of Operations](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) For the three months ended June 30, 2025, the company reported a net loss attributable to common stock shareholders of **$7.2 million**, a significant improvement from **$15.5 million** in the prior year. Net revenues slightly decreased, but the loss from continuing operations was nearly halved due to the absence of a large income tax provision seen in 2024 Table: Condensed Consolidated Statements of Operations | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :----------------------------------- | :------------------------------- | :------------------------------- | | Net revenues | $11,857,376 | $12,281,991 | | Gross Profit | $10,334,978 | $10,537,201 | | Loss from Operations | $(6,010,675) | $(6,235,365) | | Net loss from continuing operations | $(5,862,693) | $(11,997,025) | | Net loss attributable to common stock shareholders | $(7,232,459) | $(15,534,107) | | Total basic loss per share of common stock | $(0.06) | $(0.13) | | Total diluted loss per share of common stock | $(0.06) | $(0.13) | [Condensed Consolidated Statements of Shareholders' Equity](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Shareholders'%20Equity) Shareholders' equity increased slightly from **$222.0 million** at March 31, 2025, to **$222.5 million** at June 30, 2025, primarily driven by increases in additional paid-in capital from stock-based compensation and warrants issued for legal settlement, partially offset by net loss and preferred stock dividends Table: Condensed Consolidated Statements of Shareholders' Equity | Metric | March 31, 2025 | June 30, 2025 | | :-------------------------------- | :------------- | :------------- | | Preferred Stock Par Value | $1,400 | $1,400 | | Common Shares Par Value | $116,816 | $117,113 | | Additional Paid-In Capital | $434,335,782 | $442,047,037 | | Accumulated Deficit | $(203,862,034) | $(211,094,494) | | Treasury Stock | $(8,565,401) | $(8,565,401) | | Total Shareholders' Equity | $222,026,563 | $222,505,655 | **Changes during Q1 2025:** * Stock based compensation: **$787,399** increase in Additional Paid-In Capital * Warrants issued for legal settlement: **$7,094,926** increase in Additional Paid-In Capital * Net loss: **$(6,458,327)** decrease in Accumulated Deficit * Preferred stock dividends: **$(638,022)** decrease in Accumulated Deficit [Condensed Consolidated Statements of Cash Flow](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flow) Cash and cash equivalents significantly increased by **$33.1 million** to **$63.4 million** at June 30, 2025, primarily driven by **$42.9 million** in proceeds from the sale of the Ammunition business, partially offset by net cash used in operating activities (**$6.7 million**) and financing activities (**$0.8 million**) Table: Cash Flow Activity | Cash Flow Activity | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :------------------------------------------ | :------------------------------- | :------------------------------- | | Net cash provided by/(used in) operating activities | $(6,673,464) | $889,653 | | Net cash provided by/(used in) investing activities | $42,057,105 | $(802,396) | | Net cash used in financing activities | $(809,222) | $(2,821,709) | | Net cash used in discontinued operations | $(1,438,403) | $(2,097,419) | | Net increase/(decrease) in cash | $33,136,016 | $(4,831,871) | | Cash, end of period | $63,363,812 | $50,754,570 | - Sale of ammunition business assets generated **$42,946,905** in cash from investing activities for the three months ended June 30, 2025[17](index=17&type=chunk) Table: Non-cash investing and financing activities (Q2 2025) | Activity | Amount | | :---------------------------------------------------- | :------------- | | Issuance of notes payable - related party in DE Litigation settlement | $51,000,000 | | Discount on notes payable - related party in DE Litigation settlement | $(28,891,590) | | Warrant issued for legal settlement - related party in DE Litigation settlement | $7,094,926 | | Dividends accumulated on preferred stock | $136,111 | [Notes to Condensed Consolidated Financial Statements](index=8&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) These notes provide detailed explanations and additional information supporting the condensed consolidated financial statements, covering the company's organization, significant accounting policies, discontinued operations, capital structure, related party transactions, and contingencies [NOTE 1 – ORGANIZATION AND BUSINESS ACTIVITY](index=8&type=section&id=NOTE%201%20%E2%80%93%20ORGANIZATION%20AND%20BUSINESS%20ACTIVITY) Outdoor Holding Company, formerly AMMO, Inc., transitioned from a dual-segment business (Ammunition and Marketplace) to solely operating its GunBroker e-commerce Marketplace after selling its Ammunition manufacturing business in April 2025 - Company changed its name from AMMO, Inc. to **Outdoor Holding Company** on April 21, 2025[24](index=24&type=chunk) - The company sold its Ammunition manufacturing business in April 2025, transitioning to focus solely on the **GunBroker e-commerce Marketplace** segment[23](index=23&type=chunk) - The Marketplace segment, GunBroker, supports the lawful sale of firearms, ammunition, and hunting/shooting accessories, connecting buyers with sellers and federally licensed firearm dealers[22](index=22&type=chunk) [NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES](index=8&type=section&id=NOTE%202%20%E2%80%93%20SUMMARY%20OF%20SIGNIFICANT%20ACCOUNTING%20POLICIES) This note outlines the company's key accounting policies, including principles of consolidation, U.S. GAAP basis, use of estimates, and specific treatments for discontinued operations, goodwill, accounts receivable, cash, long-lived assets, revenue recognition, leases, and stock-based compensation, also mentioning the adoption of ASU 2023-09 for income tax disclosures - The company's Ammunition segment was classified as held for sale and its results are presented as **discontinued operations** for all periods, following the sale completion on April 18, 2025[33](index=33&type=chunk) - Revenue is generated from marketplace fees (listing, final value, compliance, advertising, shipping) and recognized when performance obligations are satisfied, typically at the point of transaction processing or service delivery[41](index=41&type=chunk)[42](index=42&type=chunk)[43](index=43&type=chunk)[44](index=44&type=chunk)[45](index=45&type=chunk) - The company is evaluating the impact of **ASU 2023-09**, 'Improvements to Income Tax Disclosures,' effective for annual periods beginning after December 15, 2024[59](index=59&type=chunk) [NOTE 3 – INCOME (LOSS) PER COMMON SHARE](index=13&type=section&id=NOTE%203%20%E2%80%93%20INCOME%20%28LOSS%29%20PER%20COMMON%20SHARE) Basic and diluted loss per share from continuing operations improved to **$(0.06)** for the three months ended June 30, 2025, from **$(0.11)** in the prior year. A significant number of common stock options, non-vested stock awards, and warrants were excluded from diluted EPS calculation due to their anti-dilutive effect Table: Income (Loss) Per Common Share | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :------------------------------------------ | :------------------------------- | :------------------------------- | | Net loss from continuing operations | $(5,862,693) | $(11,997,025) | | Net loss attributable to common stockholders | $(7,232,459) | $(15,534,107) | | Basic loss per share (Continuing operations) | $(0.06) | $(0.11) | | Diluted loss per share (Continuing operations) | $(0.06) | $(0.11) | | Weighted average shares outstanding (Basic/Diluted) | 116,841,148 | 119,105,502 | Table: Shares Excluded from Diluted Net Loss Per Share | Instrument | 2025 | 2024 | | :---------------------------------------------------- | :------- | :--------- | | Common stock options | 400,000 | 200,000 | | Non-vested stock awards | - | 1,032,191 | | Warrants | 8,720,345 | 1,731,370 | | Total shares excluded | 9,120,345 | 2,963,561 | [NOTE 4- DISCONTINUED OPERATIONS AND ASSETS HELD FOR SALE](index=14&type=section&id=NOTE%204-%20DISCONTINUED%20OPERATIONS%20AND%20ASSETS%20HELD%20FOR%20SALE) The Ammunition segment was sold to Olin Winchester, LLC on April 18, 2025, for approximately **$42.9 million** net proceeds. The segment's operations for the three months ended June 30, 2025 (April 1-18) resulted in a net loss of **$0.6 million**, a significant reduction from **$2.8 million** in the prior year, reflecting the divestiture - The Ammunition Manufacturing Business was sold to Olin Winchester, LLC for a gross purchase price of **$75.0 million**, with net proceeds of approximately **$42.9 million** after adjustments. The transaction closed on April 18, 2025[66](index=66&type=chunk) Table: Financial Information of Discontinued Operations (Ammunition Segment) | Metric | Three Months Ended June 30, 2025 (April 1-18) | Three Months Ended June 30, 2024 | | :------------------------------------------ | :------------------------------------ | :------------------------------- | | Net revenues | $752,762 | $18,671,559 | | Gross profit | $(846,440) | $(759,900) | | Loss from operations | $(1,178,865) | $(4,172,829) | | Loss from discontinued operations, net of tax | $(595,634) | $(2,762,950) | Table: Ammunition Segment Assets and Liabilities (March 31, 2025) | Category | Amount | | :-------------------------------- | :------------- | | Total assets of discontinued operations | $57,890,362 | | Total liabilities of discontinued operations | $16,644,998 | [NOTE 5 – SUPPLEMENTAL BALANCE SHEET INFORMATION](index=15&type=section&id=NOTE%205%20%E2%80%93%20SUPPLEMENTAL%20BALANCE%20SHEET%20INFORMATION) This note provides detailed breakdowns of accounts receivable, property and equipment, and accrued liabilities. Net accounts receivable decreased to **$8.9 million**, while net property and equipment increased to **$6.9 million**. Accrued liabilities significantly decreased to **$5.7 million**, primarily due to the resolution of an accrued contingency Table: Accounts Receivable, Net | Metric | June 30, 2025 | March 31, 2025 | | :------------------------ | :------------ | :------------- | | Accounts receivable | $12,544,721 | $13,994,499 | | Less: allowance for credit losses | $(3,596,273) | $(3,805,488) | | Accounts receivable, net | $8,948,448 | $10,189,011 | Table: Net Property and Equipment | Metric | June 30, 2025 | March 31, 2025 | | :----------------------- | :------------ | :------------- | | Total property and equipment | $11,238,698 | $10,562,538 | | Less accumulated depreciation | $(4,352,985) | $(4,084,854) | | Net property and equipment | $6,885,713 | $6,477,684 | Depreciation expense for the three months ended June 30, 2025, was **$479,663**, up from **$315,445** in 2024 Table: Accrued Liabilities | Metric | June 30, 2025 | March 31, 2025 | | :------------------ | :------------ | :------------- | | Accrued bonus program | $627,017 | $1,831,250 | | Accrued professional fees | $1,977,999 | $4,682,183 | | Accrued contingency | — | $29,067,229 | | Accrued liabilities | $5,708,093 | $37,413,636 | [NOTE 6 – LEASES](index=17&type=section&id=NOTE%206%20%E2%80%93%20LEASES) The company leases office space under operating leases, with a weighted average remaining lease term of **3.0 years** and a discount rate of **10.0%** as of June 30, 2025. Total lease expense for the three months ended June 30, 2025, was **$149,659** - Consolidated lease expense for the three months ended June 30, 2025, was **$149,659**, including **$135,734** of operating lease expense[77](index=77&type=chunk) - As of June 30, 2025, the weighted average remaining lease term for operating leases was **3.0 years**, and the weighted average discount rate was **10.0%**[78](index=78&type=chunk) Table: Future Minimum Lease Payments (as of June 30, 2025) | Years Ended March 31, | Amount | | :-------------------- | :------------- | | 2026 | $412,507 | | 2027 | $564,681 | | 2028 | $360,055 | | 2029 | $242,595 | | Total Lease Payments | $1,579,838 | | Present Value of Lease Liabilities | $1,357,412 | [NOTE 7 – PREFERRED STOCK](index=17&type=section&id=NOTE%207%20%E2%80%93%20PREFERRED%20STOCK) The company has Series A Cumulative Redeemable Perpetual Preferred Stock with an **8.75%** annual dividend rate, payable quarterly. Dividends paid for the quarter ended June 30, 2025, totaled **$765,625**, with **$136,111** accumulated as of that date - Series A Preferred Stock has an **8.75%** annual cumulative cash dividend rate (**$2.1875** per year), payable quarterly[80](index=80&type=chunk) - The Series A Preferred Stock is generally not redeemable by the Company prior to May 18, 2026, except under specific change of control or de-listing events[81](index=81&type=chunk) Table: Preferred Stock Dividends Paid | Period | Dividend Amount (2025) | Per Share Amount (2025) | Dividend Amount (2024) | Per Share Amount (2024) | | :----------------------------- | :--------------------- | :---------------------- | :--------------------- | :---------------------- | | March 15 - June 14 | $765,625 | $0.54687500 | $782,634 | $0.55902778 | Preferred dividends accumulated as of June 30, 2025, were **$136,111** [NOTE 8 – CAPITAL STOCK](index=18&type=section&id=NOTE%208%20%E2%80%93%20CAPITAL%20STOCK) The company has **200 million** authorized common shares. The 2017 Equity Incentive Plan has **1.8 million** shares available. As of June 30, 2025, **8.7 million** warrants were outstanding, including **7.0 million** issued in May 2025 as part of a legal settlement. Stock options are fully vested, and no unvested stock awards remain - The company has **200,000,000** authorized shares of common stock with a par value of **$0.001** per share[84](index=84&type=chunk) - As of June 30, 2025, there were **1,797,164** shares available to be issued under the 2017 Equity Incentive Plan[85](index=85&type=chunk) Table: Warrants Outstanding at June 30, 2025 | Metric | Value | | :-------------------------- | :-------- | | Number of Shares | 8,720,345 | | Weighted Average Exercise Price | $1.85 | | Weighted Average Life Remaining (Years) | 4.04 | Includes **7,000,000** warrants issued on May 30, 2025, at an exercise price of **$1.81** with a 5-year term, as part of a legal settlement - Stock options to purchase **400,000** shares were fully vested on May 30, 2025, upon the former CEO's separation agreement. No unrecognized compensation expense remains for unvested stock options or stock awards as of June 30, 2025[87](index=87&type=chunk)[88](index=88&type=chunk)[89](index=89&type=chunk) [NOTE 9 – GOODWILL AND INTANGIBLE ASSETS](index=20&type=section&id=NOTE%209%20%E2%80%93%20GOODWILL%20AND%20INTANGIBLE%20ASSETS) Goodwill remained stable at **$90.9 million**. Net intangible assets decreased to **$95.9 million** from **$98.9 million** due to amortization. Amortization expense for the three months ended June 30, 2025, was **$3.0 million** - Goodwill carrying value remained at **$90,870,094** as of June 30, 2025, and March 31, 2025[90](index=90&type=chunk) - Amortization expense for intangible assets was **$3,030,358** for the three months ended June 30, 2025, compared to **$3,201,411** in the prior year[90](index=90&type=chunk) Table: Intangible Assets (Net) | Asset Type | June 30, 2025 | March 31, 2025 | | :-------------------- | :------------ | :------------- | | Tradename | $76,532,389 | $76,532,389 | | Customer List | $65,252,802 | $65,252,802 | | Intellectual Property | $4,224,442 | $4,224,442 | | Other Intangible Assets | $357,747 | $357,747 | | Gross Intangibles Assets | $146,367,380 | $146,367,380 | | Accumulated Amortization | $(50,505,971) | $(47,475,613) | | Net Intangible Assets | $95,861,409 | $98,891,767 | [NOTE 10 – SEGMENTS](index=22&type=section&id=NOTE%2010%20%E2%80%93%20SEGMENTS) The company's Chief Operating Decision Maker (CODM) assesses performance and allocates resources based on consolidated EBITDA. For the three months ended June 30, 2025, consolidated EBITDA was a loss of **$2.5 million**, an improvement from a **$2.9 million** loss in the prior year - The CODM (Chief Executive Officer) reviews consolidated EBITDA to analyze performance and allocate resources[92](index=92&type=chunk) Table: Consolidated EBITDA | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :-------------------------------- | :------------------------------- | :------------------------------- | | Net revenues | $11,857,376 | $12,281,991 | | Cost of revenues | $1,522,398 | $1,744,790 | | Selling and marketing | $56,531 | $83,404 | | Corporate and administrative | $7,337,936 | $8,632,953 | | Employee salaries and related expenses | $5,441,165 | $4,710,406 | | Consolidated EBITDA | $(2,500,654) | $(2,889,562) | [NOTE 11 – INCOME TAXES](index=22&type=section&id=NOTE%2011%20%E2%80%93%20INCOME%20TAXES) The effective tax rate for the three months ended June 30, 2025, was **0.0%** due to a full valuation allowance against U.S. federal and state deferred tax assets, indicating that the company concluded it is more likely than not that these assets will not be realized - The income tax provision effective tax rate was **0.0%** for the three months ended June 30, 2025, compared to **(99.0%)** for the same period in 2024[94](index=94&type=chunk) - The **0.0%** effective tax rate in 2025 was primarily due to recording a full valuation allowance against U.S. federal and state deferred tax assets, as it was concluded that the net deferred tax assets are more likely than not to not be realized[94](index=94&type=chunk) [NOTE 12 – RELATED PARTY TRANSACTIONS](index=22&type=section&id=NOTE%2012%20%E2%80%93%20RELATED%20PARTY%20TRANSACTIONS) Related party transactions include **$201,646** in accounts receivable from entities owned by Mr. Urvan. As part of the Delaware Litigation settlement, the company issued a warrant to purchase **7.0 million** common shares and two unsecured promissory notes totaling **$51.0 million** to an affiliated designee of Mr. Urvan - Accounts receivable from entities owned by Mr. Urvan (Chairman and CEO) totaled **$201,646** as of June 30, 2025, and March 31, 2025[96](index=96&type=chunk) - A warrant to purchase **7.0 million** shares of common stock at an exercise price of **$1.81** with a 5-year term was issued to an affiliated designee of Mr. Urvan as partial consideration for the Delaware Litigation settlement. The warrant was valued at **$7,094,926**[97](index=97&type=chunk)[100](index=100&type=chunk) - Two unsecured promissory notes were issued to an affiliated designee of Mr. Urvan: Note 1 for **$12.0 million** (**6.50%** interest, due May 2037) and Note 2 for **$39.0 million** (**4.62%** interest, due May 2035). Both notes require annual prepayments and were recorded at fair value with significant debt discounts[101](index=101&type=chunk)[103](index=103&type=chunk)[104](index=104&type=chunk)[107](index=107&type=chunk) [NOTE 13 – REVOLVING LOAN](index=26&type=section&id=NOTE%2013%20%E2%80%93%20REVOLVING%20LOAN) The company's revolving loan agreement with Sunflower Bank was amended in April and May 2025. The Second Amendment reduced the available amount to zero dollars and released collateral upon the Ammunition Manufacturing Business sale. As of June 30, 2025, there was no outstanding balance on the Revolving Loan - The Loan and Security Agreement with Sunflower Bank, N.A. (Revolving Loan) was amended on April 18, 2025, to reduce the available amount to **zero dollars** and release collateral upon the sale of the Ammunition Manufacturing Business[112](index=112&type=chunk) - A Third Amendment on May 13, 2025, updated company name definitions within the agreement[114](index=114&type=chunk) - As of June 30, 2025, the company did not have an outstanding balance on the Revolving Loan[114](index=114&type=chunk) [NOTE 14 – CONTINGENCIES](index=26&type=section&id=NOTE%2014%20%E2%80%93%20CONTINGENCIES) The Delaware Litigation was settled on May 30, 2025, involving the issuance of warrants and promissory notes to a related party. The MN Action, a breach of contract lawsuit seeking **$100 million** in damages, is ongoing with a trial expected in 2026. The company also faces an inestimable loss contingency from an ongoing SEC investigation into various accounting and disclosure practices - The Delaware Litigation, involving claims by and against Mr. Urvan related to the GunBroker.com acquisition, was settled on May 30, 2025, with all claims dismissed. The settlement included the issuance of a warrant and two unsecured promissory notes to an affiliate of Mr. Urvan[121](index=121&type=chunk) - The MN Action, a breach of contract lawsuit filed by Digital Cash Processing against GunBroker.com, alleges **$100 million** in damages. The company denies the allegations and expects the matter to be scheduled for trial in 2026[122](index=122&type=chunk) - The company is subject to an ongoing SEC investigation concerning valuation of share-based compensation, capitalization of share issuance costs, disclosure of perquisites and executive compensation, related party transactions, and Adjusted EBITDA calculation. The potential loss is currently inestimable[123](index=123&type=chunk) [SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS](index=29&type=section&id=SPECIAL%20NOTE%20REGARDING%20FORWARD-LOOKING%20STATEMENTS) This section highlights that the document contains forward-looking statements based on management's current beliefs and expectations, which are subject to inherent uncertainties, risks, and changes in circumstances. Readers are cautioned not to rely on these statements, and the company does not undertake to update them unless required by law - Forward-looking statements relate to estimated or anticipated results, future events, business strategy, operating results, cash flow, and other non-historical facts[127](index=127&type=chunk) - These statements are subject to inherent uncertainties, risks, and changes in circumstances that are difficult to predict and many of which are outside of the company's control[128](index=128&type=chunk) - The company does not undertake any obligation to update or revise forward-looking statements, except as required by law[129](index=129&type=chunk) [ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION](index=30&type=section&id=ITEM%202.%20MANAGEMENT'S%20DISCUSSION%20AND%20ANALYSIS%20OF%20FINANCIAL%20CONDITION%20AND%20RESULTS%20OF%20OPERATION) This section provides management's perspective on the company's financial condition, results of operations, and liquidity for the three months ended June 30, 2025, covering the transition to a single Marketplace segment, the impact of the Delaware Litigation settlement, and key financial performance metrics [Overview](index=30&type=section&id=Overview) Outdoor Holding Company operates the GunBroker Marketplace, a leading online platform for firearms and shooting sports, generating revenue from marketplace fees. Key strategic initiatives for fiscal year 2026 include enhancing payment processing, share repurchases, business streamlining, and platform user experience improvements - Outdoor Holding Company owns the GunBroker Marketplace, an online platform for firearms and shooting sports, serving over **8.5 million** users and facilitating compliance through **32,000** federally licensed firearms dealers[132](index=132&type=chunk) - Revenue is generated from marketplace fees, including listing, compliance, advertising, and shipping revenue[132](index=132&type=chunk) - Strategic initiatives for FY2026 include launching universal payment processing, repurchasing shares, streamlining the business to reduce costs, and implementing user enhancements to the platform[132](index=132&type=chunk) [Recent Developments](index=30&type=section&id=Recent%20Developments) The company completed the sale of its Ammunition segment on April 18, 2025, for approximately **$42.9 million** net proceeds, and subsequently changed its name to Outdoor Holding Company. The Delaware Litigation was settled on May 30, 2025, resulting in leadership changes, including Steven F. Urvan's appointment as CEO and Chairman, and the issuance of warrants and promissory notes as part of the settlement - The Ammunition segment was sold to Olin Winchester, LLC on April 18, 2025, for net proceeds of approximately **$42.9 million**, leading to its classification as discontinued operations[134](index=134&type=chunk)[135](index=135&type=chunk) - The company changed its name from AMMO, Inc. to **Outdoor Holding Company** on April 21, 2025[134](index=134&type=chunk) - The Delaware Litigation was settled on May 30, 2025, resulting in the appointment of **Steven F. Urvan** as CEO and Chairman of the Board, and the issuance of a warrant for **7.0 million** shares and two unsecured promissory notes totaling **$51.0 million** to an affiliated designee of Mr. Urvan[137](index=137&type=chunk)[138](index=138&type=chunk)[139](index=139&type=chunk) [Results of Operations](index=32&type=section&id=Results%20of%20Operations) Net revenues decreased by **3.5%** to **$11.9 million** for the three months ended June 30, 2025, primarily due to a decline in gross merchandise sales in the Marketplace. Gross margin improved to **87.2%** from **85.8%**. Operating expenses decreased by **$0.4 million**, largely due to a reduction in settlement contingencies and stock-based compensation, partially offset by increased employee salaries (including severance) and legal fees. The net loss from continuing operations significantly improved to **$(5.9) million** from **$(12.0) million** Table: Condensed Consolidated Statements of Operations (Continuing Operations) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :------------------------------------------ | :------------------------------- | :------------------------------- | | Net revenues | $11,857,376 | $12,281,991 | | Cost of revenues | $1,522,398 | $1,744,790 | | Gross profit | $10,334,978 | $10,537,201 | | Operating expenses | $16,345,653 | $16,772,566 | | Loss from operations | $(6,010,675) | $(6,235,365) | | Net loss from continuing operations | $(5,862,693) | $(11,997,025) | Table: Adjusted EBITDA Reconciliation | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :------------------------------------------ | :------------------------------- | :------------------------------- | | Net loss from continuing operations | $(5,862,693) | $(11,997,025) | | Provision for income taxes | — | $5,968,414 | | Depreciation and amortization | $3,510,021 | $3,345,804 | | Interest expense, net | $348,330 | $45,478 | | Stock based compensation | $787,826 | $1,436,038 | | Other income (expense), net | $(496,312) | $(252,232) | | Acquisitions and divestitures | $79,398 | — | | Special Committee Investigation and restatement | $1,304,908 | — | | SEC Investigation | $676,080 | $1,588,809 | | Delaware Litigation legal and professional fees | $1,354,864 | $679,119 | | Corporate restructuring costs | $1,435,693 | — | | Other nonrecurring expenses | — | $3,299,933 | | Adjusted EBITDA | $3,138,115 | $4,114,338 | - Net revenues decreased by **$0.4 million (3.5%)** YoY due to a decrease in gross merchandise sales from the Marketplace, partially offset by a minor increase in the take rate[148](index=148&type=chunk) - Gross margin increased to **87.2%** in Q2 2025 from **85.8%** in Q2 2024, driven by improved platform monetization and a higher mix of high-margin seller services[150](index=150&type=chunk) - Operating expenses decreased by approximately **$0.4 million**, primarily due to a **$3.2 million** reduction in settlement contingencies and a **$0.7 million** decrease in stock-based compensation, partially offset by a **$1.4 million** increase in severance costs and a **$1.9 million** increase in legal and professional fees[153](index=153&type=chunk) [Liquidity and Capital Resources](index=34&type=section&id=Liquidity%20and%20Capital%20Resources) Cash and cash equivalents increased to **$63.4 million** as of June 30, 2025, primarily from **$42.9 million** in net proceeds from the Ammunition business sale. Working capital significantly improved to **$51.8 million**. The company expects existing working capital and cash flows to be adequate for the next 12 months, with ongoing funding from stock sales, bank financings, and related-party notes. The **$51.0 million** in promissory notes issued in the Delaware Litigation settlement require annual prepayments of **$2.95 million** starting May 2026. The revolving loan facility was reduced to zero and has no outstanding balance - Cash and cash equivalents increased by **$33.1 million** to **$63.4 million** as of June 30, 2025, primarily due to **$42.9 million** in net proceeds from the sale of the Ammunition manufacturing business[156](index=156&type=chunk) Table: Working Capital | Metric | June 30, 2025 | March 31, 2025 | | :-------------- | :------------ | :------------- | | Current assets | $74,486,175 | $72,148,138 | | Current liabilities | $22,725,627 | $62,092,917 | | Working Capital | $51,760,548 | $10,055,221 | - Net cash used in operations for Q2 2025 was **$6.7 million**, primarily due to reductions in accounts payable and accrued liabilities and increased prepaid expenses[158](index=158&type=chunk) - The company expects existing working capital and cash flows from operations to be adequate to fund operations over the next 12 months[163](index=163&type=chunk) - The **$51.0 million** aggregate principal amount of promissory notes issued in the Delaware Litigation settlement requires aggregate annual prepayments of **$2.95 million** beginning May 30, 2026[165](index=165&type=chunk) - The revolving loan facility with Sunflower Bank was reduced to **zero dollars** and had no outstanding balance as of June 30, 2025[170](index=170&type=chunk) [Off-Balance Sheet Arrangements](index=36&type=section&id=Of%20-Balance%20Sheet%20Arrangements) As of June 30, 2025, and March 31, 2025, the company did not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future material effect on its financial condition or results of operations - The company did not have any off-balance sheet arrangements as of June 30, 2025, and March 31, 2025, that are material or reasonably likely to have a material effect on its financial condition or results of operations[171](index=171&type=chunk) [Critical Accounting Estimates](index=36&type=section&id=Critical%20Accounting%20Estimates) The company's critical accounting estimates, which require significant management judgment, remain consistent with those disclosed in the Annual Report on Form 10-K for the year ended March 31, 2025, with no material changes - There have been no material changes to the critical accounting policies disclosed in the Annual Report on Form 10-K for the year ended March 31, 2025[173](index=173&type=chunk) [ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK](index=36&type=section&id=ITEM%203.%20QUANTITATIVE%20AND%20QUALITATIVE%20DISCLOSURE%20ABOUT%20MARKET%20RISK) There have been no material changes to the quantitative and qualitative disclosures about market risk from those reported in the company's Annual Report on Form 10-K - There have been no material changes from the market risks disclosed in Part II, Item 7A of the Form 10-K[174](index=174&type=chunk) [ITEM 4. CONTROLS AND PROCEDURES](index=37&type=section&id=ITEM%204.%20CONTROLS%20AND%20PROCEDURES) Management concluded that the company's disclosure controls and procedures were not effective as of June 30, 2025, due to previously identified material weaknesses in internal control over financial reporting. The company is actively implementing remediation initiatives, including organizational enhancements, policy implementations, a new accounting system, and enhanced review procedures [Evaluation of Disclosure Controls and Procedures](index=37&type=section&id=Evaluation%20of%20Disclosure%20Controls%20and%20Procedures) As of June 30, 2025, the CEO and CFO concluded that the company's disclosure controls and procedures were not effective at a reasonable assurance level due to continuing material weaknesses. These weaknesses include issues in the control environment, complex technical accounting (stock compensation, warrants, convertible notes), related party transactions and executive compensation, financial reporting, and segregation of duties - As of June 30, 2025, disclosure controls and procedures were deemed **not effective** at a reasonable assurance level[176](index=176&type=chunk) - Material weaknesses identified include deficiencies in the control environment, information and communication, monitoring activities, complex technical accounting (stock compensation, warrants, convertible notes), related party transactions and executive compensation, financial reporting, and segregation of duties[177](index=177&type=chunk)[178](index=178&type=chunk)[179](index=179&type=chunk) [Management's Remediation Initiatives for Existing Material Weaknesses](index=38&type=section&id=Management's%20Remediation%20Initiatives%20for%20Existing%20Material%20Weaknesses) The company has initiated and is focused on designing and implementing effective measures to strengthen internal controls. Remediation efforts include organizational enhancements (hiring a CFO and VP of Accounting), reinforcing compliance communications, improving processes for significant transactions, implementing related party transaction and perquisites policies, establishing a disclosure committee, implementing a new accounting system, and enhancing entity-wide review procedures - Remediation initiatives include organizational enhancements (hiring a CFO and VP of Accounting), executive communications to reinforce compliance, improved processes for significant and unusual transactions, and implementation of Related Party Transaction and Perquisites Policies[181](index=181&type=chunk)[182](index=182&type=chunk) - A formal disclosure committee was established in fiscal year 2025 to coordinate disclosures and ensure completeness and accuracy of information[182](index=182&type=chunk)[183](index=183&type=chunk) - Control activities remediation includes implementing a new accounting system for improved IT and automated controls, and enhancing existing entity-wide controls around financial reporting processes, including additional staff training and improved evidence of review[187](index=187&type=chunk) [Changes in Internal Control Over Financial Reporting](index=39&type=section&id=Changes%20in%20Internal%20Control%20Over%20Financial%20Reporting) Other than the ongoing remediation activities described, there have been no material changes in the company's internal control over financial reporting during the three months ended June 30, 2025 - No material changes in internal control over financial reporting occurred during the three months ended June 30, 2025, other than the described remediation efforts[186](index=186&type=chunk) [PART II - OTHER INFORMATION](index=40&type=section&id=PART%20II%20-%20OTHER%20INFORMATION) [ITEM 1. LEGAL PROCEEDINGS](index=40&type=section&id=ITEM%201.%20LEGAL%20PROCEEDINGS) This section provides updates on legal proceedings, noting the settlement of the Delaware Litigation on May 30, 2025, and the ongoing MN Action, a breach of contract lawsuit against GunBroker.com seeking **$100 million** in damages, with a trial expected in 2026 - The Delaware Litigation was settled on May 30, 2025, with all claims dismissed, as partial consideration for which the company issued a warrant and two unsecured promissory notes to an affiliate of Mr. Urvan[189](index=189&type=chunk) - The MN Action, a civil action alleging breach of contract and seeking **$100 million** in damages against GunBroker.com, is ongoing, with the company denying allegations and expecting a trial in 2026[190](index=190&type=chunk) [ITEM 1A. RISK FACTORS](index=41&type=section&id=ITEM%201A.%20RISK%20FACTORS) There were no material changes to the risk factors previously disclosed in the company's Annual Report on Form 10-K for the year ended March 31, 2025 - No material changes to the risk factors disclosed in Part I, Item 1A of the Form 10-K for the year ended March 31, 2025[191](index=191&type=chunk) [ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS](index=41&type=section&id=ITEM%202.%20UNREGISTERED%20SALES%20OF%20EQUITY%20SECURITIES%20AND%20USE%20OF%20PROCEEDS) There were no unregistered sales of equity securities or use of proceeds to report during the period - None[192](index=192&type=chunk) [ITEM 3. DEFAULTS UPON SENIOR SECURITIES](index=41&type=section&id=ITEM%203.%20DEFAULTS%20UPON%20SENIOR%20SECURITIES) There were no defaults upon senior securities to report during the period - None[193](index=193&type=chunk) [ITEM 4. MINE SAFETY DISCLOSURE](index=41&type=section&id=ITEM%204.%20MINE%20SAFETY%20DISCLOSURE) This item is not applicable to the company's operations - Not applicable[194](index=194&type=chunk) [ITEM 5. OTHER INFORMATION](index=41&type=section&id=ITEM%205.%20OTHER%20INFORMATION) There was no other information to disclose under this item - None[195](index=195&type=chunk) [ITEM 6. EXHIBITS](index=42&type=section&id=ITEM%206.%20EXHIBITS) This section lists all exhibits filed as part of the Form 10-Q, including merger agreements, asset purchase agreements, corporate governance documents, warrant forms, executive separation agreements, loan amendments, and settlement agreements - The exhibits include various agreements such as the Asset Purchase Agreement for the Ammunition segment sale, forms of warrants and promissory notes related to the Delaware Litigation settlement, and amendments to the Loan and Security Agreement[197](index=197&type=chunk) - Also included are executive separation agreements and certifications pursuant to the Sarbanes-Oxley Act of 2002[197](index=197&type=chunk)[198](index=198&type=chunk) [SIGNATURES](index=44&type=section&id=SIGNATURES) The report is signed by Steven F. Urvan, Chief Executive Officer, and Paul Kasowski, Chief Financial Officer, on behalf of Outdoor Holding Company, certifying its submission in accordance with the Exchange Act of 1934 - The report was signed by **Steven F. Urvan**, Chief Executive Officer, and **Paul Kasowski**, Chief Financial Officer, on August 8, 2025[205](index=205&type=chunk)

[First Quarter Fiscal 2026 Financial Results Overview](index=1&type=section&id=First%20Quarter%20Fiscal%202026%20Financial%20Results%20Overview) Outdoor Holding Company (OHC) reported Q1 FY2026 results, highlighting a strategic shift to GunBroker.com after divesting its ammunition division, focusing on efficiency and growth [Company Overview and Strategic Context](index=1&type=section&id=Company%20Overview%20and%20Strategic%20Context) OHC, formerly AMMO, Inc., transitioned to focus solely on its GunBroker.com e-commerce marketplace after divesting its ammunition manufacturing division, emphasizing operational efficiency and growth - Outdoor Holding Company (Nasdaq: POWW, POWWP) is the owner of GunBroker.com, the largest online marketplace for firearms, hunting, and related products[2](index=2&type=chunk) - The company completed the sale of its ammunition manufacturing division and rebranded to Outdoor Holding Company, now singularly focused on scaling its e-commerce marketplace platform, GunBroker.com[5](index=5&type=chunk) - Chairman and CEO Steve Urvan stated the first quarter marks a turning point to aggressively reshape the business, focusing on operational efficiency, core marketplace growth, and disciplined capital allocation[5](index=5&type=chunk) [Financial Highlights (Q1 FY2026 vs. Q1 FY2025)](index=1&type=section&id=Financial%20Highlights%20%28Q1%20FY2026%20vs.%20Q1%20FY2025%29) OHC reported a slight decrease in net revenues but significantly narrowed its net loss from continuing operations, with improved gross profit margin and decreased operating expenses Q1 Fiscal 2026 Financial Highlights (vs. Q1 Fiscal 2025) | Metric | Q1 FY2026 | Q1 FY2025 | | :-------------------------------- | :-------- | :-------- | | Net Revenues ($ million) | $11.9 million | $12.3 million | | Cost of Revenues ($ million) | $1.5 million | $1.7 million | | Gross Profit Margin (%) | 87.2% | 85.8% | | Operating Expenses ($ million) | Decreased $0.4 million | | | Net Loss from Continuing Operations ($ million) | ($5.9) million | ($12.0) million | | Diluted LPS from Continuing Operations ($) | ($0.06) | ($0.11) | | Adjusted EBITDA ($ million) | $3.1 million | $4.1 million | | Adjusted EPS ($) | $0.02 | $0.03 | [Operational Highlights (Q1 FY2026 vs. Q1 FY2025)](index=1&type=section&id=Operational%20Highlights%20%28Q1%20FY2026%20vs.%20Q1%20FY2025%29) OHC achieved key operational milestones including the ammunition division sale and corporate rebranding, while GunBroker.com showed momentum with increased listings, users, and average order value - Key operational achievements include closing the ammunition division sale to Olin-Winchester, entering a settlement agreement for Delaware litigation, appointing Steve Urvan as Chairman and CEO, and completing rebranding from AMMO, Inc. to Outdoor Holding Company[6](index=6&type=chunk) - Marketplace performance indicators showed continued momentum with increased active listings, registered GunBroker user accounts (**8.5 million**, a new high), and an increased Average Order Value from **$425 to $444** per order[6](index=6&type=chunk)[12](index=12&type=chunk) - Platform upgrades included search functionality improvements, enhanced seller programs and analytics, and refinement of buyer personalization algorithms, contributing to higher average order values and better buyer satisfaction scores[8](index=8&type=chunk) [Detailed Financial Performance](index=3&type=section&id=Detailed%20Financial%20Performance) The company's detailed financial statements reflect a significant reduction in net loss, a substantial increase in cash, and the reclassification of the ammunition business as discontinued operations [CONSOLIDATED STATEMENTS OF OPERATIONS](index=7&type=section&id=CONSOLIDATED%20STATEMENTS%20OF%20OPERATIONS) The consolidated statements show a net loss attributable to common stock shareholders of ($7.2) million for Q1 FY2026, a notable improvement from ($15.5) million in Q1 FY2025 Consolidated Statements of Operations (Three Months Ended June 30) | Metric | Q1 FY2026 ($) | Q1 FY2025 ($) | | :------------------------------------- | :---------- | :---------- | | Net revenues | $11,857,376 | $12,281,991 | | Cost of revenues | $1,522,398 | $1,744,790 | | Gross Profit | $10,334,978 | $10,537,201 | | Total operating expenses | $16,345,653 | $16,772,566 | | Loss from Operations | ($6,010,675) | ($6,235,365) | | Net loss from continuing operations | ($5,862,693) | ($11,997,025) | | Loss from discontinued operations, net of tax | ($595,634) | ($2,762,950) | | Net loss attributable to common stock shareholders | ($7,232,459) | ($15,534,107) | | Basic loss per share of common stock (Total) | ($0.06) | ($0.13) | | Diluted loss per share of common stock (Total) | ($0.06) | ($0.13) | [CONSOLIDATED BALANCE SHEETS](index=6&type=section&id=CONSOLIDATED%20BALANCE%20SHEETS) As of June 30, 2025, cash and cash equivalents significantly increased to over $63 million, while total assets and liabilities decreased due to the divestiture of discontinued operations Consolidated Balance Sheets (As of June 30, 2025 vs. March 31, 2025) | Metric | June 30, 2025 ($) | March 31, 2025 ($) | | :-------------------------------- | :------------ | :------------- | | Cash and cash equivalents | $63,363,812 | $30,227,796 | | Current assets - discontinued operations | - | $30,497,720 | | Total Current Assets | $74,486,175 | $72,148,138 | | Noncurrent assets - discontinued operations | - | $27,392,642 | | TOTAL ASSETS | $269,467,322 | $297,329,629 | | Current liabilities - discontinued operations | - | $6,080,182 | | Total Current Liabilities | $22,725,627 | $62,092,917 | | Noncurrent liabilities - discontinued operations | - | $10,564,816 | | Total Liabilities | $46,961,667 | $75,303,066 | | Total Shareholders' Equity | $222,505,655 | $222,026,563 | - The company ended the quarter with a strong liquidity position, with over **$63 million in cash**, providing a stable financial foundation to reinvest in growth[10](index=10&type=chunk) [Discontinued Operations](index=3&type=section&id=Discontinued%20Operations) In April 2025, Outdoor Holding Company completed the sale of its ammunition manufacturing business. The financial results of this segment are now presented as discontinued operations in the consolidated statements for all periods shown, and related assets and liabilities are reflected accordingly - In April 2025, the Company completed the sale of all assets of its ammunition manufacturing business[13](index=13&type=chunk) - The results of the Ammunition segment are presented as discontinued operations in the consolidated statements of operations for all periods presented, with prior periods adjusted to conform[14](index=14&type=chunk) [Non-GAAP Financial Measures](index=4&type=section&id=Non-GAAP%20Financial%20Measures) Non-GAAP measures like Adjusted EBITDA and Adjusted EPS are presented to provide additional insights into the company's operational performance, excluding certain non-cash and non-recurring items [Adjusted EBITDA Definition and Rationale](index=4&type=section&id=Adjusted%20EBITDA%20Definition%20and%20Rationale) Adjusted EBITDA is a non-GAAP measure used to evaluate operational performance by excluding specific non-cash, non-recurring, or non-operating items, aiding management in strategic decisions - Adjusted EBITDA is a non-GAAP financial measure used to evaluate operational performance, produce future strategies, and make strategic decisions, providing useful information to investors[19](index=19&type=chunk) - Adjusted EBITDA is defined as net income (loss) from continuing operations excluding provision for income taxes, depreciation and amortization, interest expense, share-based compensation, other income (expense), acquisition/divestiture expenses, professional/legal fees related to investigations/litigation, and other nonrecurring expenses[22](index=22&type=chunk) - Limitations of non-GAAP measures include not reflecting significant recurring share-based compensation, cash capital expenditure requirements, changes in working capital needs, and potential incomparability with other companies' metrics[24](index=24&type=chunk) [Adjusted EBITDA Reconciliation](index=4&type=section&id=Adjusted%20EBITDA%20Reconciliation) Adjusted EBITDA for Q1 FY2026 was $3.1 million, a decrease from $4.1 million in Q1 FY2025, primarily due to a lower net loss from continuing operations offset by reduced prior-year adjustments Reconciliation of GAAP Net Loss from Continuing Operations to Adjusted EBITDA (Three Months Ended June 30) | Metric | Q1 FY2026 ($) | Q1 FY2025 ($) | | :------------------------------------------ | :---------- | :---------- | | Net loss from continuing operations | ($5,862,693) | ($11,997,025) | | Provision for income taxes | — | $5,968,414 | | Depreciation and amortization | $3,510,021 | $3,345,804 | | Interest expense, net | $348,330 | $45,478 | | Share-based compensation | $787,826 | $1,436,038 | | Other income (expense), net | ($496,312) | ($252,232) | | Acquisitions and divestitures | $79,398 | — | | Special Committee Investigation and restatement | $1,304,908 | — | | SEC Investigation | $676,080 | $1,588,809 | | Delaware Litigation legal and professional fees | $1,354,864 | $679,119 | | Corporate restructuring costs | $1,435,693 | — | | Other nonrecurring expenses | — | $3,299,933 | | **Adjusted EBITDA** | **$3,138,115** | **$4,114,338** | [Adjusted EPS Reconciliation](index=8&type=section&id=Adjusted%20EPS%20Reconciliation) Adjusted EPS decreased from $0.03 in Q1 FY2025 to $0.02 in Q1 FY2026, reflecting the impact of various adjustments including prior-year income taxes and current legal/restructuring costs Reconciliation of GAAP Net Loss to Fully Diluted EPS (Three Months Ended June 30) | Metric | Q1 FY2026 ($) | Q1 FY2025 ($) | | :------------------------------------------ | :-------- | :-------- | | Net loss from continuing operations | ($0.06) | ($0.11) | | Provision for income taxes | - | $0.05 | | Depreciation and amortization | $0.03 | $0.03 | | Interest expense, net | $0.00 | $0.00 | | Stock based compensation | $0.01 | $0.01 | | Other income (expense), net | ($0.00) | ($0.00) | | Acquisitions and divestitures | $0.00 | - | | Special Committee Investigation and restatement | $0.01 | - | | SEC Investigation | $0.01 | $0.01 | | Delaware Litigation legal and professional fees | $0.01 | $0.01 | | Corporate restructuring costs | $0.01 | - | | Other nonrecurring expenses | - | $0.03 | | **Adjusted EBITDA (per share)** | **$0.02** | **$0.03** | [Chairman and CEO Letter to Stockholders](index=9&type=section&id=Chairman%20and%20CEO%20Letter%20to%20Stockholders) The CEO's letter outlines a strategic transformation to a focused e-commerce marketplace, highlighting financial improvements, operational enhancements, and key initiatives for fiscal 2026 [Strategic Direction and Business Transformation](index=9&type=section&id=Strategic%20Direction%20and%20Business%20Transformation) CEO Steve Urvan announced a 'new era' for OHC, transitioning to a streamlined e-commerce marketplace operator (GunBroker.com) after the ammunition division sale and resolving past challenges - The first quarter of fiscal 2026 represents a turning point, transitioning to a streamlined, focused e-commerce marketplace operator with the successful sale of the ammunition division and new corporate identity[33](index=33&type=chunk) - The company is now singularly focused on GunBroker.com and has closed a challenging chapter involving litigation, internal investigations, delayed financial filings, and regulatory reviews[34](index=34&type=chunk) - Nasdaq listing standards compliance has been restored, with financial reporting current and full compliance expected after the annual meeting on August 29th[35](index=35&type=chunk) [Financial Performance and Outlook from CEO](index=9&type=section&id=Financial%20Performance%20and%20Outlook%20from%20CEO) The CEO highlighted stable net revenue and an impressive gross margin of 87.2% for Q1 FY2026, with net loss cut in half and Adjusted EBITDA at $3.1 million. He acknowledged ongoing SG&A challenges and significant legal/compliance costs but expects these to abate within 12-18 months. The company targets a $25 million Adjusted EBITDA run rate within 18 months, even with flat revenue, and aims to maximize free cash flow with no income tax liability for several years due to a substantial Net Operating Loss (NOL) - Q1 FY2026 saw stable net revenue of almost **$12 million**, gross margin expanding to **87.2%**, net loss cut in half to **($5.9) million**, and Adjusted EBITDA of **$3.1 million**[36](index=36&type=chunk) - The company is executing an ambitious restructuring to drive meaningful reductions in SG&A, expecting improved Adjusted EBITDA and cash flow[36](index=36&type=chunk) - Significant and debilitating legal and compliance costs are a drag on corporate operating expenses but are largely a short-term aberration, expected to abate within **12-18 months**[40](index=40&type=chunk) - The CEO believes Outdoor Holding Company will achieve a **$25 million Adjusted EBITDA run rate within 18 months**, even with relatively flat revenue, and expects no income tax liability for a few years due to a substantial Net Operating Loss (NOL)[41](index=41&type=chunk) [Operational Performance and Platform Enhancements](index=10&type=section&id=Operational%20Performance%20and%20Platform%20Enhancements) The CEO affirmed GunBroker.com's position as the dominant technology player in the firearms space, maintaining market share despite industry-wide demand fluctuations. Operational performance remains strong, with increases in listings and registered users, and ongoing enhancements to buyer personalization, seller tools, and search functionality are expected to boost conversion rates and customer satisfaction - GunBroker.com continues to be the dominant technology player in the firearms space, maintaining market share despite industry-wide demand surges and weaker periods[38](index=38&type=chunk) - GunBroker's operational performance remains strong, with increases in listings and registered users, reflecting improved seller engagement and platform visibility[42](index=42&type=chunk) - Enhancements in buyer personalization, seller tools, and search functionality are expected to result in stronger conversion rates, higher average order values, and improved customer satisfaction[42](index=42&type=chunk) [Key Strategic Initiatives for Fiscal 2026](index=11&type=section&id=Key%20Strategic%20Initiatives%20for%20Fiscal%202026) For the remainder of fiscal 2026, OHC's strategy is focused on unlocking stockholder value and growing the GunBroker ecosystem through four key initiatives: launching universal payment processing, considering share repurchases, advancing restructuring for cost reduction, and implementing further user experience enhancements - Key strategic initiatives for fiscal 2026 include launching universal payment processing to increase GMV and user adoption, considering share repurchases (subject to Board approval), advancing restructuring efforts for cost reduction, and implementing user enhancements for best-in-class buyer and seller experiences[47](index=47&type=chunk) [Additional Information](index=3&type=section&id=Additional%20Information) This section provides details about Outdoor Holding Company, cautionary statements regarding forward-looking information, and investor contact details [About Outdoor Holding Company](index=3&type=section&id=About%20Outdoor%20Holding%20Company) Outdoor Holding Company is the publicly traded parent and operator of GunBroker.com, an online marketplace for firearms, hunting, shooting, and related products. Launched in 1999, GunBroker.com facilitates secure buying and selling, adhering to federal and state laws by using licensed firearms dealers as transfer agents, and promotes responsible gun ownership - Outdoor Holding Company operates GunBroker.com, the largest online marketplace dedicated to firearms, hunting, shooting, and related products[15](index=15&type=chunk) - GunBroker.com, launched in 1999, is an informative, secure, and safe platform that uses licensed firearms dealers as transfer agents to comply with federal and state laws, promoting responsible gun ownership[15](index=15&type=chunk) [Cautionary Statement Concerning Forward-Looking Statements](index=3&type=section&id=Cautionary%20Statement%20Concerning%20Forward-Looking%20Statements) The report contains forward-looking statements, identifiable by specific terminology, which are based on management's current beliefs and expectations. These statements are subject to inherent uncertainties, risks, and changes in circumstances that could cause actual results to differ materially, and investors are advised not to rely on them and to review risk factors in SEC filings. The company disclaims any obligation to update these statements - Forward-looking statements are identified by words like 'target,' 'believe,' 'expect,' and 'will,' and relate to future events or trends, based on management's current beliefs and assumptions[16](index=16&type=chunk)[46](index=46&type=chunk) - These statements are subject to inherent uncertainties, risks, and changes in circumstances that are difficult to predict and outside the Company's control, including maintaining e-commerce business, introducing new features, retaining customers, impact of lawsuits, and adverse economic conditions[16](index=16&type=chunk)[46](index=46&type=chunk) - Investors should not rely on forward-looking statements and should review risk factors in the Company's Annual Report on Form 10-K; the Company disclaims any obligation to update them[16](index=16&type=chunk)[46](index=46&type=chunk) [Contacts](index=3&type=section&id=Contacts) Investor relations contact information for Outdoor Holding Company is provided through CoreIR - Investor relations contact: CoreIR, Phone: (212) 655-0924, Email: IR@outdoorholding.com[17](index=17&type=chunk)

Core Viewpoint - Outdoor Holding Company is undergoing a strategic transformation focused on operational efficiency and growth in its e-commerce marketplace, GunBroker.com, following the sale of its ammunition division and corporate rebranding [4][30][33]. Financial Highlights - Net revenues for the first quarter of fiscal 2026 were $11.9 million, a slight decrease from $12.3 million in the prior year [5][6]. - Gross margin improved to 87.2%, up from 85.8% year-over-year, driven by better platform monetization and a higher mix of high-margin seller services [5][6]. - Operating expenses decreased by $0.4 million year-over-year, reflecting cost-reduction initiatives [5][6]. - The net loss from continuing operations narrowed to $5.9 million, compared to a net loss of $12.0 million in the prior year [6][8]. - Adjusted EBITDA was $3.1 million, down from $4.1 million in the previous year [6][8]. Operational Highlights - The company has seen an increase in active marketplace listings and registered user accounts, reaching 8.5 million [6][13]. - Platform upgrades included improvements in search functionality, seller programs, and buyer personalization algorithms, contributing to higher average order values [7][38]. - The company is focused on enhancing user experience and engagement to drive growth [39][42]. Strategic Initiatives - The company aims to launch universal payment processing to enhance transaction efficiency and increase gross merchandise value (GMV) [39]. - A disciplined capital allocation strategy is in place, focusing on organic growth and operational efficiency [9][30]. - The company expects to achieve a run rate of $25 million in Adjusted EBITDA within 18 months, even with flat revenue [37].