Koss(KOSS) - 2025 Q4 - Annual Results

Report Overview Company Information Koss Corporation, a U.S.-based high-fidelity headphone company, announced its financial results for the fourth quarter and full fiscal year ended June 30, 2025 - Koss Corporation (NASDAQ: KOSS) is a U.S.-based high-fidelity headphone company[1] Fourth Quarter Fiscal Year 2025 Performance For the fourth quarter of fiscal year 2025, Koss Corporation reported a 6.6% increase in sales, primarily driven by significant growth in export markets and Direct-to-Consumer (DTC) sales, despite a higher net loss compared to the prior year Fourth Quarter Financial Highlights (YoY) | Metric | Q4 FY2025 | Q4 FY2024 | Change ($) | Change (%) | | :----------------------- | :---------- | :---------- | :--------- | :--------- | | Net Sales | $3,084,210 | $2,893,401 | $190,809 | 6.6% | | Net Loss | $(232,696) | $(110,369) | $(122,327) | 110.8% | | Basic & Diluted Loss per Share | $(0.02) | $(0.01) | $(0.01) | 100.0% | - Sales increase was fueled by an approximately 49% increase in export markets, with sales to the two largest European distributors up over 100%, mostly led by new product sales[3] - The Direct-to-Consumer (DTC) market grew approximately 18% compared to the prior year's fourth quarter, attributed to new product introductions and higher online traffic from enhanced advertising efforts[3] - Growth was partially offset by declines in orders from domestic distributors (influenced by excess inventory of non-Koss product) and lower e-tailer sales[3] Full Year Fiscal Year 2025 Performance For the full fiscal year 2025, Koss Corporation achieved a 2.9% sales growth, primarily driven by improved international sales and a significant increase in DTC sales, while also reducing its net loss compared to the previous fiscal year Full Year Financial Highlights (YoY) | Metric | FY2025 | FY2024 | Change ($) | Change (%) | | :----------------------- | :---------- | :---------- | :--------- | :--------- | | Net Sales | $12,624,170 | $12,265,069 | $359,101 | 2.9% | | Net Loss | $(874,831) | $(950,911) | $76,080 | -8.0% | | Basic & Diluted Loss per Share | $(0.09) | $(0.10) | $0.01 | -10.0% | - Full fiscal year sales growth was mainly from improved sales to European customers, higher sales to original equipment manufacturers (OEMs) in Asian markets, and various new customers in the region[4] - DTC sales saw an uptick of 16.5%, now representing nearly a quarter of the Company's total sales, primarily due to new product launches, increased online advertising, and webpage optimizations[4] - A favorable sales mix, along with sales of higher margin new products, yielded an improved gross margin in the current fiscal year[4] - The company anticipates headwinds from newly imposed tariffs on goods from China, which will adversely impact margins as inventory sells through, but expects freight costs to stabilize next quarter[4] About Koss Corporation Product Offerings Koss Corporation offers a comprehensive range of high-fidelity audio products, catering to various consumer needs with both wired and wireless solutions - Koss Corporation markets a complete line of high-fidelity headphones, wireless Bluetooth® speakers, computer headsets, telecommunications headsets, active noise canceling headphones, and wireless headphones[5] Condensed Consolidated Statements of Operations Unaudited Financial Data The unaudited condensed consolidated statements of operations provide detailed financial figures for the three and twelve months ended June 30, 2025, compared to the same periods in 2024, outlining net sales, cost of goods sold, gross profit, operating expenses, and net loss Condensed Consolidated Statements of Operations (Unaudited) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Twelve Months Ended June 30, 2025 | Twelve Months Ended June 30, 2024 | | :----------------------------------- | :------------------------------- | :------------------------------- | :-------------------------------- | :-------------------------------- | | Net sales | $3,084,210 | $2,893,401 | $12,624,170 | $12,265,069 | | Cost of goods sold | 1,973,166 | 1,725,607 | 7,850,572 | 8,079,622 | | Gross profit | 1,111,044 | 1,167,794 | 4,773,598 | 4,185,447 | | Selling, general and administrative expenses | 1,550,243 | 1,485,557 | 6,510,721 | 6,057,606 | | Loss from operations | (439,199) | (317,763) | (1,737,123) | (1,872,159) | | Interest income | 212,555 | 211,162 | 879,774 | 847,644 | | Loss before income tax provision (benefit) | (226,644) | (106,601) | (857,349) | (1,024,515) | | Income tax provision (benefit) | 6,052 | 3,768 | 17,482 | (73,604) | | Net loss | $(232,696) | $(110,369) | $(874,831) | $(950,911) | | Loss per common share: Basic | $(0.02) | $(0.01) | $(0.09) | $(0.10) | | Loss per common share: Diluted | $(0.02) | $(0.01) | $(0.09) | $(0.10) | | Weighted-average number of shares: Basic | 9,390,855 | 9,274,987 | 9,363,117 | 9,251,373 | | Weighted-average number of shares: Diluted | 9,390,855 | 9,274,987 | 9,363,117 | 9,251,373 | Forward-Looking Statements Disclaimer and Risk Factors This section serves as a standard disclaimer, highlighting that statements regarding future events or financial performance are forward-looking and subject to various risks and uncertainties that could cause actual results to differ materially. The company explicitly states it undertakes no obligation to update these statements - Forward-looking statements are based on currently available operating, financial, and competitive information and are subject to various risks and uncertainties, which may cause actual events or results to differ materially[7] - Key risk factors include fluctuations in economic conditions, ability to develop new products, consumer receptivity to new technologies, competition, foreign manufacturing and sales (including government regulation and trade tensions like U.S.-China tariffs), health crises, geopolitical conflicts, and litigation[7] - The Company undertakes no obligation to publicly update such forward-looking statements to reflect subsequent events or circumstances or new information[7]