Barfresh(BRFH) - 2025 Q3 - Quarterly Report

Revenue Performance - Revenue increased by $594,000, or 16%, to $4,231,000 in Q3 2025 compared to $3,637,000 in Q3 2024[74] - Revenue for the nine months ended September 30, 2025, increased by $857,000, or 11%, to $8,786,000 compared to $7,929,000 in the same period of 2024[84] Profitability and Margins - Gross profit was $1,552,000 (37%) in Q3 2025, up from $1,260,000 (35%) in Q3 2024, with a reduction in gross margin attributed to product mix and inventory costs[77] - Gross profit for the nine months ended September 30, 2025, was $2,958,000 (34%), down from $2,938,000 (37%) in 2024, reflecting a decrease in gross margin[86] - Net loss improved to approximately $290,000 in Q3 2025 from $513,000 in Q3 2024, driven by increased revenue and gross margin[83] Expenses - Selling, marketing, and distribution expenses decreased by approximately $49,000 (5%) from $990,000 in Q3 2024 to $941,000 in Q3 2025[78] - General and administrative expenses increased by approximately $139,000 (20%) from $705,000 in Q3 2024 to $844,000 in Q3 2025, primarily due to costs associated with the Arps acquisition[79] - Cost of revenue for the nine months ended September 30, 2025, increased by $837,000, or 17%, to $5,828,000, attributed to trial costs at a new manufacturer[85] Cash Flow and Liquidity - As of September 30, 2025, working capital was $1,626,000, compared to $606,000 at December 31, 2024, primarily due to capital raised through the sale of common stock[99] - During the nine months ended September 30, 2025, the company used $2,173,000 in operations, with a net loss adjusted for non-cash operating expenses of $1,297,000[98] - Liquidity needs depend on the ability to profitably ramp up sales and control variable operating expenses[100] - Operations have been financed through the sale of securities, convertible debt, and short-term debt[101] - Additional funds may be required if sufficient cash flow from operations is not generated[101] Financial Reporting and Compliance - No off-balance sheet arrangements that materially affect financial condition or results of operations[102] - The company is classified as a smaller reporting company, thus not required to disclose market risk[103]