Financial Data and Key Metrics Changes - Net revenue for Q3 2025 was $19 million, a 27.5% decline from $26.2 million in Q3 2024, but only a 2% decrease from Q2 2025 [7][22] - Contribution margin improved to over 15% in Q3 2025, up from 7.8% in Q2 2025 [7][20] - Adjusted EBITDA loss improved by over 80% compared to Q2 2025, narrowing to just over $400,000 from a loss of $2.2 million [8][20] - Overall gross margin decreased to 56.1% from 60.3% in the year-ago quarter, primarily due to product mix and tariff impacts [23] Business Line Data and Key Metrics Changes - Launch revenue was $0.2 million in Q3 2025, down from $0.6 million in Q3 2024, reflecting postponed product launches [22] - The contribution margin decreased to 15.5% in Q3 2025 from 17% in Q3 2024, mainly due to reduced gross margin [23] Market Data and Key Metrics Changes - The decline in revenue was attributed to strategic price increases to offset tariff costs and a general slowdown in consumer spending [10][22] - Despite maintaining bestseller rankings, fewer units were sold due to reduced overall consumer demand [10] Company Strategy and Development Direction - The company is focusing on cost reductions, product launch strategies, and pricing adjustments to navigate the tariff environment [11][19] - Plans to diversify the supply chain and explore sourcing opportunities outside of China are ongoing, especially for high-tariff products [14][15] - The push into consumables is seen as a strong strategic objective, with new product launches primarily sourced from the U.S. [16][18] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the core products and brands, despite challenges posed by tariffs and reduced consumer demand [11][19] - The focus for 2026 will be on sustainable top-line growth and profitability, with a disciplined approach to marketing and cash management [28] Other Important Information - Cash reserves decreased to approximately $7.6 million from $18 million at the end of 2024, but cash used in operations was significantly reduced in Q3 [25] - Inventory levels increased to $17.2 million, attributed to lower expected demand for seasonal products [26] Q&A Session Summary Question: What percentage of revenue in Q3 were sales through the Amazon channel versus other platforms? - Amazon accounted for over 95% of revenue for the quarter, with new channels like Home Depot being more of a setup for future sales [32] Question: How is launch revenue tracking against plans? - Launch revenue was muted due to wholesale sales to Amazon and limited marketing spend due to tariff impacts, but the quality of products is expected to drive long-term growth [34][35] Question: How quickly can sourcing be adjusted once new sourcing is identified? - The speed of sourcing adjustments depends on manufacturer capabilities, with some products already being sourced outside of China to mitigate tariff impacts [37]