Core Viewpoint - AXIL Brands, Inc. experienced a decline in revenue and net income for fiscal 2025, but management highlighted improvements in cash flow and strategic initiatives aimed at long-term growth [12]. Financial Performance - AXIL reported net sales of $26.3 million for fiscal 2025, down 4.5% from $27.5 million a year earlier [1] - Net income decreased significantly to $0.9 million in fiscal 2024 from $2 million a year earlier, resulting in basic earnings per share (EPS) of 13 cents compared to 57 cents in the previous year [2] - Adjusted EBITDA rose 21.3% to $2.4 million, representing 9.3% of sales versus 7.3% a year earlier [2] - Operating cash flow improved markedly, generating $1.9 million versus only $3 thousand in fiscal 2024 [2] Key Business Metrics - Cash on hand rose to $4.8 million at the end of May 2025 from $3.3 million in the prior year [3] - Inventory declined to $2.5 million from $3.4 million, reflecting improved working capital management [3] - Accounts receivable nearly doubled to just more than $1 million, indicating stronger sales momentum or extended collection cycles [3] Operating Efficiency - Operating expenses represented 66.6% of sales in fiscal 2025, improving from 67.9% a year earlier [4] - Reduced sales and marketing expenses fell to $11.7 million from $13.4 million, contributing to efficiency gains [4] - Higher professional and consulting costs rose to $3.3 million from $2.7 million, partially offsetting the efficiency improvements [4] Management Insights - CEO Jeff Toghraie described fiscal 2025 as "a pivotal year" for AXIL, marking its third consecutive year of profitability despite global trade challenges [5] - Management emphasized the robust gross margin of 71% and significant improvements in operating cash flow as evidence of financial discipline [6] - The company is reshaping its supply chain by relocating manufacturing to the U.S. to mitigate tariff exposure [6] Factors Influencing Results - Revenue decline was partly due to global trade challenges, including tariffs and supply-chain disruptions [7] - Improved cost structure with lower marketing outlays and tighter expense controls helped sustain profitability [7] - The decision to advance U.S.-based manufacturing played a role in offsetting tariff-related cost pressures [7] Brand Diversification - AXIL continued to diversify its brand portfolio, with early momentum in its Reviv3 hair and skin care division supported by new leadership hires [8] Future Guidance - For fiscal 2026, management projected strong momentum driven by a major wholesale agreement with a large membership-based retailer, expected to enhance revenues and brand visibility [9] - This partnership is anticipated to expand AXIL's national reach and support long-term growth [9] Strategic Developments - AXIL launched Sharper Vision Marketing, a subsidiary aimed at monetizing internal digital marketing expertise and reducing customer acquisition costs [11] - The company advanced its operational realignment efforts, emphasizing the transition of its supply chain to the U.S. [11] - A key leadership appointment was made to bolster the Reviv3 segment, signaling intent to accelerate growth in the hair and skin care market [11]