Company: CHUC
Filing Date: 2025-08-21
Form Type: 10-Q
Source: 0001437749-25-027482
Chunk: 7

Company: Charlie's Holdings, Inc.
Filing Date: 2025-08-21
Form: 10-Q
Item: Part I, Item 1
Chunk 7
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 assumptions by the Company.

The asset or liability’s fair value measurement level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. Valuation techniques used need to maximize the use of observable inputs and minimize the use of unobservable inputs.

In determining the appropriate levels, the Company performs a detailed analysis of the assets and liabilities that are measured and reported on a fair value basis. At each reporting period, all assets and liabilities for which the fair value measurement is based on significant unobservable inputs are classified as Level 3. The valuation of assets and liabilities recognized in business combinations are considered level 3 fair value measurements on the closing date of the acquisition. These assets and liabilities are not remeasured at each reporting period.

As of June 30, 2025 and December 31, 2024, the Company did not have any Level 1, 2 or 3 assets or liabilities measured on a recurring basis.

NOTE 4 - INVENTORY

The components of inventory as of June 30, 2025 and December 31, 2024 are summarized as follows:

                                June 30,                   December 31,             
                                2025                       2024                     
 ────────────────────────────────────────────────────────────────────────────────────
  Finished goods                $               2,662      $                 2,737  
  Raw materials                                   764                          775  
  Overhead allocation                              17                           22  
  Inventory in transit                          1,198                          132  
  Less: inventory reserves                    ( 1,018                        ( 999  
  Total                         $               3,623      $                 2,667  

NOTE 5 - PROPERTY AND EQUIPMENT

Depreciation and amortization expense totaled $25,000and $66,000, respectively, during the six months ended June 30, 2025 and 2024. Property and equipment as of June 30, 2025 and December 31, 2024, are as follows (dollar amounts in thousands):

                                June 30,                   December 31,                                                                
                                2025                       2024                         Estimated Useful Life                          
 ───────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────
  Machinery and equipment       $                  41      $                    41      5 years                                        
  Trade show booth                                202                          202      5 years                                        
  Office equipment