Company: CHUC
Filing Date: 2025-06-27
Form Type: 10-Q
Source: 0001437749-25-021440
Chunk: 32

Company: Charlie's Holdings, Inc.
Filing Date: 2025-06-27
Form: 10-Q
Item: Part I, Item 1
Chunk 32
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, 2025, total sales and marketing expense decreased by approximately $120,000 to approximately $214,000 as compared to approximately $334,000 for the same period in 2024, which was primarily due to lower sales commissions paid as well as a significant reduction in tradeshow and customer event related costs. Commissions decreased due to reduced sales activity during the year.

Research and Development Expense

For the three months ended March 31, 2025 and 2024, research and development expense was $6,000.

Loss from Operations

We incurred a loss from operations of approximately $826,000 for the three months ended March 31, 2025, compared to loss of approximately $941,000 for the three months ended March 31, 2024, due primarily to lower sales and gross profit. Net loss is determined by adjusting loss from operations by the following items:

  Interest Expense. For the three months ended March 31, 2025, and 2024, we recorded interest expense related to notes payable of approximately $242,000 and $183,000, respectively. The increase w...  
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  Debt Extinguishment Loss. For the three months ended March 31, 2025, we recorded approximately $149,000 of loss from debt extinguishment, which was related to the amendment to the Pinnacle Rece...  

  Change in Fair Value of Derivative Liabilities. For the three months ended March 31, 2024, the gain in fair value of derivative liabilities was $79,000. The derivative liability was associated ...  

Net Loss

For the three months ended March 31, 2025, we incurred a net loss of $1,217,000 as compared to net loss of $1,045,000 for the same period in 2024.

Effects of Inflation

Inflation has not had a material impact on our business.

Liquidity and Capital Resources

As of March 31, 2025, we had working capital deficit of approximately $2,829,000, which consisted of current assets of approximately $3,000,000 and current liabilities of approximately $5,829,000, as compared to working capital deficit of approximately $1,855,000 at December 31, 2024. The current liabilities include approximately $2,683,000 of accounts