Company: HROW
Filing Date: 2025-08-11
Form Type: 10-Q
Source: 0001641172-25-022980
Chunk: 79

Company: HARROW, INC.
Filing Date: 2025-08-11
Form: 10-Q
Item: Item 2
Chunk 79
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)
  
    Gross margin 
     65.1% 
     67.7% 
     -2.6% 
     64.3% 
     67.2% 
     -3.0%

32

The
increase in ImprimisRx costs of sales between the three and six months ended June 30, 2025 and 2024 was primarily attributable to an
increase in units sold during the three and six months ended June 30, 2025 compared to the same periods in 2024. However, due to product
mix during the three and six months ended June 30, 2025 that included more sales of lower gross margin products and sales discounts,
ImprimisRx gross margin decreased during the 2025 periods compared to the prior year period.

Selling,
General and Administrative Expenses

Our
selling, general and administrative (“SG&A”) expenses include personnel costs, including wages and stock-based compensation,
corporate facility expenses, and investor relations, consulting, insurance, filing, legal and accounting fees and expenses as well as
costs associated with our marketing activities and sales of our proprietary compounded formulations and other non-proprietary pharmacy
products and formulations.

The
following presents our SG&A expenses for the three and six months ended June 30, 2025 and 2024:

    For the
                                                                                Three Months Ended  
       
    For the
                                                                                Six Months Ended  

    June 30,  
    $  
    June 30,  
    $ 

    2025  
    2024  
    Variance  
    2025  
    2024  
    Variance 
  
    Selling, general and administrative 
    $33,235,000  
    $31,817,000  
    $1,418,000  
    $73,748,000  
    $60,630,000  
    $13,118,000 

The
increase in SG&A expenses between the three-month periods was primarily attributable to the addition of new employees in sales, marketing
and other departments to support current and expected growth, which when combined contributed to a $4,375,000 increase in SG&A expenses
between the periods. These increases were offset by a $2,957,000 decrease in stock-based compensation expense between periods.

The
increase in SG&A expenses between the six-month periods was primarily attributable to