Company: GROVW
Filing Date: 2025-11-13
Form Type: 10-Q
Source: 0001841761-25-000048
Chunk: 289

Company: Grove Collaborative Holdings, Inc.
Filing Date: 2025-11-13
Form: 10-Q
Item: Part I, Item 8
Chunk 289
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 inspecting and warehousing inventories, picking, packing and preparing customer orders for shipment, shipping and handling expenses, packing materials costs and payment processing and related transaction costs. These costs are included within selling, general and administrative expenses in the statements of operations.

Non-operating expenses, net

Interest expense consists primarily of interest expense associated with our debt financing arrangement. In previous periods, we have recorded higher interest expense due to higher outstanding debt balances and higher prime rates. To the extent there are changes in prevailing interest rates in future periods, we anticipate cash payments for interest and interest expense to fluctuate as interest rates change.

Change in fair values of derivative liabilities consists primarily of changes in fair values of Earn-Out Shares, Public Warrants and Private Placement Warrant and the derivative liability related to our term debt we extinguished in 2024 (the 

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“Structural Derivative Liability”). Changes in the fair value of our derivative liabilities may fluctuate significantly in future periods primarily due to fluctuations in the fair value of our common stock.

Other income, net consists primarily of interest income.

Provision for Income Taxes

We account for income taxes under the asset and liability method, whereby deferred tax assets and liabilities are determined based on the difference between the financial statements and income tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. We recognize the benefits of tax-return positions in the financial statements when they are more likely than not to be sustained by the taxing authority, based on the technical merits at the reporting date. We consider many factors when evaluating and estimating our tax positions and tax benefits, which may require periodic adjustments, and which may not accurately forecast actual outcomes. We recognize interest and penalties related to unrecognized tax benefits, if any, as income tax expense.

Results of Operations

The following table sets forth our results of operations for each period presented:

Three Months EndedSeptember 30,Nine Months EndedSeptember 30,2025202420252024Revenue, net$43,734 $48,280 $131,307 $153,924 Cost of goods sold20,412 22,678 60,526 70,519 Gross profit23,322 25,602 70,781 83,405 Operating expenses:Advertising3,154 2,820 8,683 7,312 Product development1,626 4,802 5,612 13,864 Selling, general and administrative21,273