Company: CHUC
Filing Date: 2025-08-21
Form Type: 10-Q
Source: 0001437749-25-027482
Chunk: 34

Company: Charlie's Holdings, Inc.
Filing Date: 2025-08-21
Form: 10-Q
Item: Part I, Item 1
Chunk 34
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 fees was primarily the result of reductions in audit costs as well as fees paid to members of our Board of Directors. The decrease in other general and administrative costs was primarily due to lower insurance costs as well as bad debt expense. The increase in payroll and benefits costs was primarily driven by bonuses awarded to certain key employees during the period.

Sales and Marketing Expense

For the six months ended June 30, 2025, total sales and marketing expense decreased by approximately $112,000 to approximately $339,000 as compared to approximately $451,000 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.

Research and Development Expense

For the six months ended June 30, 2025, research and development expense was approximately $10,000 as compared to income of approximately $20,000 for the same period in 2024. The income in 2024 period was primarily due to a vendor refund of approximately $26,000.

Income (Loss) from Operations

We incurred loss from operations of approximately $1,703,000 for the six months ended June 30, 2025, compared to a loss of approximately $1,677,000 for the six months ended June 30, 2024, due primarily to decreased sales and gross profit. Net income (loss) is determined by adjusting loss from operations by the following items:

  Gain on sale of PMTA assets. For the six months ended June 30, 2025, we recorded a $6,500,000 gain related to the sales agreement entered with R. J. Reynolds Vapor Company.  

  Interest Expense. For the six months ended June 30, 2025, and 2024, we recorded interest expense related to notes payable of approximately $577,000 and $339,000, respectively. The increase was ...  
  Debt Extinguishment Loss. For the six months ended June 30, 2025 and 2024, we recorded approximately $50,000 and $75,000 debt extinguishment loss related to various debt amendments, respectively.   
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  Change in Fair Value of Derivative Liabilities. For the six months ended June 30, 2024, the gain in fair value of derivative liabilities was $79,000. The gain