Company: HROW
Filing Date: 2025-11-10
Form Type: 10-Q
Source: 0001493152-25-021562
Chunk: 64

Company: HARROW, INC.
Filing Date: 2025-11-10
Form: 10-Q
Item: Item 1
Chunk 64
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 lower gross margin products and sales discounts. ImprimisRx gross margin decreased during
the 2025 periods compared to the prior year period due to the previously mentioned product mix as related well as one-time costs
that impacted our efficiency.

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 nine months ended September 30, 2025 and 2024:

    For the 
Three Months Ended  
       
    For the 
Nine Months Ended  

    September 30,  
    $  
    September 30,  
    $ 

    2025  
    2024  
    Variance  
    2025  
    2024  
    Variance 
  
    Selling, general and administrative 
    $35,856,000  
    $33,645,000  
    $2,211,000  
    $109,604,000  
    $94,275,000  
    $15,329,000 

35

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 $3,434,000 increase in SG&A expenses
between the periods. These increases were offset by a $1,223,000 decrease in stock-based compensation expense between periods.

The
increase in SG&A expenses between the nine-month periods was primarily attributable to an increase in certain seasonal expenses,
such as increased costs associated with our annual audit and a special project that totaled $3,629,000 during the nine months ended September
30, 2025. In addition, the increase in SG&A expenses between periods was 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 $15,933,000 increase in
SG&A expenses between the periods. These increases were offset by a $4,233,000 decrease in stock-based compensation expense between
periods.

Research