What changed in this filing

/stocks — the workspaceLOADING

Item 2. Management’s Discussion and Analysis

2026-05-06 compared with 2025-11-05 · 208 added, 357 removed, 237 unchanged (70% of the section changed)

2 unchanged sentences

Forward-Looking Statements

This Quarterly Report on Form 10-Q for the quarter ended September 30, 2025 (this “Form 10-Q”), including but not limited to:

This Quarterly Report on Form 10-Q for the quarter ended March 31, 2026 (this “Form 10-Q”), including but not limited to:

(i) the section of this Form 10-Q entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations;” (ii) information concerning our business prospects or future financial performance, anticipated revenues, expenses, profitability or other financial items;

and (iii) our strategies, plans and objectives, together with other statements that are not historical facts, includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”).

Forward-looking statements generally can be identified by the use of forward-looking terminology, such as “may,” “will,” “would,” “expect,” “intend,” “could,” “estimate,” “should,” “anticipate”, “potential,” “continue,” “deploy” or “believe.” We intend that all forward-looking statements be subject to the safe harbors created by these laws.

All statements other than statements of historical information provided herein are forward-looking based on current expectations regarding important risk factors.

Forward-looking statements generally can be identified by the use of forward-looking terminology, such as “may,” “will,” “should,” “could,” “can,” “would,” “believe,” “anticipate,” “project,” “plan,” “expect,” “estimate,” “goal,” “seek,” “ensure,” “potential,” “opportunity,” “intend,” “predict,” “committed,” “likely,” “continue,” “strive,” “aim,” “scheduled,” “focused on,” “long-term,” “future,” “over time,” “ongoing,” “uncertain,” “moving forward,” or “subject to.” We intend that all forward-looking statements be subject to the safe harbors created by these laws.

All statements other than statements of historical information provided herein are forward-looking and based on current expectations regarding important risk factors.

Many of these risks and uncertainties are beyond our ability to control, and, in many cases, we cannot predict all of the risks and uncertainties that could cause our actual results to differ materially from those expressed in the forward-looking statements.

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We undertake no obligation to release publicly the results of any revisions to these forward-looking statements, which may be made to reflect events or circumstances after the date thereon, including, without limitation, changes in our business strategy or planned capital expenditures, or store growth plans, or to reflect the occurrence of unanticipated events.

This section includes a discussion of our operations for the three and nine months ended September 30, 2025 and 2024.

The following discussion and analysis provide information that management believes is relevant to an assessment and understanding of our financial condition and results of operations.

This section includes a discussion of our operations for the three months ended March 31, 2026 and 2025.

The following discussion and analysis provide information that management believes is relevant to assessing and understanding our financial condition, liquidity, and results of operations.

The discussion should be read in conjunction with the Company’s 2025 Annual Report, the unaudited condensed consolidated financial statements, and the related Notes thereto included in Part I, Item 1 of this report.

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Economic Conditions

Impacts of Demand for Safe-Haven Metals

While the current market for safe-haven metals has generally led to stronger premiums within our consumer segment, especially for gold and silver, demand for these metals has created industry-wide backlogs and slowed payments from refiners, which the Company has experienced.

The impact on working capital is having to pay more to procure inventory, and the delayed conversion of accounts receivable from refiners.

While the length of the current cycle and the steps

domestic refiners will take to address processing capacity are indeterminate, the Company is closely monitoring its inbound buying practices, cash, inventory levels, and its accounts receivable exposure with its refining customers.

The Company believes it has sufficient liquidity to maintain its current buying practices, yet it can adjust its buying programs to reduce exposure should these conditions materially affect its conversion of accounts receivable.

Impacts of Government Legislation

On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was signed into law, which includes significant changes to federal tax law and other regulatory provisions that may impact the Company.

We have evaluated the provisions of the new law and its potential effects on our effective tax rate, financial position, results of operations, and cash flows.

We have evaluated the provisions of the new law and its potential effects on our effective tax rate, results of operations, and financial condition.

OBBBA allows businesses to immediately deduct the full cost of qualifying assets in the year they are placed in service, rather than spreading the deduction over several years, and is effective for property acquired and placed in service after January 19, 2025.

OBBBA also requires the businesses to recognize the effect of the tax law changes in the period of enactment, such

as remeasuring estimated U.S.

OBBBA also requires businesses to recognize the effects of tax law changes in the period of enactment, such as remeasuring estimated U.S.

deferred tax assets and liabilities.

The Company intends to utilize bonus depreciation, effectively reducing taxable income in the respective period of taxation and the cash deployed to settle such obligations.

There was no material impact on the effective tax rate, financial position, results of operations, or cash flows during the three and nine months ended September 30, 2025.

The Company intends to utilize bonus depreciation, effectively reducing taxable income in the respective tax period and the cash deployed to settle such obligations.

There was no material impact on the effective tax rate, financial condition, results of operations, or cash flows during the quarter ended March 31, 2026.

In future fiscal periods, the impact of OBBBA is contingent on the continued election of bonus depreciation and the amount of qualifying assets acquired by the Company.

Impacts of High Interest Rates and Inflation

and other world economies are currently experiencing high interest rates and elevated levels of inflation, coupled with commodity price risk, mainly associated with variations in the market price of precious metals and diamonds, which have the potential to impact consumer discretionary spending behavior.

Furthermore, adverse macroeconomic conditions can also impact demand for resale personal technology assets.

Impacts of Increases in Interest Rates and Inflation

Rising interest rates and inflation, coupled with commodity price risk, mainly associated with fluctuations in the market prices of precious metals and diamonds, could affect consumer discretionary spending.

Furthermore, adverse macroeconomic conditions can also impact demand for the resale of personal technology assets.

To counterbalance economic cycles that impact market selling prices and/or underlying operating costs, we adjust the inbound purchase price of commodity-based products, luxury hard assets, and resale technology.

We continuously monitor our inventory positions and associated working capital to respond to market conditions and to meet seasonal business cycles and expansionary plans.

These economic cycles may from time to time require the business to utilize its line of credit or seek additional capital.

These economic cycles may, from time to time, require the business to use its line of credit or seek additional capital.

Impacts of Tariffs

government has recently adopted new approaches to trade policy, and announced tariffs on certain foreign goods, certain global tariffs and the possibility of significant additional tariff increases or expansions of tariffs.

Specifically, under Section 232 of the Trade Expansion Act of 1962 tariffs were applied to the importation of aluminum, copper, steel, and select derivative products, but excluded gold and silver.

The impact of such tariffs and retaliatory tariffs by other countries in response to such tariffs continues to evolve and requires regular monitoring and evaluation.

government has recently adopted new approaches to trade policy, announced tariffs on certain foreign goods and certain global tariffs, and signaled the possibility of significant additional tariff increases or tariff expansions.

Specifically, under Section 232 of the Trade Expansion Act of 1962, tariffs were imposed on the importation of aluminum, copper, steel, and certain derivative products, but excluded gold and silver.

The impact of such tariffs and retaliatory tariffs by other countries continues to evolve and requires regular monitoring and evaluation.

The deemed impacts of tariffs on each of our reportable segments are detailed below:

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However, global market uncertainty caused by tariffs can increase commodity costs on safe-haven metals such as gold and silver, which may increase working capital requirements.

The Company mitigates increased working capital requirements by monitoring its inventory position and turnover, and maintaining disciplined buying practices to maintain margin.

The Company mitigates increased working capital requirements by monitoring its inventory position and turnover and by maintaining disciplined buying practices to preserve margins.

Commercial Segment

The commercial segment periodically purchases limited quantities of personal technology assets for resale and replacement parts from international markets.

Tariffs may increase costs for original equipment manufacturers, retailers, and parts distributors and, as a result, may require the Company to pay more for the purchase of personal technology assets for resale and replacement parts, thus increasing the Company’s required working capital requirements.

The Company mitigates increased working capital requirements by monitoring its inventory position and turnover, maintaining disciplined buying practices, and using optimal domestic and international sales channels to maintain margins.

The commercial segment periodically purchases limited quantities of personal technology assets and replacement parts for resale from international markets.

Tariffs may increase costs for original equipment manufacturers, retailers, and parts distributors and, as a result, may require the Company to pay more for the purchase of personal technology assets for resale and replacement parts, thereby increasing the Company’s required working capital.

The Company mitigates increased working capital requirements by monitoring its inventory position and turnover, maintaining disciplined buying practices, and using optimal domestic or international sales channels to preserve margins.

There can be no assurance that the measures we have adopted will be successful in mitigating the aforementioned risks.

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Consumer Segment

Our consumer segment primarily operates in the jewelry industry, specializing in the online and brick-and-mortar sale of authenticated high-end luxury goods, including pre-owned fine jewelry, diamonds and gemstones, luxury watches, along with secondary market bullion.

We incorporate recycled diamonds and gemstones into our new designs meaning they were previously set and unset, producing a low-carbon and ethical origin product.

We incorporate recycled diamonds and gemstones into new designs, meaning they were previously set and unset, producing a low-carbon and ethical origin product.

The Company caters to consumers seeking environmentally responsible options for engagement rings, wedding bands, and other fine jewelry at accessible prices.

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Commercial Segment

Our commercial segment specializes in the de-manufacturing of end-of-life electronic assets to reclaim commodities and other materials, while also engaging in the ITAD industry.

The separated commodities, including metals, plastics, and glass, are sold to downstream processors where they are further processed and reintroduced into new products.

Our commercial segment specializes in the de-manufacturing of end-of-life electronic assets to reclaim commodities and other materials, while also engaging in the ITAD and product returns industry.

Separated commodities, including metals, plastics, and glass, are sold to downstream processors where they are further processed and reintroduced into new products.

ITAD services maximize the residual value of retired IT assets by adhering to a reuse-first philosophy and ensuring equipment is refurbished and re-marketed after data sanitization.

Our product returns business reintroduces products back into the supply chain, creating another opportunity for the asset to be used.

The Company offers services that manage the entire lifecycle of technology products to ensure data security, regulatory compliance, and environmental sustainability.

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Our strategy is to expand both organically and through acquisitions.

The Company has taken considerable steps to bolster its management team and operating systems to position itself for growth.

Our production facilities are capable of managing the expansion of existing relationships and consolidation of acquisition targets within relative geographic proximity to our existing facilities.

Our processing facilities are capable of managing the expansion of existing relationships and consolidation of acquisition targets within relative geographic proximity into our existing facilities.

Results of Operations

Comparison of the Three Months Ended September 30, 2025 and 2024

The following table depicts our disaggregated condensed consolidated statements of income for the three months ended September 30, 2025 and 2024:

Three Months Ended September 30,

% of Sales (1)

Cost of goods sold

Selling, general and administrative

Depreciation and amortization

Total operating expenses

Operating income (loss)

Other income (expense):

Interest expense

Income (loss) before income taxes

Income tax (expense) benefit

Net income (loss)

(1) The “% of Sales” figures present the proportion of each line item to the total consolidated sales for the respective period, which management believes is relevant to an assessment and understanding of our financial condition and results of operations.

Due to rounding, percentages presented may not add up precisely to the totals provided.

The individual segments reported the following for the three months ended September 30, 2025 and 2024:

Three Months Ended September 30,

% of consolidated sales

% of consumer sales

% of commercial sales

Sales increased by $10,489,852, or 22.4%, during the three months ended September 30, 2025, to $57,389,411, as compared to $46,899,559 during the same period in Fiscal 2024.

Consumer Segment

Sales in the consumer segment increased by $11,311,436, or 33.5%, during the three months ended September 30, 2025, to $45,068,036, as compared to $33,756,600 during the same period in Fiscal 2024.

The change was primarily attributed to higher transaction volumes, supported by record precious metals pricing, but was partially offset by moderate softness in certain customer-facing verticals.

Overall performance benefited from favorable supply flows and strong customer engagement, when compared to the same period in Fiscal 2024.

Commercial Segment

Sales in the commercial segment decreased by $821,584, or 6.3%, during the three months ended September 30, 2025, to $12,321,375, as compared to $13,142,959 during the same period in Fiscal 2024.

The change was primarily attributed to less revenue from:

ITAD revenue share settlements, electronic scrap grades and associated recoveries, and personal technology assets sourced from our trade-in programs, which were partially offset by increased service revenue from product returns and secured processing of end-of-life assets.

Our overall service-related verticals continue to grow and become a greater component of our revenue mix.

Cost of Goods Sold

Three Months Ended September 30,

% of consolidated sales

% of consumer sales

% of commercial sales

Cost of goods sold increased by $8,886,161, or 25.1%, during the three months ended September 30, 2025, to $44,321,481, as compared to $35,435,320 during the same period in Fiscal 2024.

Consumer Segment

Cost of goods sold in the consumer segment increased by $10,026,681, or 33.6%, during the three months ended September 30, 2025, to $39,866,966, as compared to $29,840,285 during the same period in Fiscal 2024.

The change was primarily attributed to the aforementioned higher sales volumes and rising gold prices compared to the same period in Fiscal 2024.

Cost of goods sold as a percentage of sales was 88.5% during the three months ended September 30, 2025, as compared to 88.4% during the three months ended September 30, 2024.

The change was immaterial, indicating a similar impact of product mix compared to the same period in Fiscal 2024.

Commercial Segment

Cost of goods sold in the commercial segment decreased by $1,140,520, or 20.4%, during the three months ended September 30, 2025, to $4,454,515, as compared to $5,595,035 during the same period in Fiscal 2024.

The change was primarily attributed to the aforementioned impact from less ITAD revenue share settlements and incrementally from electronic scrap grades and associated recoveries along with personal technology assets sourced from our trade-in programs.

Cost of goods sold as a percentage of sales was 36.2% during the three months ended September 30, 2025, as compared to 42.6% during the three months ended September 30, 2024.

The change was primarily attributed to favorable margins from our ITAD revenue share settlements, albeit on lower overall sales, and was partially offset by less favorable margins from electronic scrap grades and associated recoveries.

Our margins on the sale of personal technology assets were stable compared to the same period in Fiscal 2024.

Three Months Ended September 30,

% of consolidated sales

% of consumer sales

% of commercial sales

Gross margin increased by $1,603,691, or 14.0%, during the three months ended September 30, 2025, to $13,067,930, as compared to $11,464,239 during the same period in Fiscal 2024.

Consumer Segment

Gross margin in the consumer segment increased by $1,284,755, or 32.8%, during the three months ended September 30, 2025, to $5,201,070, as compared to $3,916,315 during the same period in Fiscal 2024.

The net impact of the aforementioned increase in sales of $11,311,436 and increase in cost of goods sold of $10,026,681 resulted in the $1,284,755 increase in gross margin.

Commercial Segment

Gross margin in the commercial segment increased by $318,936, or 4.2%, during the three months ended September 30, 2025, to $7,866,860, as compared to $7,547,924 during the same period in Fiscal 2024.

The net impact of the aforementioned decrease in sales of $821,584 and decrease in cost of goods sold $1,140,520 resulted in the $318,936 increase in gross margin.

Selling, General and Administrative

Three Months Ended September 30,

% of consolidated sales

% of consumer sales

% of commercial sales

Selling, general and administrative expense decreased by $635,110, or 7.0%, during the three months ended September 30, 2025, to $8,393,878, as compared to $9,028,988 during the same period in Fiscal 2024.

Consumer Segment

Selling, general and administrative expense in the consumer segment decreased by $98,099, or 2.5%, during the three months ended September 30, 2025, to $3,827,882, as compared to $3,925,981 during the same period in Fiscal 2024.

The change was primarily attributed to a reduction in costs associated with store onboarding and initial marketing that occurred in the same period in Fiscal 2024 along with select reductions in production human-capital costs, partially offset by full cost structures related to our new stores.

Commercial Segment

Selling, general and administrative expense in the commercial segment decreased by $537,011, or 10.5%, during the three months ended September 30, 2025, to $4,565,996, as compared to $5,103,007 during the same period in Fiscal 2024.

The change was primarily attributed to a reduction in variable-cost production expenses, of which human-capital costs were a significant component, along with a reduction in lease costs from the closure of our Arizona ITAD facility, which occurred in the latter part of the second quarter of Fiscal 2025.

We began diverting inbound asset flow prior to closure, and we fully absorbed the asset flow from the former Arizona ITAD facility into our Texas ITAD facility in the third quarter of 2025.

Depreciation and Amortization

Three Months Ended September 30,

% of consolidated sales

% of consumer sales

% of commercial sales

Depreciation and amortization expense increased by $57,745, or 13.9%, during the three months ended September 30, 2025, to $472,524, as compared to $414,779 during the same period in Fiscal 2024.

Consumer Segment

Depreciation and amortization expense in the consumer segment increased by $52,692, or 35.0%, during the three months ended September 30, 2025, to $203,349, as compared to $150,657 during the same period in Fiscal 2024.

The change was primarily attributed to the depreciation of assets placed into service related to our new retail stores.

Commercial Segment

Depreciation and amortization expense in the commercial segment increased by $5,053, or 1.9%, during the three months ended September 30, 2025, to $269,175, as compared to $264,122 during the same period in Fiscal 2024.

The change was primarily attributed to the allocation of corporate depreciation and amortization expense.

Other Income (Expense)

Three Months Ended September 30,

% of consolidated sales

% of consumer sales

% of commercial sales

Other income decreased by $106,709, or 31.4%, during the three months ended September 30, 2025, to $233,642, as compared to $340,351 during the same period in Fiscal 2024.

Consumer Segment

Other income in the consumer segment increased by $42,361, or 67.8%, during the three months ended September 30, 2025, to $104,863, as compared to $62,502 during the same period in Fiscal 2024.

The change was primarily attributable to the proportionate share of earned dividend and interest income.

While our earned interest rate has reduced, our overall cash balances are higher, resulting in incrementally higher earned income on excess cash balances.

Excess cash balances are now aggregated at the corporate level to optimize earnings as opposed to being held at the segment level.

This resulted in higher segment earned income on excess cash balances.

Further, the same period in Fiscal 2024 included the proportionate share of income from a settlement for repairs related to our corporate headquarters.

The impact of dividend and interest income is referenced below.

Dividend income comprised $42,186 and $0 of other income during the three months ended September 30, 2025 and 2024, respectively.

Interest income comprised $63,301 and $2 of other income during the three months ended September 30, 2025 and 2024, respectively.

Commercial Segment

Other income in the commercial segment decreased by $149,070, or 53.7%, during the three months ended September 30, 2025, to $128,779, as compared to $277,849 during the same period in Fiscal 2024.

The change was primarily attributable to the proportionate share of earned dividend and interest income.

While our earned interest rate has reduced, our overall cash balances are higher, resulting in incrementally higher earned income on excess cash balances.

Excess cash balances are now aggregated at the corporate level to optimize earnings as opposed to being held at the segment level.

This resulted in lower segment earned income on excess cash balances.

Further, the same period in Fiscal 2024 included the proportionate share of income from a settlement for repairs related to our corporate headquarters.

The impact of dividend and interest income is referenced below.

Dividend income comprised $43,029 and $0 other income during the three months ended September 30, 2025, and 2024, respectively.

Interest income comprised $65,646 and $203,251 of other income during the three months ended September 30, 2025 and 2024, respectively.

Interest Expense

Three Months Ended September 30,

% of consolidated sales

% of consumer sales

% of commercial sales

Interest expense decreased by $382, or 0.4%, during the three months ended September 30, 2025, to $105,757, as compared to $106,139 during the same period in Fiscal 2024.

Consumer Segment

Interest expense in the consumer segment increased by $1,943, or 3.8%, during the three months ended September 30, 2025, to $53,429, as compared to $51,486 during the same period in Fiscal 2024.

There was no material change in debt amortization from the same period in Fiscal 2024, and as such, no discussion point.

Commercial Segment

Interest expense in the commercial segment decreased by $2,325, or 4.3%, during the three months ended September 30, 2025, to $52,328, as compared to $54,653 during the same period in Fiscal 2024.

There was no material change in debt amortization from the same period in Fiscal 2024, and as such, no discussion point.

Income Tax (Expense) Benefit

Three Months Ended September 30,

% of consolidated sales

% of consumer sales

% of commercial sales

NM – Not Meaningful

Income tax expense increased by $402,848, or 70.7%, during the three months ended September 30, 2025, to $972,493, as compared to $569,645 during the same period in Fiscal 2024.

Currently, the Company has a deferred tax liability reflecting a future obligation to pay taxes.

The Company has a federal tax rate of approximately 21.0%, in addition to other state and local taxes, on net income.

The effective income tax rate was 22.5% and 25.3% for the three months ended September 30, 2025 and 2024, respectively.

Differences between our effective income tax rate and the U.S.

federal statutory rate are the result of state taxes and non-deductible expenses, as was the Company’s case for the three months ended September 30, 2025 and 2024.

Net Income (Loss)

Three Months Ended September 30,

% of consolidated sales

% of consumer sales

% of commercial sales

NM – Not Meaningful

Net income increased by $1,671,881, or 99.2%, during the three months ended September 30, 2025, to $3,356,920, as compared to $1,685,039 during the same period in Fiscal 2024.

Refer to the aforementioned attributes discussed within the Comparison of the Three Months Ended September 30, 2025 and 2024 for further details.

Consumer Segment

Net income (loss) increased in the consumer segment by $973,977, during the three months ended September 30, 2025, to net income of $947,134, as compared to net loss of $26,843 during the same period in Fiscal 2024.

Refer to the aforementioned attributes discussed within the Comparison of the Three Months Ended September 30, 2025 and 2024 for further details.

Commercial Segment

Net income increased in the commercial segment by $697,904, or 40.8%, during the three months ended September 30, 2025, to $2,409,786, as compared to $1,711,882 during the same period in Fiscal 2024.

Refer to the aforementioned attributes discussed within the Comparison of the Three Months Ended September 30, 2025 and 2024 for further details.

Earnings Per Share

The following table depicts the Company’s earnings per share:

Three Months Ended September 30,

Basic and diluted earnings per share attributable to holders of our Common Stock increased by $0.07, or 116.7%, during the three months ended September 30, 2025, to $0.13, as compared to $0.06 during the same period in Fiscal 2024.

Comparison of the nine months ended September 30, 2025 and 2024

The following table depicts our disaggregated condensed consolidated statements of income for the nine months ended September 30, 2025 and 2024:

Nine Months Ended September 30,

Comparison of the Three Months Ended March 31, 2026 and 2025

The following table depicts our disaggregated condensed consolidated statements of income for the three months ended March 31, 2026 and 2025:

Three Months Ended March 31,

% of Sales (1)

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Total operating expenses

Operating income (loss)

Operating income

Other income (expense):

Interest expense

Income (loss) before income taxes

Income tax (expense) benefit

Net income (loss)

Income before income taxes

Income tax expense

Due to rounding, percentages presented may not add up precisely to the totals provided.

The individual segments reported the following for the nine months ended September 30, 2025 and 2024:

Nine Months Ended September 30,

The individual segments reported the following for the three months ended March 31, 2026 and 2025:

Three Months Ended March 31,

% of consolidated sales

1 unchanged sentence

% of commercial sales

Sales increased by $28,467,732 or 21.6%, during the nine months ended September 30, 2025, to $160,522,073, as compared to $132,054,341 during the same period in Fiscal 2024.

Sales increased by $50,125,061, or 103.9%, during the three months ended March 31, 2026, to $98,380,890, as compared to $48,255,829 during the same period in Fiscal 2025.

Consumer Segment

Sales in the consumer segment increased by $31,039,753, or 33.0%, during the nine months ended September 30, 2025, to $125,012,398, as compared to $93,972,645 during the same period in Fiscal 2024.

The change was primarily attributed to the stronger volumes and pricing on precious metals transactions that have been consistent throughout Fiscal 2025 as well as stronger contributions from our historical and new retail store footprint.

Sales in the consumer segment increased by $45,022,918, or 122.4%, during the three months ended March 31, 2026, to $81,793,522, as compared to $36,770,604 during the same period in Fiscal 2025.

The change was primarily attributed to strong performance across both our retail stores and wholesale verticals, supported by upward movements in gold and silver prices compared with the same period in Fiscal 2025.

Commercial Segment

Sales in the commercial segment decreased by $2,572,021, or 6.8%, during the nine months ended September 30, 2025, to $35,509,675, as compared to $38,081,696 during the same period in Fiscal 2024.

The change was primarily attributed to less revenue from:

ITAD revenue share settlements, electronic scrap grades and associated recoveries, and personal technology assets sourced from our trade-in programs, which were partially offset by increased service revenue from our product returns and secured processing of end-of-life assets.

Our overall service-related verticals continue to grow and become a greater component of our revenue mix.

The aforementioned impact on sales has been relatively consistent throughout the year, representing a continued shift to a greater proportional share of service revenue in our sales mix.

Sales in the commercial segment increased by $5,102,143, or 44.4%, during the three months ended March 31, 2026, to $16,587,368, as compared to $11,485,225 during the same period in Fiscal 2025.

The change was primarily driven by improved pricing in certain product categories sourced from our ITAD vertical, reflecting current demand conditions and industry supply dynamics, which may not persist.

Cost of Goods Sold

Nine Months Ended September 30,

Three Months Ended March 31,

% of consolidated sales

1 unchanged sentence

% of commercial sales

Cost of goods sold increased by $24,218,235, or 24.5%, during the nine months ended September 30, 2025, to $123,098,196, as compared to $98,879,961 during the same period in Fiscal 2024.

Cost of goods sold increased by $41,472,669, or 114.3%, during the three months ended March 31, 2026, to $77,760,474, as compared to $36,287,805 during the same period in Fiscal 2025.

Consumer Segment

Cost of goods sold in the consumer segment increased by $28,456,627, or 34.5%, during the nine months ended September 30, 2025, to $110,942,439, as compared to $82,485,812 during the same period in Fiscal 2024.

The change was primarily attributed to the aforementioned higher sales volumes and rising gold prices compared to the same period in Fiscal 2024.

Cost of goods sold as a percentage of sales was 88.7% during the nine months ended September 30, 2025, as compared to 87.8% during the nine months ended September 30, 2024.

The change was primarily attributed to a greater mix of lower margin wholesale precious metals transactions in our overall cost of goods sold and incrementally from product mix at our retail stores.

Cost of goods sold in the consumer segment increased by $39,533,188, or 121.4%, during the three months ended March 31, 2026, to $72,092,889, as compared to $32,559,701 during the same period in Fiscal 2025.

The change was primarily attributed to higher sales volumes across our retail stores and wholesale verticals, which were also impacted by the upward movement in gold and silver prices.

Cost of goods sold as a percentage of sales was 88.1% during the three months ended March 31, 2026, as compared to 88.5% during the three months ended March 31, 2025.

The change was primarily attributed to product mix, as our margins associated with wholesale scrap-grade precious metals and bullion were stronger in comparison to the same period in Fiscal 2025.

Commercial Segment

Cost of goods sold in the commercial segment decreased by $4,238,392, or 25.9%, during the nine months ended September 30, 2025, to $12,155,757, as compared to $16,394,149 during the same period in Fiscal 2024.

The change was primarily attributed to the impact from less ITAD revenue share settlements and incrementally from the recognition of costs associated with the sale of trade-in related personal technology assets.

While sales decreased on our electronic scrap grades and associated recoveries, it did not correspondingly decrease the recognition of costs as a result of the mix of assets being sold.

Cost of goods sold as a percentage of sales was 34.2% during the nine months ended September 30, 2025, as compared to 43.0% during the nine months ended September 30, 2024.

The change was primarily attributed to favorable margins on ITAD revenue share settlements and trade-in product mix, which was partially offset by lower margins associated with sales associated with our sales of electronic waste and associated recoveries.

Nine Months Ended September 30,

Cost of goods sold in the commercial segment increased by $1,939,481, or 52.0%, during the three months ended March 31, 2026, to $5,667,585, as compared to $3,728,104 during the same period in Fiscal 2025.

The change was primarily the aforementioned impact of our ITAD revenue-share settlements and parity in performance across our other commercial segment verticals.

Cost of goods sold as a percentage of sales was 34.2% during the three months ended March 31, 2026, as compared to 32.5% during the three months ended March 31, 2025.

The change was primarily attributed to product mix.

In the same period in Fiscal 2025, we settled a large, high-margin ITAD revenue-share transaction and experienced a higher percentage of service-based revenue.

Three Months Ended March 31,

% of consolidated sales

1 unchanged sentence

% of commercial sales

Gross margin increased by $4,249,497, or 12.8%, during the nine months ended September 30, 2025, to $37,423,877, as compared to $33,174,380 during the same period in Fiscal 2024.

Gross margin increased by $8,652,392, or 72.3%, during the three months ended March 31, 2026, to $20,620,416, as compared to $11,968,024 during the same period in Fiscal 2025.

Consumer Segment

Gross margin in the consumer segment increased by $2,583,126, or 22.5%, during the nine months ended September 30, 2025, to $14,069,959, as compared to $11,486,833 during the same period in Fiscal 2024.

Gross margin in the consumer segment increased by $5,489,730, or 130.4%, during the three months ended March 31, 2026, to $9,700,633, as compared to $4,210,903 during the same period in Fiscal 2025.

The net impact of the aforementioned increase in sales of $45,022,918 and increase in cost of goods sold of $39,533,188 resulted in the $5,489,730 increase in gross margin.

Commercial Segment

Gross margin in the commercial segment increased by $1,666,371, or 7.7%, during the nine months ended September 30, 2025, to $23,353,918, as compared to $21,687,547 during the same period in Fiscal 2024.

The net impact of the aforementioned decrease in sales of $2,572,021 and decrease in cost of goods sold of $4,238,392 resulted in the $1,666,371 increase in gross margin.

Gross margin in the commercial segment increased by $3,162,662, or 40.8%, during the three months ended March 31, 2026, to $10,919,783, as compared to $7,757,121 during the same period in Fiscal 2025.

The net impact of the aforementioned increase in sales of $5,102,143 and increase in cost of goods sold $1,939,481 resulted in the $3,162,662 increase in gross margin.

Selling, General and Administrative

Nine Months Ended September 30,

Three Months Ended March 31,

% of consolidated sales

1 unchanged sentence

% of commercial sales

Selling, general and administrative expense decreased by $313,805, or 1.2%, during the nine months ended September 30, 2025, to $25,470,207, as compared to $25,784,012 during the same period in Fiscal 2024.

Selling, general and administrative expense increased by $519,530, or 6.2%, during the three months ended March 31, 2026, to $8,923,792, as compared to $8,404,262 during the same period in Fiscal 2025.

Consumer Segment

Selling, general and administrative expense in the consumer segment increased by $264,276, or 2.4%, during the nine months ended September 30, 2025, to $11,451,215, as compared to $11,186,939 during the same period in Fiscal 2024.

The change was primarily attributed to the full cost structures related to our new stores and partially offset by a reduction in costs associated with store onboarding and initial marketing that occurred in the same period in Fiscal 2024 along with select reductions in production human-capital costs.

Selling, general and administrative expense in the consumer segment increased by $166,969, or 4.3%, during the three months ended March 31, 2026, to $4,054,875, as compared to $3,887,906 during the same period in Fiscal 2025.

The change was primarily attributed to an increase in insurance costs, costs related to a new store that opened in the second

quarter of Fiscal 2025 that were not present in the first quarter of Fiscal 2025 results, and variable-processing costs associated with supplies, and an increase in merchant services fees associated with higher transaction volumes.

Commercial Segment

Selling, general and administrative expense in the commercial segment decreased by $578,081, or 4.0%, during the nine months ended September 30, 2025, to $14,018,992, as compared to $14,597,073 during the same period in Fiscal 2024.

The change was primarily attributed to a reduction in variable-cost production expenses of which human-capital costs were a significant component along with a reduction in lease costs from the closure of our Arizona ITAD facility, which occurred in the later part of the second quarter of Fiscal 2025.

We began diverting inbound asset flow prior to closure and we fully absorbed the asset flow from the former Arizona ITAD facility into our Texas ITAD facility in the third quarter of 2025.

Selling, general and administrative expense in the commercial segment increased by $352,561, or 7.8%, during the three months ended March 31, 2026, to $4,868,917, as compared to $4,516,356 during the same period in Fiscal 2025.

The change was primarily attributed to an increase in lease expense associated with lease renewal terms, an increase in variable-processing costs associated with supplies, and an increase in merchant services and online sales fees associated with higher transaction volumes.

Depreciation and Amortization

Nine Months Ended September 30,

Three Months Ended March 31,

% of consolidated sales

1 unchanged sentence

% of commercial sales

Depreciation and amortization expense increased by $257,665, or 23.0%, during the nine months ended September 30, 2025, to $1,378,276, as compared to $1,120,611 during the same period in Fiscal 2024.

Depreciation and amortization expense increased by $40,622, or 9.1%, during the three months ended March 31, 2026, to $485,963, as compared to $445,341 during the same period in Fiscal 2025.

Consumer Segment

Depreciation and amortization expense in the consumer segment increased by $222,734, or 62.4%, during the nine months ended September 30, 2025, to $579,585, as compared to $356,851 during the same period in Fiscal 2024.

The change was primarily attributed to the depreciation of assets placed into service related to our new retail stores.

Depreciation and amortization expense in the consumer segment increased by $34,468, or 19.1%, during the three months ended March 31, 2026, to $215,100, as compared to $180,632 during the same period in Fiscal 2025.

The change was primarily attributed to the depreciation of assets associated with a new store that came online in the second quarter of Fiscal 2025, which was not present in the first quarter of Fiscal 2025 results.

Commercial Segment

Depreciation and amortization expense in the commercial segment increased by $34,931, or 4.6%, during the nine months ended September 30, 2025, to $798,691, as compared to $763,760 during the same period in Fiscal 2024.

Depreciation and amortization expense in the commercial segment increased by $6,154, or 2.3%, during the three months ended March 31, 2026, to $270,863, as compared to $264,709 during the same period in Fiscal 2025.

There was no material impact from assets capitalized or reaching maturity in each comparative period, and as such, no discussion point.

Other Income (Expense)

Nine Months Ended September 30,

Three Months Ended March 31,

% of consolidated sales

1 unchanged sentence

% of commercial sales

Other income increased by $29,202, or 3.6%, during the nine months ended September 30, 2025, to $833,498, as compared to $804,296 during the same period in Fiscal 2024.

Other income decreased by $35,261, or 17.1%, during the three months ended March 31, 2026, to $170,344, as compared to $205,605 during the same period in Fiscal 2025.

Consumer Segment

Other income in the consumer segment increased by $183,360, or 233.5%, during the nine months ended September 30, 2025, to $261,870, as compared to $78,510 during the same period in Fiscal 2024.

The change was primarily attributable to the proportionate share of earned dividend and interest income.

While our earned interest rate has reduced, our overall cash balances are higher, resulting in incrementally higher earned income on excess cash balances.

Excess cash balances are now aggregated at the corporate level to optimize earnings as opposed to being held at the segment level.

This resulted in higher segment earned income on excess cash balances.

The segment also received an employee retention credit in Fiscal 2025, and Fiscal 2024 included the proportionate share of income from a settlement for repairs related to our corporate headquarters.

Other income in the consumer segment increased by $92,332, or 10,875.4%, during the three months ended March 31, 2026, to $93,181, as compared to $849 during the same period in Fiscal 2025.

The change was primarily attributed to the proportional share of dividend and interest income.

In the third quarter of Fiscal 2025, the Company began aggregating excess cash at the corporate level.

Excess cash balances are now aggregated at the corporate level to optimize earnings, rather than being held at the segment level.

During the quarter, there was greater utilization of cash for working capital, with our earned interest rate also being at a lower rate, which contributed to the unfavorable change at the consolidated level.

The impact of dividend and interest income is referenced below.

Dividend income comprised $51,069 and $0 of other income during the nine months ended September 30, 2025 and 2024, respectively.

Interest income comprised $114,339 and $10 of other income during the nine months ended September 30, 2025 and 2024, respectively.

Dividend income comprised $37,048 and $0 of other income during the three months ended March 31, 2026 and 2025, respectively.

Interest income comprised $55,740 and $0 of other income during the three months ended March 31, 2026 and 2025, respectively.

Commercial Segment

Other income in the commercial segment decreased by $154,158, or 21.2%, during the nine months ended September 30, 2025, to $571,628, as compared to $725,786 during the same period in Fiscal 2024.

The change was primarily attributable to the proportionate share of earned dividend and interest income.

While our earned interest rate has reduced, our overall cash balances are higher, resulting in incrementally higher earned income on excess cash balances.

Excess cash balances are now aggregated at the corporate level to optimize earnings as opposed to being held at the segment level.

This resulted in lower segment earned income on excess cash balances.

Further, the same period in Fiscal 2024 included the proportionate share of income from a settlement for repairs related to our corporate headquarters.

Other income in the commercial segment decreased by $127,593, or 62.3%, during the three months ended March 31, 2026, to $77,163, as compared to $204,756 during the same period in Fiscal 2025.

The change was primarily attributed to the proportional share of dividend and interest income.

In the third quarter of Fiscal 2025, the Company began aggregating excess cash at the corporate level.

Excess cash balances are now aggregated at the corporate level to optimize earnings, rather than being held at the segment level.

During the quarter, there was greater utilization of cash for working capital, and our earned interest rate was also lower, which contributed to the unfavorable change at the consolidated level.

The impact of dividend and interest income is referenced below.

Dividend income comprised $172,596 and $0 of other income during the nine months ended September 30, 2025 and 2024, respectively.

Interest income comprised $340,404 and $599,774 of other income during the nine months ended September 30, 2025 and 2024, respectively.

Dividend income comprised $43,149 and $54,864 during the three months ended March 31, 2026 and 2025, respectively.

Interest income comprised $21,084 and $144,331 of other income during the three months ended March 31, 2026 and 2025, respectively.

Interest Expense

Nine Months Ended September 30,

Three Months Ended March 31,

% of consolidated sales

1 unchanged sentence

% of commercial sales

Interest expense decreased by $17,828, or 5.3%, during the nine months ended September 30, 2025, to $318,306, as compared to $336,134 during the same period in Fiscal 2024.

Interest expense decreased by $27,549, or 25.9%, during the three months ended March 31, 2026, to $78,772, as compared to $106,321 during the same period in Fiscal 2025.

Consumer Segment

Interest expense in the consumer segment decreased by $10,115, or 5.9%, during the nine months ended September 30, 2025, to $161,469, as compared to $171,584 during the same period in Fiscal 2024.

There was no material change in debt amortization from the same period in Fiscal 2024, and as such, no discussion point.

Interest expense in the consumer segment decreased by $15,662, or 29.0%, during the three months ended March 31, 2026, to $38,385, as compared to $54,047 during the same period in Fiscal 2025.

The change was attributed to debt amortization.

Commercial Segment

Interest expense in the commercial segment decreased by $7,713, or 4.7%, during the nine months ended September 30, 2025, to $156,837, as compared to $164,550 during the same period in Fiscal 2024.

There was no material change in debt amortization from the same period in Fiscal 2024, and as such, no discussion point.

Income Tax (Expense) Benefit

Nine Months Ended September 30,

Interest expense in the commercial segment decreased by $11,887, or 22.7%, during the three months ended March 31, 2026, to $40,387, as compared to $52,274 during the same period in Fiscal 2025.

The change was attributed to debt amortization.

Income Tax Expense

Three Months Ended March 31,

% of consolidated sales

1 unchanged sentence

% of commercial sales

NM – Not Meaningful

Income tax expense increased by $906,758, or 57.3%, during the nine months ended September 30, 2025, to $2,487,920, as compared to $1,581,162 during the same period in Fiscal 2024.

Currently, the Company has a deferred tax liability reflecting a future obligation to pay taxes.

Income tax expense increased by $1,738,142, or 240.0%, during the three months ended March 31, 2026, to $2,462,500, as compared to $724,358 during the same period in Fiscal 2025.

The Company has a deferred tax liability reflecting a future obligation to pay taxes.

The Company has a federal tax rate of approximately 21.0%, in addition to other state and local taxes, on net income.

The effective income tax rate was 22.4% and 23.5% for the nine months ended September 30, 2025 and 2024, respectively.

The effective income tax rate was 21.8% and 22.5% for the three months ended March 31, 2026 and 2025, respectively.

Differences between our effective income tax rate and the U.S.

federal statutory rate are the result of state taxes and non-deductible expenses, as was the Company’s case for the nine months ended September 30, 2025 and 2024.

Net Income (Loss)

Nine Months Ended September 30,

federal statutory rate are the result of state taxes and non-deductible expenses, as was the case for the Company for the decrease for the three months ended March 31, 2026, compared to the three months ended March 31, 2025.

Three Months Ended March 31,

% of consolidated sales

1 unchanged sentence

% of commercial sales

NM – Not Meaningful

Net income increased by $3,445,909, or 66.8%, during the nine months ended September 30, 2025, to $8,602,666, as compared to $5,156,757 during the same period in Fiscal 2024.

Net income increased by $6,346,386, or 254.5%, during the three months ended March 31, 2026, to $8,839,733, as compared to $2,493,347 during the same period in Fiscal 2025.

Refer to the aforementioned attributes discussed within the Comparison of the Three Months Ended March 31, 2026 and 2025 for further details.

Consumer Segment

Net income (loss) increased in the consumer segment by $1,775,924, during the nine months ended September 30, 2025, to net income of $1,659,599, as compared to net loss of $116,325 during the same period in Fiscal 2024.

Refer to the aforementioned attributes discussed within the Comparison of the Nine Months Ended September 30, 2025 and 2024 for further details.

Net income increased in the consumer segment by $4,221,204, or 6,109.4%, during the three months ended March 31, 2026, to $4,290,298, as compared to $69,094 during the same period in Fiscal 2025.

Refer to the aforementioned attributes discussed within the Comparison of the Three Months Ended March 31, 2026 and 2025 for further details.

Commercial Segment

Net income increased in the commercial segment by $1,669,985, or 31.7%, during the nine months ended September 30, 2025, to $6,943,067, as compared to $5,273,082 during the same period in Fiscal 2024.

Refer to the aforementioned attributes discussed within the Comparison of the Nine Months Ended September 30, 2025 and 2024 for further details.

Net income increased in the commercial segment by $2,125,182, or 87.7%, during the three months ended March 31, 2026, to $4,549,435, as compared to $2,424,253 during the same period in Fiscal 2025.

Refer to the aforementioned attributes discussed within the Comparison of the Three Months Ended March 31, 2026 and 2025 for further details.

Earnings Per Share

The following table depicts the Company’s earnings per share:

Nine Months Ended September 30,

Basic and diluted earnings per share attributable to holders of our Common Stock increased by $0.13, or 65.0%, during the nine months ended September 30, 2025, to $0.33, as compared to $0.20 during the same period in Fiscal 2024.

Three Months Ended March 31,

Basic and diluted earnings per share attributable to holders of our Common Stock increased by $0.24, or 240.0%, during the three months ended March 31, 2026 to $0.34, as compared to $0.10 same period in Fiscal 2025.

GAAP Financial Measures

Within this management discussion and analysis, we use supplemental measures of our financial performance, which are derived from our consolidated financial information, but which are not presented in our consolidated financial statements prepared in accordance with U.S.

In this management discussion and analysis, we use supplemental measures of our financial performance derived from our consolidated financial information that are not presented in our consolidated financial statements prepared in accordance with U.S.

When evaluated in conjunction with U.S.

GAAP financial measures, the Company believes that these non-U.S.

GAAP financial measures add meaningful insight into our financial position, results of operations, liquidity, and ability to meet financial obligations.

GAAP financial measures add meaningful insight into our results of operations, financial condition, liquidity, and ability to meet financial obligations.

These non-U.S.

2 unchanged sentences

GAAP financial measures is not calculated in the same manner by all companies and, accordingly, may not be an appropriate measure for comparing performance among different companies.

The Company also presents certain non-U.S.

GAAP financial measures and its nearest financial measure utilizing U.S.

GAAP for the trailing four quarters period ended September 30, 2025.

Management considers the trailing four quarters period ended September 30, 2025, to be helpful in understanding historical financial results, trends, and the calculation of leverage ratios.

GAAP and U.S.

GAAP financial measures for the trailing four quarters period ended September 30, 2025, are compared against the most recent fiscal period ended December 31, 2024, which is the nearest twelve-month reporting period under U.S.

These financial measure comparisons, along with comparisons utilizing three- and nine-month periods for non-U.S.

GAAP and its nearest financial measure utilizing U.S.

GAAP may differ materially from those reported for the fiscal period ended December 31, 2025.

We have included the definitions of our non-U.S.

9 unchanged sentences

GAAP financial measures and are not calculated in accordance with, or preferable to, “net income” or other financial measures of operating performance calculated in accordance with U.S.

The following table reconciles Adjusted EBITDA and Adjusted EBITDAR to the most comparable U.S.

GAAP financial measure for the three months ended September 30, 2025 and 2024:

Three Months Ended September 30,

Adjusted EBITDA Reconciliation:

Net income (loss)

Addition (deduction):

Depreciation and amortization

Interest expense

Income tax expense (benefit)

Adjusted EBITDAR Reconciliation:

Adjusted EBITDA

Rent expense (1)

(1) The table below depicts the calculation of rent expense and reconciles rent expense to total lease cost, per ASC 842, the most directly comparable U.S.

GAAP financial measure for the three months ended September 30, 2025, and September 30, 2024:

Three Months Ended September 30,

Total lease costs, per ASC 842

variable lease cost

short-term lease cost

The following table reconciles Adjusted EBITDA and Adjusted EBITDAR to the most comparable U.S.

GAAP financial measure for the nine months ended September 30, 2025 and 2024:

Nine Months Ended September 30,

The following table provides a reconciliation of the Company’s net income to Adjusted EBITDA and Adjusted EBITDAR for the three months ended March 31, 2026 and 2025:

Three Months Ended March 31,

Adjusted EBITDA Reconciliation:

Net income (loss)

Addition (deduction):

1 unchanged sentence

Interest expense

Income tax expense (benefit)

Income tax expense

Adjusted EBITDAR Reconciliation:

2 unchanged sentences

(1) The table below depicts the calculation of rent expense and reconciles rent expense to total lease cost, per ASC 842, the most directly comparable U.S.

GAAP financial measure for the nine months ended September 30, 2025, and September 30, 2024:

Nine Months Ended September 30,

GAAP financial measure for the three months ended March 31, 2026 and 2025.

Three Months Ended March 31,

Total lease costs, per ASC 842

1 unchanged sentence

short-term lease cost

The following table reconciles Adjusted EBITDA and Adjusted EBITDAR to the most comparable U.S.

GAAP financial measure for the trailing four quarters ended September 30, 2025:

The following table provides a reconciliation of the Company’s net income to Adjusted EBITDA and Adjusted EBITDAR for the trailing four quarters ended March 31, 2026 and for the year ended December 31, 2025:

Three Months Ended

1 unchanged sentence

September 30,

Adjusted EBITDA Reconciliation:

7 unchanged sentences

(1) The table below depicts the calculation of rent expense and reconciles rent expense to total lease cost, per ASC 842, the most directly comparable U.S.

GAAP financial measure for the trailing four quarter ended September 30, 2025, and September 30, 2024:

GAAP financial measure for the trailing four quarters ended March 31, 2026 and for the year ended December 31, 2025:

Three Months Ended

1 unchanged sentence

September 30,

Total lease costs, per ASC 842

11 unchanged sentences

GAAP-derived financial statement balances and is incorporated into the presentation below.

The following table reconciles components of the Debt to Adjusted EBITDA Leverage Ratio and Net Debt to Adjusted EBITDA Leverage Ratio for the trailing four quarters ended September 30, 2025 and for the year ended December 31, 2024:

September 30,

The following table reconciles components of the Debt to Adjusted EBITDA Leverage Ratio and Net Debt to Adjusted EBITDA Leverage Ratio for the trailing four quarters ended March 31, 2026 and for the year ended December 31, 2025:

Debt Obligations

9 unchanged sentences

(b) divided by (d)

(1) The presentation of net income and Adjusted EBITDAR for September 30, 2025, represents the total amount of net income and Adjusted EBITDAR for the trailing four quarters ended September 30, 2025.

(1) The presentation of net income and Adjusted EBITDA for March 31, 2026, represents the total amount of net income and Adjusted EBITDA for the trailing four quarters ended March 31, 2026.

Adjusted Debt to Adjusted EBITDAR Leverage and Adjusted Net Debt to Adjusted EBITDAR Leverage Ratios

8 unchanged sentences

GAAP-derived financial statement balances and is incorporated into the presentation below.

The following table reconciles components of the Adjusted Debt to Adjusted EBITDAR Leverage Ratio and Adjusted Net Debt to Adjusted EBITDAR Leverage Ratio for the trailing four quarters ended September 30, 2025 and for the year ended December 31, 2024:

September 30,

The following table reconciles components of the Adjusted Debt to Adjusted EBITDAR Leverage Ratio and Adjusted Net Debt to Adjusted EBITDAR Leverage Ratio for the trailing four quarters ended March 31, 2026 and for the year ended December 31, 2025:

Debt Obligations

11 unchanged sentences

(b) divided by (d)

(1) The presentation of net income and Adjusted EBITDAR for September 30, 2025, represents the total amount of net income and Adjusted EBITDAR for the trailing four quarters ended September 30, 2025.

Net Cash is defined as the difference between the Company’s (i) cash and cash equivalents (“Total Cash”) and (ii) Debt Obligations.

Management considers this financial measure to be helpful in understanding the Company’s liquidity.

The Company’s Net Cash is considered a non-U.S.

GAAP financial measure and is not calculated in accordance with, or preferable to, “cash and cash equivalents” and amounts outstanding under “notes payable” balances or other financial measures of liquidity calculated in accordance with U.S.

The following table reconciles Net Cash to its comparable U.S.

(1) The presentation of net income and Adjusted EBITDAR for March 31, 2026, represents the total amount of net income and Adjusted EBITDAR for the trailing four quarters ended March 31, 2026.

Net Cash is defined as the difference between (i) cash and cash equivalents and (ii) the sum of debt obligations.

We believe that presenting Net Cash is useful to investors as a measure of our liquidity and leverage profile, as cash and cash equivalents can be used, among other things, to repay indebtedness.

The following table depicts the Company’s Net Cash to its comparable U.S.

GAAP financial measures:

September 30,

Debt Obligations

5 unchanged sentences

The following table reconciles Free Cash Flow to the comparable U.S.

GAAP financial measures for the three months ended September 30, 2025 and September 30, 2024:

Three Months Ended September 30,

GAAP financial measures for the three months ended March 31, 2026 and 2025:

Three Months Ended March 31,

Operating Cash Flow

Capital Expenditures

The following table reconciles Free Cash Flow to the comparable U.S.

GAAP financial measures for the nine months ended September 30, 2025 and September 30, 2024:

Nine Months Ended September 30,

The following table reconciled Free Cash Flow to the comparable U.S.

GAAP financial measures for the trailing four quarters ended March 31, 2026 and for the year ended December 31, 2025:

Three Months Ended

Trailing Four Quarters Ended

September 30,

Operating Cash Flow

Capital Expenditures

The following table reconciles Free Cash Flow to the comparable U.S.

GAAP financial measures for the trailing four quarters ended September 30, 2025 and for the year ended December 31, 2024:

Performance Metrics

In addition to non-U.S.

GAAP financial measures, management utilizes certain performance metrics to assess its operations.

A key performance metric that is calculated consistently across our reportable segments is the Inventory Turnover Ratio.

As a purveyor of recommerce assets and recycling-grade base and precious metals, our ability to acquire inventory with appropriate margin, turn over our inventory, and redeploy sale proceeds is critical to our success.

Appropriate inventory turns also reduce our exposure to changing consumer preferences and commodity market volatility.

The Company defines its Inventory Turnover Ratio as (i) cost of goods sold less shipping and handling costs divided by (ii) Average Inventory.

The Company excludes shipping and handling costs in the definition of Inventory Turnover.

The Company defines Average Inventory as the mean value of the Company’s inventory over a specific period, calculated by (i) adding the beginning inventory and ending inventory for that period and (ii) dividing by two.

When evaluated in conjunction with our consolidated financial statements, the Company believes that these performance metrics provide meaningful insight into our results of operations, financial condition, and ability to meet financial obligations.

These performance metrics should not be considered a substitute for, nor superior to, our financial results.

These performance metrics are not calculated in the same manner by all companies and, accordingly, may not be an appropriate measure for comparing performance among different companies.

The following table reconciles the components of the Company’s Inventory Turnover for the trailing four quarters ended March 31, 2026 and for the year ended December 31, 2025:

Three Months Ended

1 unchanged sentence

September 30,

Cost of goods sold

shipping and handling costs

Beginning inventory

Ending inventory

Average Inventory:

(d) plus (e) divided by 2

Inventory Turnover Ratio

Inventory Turnover:

The following table reconciles the components of the Consumer and Commercial segment’s Inventory Turnover for the trailing four quarters ended March 31, 2026 and for the year ended December 31, 2025:

Consumer Segment

Three Months Ended

Trailing Four Quarters Ended

September 30,

Operating Cash Flow

Capital Expenditures

Cost of goods sold

shipping and handling costs

Beginning inventory

Ending inventory

Average Inventory:

(d) plus (e) divided by 2

Inventory Turnover Ratio

Inventory Turnover:

Commercial Segment

Three Months Ended

Trailing Four Quarters Ended

September 30,

Cost of goods sold

shipping and handling costs

Beginning inventory

Ending inventory

Average Inventory:

(d) plus (e) divided by 2

Inventory Turnover Ratio

Inventory Turnover:

Liquidity and Capital Resources

The following table summarizes the Company’s condensed consolidated statement of cash flows:

Nine Months Ended September 30,

The following table summarizes the Company’s condensed consolidated statement of cash flows for the three months ended March 31, 2026 and 2025:

Three Months Ended March 31,

Net cash provided by (used in):

2 unchanged sentences

Financing activities

Net increase (decrease) in cash and cash equivalents

NM – Not Meaningful

Net increase in cash and cash equivalents

Operating Activities

Cash flows provided by operations decreased by $323,426, or 5.0%, during the nine months ended September 30, 2025, to $6,126,338, as compared to $6,449,764 during the same period in Fiscal 2024.

The decrease in cash provided by operations was primarily attributed to an increase in net income, certain non-cash adjustments to reconcile net income to operating cash flow (as detailed in the condensed consolidated statements of cash flows), and the following significant net

changes in cash associated with operating assets and liabilities, from the nine months ended September 30, 2024 to the same period during Fiscal 2025:

Cash flows provided by operations increased by $20,025,382, or 1,770.5%, during the three months ended March 31, 2026, to $21,156,439, as compared to $1,131,057 during the same period in Fiscal 2025.

The increase in cash provided by operations was primarily attributed to an increase in net income, certain non-cash adjustments to reconcile net income to operating cash flow (as detailed in the condensed consolidated statements of cash flows), and the following significant net changes in operating assets and liabilities:

● Accounts receivable:

a $4,271,963 net increase primarily attributed to our consumer segment, resulting from a large wholesale precious metal receivable being present in the same period in Fiscal 2024, which relieved thereafter.

a $8,592,287 net decrease primarily attributed to the conversion of accounts receivable to cash in relation to a refining customer within our consumer segment that occurred in the first quarter of Fiscal 2026.

● Inventories:

a $2,566,317 net decrease primarily attributed to our consumer segment, resulting from a lesser increase in inventory in Fiscal 2025 than from that incurred in the same period in Fiscal 2024.

In the Fiscal 2024 period, the consumer segment had greater purchases of inventory to support the onboarding of our new stores.

a $1,473,442 net decrease primarily attributed to a reduction in inventory within our consumer segment in the first quarter of Fiscal 2026.

● Prepaid expenses:

a $499,581 net increase primarily attributed to our commercial segment, resulting from incurring costs in Fiscal 2025 to obtain a contract, which was partially offset by a reduction in prepaid freight associated with our ITAD revenue share settlements in the same period in Fiscal 2024.

a $3,472 net increase primarily attributed to commercial segment prepaids resulting from increases in costs of certain service providers, along with inclusion of amortization related to the cost to obtain a contract, which began in the second quarter of Fiscal 2025.

● Other assets:

a $172,160 net decrease primarily attributed to an earnest money deposit within our commercial segment that was subsequently returned in the second quarter of Fiscal 2025.

● Accounts payable:

a $305,795 net decrease primarily attributed to a greater reduction in accounts payable in the normal with the consumer segment in the first quarter of Fiscal 2026.

● Accrued expenses:

a $1,094,859 net decrease primarily attributed to our commercial segment, resulting from a reduction in liabilities associated with unvouchered inventory in Fiscal 2025, which was partially offset by an increase in accrued state and federal income tax expense held on our corporate ledger in Fiscal 2025.

a $3,898,437 net increase primarily attributed to our income tax accruals at the corporate level.

● Operating leases:

a $204,052 net increase primarily attributed to entering a new lease within our consumer segment in the first quarter of Fiscal 2026 and a lease extension that occurred within our commercial segment in the third quarter of Fiscal 2025.

● Other liabilities:

a $2,127,818 net decrease primarily attributed to our consumer segment, resulting from a significant increase in customer deposits in Fiscal 2024, which relieved thereafter.

a $300,929 net decrease primarily attributed to our consumer segment, in which there was a lesser increase in customer gift cards during the first quarter of Fiscal 2026.

Investing Activities

Cash flows (used in) investing activities decreased by $2,175,245, or 66.7%, during the nine months ended September 30, 2025, to $1,085,472, as compared to $3,260,717 during the same period in Fiscal 2024.

The decrease in cash (used in) investing activities during the nine months ended September 30, 2025, was primarily impacted by more significant capital being deployed on ERP development, new store build-outs, and an associated real estate purchase for one of our Arizona locations in the same period in Fiscal 2024.

Fiscal 2025 expenditures have primarily related to improvements to our corporate headquarters and new store-related improvements.

Cash flows (used in) investing activities increased by $184,914, or 48.3%, during the three months ended March 31, 2026, to $567,901, as compared to $382,987 during the same period in Fiscal 2025.

The increase in cash (used in) investing activities was primarily attributed to maintenance-related capital improvements to our corporate head office and in relation to the build-out of a new store within our consumer segment.

Financing Activities

Cash flows (used in) financing activities decreased by $2,065,246, or 62.8%, during the nine months ended September 30, 2025, to $1,225,455, as compared to $3,290,701 during the same period in Fiscal 2024.

The decrease in cash (used in) financing activities during the nine months ended September 30, 2025, was primarily due to a reduction in share buybacks during Fiscal 2025.

This reduction was partially offset by an increase in payments on notes payable in Fiscal 2025.

Cash flows (used in) financing activities decreased by $200,826, or 61.1%, during the three months ended March 31, 2026, to $127,982, as compared to $328,808 during the same period in Fiscal 2025.

The decrease in cash (used in) financing activities was primarily attributed to normal course debt repayment.

Capital Resources

Although the Company has access to a line of credit our primary source of liquidity and capital resources currently consist of cash generated from our operating activities.

We do not anticipate the need to fund our operations via the line of credit and we do not have any amounts drawn as of September 30, 2025 .

Although the Company has access to a line of credit, our primary source of liquidity and capital resources currently consists of cash generated from our operating activities.

We do not anticipate needing to fund our operations through the line of credit, and we have no amounts drawn as of March 31, 2026 .

We have historically renewed, extended, or replaced short-term debt as it matures, and management believes that we will be able to continue to do so in the near future.

Capital Expenditures

In Fiscal 2025, the Company is focused on optimizing our new store performance, along with the continued focus on growing our Commercial business organically and evaluating opportunities for strategic growth.

The Company continuously monitors the deployment of capital and primarily funds capital expenditures through cash flow from operating activities.

Where appropriate, the Company may use debt financing on select projects.

When this occurs, the Company further evaluates future cash flows of the project to ensure the debt tenure and pay-back period are in alignment, as well as the appropriateness of the rate of return.

As of September 30, 2025, the Company had no commitments for capital expenditures.

The Company continuously monitors capital deployment and primarily funds capital expenditures with cash flow from operating activities.

Where appropriate, the Company may use debt financing on select capital projects.

When this occurs, the Company further evaluates the project's future cash flows to ensure that the debt tenure and payback period are aligned and that the rate of return is appropriate.

As of March 31, 2026, the Company had no commitments for capital expenditures.

Off-Balance Sheet Arrangements

We do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to our stockholders.

We do not have any off-balance-sheet arrangements that have, or are reasonably likely to have, a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures, or capital resources that are material to our stockholders.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

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What changed 10-Q

Item 2. Management’s Discussion and Analysis