10-Q: American Rebel Holdings Reports Q1 2025 Results: Revenue Declines Amid Strategic Shifts

American Rebel Holdings reports a decrease in revenue for Q1 2025, alongside increased operating expenses and a net loss, as it navigates strategic shifts and market challenges.

Summary

• American Rebel Holdings reported a revenue decrease from $4.04 million in Q1 2024 to $2.51 million in Q1 2025.
• The company's cost of goods sold decreased from $3.20 million to $2.22 million over the same period.
• Gross margin decreased significantly from $841,323 to $289,054.
• Operating expenses increased slightly from $3.12 million to $3.26 million.
• The company reported a net loss of $5.06 million, compared to a net loss of $2.70 million in the previous year.
• Basic and diluted loss per share was $(23.45) compared to $(27.47) in the prior year.
• The company is focusing on expanding its American Rebel Beer distribution and exploring strategic acquisitions.
• The company is facing legal proceedings and is not in compliance with Nasdaq listing requirements.

Sentiment

Score: 4

Explanation: The document presents a mixed sentiment. While there are positive aspects such as expansion into new markets and strategic partnerships, the negative financial results and ongoing legal challenges weigh heavily on the overall outlook.

Positives

• The company is expanding its American Rebel Beer distribution network, reaching 10 states.
• The company is exploring potential acquisitions to expand its product line.
• The company is actively working to resolve the Bank of America lawsuit.
• The company is working to regain compliance with Nasdaq listing requirements.

Negatives

• Revenue decreased by 38% year-over-year, from $4.04 million to $2.51 million.
• Gross margin decreased by 66% year-over-year, from $841,323 to $289,054.
• Net loss increased from $2.70 million to $5.06 million.
• The company is facing a lawsuit from Bank of America and Liberty Safe and Security Products, Inc..
• The company is not in compliance with Nasdaq listing requirements due to stockholders' equity being below the minimum requirement.
• The company has a working capital deficit of $(9,447,971).

Risks

• The company's ability to maintain compliance with Nasdaq listing standards is uncertain.
• The company faces risks related to new tariffs, potential acquisitions, and remediation of material weaknesses in internal controls.
• The company's success depends on introducing new products and protecting its intellectual property.
• The company's reliance on demand for safes and personal security products makes it vulnerable to changes in firearm storage regulations.
• The company's inability to raise additional financing for working capital poses a risk to its operations.
• The company is subject to risks related to competition, diversification, and general economic conditions.

Future Outlook

The company expects to incur additional losses during fiscal year ending December 31, 2025, and beyond, principally as a result of its increased investment in inventory, manufacturing capacity, marketing and sales expenses, and other growth initiatives. The company anticipates filing a new Reg. A+ offering in 2025.

Management Comments

• Its clear that Champions commitment to building safes with American-made steel and uncompromising strength really resonates with people who care deeply about freedom and security, said Tom Mihalek, CEO of Champion Safe Company.
• Champion safes are built to protect the rights, values, and possessions that matter most to Americans, Mihalek added.
• That need is in the forethought of every product we design, says Andy Ross.
• We are thrilled to see American Rebel Light Beer reach patriotic customers throughout the Commonwealth, and we couldnt have asked for a better partner than Clark Distributing Company to help us serve customers looking for American Rebel Light Americas Patriotic, God Fearing, Constitution Loving, National Anthem Singing, Stand Your Ground Beer , said Andy Ross, CEO of American Rebel.
• I havent been around the NHRA Mission Foods Drag Racing Series very long, but I realized it takes a lot to win one of these Top Fuel races, said Tony Stewart.
• Our relationship started out as a sponsorship, turned into a friendship and now its family, said American Rebel CEO Andy Ross.
• Hosting our esteemed Board of Directors, investment bankers, and key strategic investors at Mar-A-Lago in Florida is an honor and a pivotal opportunity for American Rebel Holdings, Inc., said CEO Andy Ross.
• With the guidance of capital market and investment banking industry leaders like Mark Elenowitz and the passion of brand ambassadors and true American Rebels like Matt Hagan, we are more confident than ever in our ability to grow American Rebel into a household name among patriotic Americans, said Andy Ross.
• The setting at Mar-a-Lago was the perfect venue for these types of strategic business discussions, said Andy Ross.
• We believe in the American dream hard work, perseverance, and celebrating the freedoms that make this country great, said Todd Porter, President of American Rebel Beverage.
• North Florida Sales is extremely excited for the opportunity to partner up with American Rebel, said Gentry Pelham, President and Owner of North Florida Sales.
• Adding Indiana to our list of states that distribute American Rebel Light is great for many reasons , said American Rebel CEO Andy Ross.

Industry Context

The company operates in the self-defense, safe storage, beverage, and apparel industries, facing competition from established players and evolving consumer preferences. The company's focus on patriotic branding and strategic partnerships aims to differentiate it in the market.

Comparison to Industry Standards

• The document does not provide enough information to compare the results to global benchmarks.
• The document does not provide enough information to compare the results to specific comparable companies.
• The document does not provide enough information to compare the results to specific comparable projects.

Legal Proceedings

• On July 23, 2024, the Company received notice of a complaint filed in the U.S. District Court for the District of Utah by Liberty Safe and Security Products, Inc.
• On March 21, 2025, Bank of America filed a complaint in the Fourth Judicial District Court in and for Utah County, State of Utah against the Company and its subsidiaries.

Related Party Transactions

• Charles A. Ross, Jr., Doug E. Grau, and Corey Lambrecht serve as officers of the company and have employment agreements.
• The aforementioned officers advanced the Company approximately $8,000 for the three months ended March 31, 2025, of which approximately $455,000 was outstanding as of March 31, 2025.
• On June 28, 2024, the Company entered into a short-term loan with a director, Lawrence Sinks, evidenced by a promissory note in the principal amount of $400,000.

Stakeholder Impact

• Shareholders face potential dilution from equity offerings and reverse stock splits.
• Employees may be affected by cost-cutting measures and changes in business objectives.
• Customers may experience changes in product offerings and availability.
• Suppliers and creditors may be impacted by the company's financial performance and ability to meet its obligations.

Next Steps

• The company intends to submit a Compliance Plan to Nasdaq.
• The company plans to defend the complaint from Bank of America, while continuing to work on a settlement.
• The company will continue to monitor its stockholders equity and, if appropriate, consider further available options to evidence compliance with the Stockholders Equity Requirement.

Key Dates

Keywords

American Rebel, financial results, Q1 2025, revenue, net loss, beer distribution, safes, acquisitions, Nasdaq, legal proceedings