Financial Analysis

Commitments and Contingencies Contracts Employment Agreements We have employment agreements with certain executive officers and managers that provide severance benefits upon qualifying terminations of employment, including termination without cause. These benefits generally include salary continuation and certain continued welfare benefits, and may also include accelerated vesting of specified equity awards. Certain agreements further provide enhanced benefits upon a qualifying termination following a change in control, including additional cash severance and accelerated vesting of outstanding equity awards. Leases The following summarizes our operating leases for office and/or manufacturing space: Location of Lease Expiration Date Yangjiang, China July 15, 2026 Shenzhen, China September 30, 2028 Columbia, Missouri November 26, 2038 …

CommitmentsAndContingenciesDisclosureTextBlock · excerpt; the full note is in the filing

Debt On August 24, 2020, we entered into a financing arrangement consisting of a $50.0 million revolving line of credit secured by substantially all our assets, maturing five years from the closing date, with available borrowings determined by a borrowing base calculation. The revolving line included an option to increase the credit commitment by an additional $15 million. On March 25, 2022, we amended our secured loan and security agreement, or the First Amended Loan and Security Agreement, increasing the revolving line of credit to $75 million, secured by substantially all our assets, maturing in March 2027, with available borrowings determined by a borrowing base calculation. The amendment also includes an option to increase the credit commitment by an additional $15 million. The amended revolving line bears interest at a fluctuating rate equal to the Base Rate or Secured Overnight Financing Rate, or SOFR, as applicable, plus the applicable margin. The applicable margin can range from a minimum of 0.25% to a maximum of 1.75% based on certain conditions as defined in the Amended Loan and Security Agreement. The financing arrangement contains covenants relating to minimum debt service coverage. On March 10, 2026, we amended our secured loan and security agreement, or the Third Amended Loan and Security Agreement, secured by substantially all our assets. The Third Amended Loan Agreement extended of the maturity date to March 2031, increases to the limits on permitted acquisit …

DebtDisclosureTextBlock · excerpt; the full note is in the filing

The following table sets forth certain information regarding trade channel net sales for the fiscal years ended April 30, 2026, 2025, and 2024 (dollars in thousands): 2026 2025 $ Change % Change 2024 e-commerce channels $ 71,216 $ 84,391 $ (13,175) (15.6) % $ 84,313 Traditional channels 119,320 137,931 (18,612) (13.5) % 116,786 Total net sales $ 190,536 $ 222,322 $ (31,786) (14.3) % $ 201,099

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Fair Value Measurement We follow the provisions of ASC 820-10, Fair Value Measurements and Disclosures Topic, or ASC 820-10, for our financial assets and liabilities. Certain nonfinancial assets, including assets held for sale, are measured at fair value on a nonrecurring basis when events or changes in circumstances indicate that the carrying value may not be recoverable or when classification as held for sale is appropriate. ASC 820-10 provides a framework for measuring fair value under GAAP and requires expanded disclosures regarding fair value measurements. ASC 820-10 defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820-10 also establishes a fair value hierarchy, which requires an entity to maximize the use of observable inputs, where available, and minimize the use of unobservable inputs when measuring fair value. Financial assets and liabilities recorded on the accompanying consolidated balance sheets are categorized based on the inputs to the valuation techniques as follows: Level 1 Financial assets and liabilities whose values are based on unadjusted quoted prices for identical assets or liabilities in an active market that we have the ability to access at the measurement date (examples include active exchange-traded equity securities, liste …

FairValueDisclosuresTextBlock · excerpt; the full note is in the filing

Income Taxes Income tax expense/(benefit) from operations consists of the following (in thousands): For the Years Ended April 30, 2026 2025 2024 Current: Federal (a) $ (8) $ 48 $ 5 State (b) 48 64 (79) Foreign 5 11 4 Total current 45 123 (70) Deferred: Deferred federal Deferred state Total deferred Total income tax expense/(benefit) $ 45 $ 123 $ (70) _____________________________________________________________________ (a) Fiscal Year 2025 federal current expense is net of $875,000 tax benefit of operating loss carryforwards. (b) Fiscal Year 2025 state current expense is net of $95,000 tax benefit of operating loss carryforwards. A reconciliation of the provision for income taxes at statutory rates to the provision reported in the consolidated financial statements for the period ended April 30, 2026, after the adoption of ASU 2023-09 is as follows (in thousands): April 30, 2026 Amount Percent U.S Federal Statutory Tax Rate $ (1,924) 21.0 % State and Local Income Taxes, Net of Federal Income Tax Effect (c) 36 (0.4) % Foreign Tax Effects China Statutory tax rate Difference between China and United States (24) 0.3 % Effects of Cross-Border Tax Laws Global intangible low-tax income 20 (0.2) % Tax Credits Research & Development Credits (151) 1.6 % Changes in Valuation Allowances 1,565 (17.1) % Nontaxable or Nondeductible Items Stock Compensation (104) 1.1 % Executive compensation limitation 550 (6.0) % Other 77 (0.8) % Effective Tax Rate 45 (0.5) % The following table presents …

IncomeTaxDisclosureTextBlock · excerpt; the full note is in the filing

Leases We lease real estate, as well as other equipment, under non-cancelable operating lease agreements. We recognize expenses under our operating lease assets and liabilities at the commencement date based on the present value of lease payments over the lease terms. Our leases do not provide an implicit interest rate. We use our incremental borrowing rate consistent with our revolving line of credit and based on the information available at the lease commencement date in determining the discount rate for the present value of lease payments. Our lease agreements do not require material variable lease payments, residual value guarantees, or restrictive covenants. For operating leases, we recognize expense on a straight-line basis over the lease term. We record tenant improvement allowances as an offsetting adjustment included in our calculation of the respective right-of-use asset. The vast majority of our leases are for property located in the United States. Many of our leases include renewal options that can extend the lease term. These renewal options are at our sole discretion and are reflected in the lease term when they are reasonably certain to be exercised. The depreciable life of assets and leasehold improvements are limited by the expected lease term. The amounts of assets and liabilities related to our operating leases as of April 30, 2026 and 2025 are as follows (in thousands): April 30, 2026 April 30, 2025 Operating Leases Right-of-use assets $ 37,516 $ 37,474 Ac …

LesseeOperatingLeasesTextBlock · excerpt; the full note is in the filing

"Recently Adopted Accounting Standards In December 2023, the Financial Accounting Standards Board (""FASB"") issued Accounting Standards Update (""ASU"") No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (""ASU 2023-09""), which improves the transparency of income tax disclosures by requiring companies to (1) disclose consistent categories and greater disaggregation of information in the effective rate reconciliation and (2) provide information on income taxes paid disaggregated by jurisdiction. ASU 2023-09 is effective for fiscal years beginning after December 15, 2024. We adopted ASU 2023-09 effective as of the beginning of the fiscal year ended April 30, 2026 on a prospective basis. The adoption did not have a material impact on the Company's consolidated financial statements and disclosures. Recently Issued Accounting Standards In November 2024, the FASB issued ASU No. 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses (""ASU 2024-03), which requires disaggregation disclosures on an annual or interim basis, in the notes to the financial statements, of certain categories of expenses that are included in expense line items on the face of the statement of operations. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027 and should be …

NewAccountingPronouncementsPolicyPolicyTextBlock · excerpt; the full note is in the filing

Employer Sponsored Benefit Plans Contributory Defined Investment Plan Our employees participate in a contributory defined investment plan, subject to service requirements. Under the terms of the plan, employees may contribute from 1% to 30% of their annual pay and we generally make discretionary matching contributions of up to 50% of the first 6% of employee contributions to the plan. We contributed $540,000, $546,000, and $438,000 for the fiscal years ended April 30, 2026, 2025, and 2024, respectively. Non-Contributory Profit-Sharing Plan Our employees participate in our non-contributory profit-sharing plan upon meeting certain eligibility requirements. Employees become eligible on May 1 following the completion of a full fiscal year of continuous service. Our contributions to the plan are discretionary. We did not contribute to the plan for the fiscal years 2026, 2025, or 2024. Contributions are funded after the fiscal year-end. …

PensionAndOtherPostretirementBenefitsDisclosureTextBlock · excerpt; the full note is in the filing

Segment Reporting We have evaluated our operations under ASC 280-10-50-1 Segment Reporting and have concluded that we are operating as one segment based on several key factors, including the reporting and review process used by the chief operating decision maker, or CODM, who reviews only consolidated financial information and makes decisions to allocate resources based on those financial statements. Our CODM is our Chief Executive Officer. We analyze revenue streams in various ways, including customer group, brands, product categories, and customer channels. See also Note 2 Summary of Significant Accounting Policies for more information on how we disaggregate our net sales. The CODM uses consolidated net income to set budgets, evaluate margins, review actual results and in deciding whether to reinvest profits and cash flows into our business, repurchase our stock, pursue acquisitions, or make any other capital management decisions. Consolidated net income is the measure of segment profit most consistent with U.S. GAAP that is regularly reviewed by the CODM to allocate resources and assess performance. Significant segment level expense information provided to the CODM is consistent with our consolidated statements of operations, as presented on the accompanying consolidated statements of operations. The measure of segment assets is reported on the accompanying consolidated balance sheet as total assets. …

SegmentReportingDisclosureTextBlock · excerpt; the full note is in the filing

"Summary of Significant Accounting Policies Principles of Consolidation The accompanying consolidated financial statements include the accounts of our company and our wholly owned subsidiaries, including AOB Products Company, or AOBPC, BTI Tools LLC, Crimson Trace Corporation, Ultimate Survival Technologies, LLC, or ust, and AOB Consulting (Shenzhen), Co., LTD. All intercompany accounts and transactions have been eliminated in consolidation. Reclassifications Certain prior-year amounts have been reclassified to conform to the current-year presentation. In connection with the separate presentation of other current assets on the consolidated balance sheets, amounts previously reported as prepaid expenses and other current assets have been reclassified to separate captions for prepaid expenses and other current assets. Corresponding reclassifications were also made within operating activities on the consolidated statements of cash flows. These reclassifications had no effect on previously reported total current assets, total assets, net income, stockholders' equity, net cash provided by operating activities, or net increase (decrease) in cash and cash equivalents . Use of Estimates In preparing our consolidated financial statements in accordance with accounting principles generally accepted in the United States of America, or GAAP, we make estimates and assumptions that affect amounts reported in our consolidated financial statements and accompanying notes. Our significant estim …

SignificantAccountingPoliciesTextBlock · excerpt; the full note is in the filing

Subsequent Events Subsequent to April 30, 2026, we received $2.9 million in cash related to its previously recorded IEEPA tariff refund receivable. The receipt represented a portion of our total refund claim and was recorded as a reduction of the related refund receivable. In addition, we also received an immaterial amount of interest associated with the refund payment. We accounted for the underlying tariff refund claim as a recovery of previously paid tariff amounts. However, any interest associated with the refund represents an amount in excess of previously remitted tariffs and therefore is not considered a recovery of previously incurred costs. Accordingly, we evaluate potential interest recoveries and record interest as a gain contingency in accordance with ASC 450-30, ContingenciesGain Contingencies. We did not recognize any receivable related to potential interest as of April 30, 2026 because realization of such amounts had not occurred and the amount was not reasonably determinable. Interest income, if any, is recorded and recognized when realized or realizable. …

SubsequentEventsTextBlock · excerpt; the full note is in the filing

Commitments and Contingencies: Litigation From time to time, we are involved in lawsuits, claims, investigations, and proceedings, including those relating to product liability, intellectual property, commercial relationships, employment issues, and governmental matters, which arise in the ordinary course of business. For the three and six months ended October 31, 2025 and 2024, we did not incur any material expenses in defense and administrative costs relative to product liability litigation. In addition, we did not incur any settlement fees related to product liability cases in those fiscal years. Gain Contingency In 2018, the United States imposed additional section 301 tariffs of up to 25% on certain goods imported from China. These additional section 301 tariffs apply to our sourced products from China and have added additional cost to us. We are utilizing the duty drawback mechanism to offset some of the direct impact of these tariffs, specifically on goods that we sold internationally. We are accounting for duty drawbacks as a gain contingency and may record any such gain from a reimbursement in future periods if and when the contingency is resolved.

CommitmentsAndContingenciesDisclosureTextBlock

Debt: On August 24, 2020, we entered into a financing arrangement consisting of a $50.0 million revolving line of credit secured by substantially all our assets, maturing five years from the closing date, with available borrowings determined by a borrowing base calculation. The revolving line included an option to increase the credit commitment by an additional $15 million. The revolving line bore interest at a fluctuating rate equal to the Base Rate or LIBOR, as applicable, plus the applicable margin. On March 25, 2022, we amended our secured loan and security agreement, or the Amended Loan and Security Agreement, increasing the revolving line of credit to $75 million, secured by substantially all our assets, maturing in March 2027, with available borrowings determined by a borrowing base calculation. The amendment also includes an option to increase the credit commitment by an additional $15 million. The amended revolving line bears interest at a fluctuating rate equal to the Base Rate or Secured Overnight Financing Rate, or SOFR, as applicable, plus the applicable margin. The applicable margin can range from a minimum of 0.25% to a maximum of 1.75% based on certain conditions as defined in the Amended Loan and Security Agreement. The financing arrangement contains covenants relating to minimum debt service coverage. During the three months ended October 31, 2025, we borrowed $5.3 million on our revolving line of credit for general business purposes. Also during the three m …

DebtDisclosureTextBlock · excerpt; the full note is in the filing

The following table sets forth certain information regarding trade channel net sales for the three months ended October 31, 2025 and 2024 (dollars in thousands): 2025 2024 $ Change % Change e-commerce channel net sales $ 20,422 $ 24,282 $ (3,860) (15.9 %) Traditional channel net sales 36,777 35,950 827 2.3 % Total net sales $ 57,199 $ 60,232 $ (3,033) (5.0 %) The following table sets forth certain information regarding trade channel net sales for the six months ended October 31, 2025 and 2024 (dollars in thousands): 2025 2024 $ Change % Change e-commerce channel net sales $ 31,112 $ 40,783 $ (9,671) (23.7 %) Traditional channel net sales 55,789 61,092 (5,303) (8.7 %) Total net sales $ 86,901 $ 101,875 $ (14,974) (14.7 %)

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Fair Value Measurement: We follow the provisions of ASC 820-10, Fair Value Measurements and Disclosures Topic , or ASC 820-10, for our financial assets and liabilities. ASC 820-10 provides a framework for measuring fair value under GAAP and requires expanded disclosures regarding fair value measurements. ASC 820-10 defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820-10 also establishes a fair value hierarchy, which requires an entity to maximize the use of observable inputs, where available, and minimize the use of unobservable inputs when measuring fair value. Financial assets and liabilities recorded on the accompanying condensed consolidated balance sheets are categorized based on the inputs to the valuation techniques as follows: Level 1 Financial assets and liabilities whose values are based on unadjusted quoted prices for identical assets or liabilities in an active market that we have the ability to access at the measurement date (examples include active exchange-traded equity securities, listed derivatives, and most U.S. Government and agency securities). Cash and cash equivalents are reported at fair value based on market prices for identical assets in active markets, and therefore classified as Level 1 of the value hierarchy. Our cash and …

FairValueDisclosuresTextBlock · excerpt; the full note is in the filing

Income Taxes: The income tax expense included in the condensed consolidated statements of operations is based upon the estimated effective tax rate for the year, adjusted for the impact of discrete items which are accounted for in the period in which they occur. We recorded income tax expense of $0 and $12,000 for the three months ended October 31, 2025 and 2024, respectively. We recorded income tax expense of $53,000 and $34,000 for the six months ended October1, 2025 and 2024, respectively. The effective tax rate for the three months ended October 31, 2025 and 2024 was 0.0% and 0.4%, respectively. The effective tax rate for the six months ended October 31, 2025 and 2024 was (1.1)% and 4.4%, respectively. On July 4, 2025, the U.S. government enacted the One Big Beautiful Bill Act (OBBBA), which includes a broad range of tax reform provisions affecting businesses, including extending and modifying certain Tax Cuts & Jobs Act provisions and accelerating the phase-out of certain Inflation Reduction Act incentives. The OBBBA includes provisions modifying net interest deduction limitations, expensing of U.S.-based research and development expenses, and tax depreciation methods, as well as international tax provisions modifying global intangible low-taxed income (GILTI), foreign-derived intangible income (FDII), base erosion and anti-abuse tax (BEAT), and foreign tax credits. The Company evaluated the impacts of the OBBBA and does not expect it to have a material impact on the …

IncomeTaxDisclosureTextBlock · excerpt; the full note is in the filing

Leases: We lease real estate, as well as other equipment, under non-cancelable operating lease agreements. We recognize expenses under our operating lease assets and liabilities at the commencement date based on the present value of lease payments over the lease terms. Our leases do not provide an implicit interest rate. We use our incremental borrowing rate consistent with our revolving line of credit based on the information available at the lease commencement date in determining the discount rate for the present value of lease payments. Our lease agreements do not require material variable lease payments, residual value guarantees, or restrictive covenants. For operating leases, we recognize expense on a straight-line basis over the lease term. We record tenant improvement allowances as an offsetting adjustment included in our calculation of the respective right-of-use asset. Many of our leases include renewal options that can extend the lease term. These renewal options are at our sole discretion and are reflected in the lease term when they are reasonably certain to be exercised. The depreciable life of assets and leasehold improvements are limited by the expected lease term. The amounts of assets and liabilities related to our operating leases as of October 31, 2025 and April 30, 2025 are as follows (in thousands): October 31, 2025 April 30, 2025 Operating Leases Right-of-use assets $ 37,516 $ 37,474 Accumulated amortization (5,929) (5,578) Right-of-use assets, net $ 31 …

LesseeOperatingLeasesTextBlock · excerpt; the full note is in the filing

"Recently Issued Accounting Pronouncements In December 2023, the Financial Accounting Standards Board (""FASB"") issued Accounting Standards Update (""ASU"") No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (""ASU 2023-09""), which improves the transparency of income tax disclosures by requiring companies to (1) disclose consistent categories and greater disaggregation of information in the effective rate reconciliation and (2) provide information on income taxes paid disaggregated by jurisdiction. ASU 2023-09 is effective for fiscal years beginning after December 15, 2024, although early adoption is permitted. The guidance should be applied on a prospective basis with the option to apply the standard retrospectively. We are currently evaluating the impact of adopting this ASU 2023-09 on our consolidated financial statements and disclosures. In November 2024, the FASB issued ASU No. 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses (""ASU 2024-03), which requires disaggregation disclosures on an annual or interim basis, in the notes to the financial statements, of certain categories of expenses that are included in expense line items on the face of the statement of operations. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027 and …

NewAccountingPronouncementsPolicyPolicyTextBlock · excerpt; the full note is in the filing

Segment Reporting: We have evaluated our operations under ASC 280-10-50-1 Segment Reporting and have concluded that we are operating as one segment based on several key factors, including the reporting and review process used by the chief operating decision maker, or CODM, who reviews only consolidated financial information and makes decisions to allocate resources based on those financial statements. Our CODM is our Chief Executive Officer. We analyze revenue streams in various ways, including customer group, brands, product categories, and customer channels. See also Note 2 Summary of Significant Accounting Policies for more information on how we disaggregate our net sales. The CODM uses consolidated net income to set budgets, evaluate margins, review actual results and in deciding whether to reinvest profits and cash flows into our business, repurchase our stock, pursue acquisitions, or make any other capital management decisions. Consolidated net income is the measure of segment profit most consistent with U.S. GAAP that is regularly reviewed by the CODM to allocate resources and assess performance. Significant segment level expense information provided to the CODM is consistent with our consolidated statements of operations, as presented on the accompanying consolidated statements of operations. The measure of segment assets is reported on the accompanying consolidated balance sheet as total assets. …

SegmentReportingDisclosureTextBlock · excerpt; the full note is in the filing