Released on October 26, 2023, Koss Corp (KOSS, Financial)'s first quarter earnings report for fiscal year 2024 revealed a minor increase in sales but a significant net loss compared to the same period in the previous year.
Performance Overview
Koss Corp (KOSS, Financial) reported sales of $3,373,938 for the first quarter ended September 30, 2023, marking a slight increase of $9,809, or 0.3%, compared to the same period in the prior year. However, the company experienced a net loss of $257,609 for the three months ended September 30, 2023, a stark contrast to the net income of $9,944,743 reported for the first quarter of the prior year.
Challenges and Opportunities
Michael J. Koss, Chairman and CEO, noted that while orders from two distributors in Europe signaled a positive change, a reduction in consumer confidence leading to a slowdown in spending resulted in a drop in Direct-to-Consumer (DTC) sales. This nearly negated the increase in export sales. Koss Corp (KOSS, Financial) also experienced a decline in sales to certain domestic distributors due to continued overstocked inventory levels of non-Koss product at these distributors.
Financial Highlights
According to the company's condensed consolidated statements of operations, the cost of goods sold for Q1 2024 was $2,306,248, resulting in a gross profit of $1,067,690. However, selling, general and administrative expenses amounted to $1,536,279, leading to a loss from operations of $468,589. Other income and interest income were reported at $212,859, resulting in a loss before income tax provision of $255,730. After accounting for an income tax provision of $1,879, the net loss for the period was $257,609.
Looking Ahead
Despite the challenges faced in Q1 2024, Koss Corp (KOSS, Financial) continues to monitor the supply chain environment and is expecting a slow rise in freight rates during the next quarter due to the current labor landscape, the recent settlement of threatened carrier strikes and labor disputes, and rising energy prices.
Explore the complete 8-K earnings release (here) from Koss Corp for further details.
