Charlie’s Holdings, Inc. 2025 Annual Report: In-Depth Analysis for Investors

Key Highlights from the 2025 Annual Report

• Common Stock and Market Value:
  • As of March 31, 2026, there were 274,203,242 shares of common stock outstanding.
  • The aggregate market value of common stock held by non-affiliates as of June 30, 2025, was approximately \$17.9 million, based on a closing market price of \$0.099 per share on the OTCQB Venture Market.
• Stock Information:
  • Trading Symbol: CHUC (OTC Markets)
  • No securities are registered pursuant to Section 12(b) of the Exchange Act.
• Filing Status and Compliance:
  • The company is a Non-Accelerated Filer and a Smaller Reporting Company.
  • Not an emerging growth company. The company has not filed an auditor attestation report on internal controls under Section 404(b) of Sarbanes-Oxley.
  • Charlie’s Holdings, Inc. is not a shell company.
• Dividend Policy:
  • No cash dividends have ever been paid on common stock, and none are anticipated in the foreseeable future. Investors should not rely on dividends for returns.
• Corporate Structure:
  • Incorporated in Nevada in 2001. Principal executive offices located in Costa Mesa, California.
  • The company leases office and warehouse space in Southern California and Western New York, with all properties leased and considered adequate for current operations.

Major Risks and Potential Price-Sensitive Issues

• Regulatory Risks:
  • The company operates primarily in the sale of products containing nicotine or alternative alkaloids, which are subject to significant regulatory scrutiny and government actions that could materially impact operations, financial condition, or market access.
  • Failure to comply with evolving U.S. or foreign regulations could have a material adverse effect on business results. Ongoing compliance efforts are costly and time-consuming.
• Product, Market, and Competitive Risks:
  • The company faces intense competition from well-capitalized and established firms which may affect market share and profitability. Aggressive pricing and marketing by competitors could force price reductions.
  • There is substantial uncertainty around the long-term health effects of vaping products. Adverse findings or publicity could impact sales, revenue, and share value.
  • Failure to develop and launch new products could jeopardize future growth and competitiveness. Success depends on effective product selection, marketing, regulatory approval, and customer acceptance.
  • Adverse publicity, product liability claims, or product contamination events could damage the brand and reduce sales.
• Financial and Shareholder Risks:
  • The company’s ability to achieve and maintain positive cash flow remains uncertain, dependent on successful product innovation and customer engagement.
  • There is a limited trading market for the company’s common stock; liquidity is not guaranteed and price volatility is expected.
  • Sales of substantial numbers of shares, or the perception of such sales, could materially depress the stock price. As of December 31, 2025, there were significant outstanding derivative securities (options and convertible preferred shares), which could dilute existing shareholders if exercised or converted.
  • Series A Preferred shares have anti-dilution provisions which, if triggered, could cause substantial dilution to common shareholders and negatively affect share price.
• Cybersecurity and Operational Risks:
  • The Board oversees cybersecurity risk management as part of overall enterprise risk management. The company collaborates with third-party cybersecurity providers and has not experienced any material cybersecurity incidents as of this report.
• Other Legal and Market Risks:
  • No pending or threatened material litigation as of the report date.
  • Shares may be classified as “penny stock,” adding further trading restrictions and risks for investors. Some brokers may not hold the company’s securities on behalf of clients due to regulatory uncertainties.

Important Information for Shareholders

• Shareholders should be aware of the potential for significant dilution and price volatility due to outstanding options, convertible preferred shares, and anti-dilution provisions tied to the Series A Preferred.
• Regulatory changes or adverse publicity in the vaping/nicotine sector could have a rapid and material impact on the company’s prospects and share value.
• The company’s future success depends on its ability to launch new products, respond to regulatory changes, and effectively compete in a highly competitive and scrutinized market.
• The limited trading market for CHUC shares may impede liquidity for investors. Shareholders should not expect cash dividends and must rely on potential share price appreciation for returns.

Forward-Looking Statements

The company notes that this annual report contains forward-looking statements subject to risks, uncertainties, and assumptions. Actual results may differ significantly from those discussed due to factors including but not limited to changes in market demand, regulatory environment, competitive actions, and overall economic conditions.

Disclaimer

This article is for informational purposes only and does not constitute investment advice. Investors should conduct their own due diligence and consult with a licensed financial advisor before making any investment decisions. The information provided is based on the company’s 2025 Annual Report and is subject to change without notice.

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