koss-20220930x10q

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

for the quarterly period ended September 30, 2022

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission File Number 0-3295

KOSS CORPORATION

(Exact Name of Registrant as Specified in its Charter)


DELAWARE		39-1168275
(State or other jurisdiction of		(I.R.S. Employer Identification No.)
incorporation or organization)


4129 North Port Washington Avenue, Milwaukee, Wisconsin		53212
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: (414) 964-5000

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.005 per share	KOSS	Nasdaq Capital Market

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☑ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☑ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer ☐		Accelerated filer ☐

Non-accelerated filer ☑		Smaller reporting company ☑

		Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act.). Yes ☐ No ☑

At October 24, 2022, there were 9,179,795 shares outstanding of the registrant’s common stock.

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KOSS CORPORATION

FORM 10-Q

September 30, 2022

INDEX


			Page

PART I	FINANCIAL INFORMATION		3
	Item 1.	Financial Statements (Unaudited)	3
		Condensed Consolidated Balance Sheets as of September 30, 2022 and June 30, 2022	3
		Condensed Consolidated Statements of Operations for the Three months Ended September 30, 2022 and 2021	4
		Condensed Consolidated Statements of Cash Flows for the Three Months Ended September 30, 2022 and 2021	5
		Condensed Consolidated Statements of Stockholders’ Equity for the Three months Ended September 30, 2022 and 2021	6
		Notes to Condensed Consolidated Financial Statements	7
	Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	13
	Item 3.	Quantitative and Qualitative Disclosures About Market Risk	19
	Item 4.	Controls and Procedures	19
PART II	OTHER INFORMATION		19
	Item 1.	Legal Proceedings	19
	Item 1A.	Risk Factors	19
	Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	19
	Item 6.	Exhibits	21

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Table of Contents

PART I

FINANCIAL INFORMATION

Item 1. Financial Statements

KOSS CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)



	September 30, 2022		June 30, 2022
ASSETS
Current assets:
Cash and cash equivalents	$	20,870,957	$	9,208,170
Accounts receivable, less allowance for doubtful accounts of $9,496 and $2,027, respectively		1,773,132		1,846,620
Inventories, net		7,898,496		8,631,362
Prepaid expenses and other current assets		398,467		188,478
Total current assets		30,941,052		19,874,630

Equipment and leasehold improvements, net		1,032,180		1,088,017

Other assets:
Operating lease right-of-use asset		3,190,862		3,247,725
Cash surrender value of life insurance		5,973,016		5,744,724
Total other assets		9,163,878		8,992,449

Total assets	$	41,137,110	$	29,955,096

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable	$	521,417	$	796,163
Accrued liabilities		1,514,699		560,356
Deferred revenue		393,252		543,891
Operating lease liability		227,124		223,530
Income taxes payable		600,974		3,033
Total current liabilities		3,257,466		2,126,973

Long-term liabilities:
Deferred compensation		1,979,530		1,937,229
Deferred revenue		133,113		169,210
Operating lease liability		2,966,294		3,024,195
Total long-term liabilities		5,078,937		5,130,634

Total liabilities		8,336,403		7,257,607

Stockholders' equity:
Common stock, $0.005 par value, authorized 20,000,000 shares; issued and outstanding 9,179,795 and 9,147,795, respectively		45,899		45,739
Paid in capital		12,811,717		12,653,402
Retained earnings		19,943,091		9,998,348
Total stockholders' equity		32,800,707		22,697,489

Total liabilities and stockholders' equity	$	41,137,110	$	29,955,096

The accompanying notes are an integral part of these condensed consolidated financial statements.
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KOSS CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)



	Three Months Ended
	September 30
	2022			2021
Net sales	$	3,354,529		$	4,365,067
Cost of goods sold		2,168,305			2,783,230
Gross profit		1,186,224			1,581,837

Selling, general and administrative expenses		23,670,596	<

SEC Form 10-Q filed by Koss Corporation