Solo Brands received a non-compliance notice from the New York Stock Exchange on 25 February and has six months to regain compliance with the minimum share price requirement, according to a press release.
The noncompliance warning was issued due to the company’s Class A common stock falling below $1 per share over a consecutive 30-day trading period.
However, the notice does not affect business operations within the company.
The company can regain compliance if its Class A common stock has a closing share price of at least $1.00 and an average closing share price of at least $1.00 over the 30 trading-day period.
The non-compliance warning comes amid declining sales and leadership changes.
In the company’s most recent financial report in Q3 of 2024, net sales dropped by 14.7% to $94.1 million while direct-to-consumer revenues decreased by 15.5% to $64.5 million.
Additionally, gross profit fell to $39.3 million, compared to $68.3 million in the year prior.
The declining sales were driven by a difficult macroeconomic backdrop, according to the company.
Chris Metz, former CEO, said: “Our third quarter results were in line with our expectations despite a continued challenging macroeconomic backdrop for big-ticket consumer durable items.
“We continue to see strong momentum and excitement from our retail partners; however, as expected, sales in our direct-to-consumer channel were challenged.
“During the quarter, we took decisive measures to address factors that were hindering our growth, and as a result of these actions, we believe that we are well positioned moving forward.”
Solo Brands also recently announced that CEO Chris Metz would step down, with John Larson serving as interim CEO.
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