Hour Loop Reports Results for Three and Nine Months Ended September 30, 2026
Continued Profitability Despite a Challenging Economic Environment
Financial Highlights for Three and Nine Months Ended
| · | Net revenues for the third quarter of 2026 decreased 4% to |
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| · | Net income for the third quarter of 2026 decreased to |
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| · | For the nine months ended |
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| · | Net income for the nine months ended |
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| · | Cash used in operating activities for the nine months ended |
Management Commentary
“Through the first nine months of 2026,
“We are building an AI-first company, and AI is already changing how we work every day. AI agents now support core parts of our operations – purchasing and replenishment, advertising, pricing, inbound shipments, inventory reconciliation, customer service and compliance. In purchasing, our agents help us make smarter, faster buying decisions. Agents now handle much of the day-to-day work. As routine work shifts to AI, our teams are freed to focus on higher-value decisions, and we believe this will allow us to scale the business without growing headcount at the same pace.”
“We are very excited about where
Third Quarter of 2026 Financial Results
Net revenues in the third quarter of 2026 were
Gross profit as a percentage of net revenues decreased to 50.6%, compared to 51.4% in the same period last year. The decrease was primarily due to lower inventory reimbursements from platforms, partially offset by tariff-related refunds from vendors.
Operating expenses as a percentage of net revenues in the third quarter of 2026 decreased to 49.1%, compared to 49.2% in the same period last year. The decrease was mainly attributable to lower selling and marketing expenses in line with lower revenues.
Net income in the third quarter of 2026 was $0.4 million, or $0.01 per diluted share, compared to net income of $0.5 million, or $0.02 per diluted share, in the same period last year. The decrease was primarily driven by lower net revenues and gross margin for the reasons mentioned above.
As of September 30, 2026, the Company had $1.1 million in cash and cash equivalents, compared to $3.8 million as of December 31, 2025. The decrease was primarily driven by investment in inventory ahead of the holiday season.
Full Year 2026 Financial Outlook
Hour Loop narrows its guidance for the full year, anticipating 2026 net revenue to be in the range of $147.0 million to $152.0 million, representing 3% to 6% year-over-year growth. The Company continues to expect 2026 net income to be in the range of $0.75 million to $1.5 million.
About Hour Loop, Inc.
Hour Loop is an online retailer engaged in e-commerce retailing in the U.S. market. It has operated as a third-party seller on www.amazon.com and has sold merchandise on its website at www.hourloop.com since 2013. Hour Loop further expanded its operations to other marketplaces such as Walmart, eBay, and Etsy. To date, Hour Loop has generated practically all its revenue as a third-party seller on www.amazon.com and only a negligible amount of revenue from its own website and other marketplaces. Hour Loop manages more than 100,000 stock-keeping units (“SKUs”). Product categories include home/garden décor, toys, kitchenware, apparel, and electronics. Hour Loop’s primary strategy is to bring most of its vendors’ product selections to the customers. It has advanced software that assists Hour Loop in identifying product gaps so it can keep such products in stock year-round, including the entirety of the last quarter (holiday season) of the calendar year. In upcoming years, Hour Loop plans to expand its business rapidly by increasing the number of business managers, vendors, and SKUs.
Forward-Looking Statements
This press release contains statements that constitute "forward-looking statements," within the meaning of the Private Securities Litigation Reform Act of 1995 and Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including with respect to Hour Loop’s business strategy, product development and industry trends. Forward-looking statements are subject to numerous conditions, many of which are beyond the control of Hour Loop. While Hour Loop believes these forward-looking statements are reasonable, undue reliance should not be placed on any such forward-looking statements, which are based on information available to Hour Loop on the date of this release. These forward-looking statements are based upon current estimates and assumptions and are subject to various risks and uncertainties, including, without limitation, those set forth in Hour Loop’s filings with the Securities and Exchange Commission, as the same may be updated from time to time. Thus, actual results could be materially different. Hour Loop undertakes no obligation to update these statements whether as a result of new information, future events or otherwise, after the date of this release, except as required by law.
Investor Contact
Finance Department, Hour Loop, Inc.
HOUR LOOP, INC.
CONSOLIDATED BALANCE SHEETS
As of September 30, 2026 and December 31, 2025
| (Unaudited) | ||||||||
| ASSETS | ||||||||
| Current assets | ||||||||
| Cash | $ | 1,121,671 | $ | 3,792,033 | ||||
| Accounts receivable, net | 2,638,732 | 235,959 | ||||||
| Inventory, net | 26,253,504 | 18,298,935 | ||||||
| Prepaid expenses and other current assets | 803,717 | 619,261 | ||||||
| Total current assets | 30,817,624 | 22,946,188 | ||||||
| Property and equipment, net | 100,736 | 95,917 | ||||||
| Deferred tax assets | 323,111 | 609,964 | ||||||
| Operating lease right-of-use lease assets | 511,608 | 169,368 | ||||||
| Total non-current assets | 935,455 | 875,249 | ||||||
| TOTAL ASSETS | $ | 31,753,079 | $ | 23,821,437 | ||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
| Current liabilities | ||||||||
| Accounts payable | $ | 13,095,516 | $ | 6,200,526 | ||||
| Credit cards payable | 3,216,530 | 3,707,976 | ||||||
| Short-term loan | 628,931 | 637,348 | ||||||
| Operating lease liabilities-current | 232,918 | 92,362 | ||||||
| Income taxes payable | - | 51,147 | ||||||
| Accrued expenses and other current liabilities | 828,508 | 2,226,387 | ||||||
| Due to related parties | 4,130,418 | 3,810,418 | ||||||
| Total current liabilities | 22,132,821 | 16,726,164 | ||||||
| Non-current liabilities | ||||||||
| Operating lease liabilities-non-current | 294,808 | 83,271 | ||||||
| Deferred tax liabilities | 546 | 18,143 | ||||||
| Total non-current liabilities | 295,354 | 101,414 | ||||||
| Total liabilities | 22,428,175 | 16,827,578 | ||||||
| Commitments and contingencies | - | - | ||||||
| Stockholders’ equity | ||||||||
| Preferred stock: |
- | - | ||||||
| Common stock: |
3,520 | 3,518 | ||||||
| Additional paid-in capital | 5,907,681 | 5,862,683 | ||||||
| Retained earnings | 3,406,667 | 1,109,674 | ||||||
| Accumulated other comprehensive income | 7,036 | 17,984 | ||||||
| Total stockholders’ equity | 9,324,904 | 6,993,859 | ||||||
| TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ | 31,753,079 | $ | 23,821,437 | ||||
The accompanying footnotes are an integral part of these unaudited consolidated financial statements.
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
For the Three and Nine Months Ended
(Unaudited)
| For the Three Months Ended |
For the Nine Months Ended |
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| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Revenues, net | $ | 32,075,230 | $ | 33,424,703 | $ | 95,949,763 | $ | 86,364,899 | ||||||||
| Cost of revenues | (15,841,673 | ) | (16,249,395 | ) | (45,730,293 | ) | (39,546,941 | ) | ||||||||
| Gross profit | 16,233,557 | 17,175,308 | 50,219,470 | 46,817,958 | ||||||||||||
| Operating expenses | ||||||||||||||||
| Selling and marketing | 13,782,339 | 14,665,407 | 40,899,883 | 37,627,975 | ||||||||||||
| General and administrative | 1,959,107 | 1,767,895 | 6,400,962 | 5,906,261 | ||||||||||||
| Total operating expenses | 15,741,446 | 16,433,302 | 47,300,845 | 43,534,236 | ||||||||||||
| Income from operations | 492,111 | 742,006 | 2,918,625 | 3,283,722 | ||||||||||||
| Other (expenses) income | ||||||||||||||||
| Other expense | (576 | ) | (8,186 | ) | (2,832 | ) | (10,185 | ) | ||||||||
| Interest expense | (47,660 | ) | (42,496 | ) | (127,933 | ) | (133,333 | ) | ||||||||
| Other income | 9,463 | 22,607 | 56,294 | 92,344 | ||||||||||||
| Total other expenses, net | (38,773 | ) | (28,075 | ) | (74,471 | ) | (51,174 | ) | ||||||||
| Income before income taxes | 453,338 | 713,931 | 2,844,154 | 3,232,548 | ||||||||||||
| Income tax expense | (31,512 | ) | (183,340 | ) | (547,161 | ) | (870,439 | ) | ||||||||
| Net income | 421,826 | 530,591 | 2,296,993 | 2,362,109 | ||||||||||||
| Other comprehensive income (loss) | ||||||||||||||||
| Foreign currency translation adjustments | 2,709 | (38,581 | ) | (10,948 | ) | 102,822 | ||||||||||
| Total comprehensive income | $ | 424,535 | $ | 492,010 | $ | 2,286,045 | $ | 2,464,931 | ||||||||
| Basic and diluted income per common share | $ | 0.01 | $ | 0.02 | $ | 0.07 | $ | 0.07 | ||||||||
| Weighted-average number of common shares outstanding | 35,199,735 | 35,171,320 | 35,191,668 | 35,161,068 | ||||||||||||
The accompanying footnotes are an integral part of these unaudited consolidated financial statements.
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Nine Months Ended
(Unaudited)
| Nine Months Ended |
||||||||
| 2026 | 2025 | |||||||
| Cash flows from operating activities | ||||||||
| Net income | $ | 2,296,993 | $ | 2,362,109 | ||||
| Reconciliation of net income to net cash used in operating activities: | ||||||||
| Depreciation expenses | 39,448 | 31,109 | ||||||
| Amortization of operating lease right-of-use lease assets | 100,584 | 141,320 | ||||||
| Deferred tax assets | 286,853 | 676,368 | ||||||
| Deferred tax liabilities | (17,597 | ) | 18,731 | |||||
| Stock-based compensation | 45,000 | 45,000 | ||||||
| Inventory allowance | 509,611 | 499,752 | ||||||
| Unrealized foreign exchange (gain) loss | (26,584 | ) | 156,087 | |||||
| Gain on disposal of property and equipment | - | (3,016 | ) | |||||
| Changes in operating assets and liabilities: | ||||||||
| Accounts receivable | (2,402,773 | ) | 1,104,073 | |||||
| Inventory | (8,464,180 | ) | (14,735,382 | ) | ||||
| Prepaid expenses and other current assets | (184,456 | ) | (497,449 | ) | ||||
| Accounts payable | 6,894,990 | 11,236,895 | ||||||
| Credit cards payable | (491,446 | ) | 470,430 | |||||
| Accrued expenses and other current liabilities | (2,547,879 | ) | (1,791,077 | ) | ||||
| Operating lease liabilities | (90,605 | ) | (139,950 | ) | ||||
| Income taxes payable | (51,147 | ) | - | |||||
| Net cash used in operating activities | (4,103,188 | ) | (425,000 | ) | ||||
| Cash flows from investing activities: | ||||||||
| Proceeds from disposal of property and equipment | - | 3,016 | ||||||
| Purchases of property and equipment | (45,559 | ) | (51,979 | ) | ||||
| Net cash used in investing activities | (45,559 | ) | (48,963 | ) | ||||
| Cash flows from financing activities: | ||||||||
| Payments to related parties | (1,486,000 | ) | (839,000 | ) | ||||
| Proceeds from related parties | 2,956,000 | - | ||||||
| Net cash provided by (used in) financing activities | 1,470,000 | (839,000 | ) | |||||
| Effect of changes in foreign currency exchange rates | 8,385 | (10,311 | ) | |||||
| Net change in cash | (2,670,362 | ) | (1,323,274 | ) | ||||
| Cash at beginning of period | 3,792,033 | 2,119,581 | ||||||
| Cash at end of period | $ | 1,121,671 | $ | 796,307 | ||||
| Supplemental disclosures of cash flow information: | ||||||||
| Cash paid for interest | $ | 16,155 | $ | 16,370 | ||||
| Cash paid for income tax | $ | 473,000 | $ | 163,015 | ||||
| Non-cash investing and financing activities: | ||||||||
| Operating lease right-of-use of assets and operating lease liabilities recognized | 446,496 | 131,472 | ||||||
Source: Hour Loop, Inc.