KOSS CORP Segments Disclosure
The Company has a reportable segment, the design, manufacture and sale of headphones and related accessories, which reflects the manner in which the Company’s Chief Executive Officer, who is the Company’s CODM, regularly reviews financial information to manage the business, allocate resources and assess performance. The headphones are sold through retailers and distributors both domestically and internationally, as well as direct-to-consumer.
The CODM regularly reviews revenue, certain significant expense categories, net income and select balance sheet items in evaluating segment performance. The significant segment expense categories and other segment items provided to the CODM and included in the measure of segment profit or loss are presented below.
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Years Ended June 30, |
| 2025 |
| 2024 | ||
Net sales |
| $ | 12,624,170 |
| $ | 12,265,069 |
Cost of goods sold |
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| 7,850,572 |
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| 8,079,622 |
Gross profit margin |
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| 37.8% |
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| 34.1% |
Selling, general and administrative expenses: |
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New product certification and compliance testing |
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| 226,719 |
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| 22,036 |
Legal and professional expense |
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| 999,359 |
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| 940,090 |
Deferred compensation expense |
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| 133,330 |
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| 96,004 |
Other selling, general and administrative expenses |
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| 5,151,313 |
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| 4,999,476 |
Selling, general and administrative expenses |
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| 6,510,721 |
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| 6,057,606 |
Net loss |
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| (874,831) |
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| (950,911) |
Segment net loss includes interest income and income taxes.
The CODM also reviews the following balance sheet items at period-end as part of performance monitoring and resource allocation decisions:
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As of June 30, |
| 2025 |
| 2024 | ||
Cash and cash equivalents |
| $ | 2,807,797 |
| $ | 2,837,081 |
Short term investments |
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| 12,879,882 |
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| 12,104,459 |
Long term investments |
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| 4,000,774 |
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| 4,994,327 |
Inventories |
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| 4,885,067 |
|
| 4,473,680 |
Total segment assets |
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| 37,184,609 |
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| 37,199,479 |
The Company applied the provisions of ASU 2023-07 retrospectively and has included comparative information for the year ended June 30, 2024. Because the Company operates as a single reportable segment, the amounts above reconcile directly to the corresponding consolidated financial statement line items. There was no impact on previously reported consolidated net income, financial position or cash flows.
About Segments Disclosures
Segment disclosures break a company into its reportable operating units, revealing revenue, profit, and asset allocation that consolidated financial statements obscure. Under ASC 280, segments must match how the chief operating decision maker views the business, providing a window into internal management structure and resource allocation priorities.
Key signals: compare segment margins to identify which units drive profitability and which destroy value. Watch for changes in the number of reportable segments — segment aggregation or disaggregation often coincides with strategic shifts or attempts to obscure declining performance. Intersegment elimination patterns reveal internal pricing practices. The reconciliation between segment totals and consolidated figures exposes corporate overhead allocation and unallocated items. Geographic revenue concentration highlights regulatory and currency exposure. Compare segment-level capital expenditure against segment revenue to assess where management is investing for future growth versus harvesting existing assets.