v3.25.2
Business Segment and Geographic Area Information
 12 Months Ended
May 31, 2025
Segment Reporting [Abstract]  
Business Segment and Geographic Area Information

Note 13 – Business Segment and Geographic Area Information

 

Business Segments

 

The Company operates in two reportable segments: Hearing Enhancement and Protection and Hair and Skin Care. The segments are determined based on the nature of the products sold and how the business is managed. On May 5, 2025, the Company incorporated a new wholly owned subsidiary, Sharper Vision Marketing Inc., which did not have any material activity for the year ended May 31, 2025.

 

The Chief Operating Decision Maker (“CODM”) is the Company’s Chief Executive Officer. The CODM evaluates segment performance and allocates resources based primarily on a segment profit measure referred to as Segment non-cash operating income, which the Company has concluded is the measure of segment profitability. This non-GAAP measure is defined as operating income from segment operations before depreciation and amortization, stock-based compensation expense and corporate expenses. Corporate expenses primarily include insurance, expenses related to operating as a public company—including fees paid to related parties for executive management services—corporate office rent, and stock-based compensation for management.

 

The CODM reviews Segment non-cash operating income for each segment regularly to assess performance and to make decisions regarding the allocation of resources.

 

A reconciliation of Segment non-cash operating income to the most directly comparable measure under U.S. GAAP is Income from Operations and is included in the table below.

 

The Company’s segment information is as follows:

 

                              
   For the years ended,  
   May 31, 2025   May 31, 2024  
   Hearing
enhancement and
protection		   Hair and skin
care		   Consolidated   Hearing
enhancement and
protection		   Hair and skin
care		   Consolidated 
Sales, net  $24,735,101   $1,522,421   $26,257,522   $26,115,662   $1,382,877   $27,498,539 
Cost of sales   6,928,245    687,709    7,615,954    6,814,190    507,648    7,321,838 
Gross profit  $17,806,856   $834,712   $18,641,568   $19,301,472   $875,229   $20,176,701 
Operating expenses (Adjusted for non-cash items):                              
Sales and marketing  $11,000,206   $452,136   $11,452,342   $12,962,298   $486,756   $13,449,054 
Compensation and related taxes   814,603    32,547    847,150    753,383    44,278    797,661 
Professional and consulting   2,012,612    8,685    2,021,297    2,284,246    154,128    2,438,374 
General and administrative   467,540    184,284    651,824    585,566    7,336    592,902 
Total segment expenses adjusted for non-cash items  $14,294,961   $677,652   $14,972,613   $16,585,493   $692,498   $17,277,991 
Segment non-cash operating income  $3,511,895   $157,060   $3,668,955   $2,715,979   $182,731   $2,898,710 
Depreciation and amortization             148,498              130,610 
Stock-based compensation             1,108,934              267,183 
Corporate expenses (1)             1,250,158              997,537 
Income from Operations            $1,161,365             $1,503,380 
Total Assets (2)  $8,109,272   $4,760,523   $12,869,795   $7,802,282   $3,172,079   $10,974,361 
Payments for property and equipment and intangible assets  $392,428   $1,870   $394,298   $160,525   $—   $160,525 
Depreciation and amortization  $144,955   $3,543   $148,498   $125,057   $5,553   $130,610 

  

(1)

For the year ended May 31, 2025, compensation paid to the CFO for operational responsibilities within the business is excluded from corporate expenses and include in the respective segment costs.

 

For the year ended May 31, 2024, the former CFO's compensation related solely to public company responsibilities and is therefore entirely included in corporate expenses.

 

(2) As of May 31, 2025, Total Assets in the Company's Hearing enhancement and protection segment includes $10,000 related to cash held by the Company’s recently incorporated subsidiary.

 

Geographic Area Information

 

During the fiscal years ended May 31, 2025 and 2024, approximately 93% and 95%, respectively, of our consolidated net sales were to customers located in the U.S. (based on the customer’s shipping address). All Company assets are located in the U.S.