v3.26.1
Business Segment Information
 3 Months Ended
Mar. 31, 2026
Segment Reporting [Abstract]  
Business Segment Information
Note 16 – Business Segment Information
 
Our internal management financial reporting consists of two business divisions: (i) Wine and (ii) Spirits and we report our operating results in two segments: (i) Wine and (ii) Spirits. In the Wine segment, our portfolio consists of premium imported and domestic wine brands across multiple varietals and price points (both alcoholic and non-alcoholic). In the Spirits segment, our portfolio includes premium and craft spirits brands across categories such as gin, vodka, mezcal, tequila, and non-alcoholic. Our CODM is our Chief Executive Officer. The business segments reflect how our operations are managed, how resources are allocated, how operating performance is evaluated by senior management, and the structure of our internal financial reporting. Our CODM utilizes segment comparable operating loss performance in deciding how to deploy capital in line with disciplined and balanced priorities. These priorities largely include investing in our people and our brands, making capital investments, and strategic acquisitions. Our CODM also monitors budgeted versus actual results in assessing segment operating performance and understanding underlying business trends.
 
Management excludes certain non-GAAP Comparable Adjustments from its evaluation of the results of each operating segment as these Comparable Adjustments are not reflective of core operations of the segments. Segment operating performance and the incentive compensation of segment management are evaluated based on core segment operating loss which does not include the impact of these Comparable Adjustments, collectively referred to as comparable operating loss. We evaluate segment operating performance based on comparable operating loss of the respective business units.
 
The accounting policies of the segments are the same as those described for the Company in the Summary of Significant Accounting Policies in Note 3.
 
Segment information is as follows:

 
 
 
 
 
 
 
 
 
 
 
Unallocated
 
 
Comparable
 
 
 
 
 
 
Wine
 
 
Spirits
 
 
Total
segment
 
 
amounts
 
 
Adjustments
(c)
 
 
Consolidated
 
For the three months ended March 31, 2026
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net revenues
 
$
3,688,329
 
 
$
461,017
 
 
$
4,149,346
 
 
$
 
-
 
 
$
 
-
(a)
 
$
4,149,346
 
Cost of net revenues
 
$
2,821,329
 
 
 
255,073
 
 
 
3,076,402
 
 
 
-
 
 
 
-
(a)
 
 
3,076,402
 
Gross profit, non-GAAP 
(d)
 
 
867,000
 
 
 
205,944
 
 
 
1,072,944
 
 
 
-
 
 
 
-
 
 
 
1,072,944
 
Sales and marketing
 
 
862,129
 
 
 
67,199
 
 
 
929,328
 
 
 
38,149
 
 
 
-
(a)
 
 
967,477
 
General and administrative
 
 
695,828
 
 
 
139,334
 
 
 
835,162
 
 
 
1,460,711
 
(b)
 
 
220,932
(a)
 
 
2,516,805
 
Research and development
 
 
-
 
 
 
-
 
 
 
-
 
 
 
-
 
 
 
-
 
 
 
-
 
Impairment loss
 
 
-
 
 
 
-
 
 
 
-
 
 
 
-
 
 
 
110,402
(a)
 
 
110,402
 
Loss from operations
 
 
(690,957
)
 
 
(589
)
 
 
(691,546
)
 
 
(1,498,860
)
 
 
(331,334
)
 
 
(2,521,740
)
Other income (expense)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(519,865
)
Provision for income taxes
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
-
 
Net loss
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(3,041,605
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Non-controlling interest net loss
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(5,901
)
Net loss attributable to parent
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(3,035,704
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Foreign currency translation adjustment
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total comprehensive loss
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$
(3,035,704
)
 
(a)
See comparable adjustments table discussed in this footnote for explanations surrounding items included in comparable adjustments.
 
(b)
Unallocated amounts include costs held in the corporate infrastructure that are not allocated to any reporting segment. Significant items included in general and administrative expenses include $523 thousand in headcount and contractor costs, $699 thousand in professional services, and $44 thousand in amortization costs.
 
(c)
Comparable Adjustments are determined and presented on a non-GAAP basis and are intended to reflect our current operations.
 
(d)
Our presentation of gross profit is non-GAAP. Segment gross profit is reconciled to gross profit on the consolidated statement of operations with the inclusion of unallocated amounts and comparable adjustments.
 
 
 
 
 
 
 
 
 
 
 
 
Unallocated
 
 
Comparable
 
 
 
 
 
 
Wine
 
 
Spirits
 
 
Total segment
 
 
amounts
 
 
Adjustments
(c)
 
 
Consolidated
 
For the three months ended March 31, 2025
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net revenues
 
$
3,754,755
 
 
$
457,053
 
 
$
4,211,808
 
 
$
-
 
 
$
128,736
(a)
 
$
4,340,544
 
Cost of net revenues
 
 
2,575,491
 
 
 
234,798
 
 
 
2,810,289
 
 
 
-
 
 
 
315,495
(a)
 
 
3,125,784
 
Gross profit, non-GAAP
(d)
 
 
1,179,264
 
 
 
222,255
 
 
 
1,401,519
 
 
 
-
 
 
 
(186,759
)
 
 
1,214,760
 
Sales and marketing
 
 
901,696
 
 
 
80,547
 
 
 
982,243
 
 
 
11,162
 
 
 
-
(a)
 
 
993,405
 
General and administrative
 
 
952,946
 
 
 
376,602
 
 
 
1,329,548
 
 
 
685,959
 
(b)
 
 
102,595
(a)
 
 
2,118,102
 
Research and development
 
 
-
 
 
 
-
 
 
 
-
 
 
 
-
 
 
 
-
 
 
 
-
 
Impairment loss
 
 
-
 
 
 
-
 
 
 
-
 
 
 
-
 
 
 
-
(a)
 
 
-
 
Loss from operations
 
 
(675,378
)
 
 
(234,894
)
 
 
(910,272
)
 
 
(697,121
)
 
 
(289,354
)
 
 
(1,896,747
)
Other income (expense)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(1,822,874
)
Provision for income taxes
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
-
 
Net income (loss)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(3,719,621
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Non-controlling interest net (loss)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(62,579
)
Net income (loss) attributable to parent
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(3,657,042
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Foreign currency translation adjustment
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total comprehensive loss
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$
(3,657,042
)

(a)
See comparable adjustments table discussed in this footnote for explanations surrounding items included in comparable adjustments.
 
(b)
Unallocated amounts include costs held in the corporate infrastructure that are not allocated to any reporting segment. Significant items included in general and administrative expenses include $375 thousand in headcount and contractor costs, $58 thousand in professional services, $144 thousand in depreciation and amortization, and $75 thousand in warehouse lease termination costs.
 
(c)
Comparable Adjustments are determined and presented on a non-GAAP basis and are intended to reflect our current operations.
 
(d)
Our presentation of gross profit is non-GAAP. Segment gross profit is reconciled to gross profit on the consolidated statement of operations with the inclusion of unallocated amounts and comparable adjustments.
Comparable adjustments were as follows:
 
 
 
March 31,
 
 
March 31,
 
 
 
 
2026
 
 
2025
 
Net revenues
 
 
 
 
 
 
Sales of bulk wine
(a)
 
 
-
 
 
 
128,736
 
Comparable adjustments
.
 Net revenues
 
 
-
 
 
 
128,736
 
 
 
 
 
 
 
 
Cost of net revenues
 
 
 
 
 
 
Cost of sales of bulk wine
(a)
 
 
-
 
 
 
146,565
 
Cost of write-down of unutilized wine pre-acquisition
(b)
 
 
-
 
 
 
168,930
 
Comparable adjustments, Cost of net revenues
 
 
-
 
 
 
315,495
 
 
 
 
 
 
 
 
General and administrative
 
 
 
 
 
 
Stock-based compensation
(c)
 
 
220,932
 
 
 
44,548
 
Storage on bulk wine
(a)
 
 
-
 
 
 
58,047
 
Comparable adjustments, general and administrative
 
 
220,932
 
 
 
102,595
 
 
 
 
 
 
 
 
Impairment loss
(d)
 
 
110,402
 
 
 
-
 
 
 
 
 
 
 
 
Comparable adjustments, Operating loss
 
 
(331,334
)
 
 
(289,354
)

(a)
The Company sold and is expected to sell excess bulk wine for losses. These are not part of the Company’s regular operations and thus are excluded from the CODM’s review of the wine business. This includes storage costs incurred on the excess bulk wine.
 
(b)
The Company wrote-down inventory that was acquired as part of the Winc acquisition in 2023. When the Company sold the winc.com business, it lost its ability to sell wine unwanted on the wholesale channel through the winc.com channel. As such, excess bulk wine that was identified and written down in 2024 was not considered to be a core/recurring operation for the business.
 
(c)
The Company does not include stock-based compensation nor impairment losses in its evaluation of performance.

Our principal area of operation is in the U.S. Current operations for one of the spirits brands is in Mexico. Revenues are attributed to countries based on the location of the
customer
.
 
Geographic data is as follows:
 
 
 
March 31,
 
 
March 31,
 
 
 
2026
 
 
2025
 
Net revenues
 
 
 
 
 
 
U.S.
 
$
4,138,442
 
 
$
4,337,540
 
Non-U.S.
 
$
10,904
 
 
$
3,003