{"success":true,"data":{"pressRelease":{"id":"107478","rtpr_id":"nGNX636qTw","ticker":"RYM","exchange":"NASDAQ","all_tickers":["RYM"],"title":"RYTHM, Inc. Reports Second Quarter 2026 Results","author":"Globe Newswire","published_at":"2026-08-04T11:00:00.967Z","article_body":"ROLLING MEADOWS, Ill., Aug. 04, 2026 (GLOBE NEWSWIRE) -- RYTHM, Inc.\n(https://www.globenewswire.com/Tracker?data=nx7wbIUoFa-XgtctkkRjIW0R4fqi26lEczB08aGu8CRyK81I0JouGG4BYRTXLAb6ZTrG5SdWQm-LSCp6Azkemg==)\n(Nasdaq: RYM) (“RYTHM” or the “Company”), America’s THC Company\nwhose portfolio of trusted THC brands includes RYTHM, Señorita, incredibles,\nBeboe, and Dogwalkers, today announced financial results for the second\nquarter ended June 30, 2026.\n\nHighlights for the second quarter ended June 30, 2026:\n* Revenue from continuing operations of $23.0 million, up 73% from $13.3\nmillion in the prior quarter.\n* Cash increased to $41.9 million driven by cash flow from operations of $8.7\nmillion.\n* Net income of $1.2 million.\n* Adjusted EBITDA of $6.4 million compared to approximately breakeven in the\nprior quarter.\n* At quarter end, the Company had approximately 2.2 million shares\noutstanding, as well as 11.0 million warrants outstanding and 3.0 million\nshares issuable upon conversion of outstanding convertible notes (excluding\nshares issuable upon conversion from accrued interest).\nSee definitions and reconciliation of non-GAAP measures elsewhere in this\nrelease.\n\nRecent Developments\n* Fixed annual cash licensing fees of $70 million from Green Thumb Industries\nInc. took effect April 1, 2026.\n* Señorita named the official THC beverage partner of Lollapalooza music\nfestival and Opry Entertainment Group venues, and RYTHM the official THC\nbeverage partner of Chicago's Navy Pier, expanding the Company’s existing\nbrand presence at premier live entertainment destinations across the country.\n* THC beverage depletions¹ increased to a record of approximately 25,000\ncases across 18 states in the month of June, compared to approximately 7,000\nin June 2025.\n* Hemp-derived product revenue increased 67% sequentially, driven by continued\ngrowth in THC beverage distribution and direct-to-consumer channels.\n* Due to uncertainty stemming from forthcoming changes in federal law\naffecting hemp-derived THC products, scheduled to take effect November 12,\n2026, the Company is not providing an outlook for the third quarter of 2026 at\nthis time.\n¹ Depletions represent U.S. distributor shipments of the Company’s branded\nTHC beverages to retailers, measured in 24-can case equivalents, based on\nthird-party data.\n\nManagement Commentary\n\n\"The Company delivered a record second quarter, with revenue growing 73%\nsequentially and exceeding prior guidance of 65% growth. This performance\nreflects accelerating momentum in THC beverages and the first full quarter of\nour amended licensing agreement with Green Thumb Industries,\" said RYTHM, Inc.\nChairman and Interim Chief Executive Officer Ben Kovler. \"That strength was\nunderscored by robust depletion growth across the category, a clear signal of\nreal consumer demand for THC beverages sold in traditional retail channels,\nincluding liquor, convenience, and grocery.\"\n\n\"The quarter was also defined by the growing role of THC beverages in premier\nlive entertainment venues, as we continued to expand our partnership roster.\nNew collaborations with Lollapalooza music festival, Opry Entertainment Group\nand Chicago's Navy Pier bring Señorita and RYTHM to some of the most storied\nstages in America, reflecting a broader shift in how leading venues and\nconcessionaires are responding to evolving consumer preferences for a\nnon-alcoholic alternative. As America's THC Company, we are meeting consumers\nwherever they gather — from everyday moments to memorable occasions.”\n\n\"As we move through the summer season, we recognize the regulatory environment\nfor THC beverages remains uncertain, with limited near-term visibility. That\nsaid, there is no wavering in our conviction on the long-term viability of\nthis category and the durability of the demand behind it. In this dynamic\noperating environment, we remain focused on the factors within our control:\nexecuting with discipline and continuing to build iconic brands that consumers\ntrust. With a scalable platform now in place, the Company has multiple paths\nto realize the long-term value of America's leading portfolio of THC brands.\"\n\nThe Company’s products are available direct to consumers at the following\nwebsites:\n* Señorita THC Margaritas: https://www.senoritadrinks.com/\n* 1777 by Señorita: https://www.1777spirit.com\n* RYTHM Beverages: https://rythmdrinks.com/\n* incredibles Edibles: https://iloveincredibles.com/\n* Beboe Edibles: https://beboe.com/\nNon-GAAP Financial Information\n\nThis press release includes certain non-GAAP financial measures as defined by\nthe U.S. Securities and Exchange Commission. Reconciliations of these\nnon-GAAP financial measures to the most directly comparable financial measure\ncalculated and presented in accordance with generally accepted accounting\nprinciples (“GAAP”) are included in the financial schedules attached to\nthis press release. This information should be considered as supplemental in\nnature and not as a substitute for, or superior to, any measure of performance\nprepared in accordance with GAAP.\n\nDefinitions\n\nEBITDA: Income (loss) from continuing operations before: net interest\n(expense) income, provision for income taxes, and depreciation and\namortization.\n\nAdjusted EBITDA: EBITDA before stock-based compensation, change in fair value\nof warrant liabilities and exceptional items.\n\nAbout RYTHM, Inc.\n\nRYTHM, Inc.’s portfolio of THC brands includes the most recognized and\ntrusted names in the cannabis and hemp industries, including RYTHM,\nincredibles, Dogwalkers, Beboe, Señorita THC Margaritas, &Shine, Doctor\nSolomon’s, and Good Green. With products available in thousands of physical\nlocations and online, supported by an iconic lineup of brands rooted in\nquality and safety, RYTHM, Inc. is cementing its position as\nAmerica’s THC Company. Through a focus on innovation, the Company is\ncontinually shaping THC experiences to meet the evolving preferences of\nconsumers across the country. Learn more and explore the full brand portfolio\nat https://rythminc.com/.\n\nForward-Looking Statements\n\nThis press release contains forward-looking statements within the meaning of\nthe Private Securities Litigation Reform Act of 1995 concerning RYTHM, Inc.\nand other matters. All statements contained in this press release that do not\nrelate to matters of historical fact should be considered forward-looking\nstatements including, without limitation, statements regarding future\nfinancial results, regulatory trends, potential annual licensing revenue,\ncontinued momentum for hemp-derived beverages, potential trends in the\nhemp-derived beverage and alcohol markets, and consumer trends. In some cases,\nyou can identify forward-looking statements by terms such as “may,”\n“will,” “should,” “expects,” “plans,” “anticipates,”\n“could,” “intends,” “targets,” “projects,” “contemplates,”\n“believes,” “estimates,” “predicts,” “potential,”\n“opportunity,” “looms” or “continue” or the negative of these\nterms or other similar expressions. The forward-looking statements in this\npress release are only predictions. We have based these forward-looking\nstatements largely on our current expectations and projections about future\nevents and financial trends that we believe may affect our business, financial\ncondition and results of operations. Forward-looking statements involve known\nand unknown risks, uncertainties and other important factors that may cause\nour actual results, performance or achievements to be materially different\nfrom any future results, performance or achievements expressed or implied by\nthe forward-looking statements. You should carefully consider the risks and\nuncertainties that affect our business, including the risk that Congress does\nnot amend or repeal the pending federal prohibition on hemp-derived THC\nproducts prior to its November 2026 effective date as well as those described\nin our filings with the Securities and Exchange Commission (“SEC”),\nincluding under the caption “Risk Factors” in our most recent Annual\nReport on Form 10-K, which can be obtained on the SEC website at www.sec.gov.\nThese forward-looking statements speak only as of the date of this\ncommunication. Except as required by applicable law, we do not plan to\npublicly update or revise any forward-looking statements, whether as a result\nof any new information, future events or otherwise. You are advised, however,\nto consult any further disclosures we make on related subjects in our public\nannouncements and filings with the SEC.\n\nInvestor Contact\nIR@RYTHMinc.com\n\nMedia Contact\nMedia@RYTHMinc.com\n\n RYTHM Inc. \n Highlights from Unaudited Condensed Consolidated Statements of Operations \n For the Three and Six Months Ended June 30, 2026 and 2025 \n (Amounts Expressed in Thousands of United States Dollars, Except for Share Amounts) \n \n Three months ended June 30, Six months ended June 30, \n 2026 2025 2026 2025 \n (Unaudited) (Unaudited) (Unaudited) (Unaudited) \n Revenue $ 23,021 $ 2,042 $ 36,307 $ 2,580 \n Cost of goods sold 4,485 1,360 7,374 1,808 \n Gross profit 18,536 682 28,933 772 \n Operating expenses 16,600 7,480 31,031 11,271 \n Operating income (loss) from continuing operations 1,936 (6,798 ) (2,098 ) (10,499 ) \n \n Other (expense) income, net (1,957 ) (407 ) (3,594 ) 20 \n Loss from continuing operations before income taxes (21 ) (7,205 ) (5,692 ) (10,479 ) \n Income tax benefit 1,205 — 26,798 — \n Income (loss) from continuing operations, net of income taxes 1,184 (7,205 ) 21,106 (10,479 ) \n Income (loss) from discontinued operations, net of income taxes - (155 ) - 1,493 \n Net income (loss) $ 1,184 $ (7,360 ) $ 21,106 $ (8,986 ) \n Basic income (loss) per share \n Continuing operations $ 0.09 $ (3.66 ) $ 1.61 $ (5.35 ) \n Discontinued operations — (0.08 ) — 0.76 \n Net income (loss) per share attributable to Common Stockholders – basic $ 0.09 $ (3.74 ) $ 1.61 $ (4.59 ) \n Diluted income (loss) per share \n Continuing operations $ 0.09 $ (3.66 ) $ 1.49 $ (5.35 ) \n Discontinued operations — (0.08 ) — 0.76 \n Net income (loss) per share attributable to Common Stockholders – diluted $ 0.09 $ (3.74 ) $ 1.49 $ (4.59 ) \n Weighted average common shares outstanding - basic 2,155,721 1,965,425 2,152,443 1,958,724 \n Weighted average common shares outstanding - diluted 2,283,971 1,965,425 5,252,126 1,958,724 \n\n\n\n RYTHM Inc. \n Highlights from Unaudited Condensed Consolidated Balance Sheet \n (Amounts Expressed in Thousands of United States Dollars) \n June 30, \n 2026 \n (Unaudited) \n Cash and cash equivalents $ 41,915 \n Other current assets 14,480 \n Goodwill 9,713 \n Intangible assets and related party prepaid license rights 42,475 \n Deferred tax assets 26,798 \n Total assets $ 135,381 \n \n Accounts payable and accrued expenses $ 12,804 \n Related party debt, current 72,000 \n Long-term debt, current 8,623 \n Current liabilities associated with discontinued operations 2,043 \n Total long-term liabilities 824 \n Total equity 39,087 \n Total liabilities and equity $ 135,381 \n\n\n\n RYTHM Inc. \n Highlights from the Condensed Consolidated Statement of Cash Flows \n For the Six Months Ended June 30, 2026 and 2025 \n (Amounts Expressed in Thousands of United States Dollars) \n \n Six months ended June 30, \n 2026 2025 \n (unaudited) (unaudited) \n \n Cash flows (used in) provided by \n Operating activities $ 9,697 $ (15,138 ) \n Investing activities $ - $ (5,075 ) \n Financing activities — 29,999 \n Net increase in cash and cash equivalents $ 9,697 $ 9,786 \n\n\n\n RYTHM Inc. \n Supplemental Information (Unaudited) Regarding Non-GAAP Financial Measures \n For the Three and Six Months Ended June 30, 2026 and 2025 \n (Amounts Expressed in Thousands of United States Dollars) \n \n Three months ended June 30, Six months ended June 30, \n 2026 2025 2026 2025 \n (unaudited) (unaudited) (unaudited) (unaudited) \n \n Income (loss) from continuing operations, net of income taxes $ 1,184 $ (7,205 ) $ 21,106 $ (10,479 ) \n Interest expense, net 1,727 291 3,469 290 \n Income tax benefit (1,205 ) - (26,798 ) - \n Depreciation and amortization 3,481 399 6,925 735 \n Earnings before interest, taxes, depreciation and amortization (EBITDA) (non-GAAP measure) 5,187 (6,515 ) 4,702 (9,454 ) \n Stock-based compensation expense 578 515 1,148 1,104 \n Change in fair value of warrant liabilities 232 115 127 (292 ) \n Exceptional items (1) 360 437 360 437 \n Adjusted EBITDA (non-GAAP measure) $ 6,357 $ (5,448 ) $ 6,337 $ (8,205 ) \n \n (1)Exceptional items correspond to costs incurred outside the ordinary course of business, including transition, restructuring, or other dislocation costs arising from or related to resizing initiatives, distributor termination fees, and other similar items. \n\n\n\n(https://www.globenewswire.com/NewsRoom/AttachmentNg/ca5999d5-df33-4d25-a08a-e7d9dfcf44ad)\n\n\n\nGlobeNewswire, Inc. 2026","article_body_html":"","raw_payload":{"data":{"id":"nGNX636qTw","title":"RYTHM, Inc. Reports Second Quarter 2026 Results","author":"Globe Newswire","ticker":"RYM","created":"2026-08-04T11:00:00.967Z","tickers":["RYM"],"exchange":"NASDAQ","article_body":"ROLLING MEADOWS, Ill., Aug. 04, 2026 (GLOBE NEWSWIRE) -- RYTHM, Inc.\n(https://www.globenewswire.com/Tracker?data=nx7wbIUoFa-XgtctkkRjIW0R4fqi26lEczB08aGu8CRyK81I0JouGG4BYRTXLAb6ZTrG5SdWQm-LSCp6Azkemg==)\n(Nasdaq: RYM) (“RYTHM” or the “Company”), America’s THC Company\nwhose portfolio of trusted THC brands includes RYTHM, Señorita, incredibles,\nBeboe, and Dogwalkers, today announced financial results for the second\nquarter ended June 30, 2026.\n\nHighlights for the second quarter ended June 30, 2026:\n* Revenue from continuing operations of $23.0 million, up 73% from $13.3\nmillion in the prior quarter.\n* Cash increased to $41.9 million driven by cash flow from operations of $8.7\nmillion.\n* Net income of $1.2 million.\n* Adjusted EBITDA of $6.4 million compared to approximately breakeven in the\nprior quarter.\n* At quarter end, the Company had approximately 2.2 million shares\noutstanding, as well as 11.0 million warrants outstanding and 3.0 million\nshares issuable upon conversion of outstanding convertible notes (excluding\nshares issuable upon conversion from accrued interest).\nSee definitions and reconciliation of non-GAAP measures elsewhere in this\nrelease.\n\nRecent Developments\n* Fixed annual cash licensing fees of $70 million from Green Thumb Industries\nInc. took effect April 1, 2026.\n* Señorita named the official THC beverage partner of Lollapalooza music\nfestival and Opry Entertainment Group venues, and RYTHM the official THC\nbeverage partner of Chicago's Navy Pier, expanding the Company’s existing\nbrand presence at premier live entertainment destinations across the country.\n* THC beverage depletions¹ increased to a record of approximately 25,000\ncases across 18 states in the month of June, compared to approximately 7,000\nin June 2025.\n* Hemp-derived product revenue increased 67% sequentially, driven by continued\ngrowth in THC beverage distribution and direct-to-consumer channels.\n* Due to uncertainty stemming from forthcoming changes in federal law\naffecting hemp-derived THC products, scheduled to take effect November 12,\n2026, the Company is not providing an outlook for the third quarter of 2026 at\nthis time.\n¹ Depletions represent U.S. distributor shipments of the Company’s branded\nTHC beverages to retailers, measured in 24-can case equivalents, based on\nthird-party data.\n\nManagement Commentary\n\n\"The Company delivered a record second quarter, with revenue growing 73%\nsequentially and exceeding prior guidance of 65% growth. This performance\nreflects accelerating momentum in THC beverages and the first full quarter of\nour amended licensing agreement with Green Thumb Industries,\" said RYTHM, Inc.\nChairman and Interim Chief Executive Officer Ben Kovler. \"That strength was\nunderscored by robust depletion growth across the category, a clear signal of\nreal consumer demand for THC beverages sold in traditional retail channels,\nincluding liquor, convenience, and grocery.\"\n\n\"The quarter was also defined by the growing role of THC beverages in premier\nlive entertainment venues, as we continued to expand our partnership roster.\nNew collaborations with Lollapalooza music festival, Opry Entertainment Group\nand Chicago's Navy Pier bring Señorita and RYTHM to some of the most storied\nstages in America, reflecting a broader shift in how leading venues and\nconcessionaires are responding to evolving consumer preferences for a\nnon-alcoholic alternative. As America's THC Company, we are meeting consumers\nwherever they gather — from everyday moments to memorable occasions.”\n\n\"As we move through the summer season, we recognize the regulatory environment\nfor THC beverages remains uncertain, with limited near-term visibility. That\nsaid, there is no wavering in our conviction on the long-term viability of\nthis category and the durability of the demand behind it. In this dynamic\noperating environment, we remain focused on the factors within our control:\nexecuting with discipline and continuing to build iconic brands that consumers\ntrust. With a scalable platform now in place, the Company has multiple paths\nto realize the long-term value of America's leading portfolio of THC brands.\"\n\nThe Company’s products are available direct to consumers at the following\nwebsites:\n* Señorita THC Margaritas: https://www.senoritadrinks.com/\n* 1777 by Señorita: https://www.1777spirit.com\n* RYTHM Beverages: https://rythmdrinks.com/\n* incredibles Edibles: https://iloveincredibles.com/\n* Beboe Edibles: https://beboe.com/\nNon-GAAP Financial Information\n\nThis press release includes certain non-GAAP financial measures as defined by\nthe U.S. Securities and Exchange Commission. Reconciliations of these\nnon-GAAP financial measures to the most directly comparable financial measure\ncalculated and presented in accordance with generally accepted accounting\nprinciples (“GAAP”) are included in the financial schedules attached to\nthis press release. This information should be considered as supplemental in\nnature and not as a substitute for, or superior to, any measure of performance\nprepared in accordance with GAAP.\n\nDefinitions\n\nEBITDA: Income (loss) from continuing operations before: net interest\n(expense) income, provision for income taxes, and depreciation and\namortization.\n\nAdjusted EBITDA: EBITDA before stock-based compensation, change in fair value\nof warrant liabilities and exceptional items.\n\nAbout RYTHM, Inc.\n\nRYTHM, Inc.’s portfolio of THC brands includes the most recognized and\ntrusted names in the cannabis and hemp industries, including RYTHM,\nincredibles, Dogwalkers, Beboe, Señorita THC Margaritas, &Shine, Doctor\nSolomon’s, and Good Green. With products available in thousands of physical\nlocations and online, supported by an iconic lineup of brands rooted in\nquality and safety, RYTHM, Inc. is cementing its position as\nAmerica’s THC Company. Through a focus on innovation, the Company is\ncontinually shaping THC experiences to meet the evolving preferences of\nconsumers across the country. Learn more and explore the full brand portfolio\nat https://rythminc.com/.\n\nForward-Looking Statements\n\nThis press release contains forward-looking statements within the meaning of\nthe Private Securities Litigation Reform Act of 1995 concerning RYTHM, Inc.\nand other matters. All statements contained in this press release that do not\nrelate to matters of historical fact should be considered forward-looking\nstatements including, without limitation, statements regarding future\nfinancial results, regulatory trends, potential annual licensing revenue,\ncontinued momentum for hemp-derived beverages, potential trends in the\nhemp-derived beverage and alcohol markets, and consumer trends. In some cases,\nyou can identify forward-looking statements by terms such as “may,”\n“will,” “should,” “expects,” “plans,” “anticipates,”\n“could,” “intends,” “targets,” “projects,” “contemplates,”\n“believes,” “estimates,” “predicts,” “potential,”\n“opportunity,” “looms” or “continue” or the negative of these\nterms or other similar expressions. The forward-looking statements in this\npress release are only predictions. We have based these forward-looking\nstatements largely on our current expectations and projections about future\nevents and financial trends that we believe may affect our business, financial\ncondition and results of operations. Forward-looking statements involve known\nand unknown risks, uncertainties and other important factors that may cause\nour actual results, performance or achievements to be materially different\nfrom any future results, performance or achievements expressed or implied by\nthe forward-looking statements. You should carefully consider the risks and\nuncertainties that affect our business, including the risk that Congress does\nnot amend or repeal the pending federal prohibition on hemp-derived THC\nproducts prior to its November 2026 effective date as well as those described\nin our filings with the Securities and Exchange Commission (“SEC”),\nincluding under the caption “Risk Factors” in our most recent Annual\nReport on Form 10-K, which can be obtained on the SEC website at www.sec.gov.\nThese forward-looking statements speak only as of the date of this\ncommunication. Except as required by applicable law, we do not plan to\npublicly update or revise any forward-looking statements, whether as a result\nof any new information, future events or otherwise. You are advised, however,\nto consult any further disclosures we make on related subjects in our public\nannouncements and filings with the SEC.\n\nInvestor Contact\nIR@RYTHMinc.com\n\nMedia Contact\nMedia@RYTHMinc.com\n\n RYTHM Inc. \n Highlights from Unaudited Condensed Consolidated Statements of Operations \n For the Three and Six Months Ended June 30, 2026 and 2025 \n (Amounts Expressed in Thousands of United States Dollars, Except for Share Amounts) \n \n Three months ended June 30, Six months ended June 30, \n 2026 2025 2026 2025 \n (Unaudited) (Unaudited) (Unaudited) (Unaudited) \n Revenue $ 23,021 $ 2,042 $ 36,307 $ 2,580 \n Cost of goods sold 4,485 1,360 7,374 1,808 \n Gross profit 18,536 682 28,933 772 \n Operating expenses 16,600 7,480 31,031 11,271 \n Operating income (loss) from continuing operations 1,936 (6,798 ) (2,098 ) (10,499 ) \n \n Other (expense) income, net (1,957 ) (407 ) (3,594 ) 20 \n Loss from continuing operations before income taxes (21 ) (7,205 ) (5,692 ) (10,479 ) \n Income tax benefit 1,205 — 26,798 — \n Income (loss) from continuing operations, net of income taxes 1,184 (7,205 ) 21,106 (10,479 ) \n Income (loss) from discontinued operations, net of income taxes - (155 ) - 1,493 \n Net income (loss) $ 1,184 $ (7,360 ) $ 21,106 $ (8,986 ) \n Basic income (loss) per share \n Continuing operations $ 0.09 $ (3.66 ) $ 1.61 $ (5.35 ) \n Discontinued operations — (0.08 ) — 0.76 \n Net income (loss) per share attributable to Common Stockholders – basic $ 0.09 $ (3.74 ) $ 1.61 $ (4.59 ) \n Diluted income (loss) per share \n Continuing operations $ 0.09 $ (3.66 ) $ 1.49 $ (5.35 ) \n Discontinued operations — (0.08 ) — 0.76 \n Net income (loss) per share attributable to Common Stockholders – diluted $ 0.09 $ (3.74 ) $ 1.49 $ (4.59 ) \n Weighted average common shares outstanding - basic 2,155,721 1,965,425 2,152,443 1,958,724 \n Weighted average common shares outstanding - diluted 2,283,971 1,965,425 5,252,126 1,958,724 \n\n\n\n RYTHM Inc. \n Highlights from Unaudited Condensed Consolidated Balance Sheet \n (Amounts Expressed in Thousands of United States Dollars) \n June 30, \n 2026 \n (Unaudited) \n Cash and cash equivalents $ 41,915 \n Other current assets 14,480 \n Goodwill 9,713 \n Intangible assets and related party prepaid license rights 42,475 \n Deferred tax assets 26,798 \n Total assets $ 135,381 \n \n Accounts payable and accrued expenses $ 12,804 \n Related party debt, current 72,000 \n Long-term debt, current 8,623 \n Current liabilities associated with discontinued operations 2,043 \n Total long-term liabilities 824 \n Total equity 39,087 \n Total liabilities and equity $ 135,381 \n\n\n\n RYTHM Inc. \n Highlights from the Condensed Consolidated Statement of Cash Flows \n For the Six Months Ended June 30, 2026 and 2025 \n (Amounts Expressed in Thousands of United States Dollars) \n \n Six months ended June 30, \n 2026 2025 \n (unaudited) (unaudited) \n \n Cash flows (used in) provided by \n Operating activities $ 9,697 $ (15,138 ) \n Investing activities $ - $ (5,075 ) \n Financing activities — 29,999 \n Net increase in cash and cash equivalents $ 9,697 $ 9,786 \n\n\n\n RYTHM Inc. \n Supplemental Information (Unaudited) Regarding Non-GAAP Financial Measures \n For the Three and Six Months Ended June 30, 2026 and 2025 \n (Amounts Expressed in Thousands of United States Dollars) \n \n Three months ended June 30, Six months ended June 30, \n 2026 2025 2026 2025 \n (unaudited) (unaudited) (unaudited) (unaudited) \n \n Income (loss) from continuing operations, net of income taxes $ 1,184 $ (7,205 ) $ 21,106 $ (10,479 ) \n Interest expense, net 1,727 291 3,469 290 \n Income tax benefit (1,205 ) - (26,798 ) - \n Depreciation and amortization 3,481 399 6,925 735 \n Earnings before interest, taxes, depreciation and amortization (EBITDA) (non-GAAP measure) 5,187 (6,515 ) 4,702 (9,454 ) \n Stock-based compensation expense 578 515 1,148 1,104 \n Change in fair value of warrant liabilities 232 115 127 (292 ) \n Exceptional items (1) 360 437 360 437 \n Adjusted EBITDA (non-GAAP measure) $ 6,357 $ (5,448 ) $ 6,337 $ (8,205 ) \n \n (1)Exceptional items correspond to costs incurred outside the ordinary course of business, including transition, restructuring, or other dislocation costs arising from or related to resizing initiatives, distributor termination fees, and other similar items. \n\n\n\n(https://www.globenewswire.com/NewsRoom/AttachmentNg/ca5999d5-df33-4d25-a08a-e7d9dfcf44ad)\n\n\n\nGlobeNewswire, Inc. 2026"},"type":"article","timestamp":"2026-08-04T11:00:01.841919969Z","server_sent_at_ms":1785841201841},"received_at":"2026-08-04T11:00:01.894Z","source_url":"https://www.globenewswire.com/news-release/2026/08/04/3338135/0/en/rythm-inc-reports-second-quarter-2026-results.html"},"analysis":{"id":"96485","press_release_id":"107478","analysis_json":{"industry":{"label":"Food, Beverage & Tobacco","sector":"Consumer Staples"},"redFlags":["Guidance withdrawn due to federal regulatory uncertainty affecting hemp-derived THC","Ben Kovler serving as Interim CEO"],"eventType":"earnings","narrative":"RYTHM reported Q2 revenue of $23.0 million, up 73% sequentially, driven by the first full quarter of its amended Green Thumb Industries licensing agreement. The company generated $8.7 million in operating cash flow and achieved net income of $1.2 million, compared to breakeven Adjusted EBITDA in the prior quarter.\n\nStrategic momentum accelerated with THC beverage depletions hitting a record 25,000 cases in June, supported by new partnerships with Lollapalooza and Opry Entertainment Group venues. The $70 million annual licensing fee stream from Green Thumb took effect April 1, solidifying the revenue base.\n\nHowever, the company withdrew its Q3 outlook due to uncertainty regarding forthcoming federal changes to hemp-derived THC laws scheduled for November 2026.","sentiment":"bullish","agentHooks":{"shouldPost":true,"suggestedAngle":"Record Q2 with 73% sequential growth and profitability, but regulatory uncertainty clouds H2 outlook."},"keyFigures":{"eps":0.09,"revenue":"$23.0 million","guidance":"Not providing an outlook for the third quarter of 2026 due to regulatory uncertainty","customDimensions":{"cash":41900000,"net_income":1200000,"adjusted_ebitda":6400000,"operating_cash_flow":8700000,"annual_licensing_fees":70000000,"revenue_seq_growth_pct":73,"thc_beverage_depletions":25000}},"quotedText":"The Company delivered a record second quarter, with revenue growing 73% sequentially and exceeding prior guidance of 65% growth.","namedEntities":{"people":[{"name":"Ben Kovler","role":"Chairman and Interim Chief Executive Officer"}],"products":["RYTHM","Señorita","incredibles","Beboe","Dogwalkers","1777 by Señorita","&Shine","Doctor Solomon’s","Good Green"],"companies":[{"name":"Green Thumb Industries Inc.","relationship":"licensor"},{"name":"Lollapalooza","relationship":"partner"},{"name":"Opry Entertainment Group","relationship":"partner"}],"dollarAmounts":[{"amount":"$23.0 million","context":"Q2 2026 revenue"},{"amount":"$13.3 million","context":"Q1 2026 revenue"},{"amount":"$41.9 million","context":"cash balance"},{"amount":"$8.7 million","context":"cash flow from operations"},{"amount":"$1.2 million","context":"net income"},{"amount":"$6.4 million","context":"Adjusted EBITDA"},{"amount":"$70 million","context":"Fixed annual cash licensing fees"}]},"materialImpact":{"score":4,"reasoning":"Strong quarter with 73% sequential revenue growth, a pivot to profitability ($1.2M net income), and positive cash flow ($8.7M). While the operational beat is material, guidance withdrawal due to regulatory risk tempers the highest score."},"tickerRelevance":{"others":[],"primary":"RYM"},"globalImportance":25,"audienceRelevance":30,"eventTypeSecondary":["operations_update","guidance_update"],"importanceComponents":{"tickerTier":"small-cap","eventGravity":"earnings-beat-profitability","sectorWeight":"cannabis/consumer","regulatoryRisk":"high"}},"event_type":"earnings","event_type_secondary":["operations_update","guidance_update"],"sentiment":"bullish","material_impact_score":4,"narrative":"RYTHM reported Q2 revenue of $23.0 million, up 73% sequentially, driven by the first full quarter of its amended Green Thumb Industries licensing agreement. The company generated $8.7 million in operating cash flow and achieved net income of $1.2 million, compared to breakeven Adjusted EBITDA in the prior quarter.\n\nStrategic momentum accelerated with THC beverage depletions hitting a record 25,000 cases in June, supported by new partnerships with Lollapalooza and Opry Entertainment Group venues. The $70 million annual licensing fee stream from Green Thumb took effect April 1, solidifying the revenue base.\n\nHowever, the company withdrew its Q3 outlook due to uncertainty regarding forthcoming federal changes to hemp-derived THC laws scheduled for November 2026.","key_figures":{"eps":0.09,"revenue":"$23.0 million","guidance":"Not providing an outlook for the third quarter of 2026 due to regulatory uncertainty","customDimensions":{"cash":41900000,"net_income":1200000,"adjusted_ebitda":6400000,"operating_cash_flow":8700000,"annual_licensing_fees":70000000,"revenue_seq_growth_pct":73,"thc_beverage_depletions":25000}},"named_entities":{"people":[{"name":"Ben Kovler","role":"Chairman and Interim Chief Executive Officer"}],"products":["RYTHM","Señorita","incredibles","Beboe","Dogwalkers","1777 by Señorita","&Shine","Doctor Solomon’s","Good Green"],"companies":[{"name":"Green Thumb Industries Inc.","relationship":"licensor"},{"name":"Lollapalooza","relationship":"partner"},{"name":"Opry Entertainment Group","relationship":"partner"}],"dollarAmounts":[{"amount":"$23.0 million","context":"Q2 2026 revenue"},{"amount":"$13.3 million","context":"Q1 2026 revenue"},{"amount":"$41.9 million","context":"cash balance"},{"amount":"$8.7 million","context":"cash flow from operations"},{"amount":"$1.2 million","context":"net income"},{"amount":"$6.4 million","context":"Adjusted EBITDA"},{"amount":"$70 million","context":"Fixed annual cash licensing fees"}]},"model_name":"glm-4.7","prompt_hash":"sha256:727b4b9429a443af","schema_hash":"sha256:05005c02d9cffac9","created_at":"2026-08-04T12:41:25.495Z","global_importance":25,"audience_relevance":30,"importance_components":{"tickerTier":"small-cap","eventGravity":"earnings-beat-profitability","sectorWeight":"cannabis/consumer","regulatoryRisk":"high"}},"durationMs":168909,"modelName":"glm-4.7"}}