UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended July 2, 2022

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 001-41032

Kidpik Corp.

(Exact name of Registrant as specified in its charter)

Delaware		81-3640708
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

200 Park Avenue South, 3rd Floor New York, New York		10003
(Address of principal executive offices)		(Zip Code)

(212) 399-2323

(Registrant’s Telephone Number, Including Area Code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock, par value $0.001 per share		PIK		The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 (the “Exchange Act”) during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated Filer ☐		Accelerated Filer ☐
Non-accelerated Filer ☒		Smaller reporting company ☒
		Emerging growth company ☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Number of shares of registrant’s common stock outstanding as of August 16, 2022: 7,688,194.

TABLE OF CONTENTS

		Page
Cautionary Statement Regarding Forward-Looking Information		1

Summary Risk Factors		2

PART I	FINANCIAL INFORMATION	F-1

Item 1.	Financial Statements (unaudited)	F-1

	Condensed Interim Balance Sheets as of July 2, 2022 and January 1, 2022	F-1

	Condensed Interim Statements of Operations for the 13 and 26 weeks ended July 2, 2022 and July 3, 2021	F-2

	Condensed Interim Statements of Changes in Stockholders’ Equity for the 13 and 26 weeks ended July 2, 2022 and July 3, 2021	F-3

	Condensed Interim Statements of Cash Flows for the 26 weeks ended July 2, 2022 and July 3, 2021	F-4

	Notes to Condensed Interim Financial Statements	F-5

Item 2.	MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	4

Item 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	17

Item 4.	CONTROLS AND PROCEDURES	17

PART II	OTHER INFORMATION	18

Item 1.	LEGAL PROCEEDINGS	18

Item 1A.	RISK FACTORS	18

Item 2.	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	18

Item 3.	DEFAULTS UPON SENIOR SECURITIES	19

Item 4.	MINE SAFETY DISCLOSURES	19

Item 5.	OTHER INFORMATION	19

Item 6.	EXHIBITS	20

SIGNATURES		21

Cautionary Statement Regarding Forward-Looking Information

This Quarterly Report on Form 10-Q (this “Report”) contains forward-looking statements within the meaning of the federal securities laws, including the Private Securities Litigation Reform Act of 1995, regarding future events and the future results of Kidpik Corp. (the “Company”) that are based on current expectations, estimates, forecasts, and projections about the industry in which the Company operates and the beliefs and assumptions of the management of the Company. In some cases, you can identify forward-looking statements by the following words: “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “ongoing,” “plan,” “potential,” “predict,” “project,” “should,” or the negative of these terms or other comparable terminology, although not all forward-looking statements contain these words. Forward-looking statements are not a guarantee of future performance or results, and will not necessarily be accurate indications of the times at, or by, which such performance or results will be achieved. Forward-looking statements are based on information available at the time the statements are made and involve known and unknown risks, uncertainties and other factors that may cause our results, levels of activity, performance or achievements to be materially different from the information expressed or implied by the forward-looking statements in this Report. Factors that might cause or contribute to such differences include, but are not limited to, those discussed elsewhere in this Report, including under, or incorporated by reference into, “Risk Factors”, which factors include:

	●	our ability to obtain additional funding;

	●	the continuing effect of COVID-19 on our operations, sales, and market for our products;

	●	our ability to build and maintain our brand;

	●	cybersecurity, information systems and fraud risks and problems with our websites;

	●	our ability to expand and grow our operations, and successfully market our products and services;

	●	changes in, and our compliance with, rules and regulations affecting our operations, sales, the internet in general and/or our products;

	●	shipping, production or manufacturing delays and/or tariffs on our products;

	●	our ability to increase members and sales;

	●	regulations we are required to comply with in connection with our operations, manufacturing, labeling and shipping;

	●	competition from existing competitors or new competitors or products that may emerge;

	●	rising inflation and our ability to control our costs, including employee wages and benefits and other operating expenses;

	●	our dependency on third-party manufacturers to supply or manufacture our products;

	●	our business, including our costs and supply chain, which is subject to risks associated with inflation;

	●	our ability to establish or maintain vendor and supplier relations and/or relationships with third-parties;

	●	our ability and third parties’ abilities to protect intellectual property rights;

	●	our ability to adequately support future growth;

	●	our ability to attract and retain key personnel to manage our business effectively; and

	●	other risk factors included under “Risk Factors” below.

You should read the matters described in, and incorporated by reference in, “Risk Factors” and the other cautionary statements made in this Report, and incorporated by reference herein, as being applicable to all related forward-looking statements wherever they appear in this Report. We cannot assure you that the forward-looking statements in this Report will prove to be accurate and therefore prospective investors are encouraged not to place undue reliance on forward-looking statements. All forward-looking statements included herein speak only of the date of the filing of this Report. All subsequent written and oral forward-looking statements attributable to the Company, or persons acting on its behalf, are expressly qualified in their entirety by the cautionary statements above. Other than as required by law, we undertake no obligation to update or revise these forward-looking statements, even though our situation may change in the future.

Summary Risk Factors

Our business is subject to varying degrees of risk and uncertainty. Investors should consider the risks and uncertainties summarized below, as well as the risks and uncertainties discussed in Part II, Item 1A, “Risk Factors” of this Quarterly Report on Form 10-Q and Part I, Item 1A, “Risk Factors” of our Annual Report on Form 10-K for the year ended January 1, 2022, which was filed with the Securities and Exchange Commission on April 1, 2022 (the “2021 Annual Report”). Investors should also refer to the other information contained or incorporated by reference in this Quarterly Report on Form 10-Q, including our financial statements and related notes, and our other filings made from time to time with the Securities and Exchange Commission. Our business operations could also be affected by factors that we currently consider to be immaterial or that are unknown to us at the present time. If any of these risks occur, our business, financial condition, and results of operations could be materially and adversely affected, and the trading price of our common stock could decline or our common stock could become worthless:

	●	Our history of losses, our ability to achieve profitability, our potential need for additional funding and the availability and terms of such funding;

	●	Our ability to execute our growth strategy and scale our operations and risks associated with such growth, our ability to maintain current members and customers and grow our members and customers;

	●	Risks associated with the effect of the COVID-19 pandemic, and governmental responses thereto on our operations, those of our vendors, our customers and members and the economy in general;

	●	Risks associated with our supply chain and third-party service providers, interruptions in the supply of raw materials and merchandise, increased costs of raw materials, products and shipping costs due to inflation, disruptions at our warehouse facility and/or of our data or information services, issues affecting our shipping providers, and disruptions to the internet, any of which may have a material adverse effect on our operations;

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SEC Form 10-Q filed by Kidpik Corp.