sgrp20260630

sgrp20260630_10q.htm

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 first quarterly period ended June 30, 2026

☐ 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 0-27408

SPAR GROUP, INC.
(Exact name of Registrant as specified in its charter)

Delaware	33-0684451
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

110 East Boulevard, Suite 1600 Charlotte, North Carolina	28203
(Address of principal executive offices)	(Zip Code)

Registrant's telephone number, including area code: (704) 837-1651

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 during the preceding twelve 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.). (Check one):

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 ☒

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 $0.01 per share

SGRP

OTCQB

As of August 6, 2026, the Registrant had 28,398,560 shares of common stock, par value $0.01 per share, outstanding.

SPAR Group, Inc.

Index

PART I:	FINANCIAL INFORMATION

Item 1	Condensed Consolidated Financial Statements (Unaudited)

	Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) for the three and six months ended June 30, 2026 and 2025 (Unaudited)	2

	Condensed Consolidated Balance Sheets as of June 30, 2026 (Unaudited) and December 31, 2025	3

	Condensed Consolidated Statements of Stockholders’ Equity for the three and six months ended June 30, 2026 and 2025 (Unaudited)	4

	Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2026 and 2025 (Unaudited)	5

	Notes to Condensed Consolidated Financial Statements (Unaudited)	6

Item 2	Management's Discussion and Analysis of Financial Condition and Results of Operations	17

Item 3	Quantitative and Qualitative Disclosures about Market Risk	23

Item 4	Controls and Procedures	23

PART II:	OTHER INFORMATION

Item 1	Legal Proceedings	24

Item 1A	Risk Factors	24

Item 2	Unregistered Sales of Equity Securities and Use of Proceeds	24

Item 3	Defaults Upon Senior Securities	24

Item 4	Mine Safety Disclosures	25

Item 5	Other Information	25

Item 6	Exhibits	26

SIGNATURES		27

PART I:

FINANCIAL INFORMATION

Item 1.

Condensed Consolidated Financial Statements (Unaudited)

SPAR Group, Inc. and Subsidiaries

Condensed Consolidated Statements of Operations and Comprehensive Income (Loss)

(Unaudited)

(In thousands, except per share amounts)

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2026			2025			2026			2025
Net revenue	$	36,906		$	38,629		$	67,424		$	72,671
Cost of revenue		28,497			29,567			52,203			56,333
Gross profit		8,409			9,062			15,221			16,338

Operating expenses:
Selling, general and administrative expense		6,767			7,934			12,966			13,807
Restructuring costs and severance		-			-			245			-
Depreciation and amortization		433			413			843			780
Total operating expenses		7,200			8,347			14,054			14,587

Operating income		1,209			715			1,167			1,751

Interest expense, net		642			589			1,141			1,058
Other expense (income), net		46			7			30			(2	)
Income (loss) before income tax expense		521			119			(4	)		695
Provision for income taxes		112			120			140			234
Net income (loss)	$	409		$	(1	)	$	(144	)	$	461

Earnings (loss) per share:
Basic	$	0.02		$	(0.00	)	$	(0.01	)	$	0.02
Diluted	$	0.02		$	(0.00	)	$	(0.01	)	$	0.02

Weighted-average shares outstanding:
Basic		26,240			23,470			25,191			23,460
Diluted		26,242			23,499			25,191			23,532


Net income (loss)	$	409		$	(1	)	$	(144	)	$	461
Other comprehensive income (loss):
Foreign currency translation adjustments		(139	)		160			(149	)		71
Total comprehensive income (loss)	$	270		$	159		$	(293	)	$	532

See accompanying notes to the unaudited condensed consolidated financial statements.

SPAR Group, Inc. and Subsidiaries

Condensed Consolidated Balance Sheets

(Unaudited)

(In thousands, except share and per share data)

	*June 30, 2026*			*December 31, 2025*
Assets
Current assets:
Cash and cash equivalents	$	2,947		$	3,262
Accounts receivable, net		35,198			27,006
Prepaid expenses and other current assets		2,493			1,168
Total current assets		40,638			31,436

Property and equipment, net		4,070			3,601
Operating lease right-of-use assets, net		4,212			4,861
Goodwill		856			856
Intangible assets, net		642			709
Deferred income taxes		-			18
Other assets		2,546			2,578
Total Assets	$	52,964		$	44,059

Liabilities and Equity
Current liabilities:
Accounts payable	$	5,040		$	9,342
Accrued expenses and other current liabilities		6,046			5,576
Customer incentives and deposits		3,068			1,221
Lines of credit		26,723			20,442
Current portion of long-term debt		500			500
Current portion of operating lease liabilities		646			643
Total current liabilities		42,023			37,724

Operating lease liabilities, net of current portion		3,820			4,395
Deferred income taxes		24			34
Embedded derivative liability		287			-
Long-term debt, net of current portion		3,576			1,284
Total Liabilities		49,730			43,437

Commitments and contingencies – See Note 4

Equity
Common stock, $0.01 par value per share: 47,000,000 shares authorized as of June 30, 2026 and December 31, 2025; 28,398,560 and 24,129,991 shares issued and outstanding as of June 30, 2026 and December 31, 2025		284			241
Treasury stock, at cost, 554,485 and 632,485 shares as of June 30, 2026 and December 31, 2025		(907	)		(1,047	)
Additional paid-in capital		22,471			19,749
Accumulated other comprehensive loss		(1,303	)		(1,154	)
Retained deficit		(17,311	)		(17,167	)
Total Equity		3,234			622
Total Liabilities and Equity	$	52,964		$	44,059

See accompanying notes to the unaudited condensed consolidated financial statements.

SPAR Group, Inc. and Subsidiaries

Condensed Consolidated Statements of Stockholders’ Equity

(Unaudited)

(In thousands)

	*Common Stock*				*Treasury Stock*					*Additional Paid-In*		*Accumulated Other Comprehensive*			*Retained*			*Total Stockholders'*
	*Shares*		*Amount*		*Shares*		*Amount*			*Capital*		*Loss*			*Deficit*			*Equity*
Balance at January 1, 2026		24,129	$	241		632	$	(1,047	)	$	19,749	$	(1,154	)	$	(17,167	)	$	622
Other comprehensive loss		-		-		-		-			-		(10	)		-			(10	)
Net loss		-		-		-		-			-		-			(553	)