strn-20260630

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: 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: 001-41038

STRAN & COMPANY, INC.

(Exact name of registrant as specified in its charter)

Nevada		04-3297200
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

500 Victory Road, Suite 301, Quincy, MA		02171
(Address of principal executive offices)		(Zip Code)

800-833-3309

(Registrant’s telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report)

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 $0.0001 per share	SWAG	The Nasdaq Stock Market LLC
Warrants, each warrant exercisable for one share of Common Stock, at an exercise price of $4.81375	SWAGW	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 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 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 ☒

As of August 7, 2026, there were a total of 18,639,589 shares of the registrant’s common stock outstanding.

STRAN & COMPANY, INC.

Quarterly Report on Form 10-Q

Period Ended June 30, 2026

TABLE OF CONTENTS

PART I

FINANCIAL INFORMATION

		Page

Item 1.	Financial Statements	1
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	20
Item 3.	Quantitative and Qualitative Disclosure About Market Risk	34
Item 4.	Controls and Procedures	34

	PART II
	OTHER INFORMATION
Item 1.	Legal Proceedings	35
Item 1A.	Risk Factors	35
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	35
Item 3.	Defaults Upon Senior Securities	35
Item 4.	Mine Safety Disclosures	35
Item 5.	Other Information	35
Item 6.	Exhibits	36

PART I

FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS.

STRAN & COMPANY, INC.

UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

		Page

Condensed Consolidated Balance Sheets as of June 30, 2026 (unaudited) and December 31, 2025		2
Condensed Consolidated Statements of Operations for the Three and Six Months Ended June 30, 2026 and 2025 (unaudited)		3
Condensed Consolidated Statements of Comprehensive Income (Loss) for the Three and Six Months Ended June 30, 2026 and 2025 (unaudited)		4
Condensed Consolidated Statements of Stockholders’ Equity for the Three and Six Months Ended June 30, 2026 and 2025 (unaudited)		5
Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2026 and 2025 (unaudited)		6
Notes to the Unaudited Condensed Consolidated Financial Statements		8

STRAN & COMPANY, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except share and per share amounts)

	June 30, 2026			December 31, 2025
	(Unaudited)
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	7,408		$	6,753
Investments		5,191			4,872
Accounts receivable, net		20,274			17,252
Inventory		10,776			7,621
Prepaid corporate taxes		39			—
Prepaid expenses		2,510			1,778
Deposits		843			363
Other current assets		—			2
Total current assets		47,041			38,641

Property and equipment, net		1,615			1,944

OTHER ASSETS:
Intangible assets - customer lists, net		3,446			3,690
Intangible assets - trade name		654			654
Goodwill		2,321			2,321
Other assets		—			53
Right of use assets		1,773			2,045
Total other assets		8,194			8,763
Total assets	$	56,850		$	49,348

LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES:
Accounts payable and accrued expenses	$	11,205		$	8,568
Accrued payroll and related		2,238			1,970
Unearned revenue		6,081			3,201
Rewards program liability		3,000			1,500
Sales tax payable		350			327
Current portion of contingent earn-out liabilities		274			105
Current portion of installment payment liabilities		190			230
Current portion of vehicle loan		29			—
Current portion of lease liabilities		582			602
Total current liabilities		23,949			16,503

LONG-TERM LIABILITIES:
Long-term contingent earn-out liabilities		—			455
Long-term installment payment liabilities		—			147
Long-term lease liabilities		1,428			1,695
Long-term vehicle loan		5			47
Total long-term liabilities		1,433			2,344
Total liabilities		25,382			18,847

Commitments and contingencies (Note F)

STOCKHOLDERS’ EQUITY:
Preferred stock, $0.0001 par value; 50,000,000 shares authorized, 0 shares issued and outstanding as of June 30, 2026 and December 31, 2025, respectively		—			—
Common stock, $0.0001 par value; 300,000,000 shares authorized, 18,639,589 and 18,508,157 shares issued and outstanding as of June 30, 2026 and December 31, 2025, respectively		2			2
Additional paid-in capital		37,847			37,925
Accumulated deficit		(6,436	)		(7,489	)
Accumulated other comprehensive income		55			63
Total stockholders’ equity		31,468			30,501
Total liabilities and stockholders’ equity	$	56,850		$	49,348

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

STRAN & COMPANY, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

three and six months ended June 30, 2026 and 2025

(in thousands, except share and per share amounts)

(unaudited)

	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2026		2025		2026		2025
Sales	$	33,358	$	32,577	$	64,607	$	61,271

Cost of sales		23,336		22,708		44,942		42,920

GROSS PROFIT		10,022		9,869		19,665		18,351

OPERATING EXPENSES:
General and administrative expenses		9,936		9,474		18,934		18,491
Total operating expenses		9,936		9,474		18,934		18,491

INCOME (LOSS) FROM OPERATIONS		86		395		731		(140	)

OTHER INCOME:
Other income (expense), net		165		285		243		280
Interest income		67		77		134		119
Realized gain on investments		10		—		10		67
Total other income		242		362		387		466

INCOME BEFORE INCOME TAXES		328		757		1,118		326

Provision for income taxes		19		114		65		76

NET INCOME	$	309	$	643	$	1,053	$	250

NET INCOME PER COMMON SHARE
Basic	$	0.02	$	0.03	$	0.06	$	0.01
Diluted	$	0.02	$	0.03	$	0.06	$	0.01

WEIGHTED-AVERAGE COMMON SHARES OUTSTANDING
Basic		18,725,024		18,592,339		18,679,433		18,600,373
Diluted		18,756,935		18,596,826		18,713,633		18,603,432

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

STRAN & COMPANY, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

three and six months ended June 30, 2026 and 2025

(in thousands)

(unaudited)

	For the Three Months Ended June 30,					For the Six Months Ended June 30,
	2026			2025		2026			2025
Net income	$	309		$	643	$	1,053		$	250

Other comprehensive income (loss):
Reclassification of investment gains to net income		(8	)		—		(8	)		—
Unrealized (loss) gain on investment, net of tax		2			33		—			48
Total other comprehensive income (loss)		(6	)		33		(8	)		48

Comprehensive income	$	303		$	676	$	1,045		$	298

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

STRAN & COMPANY, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

three and six months ended June 30, 2026 and 2025

(in thousands, except share amounts)

(unaudited)

													Accumulated
	Preferred Stock				Common Stock					Additional Paid-in			Other Comprehensive			Accumulated			Stockholders’
	Shares		Value		Shares			Value		Capital			Income (Loss)			Deficit			Equity
Balance, January 1, 2026		—	$	—		18,508,157		$	2	$	37,925		$	63		$	(7,489	)		30,501
Issuance of restricted stock awards		—		—		262,000			—		—			—			—			—
Stock-based compensation		—		—		—			—		159			—			—			159
Other comprehensive loss		—		—		—			—		—			(2	)		—			(2	)
Net income		—		—		—			—		—			—			744			744
Balance, March 31, 2026		—	$	—		18,770,157		$	2	$	38,084		$	61		$	(6,745	)	$	31,402
Stock-based compensation		—		—		—			—		35			—			—			35
Repurchase and retirement of ordinary shares		—		—		(130,568	)		—		(272	)		—			—			(272	)
Other comprehensive loss		—		—		—			—		—			(6	)		—			(6	)
Net income		—		—		—			—		—			—			309			309
Balance, June 30, 2026		—	$	—		18,639,589		$	2	$	37,847		$	55		$	(6,436	)	$	31,468

													Accumulated
	Preferred Stock				Common Stock					Additional Paid-in			Other Comprehensive			Accumulated			Stockholders’
	Shares		Value		Shares			Value		Capital			Income (Loss)			Deficit			Equity
Balance, January 1, 2025		—	$	—		18,598,574		$	2	$	38,391		$	(10	)	$	(6,742	)	$	31,641
Stock-based compensation		—		—		9,833			—		9			—			—			9
Other comprehensive income		—		—		—			—		—			15			—			15
Net loss		—		—		—			—		—			—			(393	)		(393	)
Balance, March 31, 2025		—	$	—		18,608,407		$	2	$	38,400		$	5		$	(7,135	)	$	31,272
Issuance of restricted stock awards		—		—		48,347			—		—			—			—			—
Stock-based compensation		—		—		—			—		31			—			—			31
Repurchase and retirement of ordinary shares		—		—		(110,293	)		—		(146	)		—			—			(146	)
Other comprehensive income		—		—		—			—		—			33			—			33
Net income		—		—		—			—		—			—			643			643
Balance, June 30, 2025		—	$	—		18,546,461		$	2	$	38,285		$	38		$	(6,492	)	$	31,833

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

STRAN & COMPANY, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

six months ended June 30, 2026 and 2025

(in thousands)

(unaudited)

	2026			2025
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	1,053		$	250
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		585			521
Noncash operating lease expense		332			537
Noncash earnout liability adjustmentz		(200	)		—
Provision for credit losses		159			598
Noncash interest accretion		13			23
Stock-based compensation		194			40
Realized gain on short-term investment		(10	)		—

Changes in operating assets and liabilities:
Accounts receivable, net		(3,181	)		(4,569	)
Accounts receivable – related parties, net		—			172
Inventory		(3,155	)		(1,347	)
Prepaid corporate taxes		(39	)		29
Prepaid expenses		(732	)		(82	)
Deposits		(480	)		(44	)
Other assets		55			252
Accounts payable and accrued expenses		2,637			590
Accrued payroll and related		269			531
Unearned revenue		2,880			395
Rewards program liability		1,500			3,000
Sales tax payable		22			(38	)
Corporate taxes payable		—			9
Operating lease liabilities		(347	)		(333	)
Net cash provided by operating activities		1,555			534

CASH FLOWS FROM INVESTING ACTIVITIES:
Additions to property and equipment		(21	)		(202	)
Proceeds from sale of investments		600			4,400
Purchase of investments		(918	)		(493	)
Net cash (used in) provided by investing activities		(339	)		3,705

CASH FLOWS FROM FINANCING ACTIVITIES:
Payment of contingent earn-out liabilities		(86	)		(151	)
Payment of installment payment liabilities		(200	)		(230	)
Payment for stock repurchase		(272	)		(146	)
Repayment of vehicle loan		(3	)		—
Net cash used in financing activities		(561	)		(527	)

NET CHANGE IN CASH AND CASH EQUIVALENTS		655			3,712

CASH AND CASH EQUIVALENTS - BEGINNING		6,753			9,358
CASH AND CASH EQUIVALENTS - ENDING	$	7,408		$	13,070

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

STRAN & COMPANY, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

six months ended June 30, 2026 and 2025

(CONTINUED)

(in thousands)

(unaudited)

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION

	2026		2025
Cash paid during the period for:
Interest	$	2	$	24
Income taxes	$	61	$	67

Noncash investing and financing activities:
Right of use assets obtained in exchange for lease liabilities	$	—	$	2,077

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

STRAN & COMPANY, INC.

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(in thousands, except share and per share amounts)

DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION:

Description of Business

Stran & Company, Inc. was incorporated under the laws of the Commonwealth of Massachusetts and commenced operations on November 17, 1995. The Company re-incorporated under the laws of the State of Nevada on May 24, 2021.

On August 23, 2024, Stran Loyalty Solutions, LLC, a Nevada limited liability company (the “Purchaser” or “Stran Loyalty Solutions”), a wholly-owned subsidiary of the Company, entered into a Secured Party Sale Agreement, dated as of August 23, 2024 (the “Sale Agreement”), between Stran Loyalty Solutions and Sallyport Commercial Finance, LLC, a Delaware limited liability company (“Secured Party”), pursuant to which Stran Loyalty Solutions agreed to purchase, on an as-is basis, all of the rights and interests of Gander Group, in and to substantially all of the assets of Gander Group (the “Gander Group Assets”) from Secured Party as a private sale pursuant to Article 9 of the Uniform Commercial Code (the “Gander Group Transaction”).

The Gander Group Transaction was treated as a business combination in accordance with Accounting Standards Codification (“ASC”) 805, Business Combinations. Stran Loyalty Solutions is a wholly owned subsidiary of the Company and Gander Group Louisiana, LLC is a wholly owned subsidiary of Stran Loyalty Solutions.

Unless otherwise stated in this Quarterly Report on Form 10-Q, references to “we”, “our”, or the “Company” refer to Stran & Company, Inc. The Company is headquartered in Quincy, Massachusetts.

The Company is an outsourced marketing solutions provider that sells branded products to customers. The Company purchases products and branding through various third-party manufacturers and decorators and resells the finished goods to customers.

In addition to selling branded products, the Company offers clients custom sourcing capabilities; a flexible and customizable e-commerce solution for promoting branded merchandise and other promotional products, managing promotional loyalty and incentives, print collateral, and event assets, order and inventory management, and designing and hosting online retail popup shops, fixed public retail online stores, and online business-to-business service offerings; creative and merchandising services; warehousing/fulfillment and distribution; print-on-demand; kitting; point of sale displays; and loyalty and incentive programs.

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements as of and for the three and six months ended June 30, 2026, include the accounts of the Company and have been prepared by the Company, without audit in accordance with accounting principles generally accepted in the United States of America for interim financial information and in accordance with the instructions to Form 10-Q. Accordingly, they do not include all of the information and note disclosures required by accounting principles generally accepted in the United States (“U.S. GAAP”) for complete audited financial statements. These unaudited condensed consolidated financial statements should be read in conjunction with the audited financial statements and the notes thereto included in our Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 25, 2026.

In our opinion, all adjustments (consisting solely of normal recurring adjustments) necessary to state fairly the information in the following unaudited condensed consolidated financial statements of the Company have been included. The results of operations for interim periods are not necessarily indicative of the results for the full year or for any future period.

Principles of Consolidation

The Company’s unaudited condensed consolidated financial statements include the accounts of its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation.

STRAN & COMPANY, INC.

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(in thousands, except share and per share amounts)

Use of Estimates

The Company prepares its unaudited condensed consolidated financial statements in accordance with U.S. GAAP, which requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements, and revenue and expenses during the reporting period. Actual results could differ from those estimates.

Reclassification

Certain prior period amounts reported in the Company’s unaudited condensed consolidated statement of cash flows and segment disclosures have been reclassified to conform to the Company’s current period presentation. These reclassifications have no impact on the Company’s previously reported results of operations or cash flows.

Recent Accounting Pronouncements - Adopted:

ASU 2025-05 – Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets

In July 2025, the FASB issued ASU 2025-05, which provides all entities with a practical expedient for use in developing reasonable and supportable forecasts as part of estimating expected credit losses, upon which an entity may assume that current conditions as of the balance sheet date do not change for the remaining life of the asset. The update must be applied prospectively. ASU 2025-05 is effective for fiscal years beginning after December 15, 2025 and interim periods within those annual reporting periods, with prospective application. The Company adopted the standard on January 1, 2026. Its adoption did not have a material impact on the Company’s unaudited condensed consolidated financial statements.

Recent Accounting Pronouncements - Not Yet Adopted:

ASU 2024-03 - Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses

In November 2024, the FASB issued ASU 2024-03, which requires the disaggregation, in the notes to the financial statements, of certain cost and expense captions presented on the face of the Company’s statements of operations, to provide enhanced transparency to investors. The update may be applied either prospectively or retrospectively. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026 and interim periods within fiscal years beginning after December 15, 2027. Early adoption is permitted. The Company is currently evaluating the impact of adoption of this ASU on its disclosures.

ASU 2025-06 - Intangibles - Goodwill and Other-Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software

In September 2025, the FASB issued ASU 2025-06, which is intended to improve the operability and application of guidance related to capitalized software development costs. ASU 2025-06 is effective for fiscal years beginning after December 15, 2027. Early adoption is permitted. ASU 2025-05 permits an entity to apply the new guidance under either a prospective transition approach, a modified transition approach, or a retrospective approach. The Company is currently evaluating the impact of adoption of this ASU on its disclosures.

ASU 2025-11 - Interim Reporting (Topic 290): Narrow-Scope Improvements

In December 2025, the FASB issued ASU 2025-11, which further clarifies certain interim disclosure requirements. ASU 2025-11 is effective for interim reporting periods within annual reporting periods beginning after December 31, 2027. Early adoption is permitted and adoption can be applied either on a prospective or retrospective approach. The Company is currently evaluating the impact of adoption of this ASU on its disclosures.

No other new accounting pronouncements adopted or issued had or are expected to have a material impact on the unaudited condensed consolidated financial statements.

STRAN & COMPANY, INC.

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(in thousands, except share and per share amounts)

FAIR VALUE MEASUREMENTS:

Fair value measurements discussed herein are based upon certain market assumptions and pertinent information available to management as of June 30, 2026 and December 31, 2025.

Fair Value on a Recurring Basis

The Company follows the guidance in ASC 820, Fair Value Measurement, for its financial assets and liabilities that are re-measured and reported at fair value at each reporting period. The estimated fair value of the Company’s investments and money market accounts represent Level 1 measurements. The estimated fair value of the earn-out liabilities represents Level 3 measurements. There were no transfers between levels within the fair value measurement hierarchy during the three and six months ended June 30, 2026. The following table presents information about the Company’s assets and liabilities that are measured at fair value on a recurring basis as of June 30, 2026 and December 31, 2025, and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value:

Description	Level		June 30, 2026		December 31, 2025
Assets:
Investments		1	$	5,191	$	4,872

Liabilities:
Earn-out liabilities		3	$	274	$	560

Investments

The Company’s investments consisted of the following as of June 30, 2026:

	Cost		Unrealized Gain (Loss)		Fair Value
Money market fund	$	1,814	$	—	$	1,814
Corporate bonds		1,179		14		1,193
Mutual funds		2,184		—		2,184
	$	5,177	$	14	$	5,191

The Company’s investments consisted of the following as of December 31, 2025:

	Cost		Unrealized Gain (Loss)		Fair Value
Money market fund	$	1,788	$	—	$	1,788
Corporate bonds		1,768		25		1,793
Mutual funds		1,291		—		1,291
	$	4,847	$	25	$	4,872

STRAN & COMPANY, INC.

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(in thousands, except share and per share amounts)

Earn-Out Liabilities

In connection with certain of the Company’s asset acquisitions, certain earn-out liabilities were established which reflect the estimated amounts payable upon the achievement of sales from acquired intangible assets over a period of time following the acquisition. As of June 30, 2026, the Company has earn-out liabilities associated with its purchase of Trend Brand Solutions and T.R. Miller Co.

Assumptions used in determining the fair value of the earn-out liabilities include the acquired asset’s projected gross profit, discount rates, remaining time intervals and residual earn-out percentages. The following table summarizes the key unobservable inputs into the models used to estimate the fair value of the earn-out liabilities at June 30, 2026:

Unobservable Inputs	June 30, 2026
Projected annual gross profit		$392 - $4,398
Earnout percentage		40% - 45	%
Expected volatility		25	%
Risk-free rate		3.6% - 4.3	%
Discount rate		5.0% - 5.2	%
Required Metric Risk Premium		5.3% - 7.7	%
Time period to settlement		0.4 - 1.4 years

A reconciliation of the earn-out liabilities is included below:

Balance as of December 31, 2025	$	560
Payments earned and paid		(86	)
Release of liabilities not earned or paid		(200	)
Balance as of June 30, 2026	$	274

Current portion of contingent earn-out liabilities	$	274
Long-term contingent earn-out liabilities	$	—

INVENTORY:

Inventory consists of the following:

	June 30, 2026		December 31, 2025
Finished goods (branded products)	$	10,650	$	7,278
Goods in process (un-branded products)		126		343
	$	10,776	$	7,621

STRAN & COMPANY, INC.

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(in thousands, except share and per share amounts)

D.	INSTALLMENT PAYMENT LIABILITIES:

The installment payment liabilities incurred in connection with certain of the Company’s asset acquisitions were initially measured at fair value on the date of acquisition by discounting the contractually agreed upon payments using the Bloomberg B+ corporate yield curve as of the valuation date, applying rates commensurate with the term to payment. The credit rating was determined utilizing Bloomberg’s default risk function for the Company as of the respective acquisition valuation dates. The installment payment amounts and payment dates were based on the purchase agreements and the discount rates utilized at the date of the Company’s asset acquisition.

A reconciliation of the installment payment liabilities is included below:

Balance as of December 31, 2025	$	377
Interest accretion		13
Payments made		(200	)
Balance as of June 30, 2026	$	190

Current portion of installment payment liabilities	$	190
Long-term installment payment liabilities	$	—

REVENUE:

Revenue disaggregated according to the timing of transfer of goods or services (e.g., at a point in time) was as follows:

	Three Months Ended June 30,				Six Months Ended June 30,
Revenue generated per major product category	2026		2025		2026		2025
Promotional products - dropshipping	$	13,660	$	11,953	$	23,299	$	21,138
Promotional products – bulk dropshipping		2,550		3,584		9,775		9,915
Promotional products – Company owned inventory		4,672		4,296		8,252		7,190
Casino continuity program		10,096		10,197		17,899		17,565
Promotional products – third-party distributor		1,861		2,102		4,316		4,697
Rewards program		266		365		582		590
Additional services		253		80		484		176
	$	33,358	$	32,577	$	64,607	$	61,271

Unearned revenue includes customer deposits and deferred revenue which represent prepayments from customers. The Company had unearned revenue as follows:

	June 30, 2026			June 30, 2025
Balance at January 1,	$	3,201		$	4,423
Revenue recognized		(5,503	)		(4,920	)
Amounts collected not invoiced		8,383			5,314
Balance at June 30,	$	6,081		$	4,817

For the six months ended June 30, 2026 and 2025, the Company recognized $2,418 and $2,832 associated with unearned revenue balances outstanding at December 31, 2025 and 2024, respectively.

STRAN & COMPANY, INC.

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(in thousands, except share and per share amounts)

F.	COMMITMENTS AND CONTINGENCIES:

Legal Proceedings

The Company may from time to time become involved in various legal actions incidental to our business. As of the date of this report, the Company is not involved in any legal proceedings that it believes could have a material adverse effect on its financial position or results of operations. However, the outcome of any current or future legal proceeding is inherently difficult to predict and any dispute resolved unfavorably could have a material adverse effect on the Company’s business, financial position, and operating results.

G.	STOCKHOLDERS’ EQUITY:

Stock Repurchase Program

On February 21, 2022, the board of directors of the Company authorized a repurchase of up to $10,000 of the Company’s shares from time to pursuant to a stock repurchase program. Under the terms of the repurchase program, the Company may repurchase shares through open market or negotiated private transactions. The timing and extent of any purchases depend upon ongoing assessments of the Company’s capital needs, market conditions and the price of the Company’s common stock, and other corporate considerations, as determined by management, and are subject to the restrictions relating to volume, price and timing under applicable laws, including but not limited to, Rule 10b-18 promulgated under the Exchange Act. On June 30, 2025, the Company adopted broker repurchase instructions pursuant to Rule 10b-18 and Rule 10b5-1 promulgated pursuant to the Exchange Act. Each of the above broker repurchase instructions was adopted in accordance with the restrictions that would apply to the Company if it were subject to the Stran & Company, Inc. Second Amended and Restated Insider Trading Policy (the “Insider Trading Policy”), which generally permits insider purchases of the Company’s stock during the period beginning on the second business day following the day of public release of the Company’s quarterly or annual earnings and ending on the last day of the then-current quarter; repurchases pursuant to a plan that meets the requirements of Rule 10b5-1; or that meet certain other requirements.

The Company did not repurchase any shares during the three months ended March 31, 2026 or March 31, 2025. During the three months ended June 30, 2025, the Company repurchased 110,293 shares at an average price of $1.33.

The following table provides information about stock repurchases during the period April 1, 2026 to June 30, 2026.

Period	Total Number of Shares Purchased		Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs		Maximum Approximate Dollar Value of Shares that May Yet be Purchased Under the Plans or Programs
April 1, 2026 – April 30, 2026		—	$	—		2,192,667	$	6,064
May 1, 2026 - May 31, 2026		80,236	$	1.98		2,272,903	$	5,905
June 1, 2026 - June 30, 2026		50,332	$	2.02		2,323,235	$	5,803

STOCK-BASED COMPENSATION:

In November 2021, the board of directors adopted the Amended and Restated 2021 Equity Incentive Plan (the “2021 Plan”) which provides for the granting of non-qualified stock options and restricted stock to the Company’s employees, officers, directors, and outside consultants to purchase shares of the Company’s common stock. As of June 30, 2026, the number of shares of common stock available for issuance under the 2021 Plan is 570,596 shares of common stock.

Stock-based compensation expense included the following components:

	Three Months Ended June 30,				Six Months Ended June 30,
	2026		2025		2026		2025
Stock options	$	13	$	2	$	57	$	10
Restricted stock		22		29		137		30
	$	35	$	31		194		40

All stock-based compensation expense is recorded in general and administrative expense in the unaudited condensed consolidated statements of operations.

STRAN & COMPANY, INC.

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(in thousands, except share and per share amounts)

Stock Options

The fair value of options is estimated on the date of grant using the Black-Scholes option pricing model. The fair value is amortized as compensation cost on a straight-line basis over the requisite service period of the awards, which is generally the vesting period. Expected volatility is estimated based on the Company’s historical stock price volatility, and for periods prior to January 1, 2026 the expected volatility was based on historical volatility from a representative sample of publicly traded companies. The expected term represents the period of time that the options are expected to be outstanding. The risk-free interest rate is estimated using the rate of return on U.S. Treasury Notes with a life that approximates the expected life of the option. Stock-based compensation is based on awards that are ultimately expected to vest.

Option awards are generally granted with an exercise price equal to the fair value of the Company’s stock at the date of grant; those options generally vest based on four years of continuous service and have 10-year contractual terms.

A summary of option activity under the 2021 Plan as of and for the six months ended June 30, 2026 is presented below:

	Shares			Weighted Average Exercise Price		Aggregate Intrinsic Value
Outstanding at December 31, 2025		1,394,500		$	3.89	$	—
Granted		61,450			1.65		—
Forfeited or expired and other adjustments		(12,334	)		2.47		—
Outstanding at June 30, 2026		1,443,616		$	3.81	$	142
Vested and exercisable at June 30, 2026		1,416,616		$	3.84	$	128

The weighted-average grant date fair value of options granted during the six months ended June 30, 2026 was $1.05. The grant date fair value of the options was determined utilizing the Black-Scholes model with the following assumptions at the date of issuance: Company stock price of $1.65 on date of grant, a 6.0 year expected life, volatility of 67.4%, a risk-free rate of 3.73% and an expected dividend yield of 0%. The weighted-average remaining contractual term for the options outstanding and exercisable is approximately 6.0 years and 5.7 years, respectively, as of June 30, 2026. As of June 30, 2026, the Company had $28 in unrecognized compensation related to non-vested options to be recognized over the remaining weighted average vesting period of 2.6 years.

Restricted Stock

Restricted stock consists of grants of shares the Company’s common stock, subject to time-based or performance-based vesting requirements. Shares of restricted stock granted under the 2021 Plan with time-based vesting requirements generally vest based on continued services. Shares of restricted stock with performance-based vesting requirements typically vest immediately as various performance goals and targets are achieved. Grants of restricted stock are recognized as issued and outstanding shares of the Company’s common stock, subject to forfeiture in the event the vesting requirements are not met.

A summary of restricted stock activity under the 2021 Plan as of and for the six months ended June 30, 2026 is presented below:

	Time-Based Restricted Stock
Outstanding (unvested) at December 31, 2025		238,627
Granted		262,000
Vested		(73,627	)
Forfeited		—
Outstanding (unvested) at June 30, 2026		427,000

As of June 30, 2026, the Company had $702 in unrecognized compensation related to non-vested restricted stock to be recognized over the remaining weighted average vesting period of 2.41 years.

STRAN & COMPANY, INC.

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(in thousands, except share and per share amounts)

INCOME PER SHARE:

Basic net income per share is computed by dividing net income by the weighted average number of shares of common stock outstanding during the period. The computation of diluted net income per share is similar to the computation of basic net income per share, except that diluted net income per share includes the assumed exercise of dilutive warrants and stock options, using the treasury stock method unless the effect is anti-dilutive. The treasury stock method assumes that proceeds received from the exercise of stock options and warrants, as well as the average unrecognized stock compensation expense for the stock options, would be used to purchase the Company’s common stock at the average market price during the period.

The following tables set forth the computation of basic and diluted net income per share of common stock for the three and six months ended June 30, 2026:

	Three Months Ended June 30, 2026		Six Months Ended June 30, 2026
Basic net income per common share:
Numerator:
Net income	$	309	$	1,053
Denominator:
Weighted average number of shares of common stock outstanding		18,725,024		18,679,433
Basic net income per common share	$	0.02	$	0.06

Diluted net income per common share:
Numerator:
Net income	$	309	$	1,053
Denominator:
Number of shares used in basic computation		18,725,024		18,679,433
Add: effect of dilutive securities:
Warrants		—		—
Stock options		31,911		34,200
Weighted average number of shares of common stock outstanding used to calculate diluted income per share		18,756,935		18,713,633
Diluted net income per common share	$	0.02	$	0.06

The following tables set forth the computation of basic and diluted net income per share of common stock for the three and six months ended June 30, 2025:

	Three Months Ended June 30, 2025		Six Months Ended June 30, 2025
Basic net income per common share:
Numerator:
Net income	$	643	$	250
Denominator:
Weighted average number of shares of common stock outstanding		18,592,339		18,600,373
Basic net income per common share	$	0.03	$	0.01

Diluted net income per common share:
Numerator:
Net income	$	643	$	250
Denominator:
Number of shares used in basic computation		18,592,339		18,600,373
Add: effect of dilutive securities:
Warrants		—		—
Stock options		4,487		3,059
Weighted average number of shares of common stock outstanding used to calculate diluted income per share		18,596,826		18,603,432
Diluted net income per common share	$	0.03	$	0.01

STRAN & COMPANY, INC.

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(in thousands, except share and per share amounts)

The following table summarizes the outstanding shares of potentially dilutive securities that were excluded from the computation of diluted net income (loss) per share for the periods presented because their inclusion would have been anti-dilutive.

	For the Three Months Ended June 30, 2026		For the Six Months Ended June 30, 2026		For the Three Months Ended June 30, 2025		For the Six Months Ended June 30, 2025
Warrants		10,074,195		10,074,195		10,074,195		10,074,195
Stock options		1,263,166		1,263,166		1,256,680		1,258,108
		11,337,361		11,337,361		11,330,875		11,332,303

INCOME TAXES:

The Company calculates its interim income tax provision in accordance with the accounting guidance for income taxes in interim periods. At the end of each interim period, the Company makes its best estimate of the annual expected effective tax rate and applies that rate to its ordinary year-to-date income or loss. The income tax provision or benefit related to significant, unusual, or extraordinary items that will be separately reported or reported net of their related tax effect are individually computed and recognized in the interim period in which those items occur.

The computation of the annual expected effective tax rate at each interim period requires certain estimates and assumptions including, but not limited to, the expected operating income for the year and permanent and temporary differences. The accounting estimates used to compute the provision for income taxes may change as new events occur, additional information is obtained or the tax environment changes.

The Company recorded an income tax provision of approximately $19 thousand and $114 thousand in the unaudited condensed consolidated statement of operations for the three months ended June 30, 2026 and 2025, respectively. The Company recorded an income tax provision of approximately $65 thousand and $76 thousand in the unaudited condensed consolidated statement of operations for the six months ended June 30, 2026 and 2025, respectively.

As of year-end 2025, the Company had federal and state net operating losses (“NOL”) of approximately $5,900 and $5,100, respectively. The federal NOLs generated will carryforward indefinitely, but are subject to 80% deduction limitations based upon pre-NOL deduction taxable income. Generally, state NOLs will begin to expire in 2026. In accordance with Section 382 of the U.S. Internal Revenue Code, the usage of the Company’s NOL carryforwards may be subject to annual limitations to the extent that greater than 50% ownership changes have occurred. Tax returns for the years ended 2023 through 2025 are subject to review by tax authorities.

The Company’s effective tax rate for the three months ended June 30, 2026 and 2025 was 5.9% and 15.1%, respectively. The Company’s effective tax rate for the six months ended June 30, 2026 and 2025 was 5.8% and 23.3%, respectively. The decrease in the effective tax rate for the six months ended June 30, 2026 compared to the six months ended June 30, 2025 is primarily due to the change in the impact of permanent items and uncertain tax positions. Additionally, the Company’s annual effective tax rate compared to the statutory tax rate has been impacted by a partial release of a valuation allowance due to the projected taxable income and net operating loss utilization. The Company has recognized a full valuation allowance on its gross deferred tax assets less its deferred tax liabilities.

STRAN & COMPANY, INC.

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(in thousands, except share and per share amounts)

SEGMENTS:

There is no expense or asset information that is supplemental to information disclosed within the consolidated financial statements that is regularly provided to the CODM (the Company’s Chief Executive Officer) to monitor and evaluate segment performance.

The Company’s segments are Stran & Company, Inc. (“Stran”) and Stran Loyalty Solutions, LLC (“SLS”). Our reportable segments are described below.

The Stran segment’s business is focused on being an outsourced marketing solutions and promotional products provider for a variety of customers and industries, working closely with customers to develop sophisticated marketing programs that leverage Stran’s promotional products and loyalty incentive expertise. Stran purchases products and branding through various third-party manufacturers and decorators and resells the finished goods to customers. The segment earns the majority of its revenue from the sale of unique, quality promotional products for a wide variety of industries primarily to support marketing efforts.

The SLS segment’s business is focused on the casino, gaming, and entertainment industries as an extension of the Company’s newly formed Casino Continuity and Loyalty group. The group specializes in creating high-quality, branded merchandise for casinos, sourced through various third-party manufacturers, focusing on promotional products that enhance customer loyalty and engagement. It partners with nationally recognized brands to create high-quality, custom products that resonate with casino patrons, helping casinos drive redemption rates and return on investment through tailored merchandise and marketing solutions to build recurring revenues for SLS customers and the segment itself.

For each of the two segments, the CODM uses segment gross margin and segment operating profits or losses in the annual budgeting and forecasting process. The CODM considers budget-to-actual variances on a monthly basis for revenue as well as profit measures when making decisions about allocating capital and personnel to the segments. The CODM uses segment gross margin and segment operating income in determining the compensation of certain employees. Certain expenses related to corporate functions are excluded from these measures at the segment level, but are reflected as a reconciliation to income (loss) from operations as reported in the consolidated financial statements (see table below). Expenses related to corporate functions that are not specifically attributable to an individual reportable segment are presented within ‘Other’ in the table below.

As of June 30, 2026, Stran and SLS had total assets of $42,306 and $14,562, respectively. As of December 31, 2025, Stran and SLS had total assets of $39,084 and $10,264, respectively. The entire goodwill balance of $2,321 as of June 30, 2026 and December 31, 2025, was allocated to the SLS segment.

Revenue and costs are directly attributed to our segments, and the revenues recognized as well as the costs incurred in generating those revenues within each segment are distinguishable based on the information systems in which each segment’s financial information gets recorded. The CODM reviews operating expense information to monitor segment performance. For the Stran segment, operating expenses are reviewed primarily on an aggregated basis through monthly operating reports and quarterly operating reviews and include payroll and employee-related costs, marketing and selling expenses, general and administrative expenses, professional fees, technology and systems costs, and facilities and occupancy costs. For the SLS segment, the CODM reviews standalone financial statements for the subsidiary, including detailed operating expenses recorded in the subsidiary’s general ledger, consisting primarily of payroll and employee-related costs, marketing and sales expenses, professional fees, technology costs, and other general and administrative expenses. These expense categories are considered together with revenue and profitability measures when assessing segment performance and allocating resources. There are no intersegment revenues or other transactions between the two segments that are eliminated in consolidation by the Company for external reporting.

The tables below present information about reported segments for the three and six months ended June 30, 2026 and 2025.

	For the Three Months Ended
	June 30, 2026									June 30, 2025
	Stran		SLS		Other			Total		Stran		SLS		Other			Total
Sales	$	23,262	$	10,096	$	-		$	33,358	$	21,765	$	10,812	$	-		$	32,577
Gross profit	$	7,570	$	2,452	$	-		$	10,022	$	7,594	$	2,275	$	-		$	9,869
Operating income	$	638	$	443	$	(995	)	$	86	$	1,055	$	229	$	(889	)	$	395

STRAN & COMPANY, INC.

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(in thousands, except share and per share amounts)

	For the Six Months Ended
	June 30, 2026									June 30, 2025
	Stran		SLS		Other			Total		Stran		SLS			Other			Total
Sales	$	46,690	$	17,917	$	-		$	64,607	$	42,700	$	18,571		$	-		$	61,271
Gross profit	$	14,967	$	4,698	$	-		$	19,665	$	14,385	$	3,966		$	-		$	18,351
Operating income (loss)	$	1,807	$	975	$	(2,051	)	$	731	$	2,216	$	(233	)	$	(2,123	)	$	(140	)

CREDIT LOSSES:

The Company is exposed to credit losses primarily through sales of products and services. The Company’s expected loss allowance methodology for accounts receivable is developed using historical collection experience, current and future economic and market conditions and a review of the current status of customers’ trade accounts receivable. Customers are pooled based on sharing specific risk factors. Due to the short-term nature of such receivables, the estimated accounts receivable that may not be collected is based on aging of the accounts receivable balances.

Customers are assessed for credit worthiness upfront through a credit review, which includes assessment based on the Company’s analysis of their financial statements when a credit rating is not available. The Company evaluates contract terms and conditions, country and political risk, and may require prepayment to mitigate risk of loss. Specific allowance amounts are established to record the appropriate provision for customers that have a higher probability of default. The Company monitors changes to the receivables balance on a timely basis, and balances are written off as they are determined to be uncollectible after all collection efforts have been exhausted. Estimates of potential credit losses are used to determine the allowance. It is based on assessment of anticipated payment and all other historical, current and future information that is reasonably available.

For the three and six months ended June 30, 2026, the Company had no major customer to which sales accounted for more than 10% of the Company’s revenues. The Company had accounts receivable from one customer amounting to 16.1% of the total accounts receivable balance as of June 30, 2026.

For the three and six months ended June 30, 2025, the Company had no major customers to which sales accounted for more than 10% of the Company’s revenues. The Company had accounts receivable from one customer amounting to 16.7% of the total accounts receivable balance.

The accounts receivable balance from all sources on the Company’s consolidated balance sheets as of June 30, 2026 was $20,274, net of $1,336 (inclusive of $829 for related party receivables) of allowances. The following table provides a roll-forward of the allowance for credit losses for the six months ended June 30, 2026 and 2025 that is deducted from the amortized cost basis of accounts receivable to present the net amount expected to be collected:

	June 30, 2026			June 30, 2025
Balance of allowance for credit losses, beginning of year	$	(1,378	)	$	(791	)
Write off charged against the allowance		201			238
Net increase in allowance estimate		(159	)		(598	)
Balance of allowance for credit losses, end of period	$	(1,336	)	$	(1,151	)

Accounts receivable at June 30, 2026 and December 31, 2025, includes allowance for credit losses of $1,336 and $1,378 (inclusive of $829 and $829 for related party receivables), respectively. Accounts receivable at December 31, 2024 was $18,665 (inclusive of $573 for related party receivables and net of an allowance for credit losses of $464).

	June 30, 2026			December 31, 2025
Trade accounts receivable	$	20,781		$	17,801
Less: allowance for credit losses on accounts receivable		(507	)		(549	)
Total accounts receivable, net	$	20,274		$	17,252
Accounts receivable - related party		829