Safety Shot, Inc. (SHOT) - Q1 2025 10-Q Summary
Business Context and Reporting Period
This Quarterly Report on Form 10-Q covers the three-month period ended March 31, 2025. Safety Shot, Inc. (formerly Jupiter Wellness, Inc.) is a Delaware corporation focused on the commercialization of the "Sure Shot" dietary supplement, designed to reduce blood alcohol content. The Company is classified as a smaller reporting company and an emerging growth company. As of May 15, 2025, there were 75,176,604 shares of common stock outstanding.
Key Financial Metrics
| Metric | Q1 2025 | Q1 2024 |
|---|---|---|
| Revenue (Sales) | $42,101 | $170,732 |
| Cost of Sales | $21,112 | $2,383,285 |
| Gross Profit | $20,989 | $(2,212,553) |
| Operating Expenses | $5,411,324 | $12,956,552 |
| Net Loss | $(5,326,933) | $(15,674,671) |
| Net Loss Per Share (Basic) | $(0.08) | $(0.33) |
| Cash and Cash Equivalents | $329,285 | $2,046,355 |
| Total Assets | $8,694,791 | $7,338,403 |
| Total Liabilities | $9,237,429 | $9,511,455 |
| Shareholders' Equity | $(542,638) | $(2,173,052) |
Liquidity and Debt: The Company reported negative working capital of approximately $5.15 million. Significant liabilities include Convertible Notes totaling $5,341,875 (primarily related to legal settlements) and Accounts Payable of $2,841,666. Cash flow used in operating activities was $4,628,114 for the quarter.
Material Changes vs. Prior Period
- Revenue Decline: Sales decreased by approximately 75% to $42,101. Management attributes this to a strategic redirection of focus toward the acquisition of Yerbae Brands Inc. and a new marketing strategy scheduled for Q2 2025.
- Cost of Sales Normalization: Cost of sales dropped significantly from $2.38 million in Q1 2024 to $21,112 in Q1 2025. The prior year figure included a one-time inventory write-off of $1.74 million due to rebranding issues.
- Operating Expense Reduction: Total operating expenses decreased by roughly 58% to $5.41 million, driven largely by a reduction in stock-based compensation (from $8.09 million in Q1 2024 to $1.99 million in Q1 2025) and marketing spend.
- Capital Structure: The Company issued 9,038,650 shares in a private placement raising $4.97 million and issued 1,927,640 shares to settle litigation claims valued at $809,608.
Guidance, Outlook, Risks, and Unusual Items
- Going Concern: The Company's auditors have expressed substantial doubt about its ability to continue as a going concern due to accumulated deficits of over $120 million and negative operating cash flows. The Company expects to incur significant costs for expansion and development.
- Legal Settlements: The Company settled multiple significant lawsuits in Q1 2025, including:
- Bigger Capital: Settled via $375,000 cash payment, issuance of $5.25 million in convertible notes, and new warrants.
- Intracoastal Capital: Settled via issuance of shares valued at $875,000 and a $175,000 payment.
- Alta Partners: Settled via a $350,000 payment.
- 3i LP: Settled via issuance of shares valued at $400,000.
- Acquisition Activity: The Company is pursuing the acquisition of Yerbae Brands Corp., having entered into a Letter of Intent to fund up to $3 million in payables and provided a loan of up to $500,000.
- Subsequent Events: Following March 31, 2025, the Company issued 2,369,668 shares in a private placement for $5,000,000.
- Risks: Key risks include regulatory scrutiny of the "Sure Shot" product (potential reclassification as a drug by the FDA), reliance on third-party manufacturers, and the need for additional capital to fund operations.
Investor Verification Checklist
- Cash Runway: Verify the sufficiency of the $329,285 cash balance against the $5.4 million quarterly burn rate and upcoming debt maturities (specifically the $3.5 million Convertible Bigger Note due June 30, 2025).
- Dilution Impact: Assess the impact of recent and potential future equity issuances, including the 23 million shares reserved for the Silverback Capital liabilities settlement program and the 5.3 million Bigger Warrants.
- Revenue Sustainability: Confirm the timeline and expected impact of the new marketing strategy for Q2 2025 to reverse the 75% revenue decline.
- Regulatory Status: Monitor FDA communications regarding the "Sure Shot" dietary supplement to ensure it is not reclassified as a drug, which would require costly clinical trials.
- Debt Conversion Terms: Review the conversion prices of the new convertible notes ($0.5435) relative to the current market price to understand potential future dilution.