Brownie's Marine Swings to Profit Despite Revenue Dip

TL;DR

**BWMG is a 'show-me' story: they cut costs to profitability, but now they need to prove they can grow revenue beyond related parties.**

AI Summary

Brownie's Marine Group, Inc. (BWMG) reported a net income of $277,574 for the nine months ended September 30, 2025, a significant improvement from a net loss of $81,938 in the same period of 2024. Total revenues decreased by 5.3% to $6,119,257 for the nine months ended September 30, 2025, compared to $6,466,053 in 2024, primarily due to a reduction in non-related party revenues from $6,147,102 to $5,607,584. However, related party revenues increased substantially from $318,951 to $511,673. Gross profit also saw a decline, falling to $2,350,716 in 2025 from $2,621,508 in 2024. Operating expenses were effectively managed, decreasing from $2,646,358 in 2024 to $2,133,653 in 2025, which contributed to the positive income from operations of $217,063, a turnaround from a $24,850 loss in the prior year. Cash increased by $61,865 from operating activities, reaching $479,543 by September 30, 2025, up from $417,678 at December 31, 2024. The company's total assets slightly decreased to $5,629,896 from $5,766,915, while total stockholders' equity improved to $1,904,034 from $1,579,960.

Why It Matters

This filing reveals Brownie's Marine Group's ability to achieve profitability despite a revenue decline, primarily by significantly cutting operating expenses. For investors, this indicates improved cost management and operational efficiency, which could signal a more sustainable business model. However, the decrease in non-related party revenue suggests potential challenges in core market demand or competitive pressures, while the increase in related party revenue warrants closer scrutiny for potential conflicts of interest or reliance on specific relationships. Employees might see this as a positive sign for job security due to improved financial health, but the overall market will be watching if BWMG can reverse its revenue trend to sustain long-term growth against competitors in the recreational diving and marine equipment sector.

Risk Assessment

Risk Level: medium — The company's total revenues decreased by 5.3% for the nine months ended September 30, 2025, from $6,466,053 to $6,119,257, indicating potential market demand challenges. While net income improved, the reliance on cost cutting to achieve profitability, rather than revenue growth, presents a medium-term risk if market conditions worsen or cost-cutting opportunities diminish.

Analyst Insight

Investors should monitor Brownie's Marine Group's next few quarters for signs of revenue stabilization or growth, particularly in non-related party sales. A deeper dive into the nature and sustainability of related party revenues is also warranted. Consider this a 'hold' until a clear revenue growth strategy emerges.

Financial Highlights

debt To Equity

N/A

revenue

$6,119,257

operating Margin

3.55%

total Assets

$5,629,896

total Debt

N/A

net Income

$277,574

eps

N/A

gross Margin

38.41%

cash Position

$479,543

revenue Growth

-5.3%

Revenue Breakdown

Key Numbers

• $277,574 — Net Income (For the nine months ended September 30, 2025, a significant improvement from a net loss of $81,938 in 2024.)
• $6,119,257 — Total Revenues (For the nine months ended September 30, 2025, a decrease of 5.3% from $6,466,053 in 2024.)
• $511,673 — Related Party Revenues (For the nine months ended September 30, 2025, an increase from $318,951 in 2024.)
• $2,133,653 — Total Operating Expenses (For the nine months ended September 30, 2025, a decrease from $2,646,358 in 2024.)
• $1,904,034 — Total Stockholders' Equity (As of September 30, 2025, an increase from $1,579,960 at December 31, 2024.)
• $479,543 — Cash, end of period (As of September 30, 2025, an increase from $417,678 at December 31, 2024.)
• 453,494,622 — Common Stock Outstanding (As of November 14, 2025.)
• $2,350,716 — Gross Profit (For the nine months ended September 30, 2025, a decrease from $2,621,508 in 2024.)
• $217,063 — Income from Operations (For the nine months ended September 30, 2025, a turnaround from a loss of $24,850 in 2024.)
• $2,250,717 — Inventory, net (As of September 30, 2025, an increase from $2,062,279 at December 31, 2024.)

Key Players & Entities

• Brownie's Marine Group, Inc. (company) — Registrant
• Trebor Industries, Inc. (company) — Wholly owned subsidiary
• Brownie's High Pressure Compressor Services, Inc. (company) — Wholly owned subsidiary
• BLU3, Inc. (company) — Wholly owned subsidiary
• Submersible Systems, Inc. (company) — Wholly owned subsidiary
• Live Blue, Inc. (company) — Wholly owned subsidiary
• Gold Coast Scuba, LLC (company) — Acquired by LBI
• Steven M. Gagas (person) — LLC Member of Gold Coast Scuba
• William Frenier (person) — LLC Member of Gold Coast Scuba
• SEC (regulator) — Securities and Exchange Commission

FAQ

Industry Context

Brownie's Marine Group operates in the recreational diving and water safety products market, which includes manufacturing and distribution of specialized equipment. The industry is influenced by consumer discretionary spending, technological advancements in diving gear, and safety regulations. The company's subsidiaries focus on different niches, from high-pressure compressors to portable dive systems and guided tour experiences.

Regulatory Implications

As a manufacturer and distributor of diving equipment, Brownie's Marine Group is subject to product safety regulations and standards. Compliance with these regulations is crucial to avoid potential liabilities and maintain market access. The company's operations also involve environmental considerations related to manufacturing processes.

What Investors Should Do

1. Monitor the sustainability of related party revenue growth.
2. Analyze the drivers of the gross profit decline.
3. Evaluate the effectiveness of operating expense management.

Glossary

Net Income

The profit remaining after all expenses and taxes have been deducted from total revenue. (Indicates the company's overall profitability for the period, showing a significant turnaround from a loss in the prior year.)

Gross Profit

The profit a company makes after deducting the costs associated with making and selling its products, or the costs associated with providing its services. (Shows the profitability of the company's core operations before considering operating expenses.)

Operating Expenses

Costs incurred by a business in its normal course of operations, excluding costs of goods sold and interest and taxes. (Effective management of these expenses contributed to the company's return to profitability.)

Income from Operations

Revenue minus cost of goods sold and operating expenses. (Measures the profitability of a company's core business operations.)

Stockholders' Equity

The value of a company's assets that is attributable to its shareholders. (An increase in stockholders' equity indicates an improvement in the company's net worth.)

Related Party Revenues

Revenue generated from transactions with entities or individuals that have a close relationship with the company, such as parent companies, subsidiaries, or key management personnel. (A substantial increase in this revenue stream was a key factor in the company's improved net income.)

Year-Over-Year Comparison

For the nine months ended September 30, 2025, Brownie's Marine Group reported a net income of $277,574, a substantial improvement from a net loss of $81,938 in the same period of 2024. Total revenues decreased by 5.3% to $6,119,257, primarily due to a decline in non-related party revenues, though related party revenues saw a significant increase. Gross profit declined, but operating expenses were effectively managed, leading to a positive income from operations, a turnaround from the prior year's loss. Total stockholders' equity improved, and cash from operations increased.

Filing Documents

• form10-q.htm (10-Q) — 1019KB
• ex31-1.htm (EX-31.1) — 17KB
• ex31-2.htm (EX-31.2) — 17KB
• ex32.htm (EX-32) — 10KB
• logo-001.jpg (GRAPHIC) — 5KB
• 0001493152-25-023249.txt ( ) — 6685KB
• bwmg-20250930.xsd (EX-101.SCH) — 47KB
• bwmg-20250930_cal.xml (EX-101.CAL) — 57KB
• bwmg-20250930_def.xml (EX-101.DEF) — 247KB
• bwmg-20250930_lab.xml (EX-101.LAB) — 448KB
• bwmg-20250930_pre.xml (EX-101.PRE) — 360KB
• form10-q_htm.xml (XML) — 1056KB

– FINANCIAL INFORMATION

PART I – FINANCIAL INFORMATION ITEM 1.

FINANCIAL STATEMENTS

FINANCIAL STATEMENTS. 4 ITEM 2.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS. 23 ITEM 3.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK. 27 ITEM 4.

CONTROLS AND PROCEDURES

CONTROLS AND PROCEDURES. 27

– OTHER INFORMATION

PART II – OTHER INFORMATION ITEM 1. LEGAL PROCEEDINGS. 28 ITEM 1A. RISK FACTORS. 28 ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS. 28 ITEM 3. DEFAULTS UPON SENIOR SECURITIES. 28 ITEM 4. MINE SAFETY DISCLOSURES. 28 ITEM 5. OTHER INFORMATION. 28 ITEM 6. EXHIBITS. 28 2 NOTE REGARDING FORWARD-LOOKING INFORMATION This Quarterly Report includes forward-looking statements that relate to future events or our future financial performance and involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to differ materially from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking "intend," "plan," "targets," "likely," "aim," "will," "would," "could," and similar expressions or phrases identify forward- looking statements. We have based these forward-looking statements largely on our current expectations and future events and financial trends that we believe may affect our financial condition, results of operation, business strategy and financial needs. You should read thoroughly this Quarterly Report with the understanding that our actual future results may be materially different from what we expect. We qualify all of our forward-looking statements by risk factors included in our Annual Report on Form 10-K filed with the Securities and Exchange Commission ("SEC") on June 6, 2025, which risk factors could adversely impact our business and financial performance. New risk factors emerge from time to time and it is not possible for our management to predict all risk factors, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-lo

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS SEPTEMBER 30, 2025 (UNAUDITED) Note 1. Company Overview Brownie's Marine Group, Inc. (the "Company") designs, tests, manufactures and distributes recreational hookah diving, scuba, and water safety products through its wholly owned subsidiary, Trebor Industries, Inc., a Florida corporation, incorporated in 1981 ("Trebor" or "BTL"), manufactures and sells high pressure air and industrial compressor packages, yacht based scuba air compressor and nitrox generation systems through its wholly owned subsidiary, Brownie's High Pressure Compressor Services, Inc., a Florida corporation incorporated in 2017 ("BHP") and doing business as LW Americas ("LWA") and develops and markets portable battery powered surface supplied air dive systems through its wholly owned subsidiary BLU3, Inc., a Florida corporation ("BLU3"). On September 3, 2021, the Company, entered into an Agreement and Plan of Merger and Reorganization (the "Merger Agreement") with Submersible Acquisition, Inc., a Florida corporation and wholly owned subsidiary of the Company ("Acquisition Sub"), Submersible Systems, Inc., a Florida corporation ("Submersible" or "SSI"), and Summit Holdings V, LLC, a Florida limited liability company ("Summit") and Tierra Vista Group, LLC, a Florida limited liability company ("Tierra Vista" and, together with Summit, the "Sellers"), the owners of all of the capital stock of Submersible, pursuant to which Acquisition Sub merged with and into Submersible (the "Merger"), and Submersible, the surviving corporation, became a wholly owned subsidiary of the Company. Submersible is a manufacturer of high pressure tanks and redundant air systems for the military and recreational diving industries, based in Huntington Beach, California and sells its products to governments, militaries, private companies and the dive industry throughout the world. On February 13, 2022 the Company filed with the Florida Department of State, the articles of

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View this 10-Q filing on SEC EDGAR