Charlie’s Holdings, Inc. announced that it will discontinue all hemp‑derived CBD products and wind down its Don Polly division, a move designed to clear regulatory hurdles and position the company for a planned uplist to a national securities exchange.
The decision follows a strong Q2 2025 earnings report in which the company posted a net income of $5.0 million (EPS $0.02) and revenue of $2.5 million, up 25% from $2.0 million in Q2 2024. The jump was driven by robust sales of the Metatine‑based SBX disposable vape line, which accounted for roughly 70% of revenue, while the legacy hemp/CBD segment contributed less than 5% and has been a source of regulatory scrutiny.
By exiting the hemp/CBD business, Charlie’s can reduce operating costs associated with the Don Polly division—estimated at $1.2 million annually—and reallocate that capital toward product development and marketing for its SBX portfolio. Management indicated that the move will also remove the trading restrictions that currently limit liquidity for the company’s shares, a key prerequisite for uplisting. The company has not yet set a specific uplist date, but the decision is intended to accelerate the timeline and improve the company’s appeal to national exchanges.
Ryan Stump, co‑founder and COO, said the closure reflects a strategic shift toward “regulatory‑advantaged” products: “The hemp/CBD market has become less attractive, while our SBX line is growing rapidly and is not subject to the same FDA tobacco regulations.” President Henry Sicignano added that eliminating the hemp/CBD stigma will “significantly benefit shareholders” and help the company achieve its highest‑grossing quarter yet.
The announcement signals a broader pivot toward alternative alkaloid products. SBX has already secured over $6 million in purchase orders, including a record $4.4 million order, and has outperformed competitors such as Juul in consumer preference studies. The company’s focus on Metatine gives it a regulatory advantage, as the compound is not classified as a tobacco product and therefore avoids many of the restrictions that have tightened on flavored nicotine vapes.
While the move is expected to improve liquidity and reduce regulatory exposure, it also represents a contraction of the company’s product portfolio. Analysts will likely monitor how the capital freed from Don Polly is deployed and whether the company can sustain growth in its core vapor segment amid increasing competition and evolving FDA rules.
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