TILE SHOP HOLDINGS, INC. Annual Report: The Final Public Chapter for Investors

Considering an investment in Tile Shop Holdings? This isn't just another annual report summary; it's a critical update for anyone who has considered investing or still holds shares. This report offers a straightforward look at a company that has undergone a massive transformation, and importantly, it marks their final public filing.

🚨 URGENT: TILE SHOP HOLDINGS IS NO LONGER A PUBLICLY TRADED COMPANY! 🚨

Before delving into the details, investors must understand the most significant news: Tile Shop Holdings has delisted its stock from Nasdaq and gone private. This means its shares are no longer easily traded on a major stock exchange, and the company will stop filing regular reports with the SEC (Securities and Exchange Commission). This annual report is, critically, their last required public filing!

The company achieved this by executing a "reverse stock split" followed by a "forward stock split" in December 2025. This complex maneuver effectively converted shares of stockholders owning less than 3,000 shares into cash. This action reduced their total number of public shareholders below the threshold requiring SEC reporting. The company paid approximately $32.2 million to these "cashed-out" stockholders.

What does this mean for you? If you are a retail investor seeking a publicly traded company with transparent financial reporting, Tile Shop Holdings is no longer that company. Its stock now trades on the "OTC Markets Pink Limited" (symbol "TTSH"), a significantly less regulated and less liquid market. This fundamentally alters the investment landscape, making it extremely difficult to buy, sell, or even track your investment.

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With this critical context in mind, let's review the company's final public disclosures:

Business Overview

Tile Shop Holdings, Inc. ("Tile Shop") operates as a specialty retailer, offering a wide array of tiles. Their selection ranges from natural stone like marble and granite to man-made options such as ceramic, porcelain, and luxury vinyl. The company also provides all necessary installation and maintenance products, often under its proprietary "Superior" brand. With over 6,000 products, including their "Rush River" and "Fired Earth" brands, Tile Shop offers a broad selection. As of the end of 2025, the company operated 140 stores across 31 states and Washington D.C., with each store averaging about 20,000 square feet.

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Financial Performance

This final report provides the following key financial figures:

• Net Sales (Revenue from selling products):

  • 2025: $336.8 million
  • 2024: $347.1 million
  • 2023: $377.1 million
  • Year-over-year change: In 2025, net sales were down approximately 3% from 2024, and a more substantial 10% decline from 2023 levels. This indicates a shrinking top line for the business.

• Operating Profit/Loss (Profitability from core business operations, before taxes and other non-operating items):

  • 2025: -$5.8 million (an operating loss)
  • 2024: $3.5 million (an operating profit)
  • 2023: $16.2 million (an operating profit)
  • Year-over-year change: After generating healthy operating profits in 2023, profitability sharply decreased in 2024, culminating in an operating loss of $5.8 million in 2025. This suggests that the costs of running the business now exceed the revenue generated, a financially unsustainable position.

• Total Assets (The total value of everything the company owns):

  • 2025: $301.7 million
  • 2024: $319.6 million
  • Year-over-year change: The company's total asset base decreased by about $17.9 million, or roughly 5.6%, from 2024 to 2025. Combined with declining sales and operating losses, this indicates a contraction in the company's overall size and financial footprint.

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Risk Factors

For any investor still holding shares or considering the OTC market, the risks are now profoundly different and significantly elevated. Key risks include:

• Extreme Lack of Liquidity: With trading moved to the "OTC Markets Pink Limited," selling your shares quickly or at a fair market price will be exceptionally difficult. This market has far fewer buyers and sellers compared to Nasdaq.
• Zero Transparency: As this is their last required SEC filing, there will be no future public financial reports, strategic updates, or disclosures. Investing in Tile Shop is now akin to investing in a "dark" company, with virtually no insight into its ongoing performance or operations.
• Valuation Difficulty: Without public financial data, analyst coverage, or an active market, determining the true value of the company's shares becomes an almost impossible task.
• Continued Financial Decline: The existing trend of falling sales and operating losses could persist, further eroding the company's underlying value, but without public reporting, investors will have no way to track this.
• Operational Risks: A retail business like Tile Shop faces inherent risks such as economic downturns impacting home improvement spending, intense competition, supply chain disruptions, and changing consumer preferences. These risks are now opaque to external investors.

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Management Discussion and Analysis (MD&A) Highlights

The most significant development and strategic decision for Tile Shop Holdings in 2025 involved the execution of a plan to go private and delist its shares from Nasdaq. This complex maneuver, which included a reverse and forward stock split in December 2025, effectively reduced the number of public shareholders below the SEC reporting threshold. The company paid approximately $32.2 million to 'cashed-out' stockholders as part of this process, indicating a significant use of capital resources for this strategic shift.

Operationally, the company faced substantial headwinds, evidenced by the persistent decline in net sales and the shift from an operating profit to an operating loss in 2025. The decision to go private fundamentally changes the company's capital structure and its relationship with public investors. This move was driven by a desire to operate outside the regulatory and reporting requirements of public markets. This strategic direction overshadows other potential operational or growth strategies, as corporate restructuring became the primary focus.

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Financial Health

The decrease in total assets and the shift to an operating loss suggest Tile Shop's financial health is under pressure. The company paid approximately $32.2 million to "cashed-out" stockholders during the going-private process, indicating it possessed sufficient cash for this specific transaction. The operating losses present a challenge for the company's financial stability.

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Future Outlook

For public investors, Tile Shop Holdings' future outlook is now a complete black box. As this 10-K represents their final required report, the company will provide no further public updates on its sales, profits, strategic plans, or any forward-looking statements. The company's primary strategic decision in 2025 was to go private, fundamentally altering its operational and financial structure.