The EPS of Safety Shot Inc. (SHOT) dropped sharply to -$0.26 in Q3 2023 due to several significant factors:
- High Operating Expenses: The company's total operating expenses reached $39,611,915 for the year ended December 31, 2024, which is a substantial increase from the previous year's $12,524,8691. This significant increase in operating expenses, including marketing, research and development, legal, and professional fees, as well as stock-based compensation, has a direct impact on the net profit, thereby lowering the EPS1.
- Legal Settlements: The company is facing ongoing legal proceedings, including settlements with Bigger Capital and Intracoastal Capital, which have impacted its financial position1. These legal settlements likely incurred additional costs that were reflected in the quarterly financial statements, contributing to the decline in EPS.
- Strategic Restructuring: Safety Shot is undergoing a transformational period with significant corporate restructuring. The spin-off and distribution of Caring Brands Inc. common stock, announced on March 28, 2025, involve complex transactions that can be financially disruptive, potentially affecting short-term profitability23.
In conclusion, the combination of high operating expenses, legal settlements, and strategic restructuring has led to a substantial drop in Safety Shot's EPS in Q3 2023.