Milwaukee-based Koss Corp. saw stronger sales to mass retailers in the United States, but the headphone maker saw sales decline 9.4 percent in the third quarter.
“Sales were soft in the third quarter as distributors in Europe significantly reduced their orders compared to the same period last year,” said Michael Koss, chairman and chief executive officer.
Revenue decreased from slightly less than $4.8 million to about $4.3 million. Despite the decline, gross profit margins improved from 19.9 percent to 22.3 percent. Selling, general and administrative expenses decreased by nearly 10 percent.
Koss said controlled spending helped reduce the company’s net loss, which improved from $1.1 million to $812,868 in the quarter.
“Controlled spending has also reduced the loss before income tax for the first nine months compared to last year,” Koss said. “But the write-down of deferred tax assets to the new federal statutory rate as well as an increase in the valuation allowance for deferred tax assets in the second quarter drove an increase in tax expense for the nine months ended March 31, 2018. This caused the increased net loss compared to the same nine month period one year ago.”
