UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2023

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ______________ to ______________

Commission File Number: 001-40128

biote Corp.

(Exact Name of Registrant as Specified in its Charter)

Delaware	85-1791125
( State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
1875 W. Walnut Hill Ln #100 Irving, TX	75038
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (844) 604-1246

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Class A common stock, par value $0.0001 per share	BTMD	The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
Emerging growth company	☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of August 10, 2023, the registrant had 29,310,636 shares of Class A common stock, $0.0001 par value per share, outstanding and 44,819,066 shares of Class V voting stock, $0.0001 par value per share, outstanding.

Table of Contents

		Page
	Cautionary Note Regarding Forward Looking Statements	ii
PART I.	FINANCIAL INFORMATION	ii
Item 1.	Financial Statements (Unaudited)	ii
	Condensed Consolidated Balance Sheets	1
	Condensed Consolidated Statements of Income and Comprehensive Income	2
	Condensed Consolidated Statements of Stockholders’ Equity (Deficit)	3
	Condensed Consolidated Statements of Cash Flows	5
	Notes to Condensed Consolidated Financial Statements	6
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	28
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	38
Item 4.	Controls and Procedures	38
PART II.	OTHER INFORMATION	40
Item 1.	Legal Proceedings	40
Item 1A.	Risk Factors	41
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	72
Item 3.	Defaults Upon Senior Securities	72
Item 4.	Mine Safety Disclosures	73
Item 5.	Other Information	73
Item 6.	Exhibits	74
Signatures		75

i

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q (the “Quarterly Report”) contains forward-looking statements. These forward-looking statements relate to expectations for future financial performance, business strategies, or expectations for the Company’s business. These forward-looking statements include, but are not limited to, statements regarding the Company’s or its management team’s expectations, hopes, beliefs, intentions, or strategies regarding the future. In addition, any statements that refer to projections, forecasts, or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. The forward-looking statements are contained principally in the sections titled “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and elsewhere in this Quarterly Report. In some cases, you can identify forward-looking statements by terms such as “may,” “can,” “should,” “will,” “estimate,” “plan,” “project,” “forecast,” “intend,” “expect,” “hope,” “anticipate,” “believe,” “seek,” “target,” “continue,” “could,” “might,” “ongoing,” “potential,” “predict,” “would” or similar expressions.

These forward-looking statements are based on information available as of the date of this Quarterly Report, and our management’s current expectations, forecasts and assumptions, and involve a number of judgments, risks and uncertainties. Accordingly, forward-looking statements should not be relied upon as representing the Company’s views as of any subsequent date. The Company does not undertake any obligation to update forward-looking statements to reflect events or circumstances after the date they were made, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.

You should not place undue reliance on these forward-looking statements. As a result of a number of known and unknown risks and uncertainties, the Company’s actual results or performance may be materially different from those expressed or implied by these forward-looking statements. Some factors that could cause actual results to differ include:

•the success of our dietary supplements to attain significant market acceptance among clinics, practitioners and their patients;

•our customers’ reliance on certain third parties to support the manufacturing of bio-identical hormones for prescribers;

•our and our customers’ sensitive to regulatory, economic, environmental and competitive conditions in certain geographic regions;

•our ability to increase the use by practitioners and clinics of the Biote Method at the rate that we anticipate or at all;

•our ability to grow our business;

•the significant competition we face in our industry;

•our limited operating history;

•our ability to protect our intellectual property;

•the heavy regulatory oversight in our industry;

•changes in applicable laws or regulations;

•the inability to profitably expand in existing markets and into new markets;

•the possibility that we may be adversely impacted by other economic, business and/or competitive factors;

•future exchange and interest rates; and

•other risks and uncertainties indicated in this Quarterly Report, including those under “Risk Factors” herein, and other filings the Company has made, or will make, with the Securities and Exchange Commission (the “SEC”).

For the reasons described above, we caution you against relying on any forward-looking statements, which should also be read in conjunction with Part I, Item 1A, “Risk Factors”, in our Annual Report on Form 10-K for the year ended December 31, 2022 (the “Annual Report”), and Part II, Item 1A in this Quarterly Report and the other cautionary statements that are included elsewhere in this Quarterly Report and in our public filings, including under “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” Any forward-looking statement made by us speaks only as of the date on which we make it. We undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future developments, or otherwise, except as may be required by law.

PART I—FINANCIAL INFORMATION

Item 1. Financial Statements

ii

biote Corp.

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except share amounts) (Unaudited)

	June 30,			December 31,
	2023			2022
Assets
Current assets:
Cash and cash equivalents	$	68,480		$	79,231
Short-term investment		20,000			—
Accounts receivable, net		8,336			6,948
Inventory, net		7,396			11,183
Other current assets		7,898			3,816
Total current assets		112,110			101,178
Property and equipment, net		1,062			1,504
Capitalized software, net		5,733			5,073
Operating lease right-of-use assets		1,915			2,052
Deferred tax asset		18,232			1,838
Total assets	$	139,052		$	111,645
Liabilities and Stockholders’ Deficit
Current liabilities:
Accounts payable	$	7,468		$	4,112
Accrued expenses		5,426			6,274
Term loan, current		6,250			6,250
Deferred revenue, current		2,310			1,965
Operating lease liabilities, current		280			165
Total current liabilities		21,734			18,766
Term loan, net of current portion		109,352			112,086
Deferred revenue, net of current portion		1,071			926
Operating lease liabilities, net of current portion		1,781			1,927
TRA liability		14,432			—
Warrant liability		—			4,104
Earnout liability		63,920			32,110
Total liabilities		212,290			169,919
Commitments and contingencies (See Note 18)
Stockholders’ Deficit
Preferred stock, $0.0001 par value, 10,000,000 shares authorized; no shares issued or outstanding as of June 30, 2023 and December 31, 2022		—			—
Class A common stock, $0.0001 par value, 600,000,000 shares authorized; 29,310,636 and 11,242,887 shares issued, 27,723,136 and 9,655,387 shares outstanding as of June 30, 2023 and December 31, 2022, respectively		3			1
Class B common stock, $0.0001 par value, 8,000,000 shares authorized; no shares issued or outstanding as of June 30, 2023 and December 31, 2022		—			—
Class V voting stock, $0.0001 par value, 100,000,000 shares authorized; 44,819,066 and 58,565,824 shares issued, 34,819,066 and 48,565,824 shares outstanding as of June 30, 2023 and December 31, 2022, respectively		3			5
Additional paid-in capital		—			—
Accumulated deficit		(46,393	)		(44,460	)
Accumulated other comprehensive loss		(18	)		(5	)
biote Corp.’s stockholders’ deficit		(46,405	)		(44,459	)
Noncontrolling interest		(26,833	)		(13,815	)
Total stockholders’ deficit		(73,238	)		(58,274	)
Total liabilities and stockholders’ deficit	$	139,052		$	111,645

The accompanying notes are an integral part of these condensed consolidated financial statements.

1

biote Corp.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

(in thousands, except share and per share amounts) (Unaudited)

	Three Months Ended June 30,						Six Months Ended June 30,
	2023			2022			2023			2022
Revenue:
Product revenue	$	48,652		$	40,789		$	92,807		$	77,547
Service revenue		605			570			1,293			955
Total revenue		49,257			41,359			94,100			78,502
Cost of revenue (excluding depreciation and amortization included in selling, general and administrative, below)
Cost of products		14,992			12,984			28,019			24,641
Cost of services		836			553			1,686			1,173
Cost of revenue		15,828			13,537			29,705			25,814
Selling, general and administrative		25,760			113,425			48,845			128,528
Income (loss) from operations		7,669			(85,603	)		15,550			(75,840	)
Other income (expense), net:
Interest expense		(2,547	)		(794	)		(4,973	)		(1,153	)
Gain (loss) from change in fair value of warrant liability		(11,793	)		3,399			(13,411	)		3,399
Gain (loss) from change in fair value of earnout liability		(6,400	)		61,680			(31,810	)		61,680
Loss from extinguishment of debt		—			(445	)		—			(445	)
Other income		898			88			1,671			98
Total other income (expense), net		(19,842	)		63,928			(48,523	)		63,579
Loss before provision for income taxes		(12,173	)		(21,675	)		(32,973	)		(12,261	)
Income tax expense (benefit)		922			(346	)		1,552			(282	)
Net loss		(13,095	)		(21,329	)		(34,525	)		(11,979	)
Less: Net loss attributable to noncontrolling interest		(7,952	)		(18,723	)		(22,577	)		(9,373	)
Net loss attributable to biote Corp. stockholders		(5,143	)		(2,606	)		(11,948	)		(2,606	)
Other comprehensive income (loss):
Foreign currency translation adjustments		—			(5	)		—			1
Other comprehensive income (loss)		—			(5	)		—			1
Comprehensive loss	$	(13,095	)	$	(21,334	)	$	(34,525	)	$	(11,978	)
Net loss per common share
Basic	$	(0.25	)	$	(0.34	)	$	(0.62	)	$	(0.34	)
Diluted	$	(0.25	)	$	(0.34	)	$	(0.62	)	$	(0.34	)
Weighted average common shares outstanding
Basic		20,704,866			7,574,271			19,153,574			7,574,271
Diluted		20,704,866			7,574,271			19,153,574			7,574,271

The accompanying notes are an integral part of these condensed consolidated financial statements.

2

biote Corp.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIT)

(in thousands, except share amounts) (Unaudited)

																			Total
																Accumulated			Stockholders’
											Additional					Other			Deficit			Non-			Total
	Class A Common Stock				Class V Voting Stock						Paid-in		Accumulated			Comprehensive			Attributable to			controlling			Stockholders’
	Shares		Amount		Shares			Amount			Capital		Deficit			Loss			biote Corp.			Interest			Deficit
Balance at December 31, 2022		9,655,387	$	1		48,565,824		$	5		$	—	$	(44,460	)	$	(5	)	$	(44,459	)	$	(13,815	)	$	(58,274	)
Distributions		—		—		—			—			—		—			—			—			(3,093	)		(3,093	)
Net loss		—		—		—			—			—		(6,805	)		—			(6,805	)		(14,625	)		(21,430	)
Other comprehensive income		—		—		—			—			—		—			—			—			1			1
Share-based compensation		—		—		—			—			—		2,170			—			2,170			—			2,170
Vesting of RSUs		426,208		—		—			—			—		1,915			(4	)		1,911			(1,911	)		—
Exercise of stock options		105,049		—		—			—			—		2,043			(3	)		2,040			(1,620	)		420
Litigation settlement		375,000		—		—			—			—		1,199			—			1,199			—			1,199
Exchanges of Class V voting stock		7,953,258		1		(7,953,258	)		(1	)		—		208			—			208			(208	)		—
TRA liability		—		—		—			—			—		(4,802	)		—			(4,802	)		—			(4,802	)
Balance at March 31, 2023		18,514,902	$	2		40,612,566		$	4		$	—	$	(48,532	)	$	(12	)	$	(48,538	)	$	(35,271	)	$	(83,809	)
Distributions		—		—		—			—			—		—			—			—			(3,495	)		(3,495	)
Net loss		—		—		—			—			—		(5,143	)		—			(5,143	)		(