Kaival Brands Innovations Group, Inc.

Core business

Kaival Brands Innovations Group, Inc. is a wholesale distributor and marketer of electronic nicotine delivery systems (ENDS). The company historically generated revenue by selling the BIDI® Stick (a disposable ENDS product for adult smokers 21+) under a distribution agreement with Bidi. As of 2024–2025, the primary revenue source is royalty income from an international licensing arrangement with Philip Morris Products S.A. (PMPSA) under the PMI License Agreement.

Revenue streams and current status

• BIDI® Stick sales: Previously the main revenue driver under the Bidi Distribution Agreement. An ITC complaint filed in June 2024 halted import and sale of the BIDI Stick in the U.S.; by late 2024–2025 the company no longer imports or sells BIDI Sticks and does not derive revenue from them.
• PMI licensing (via Kaival Brands International, LLC — KBI): KBI and Kaival Brands entered an exclusive international licensing arrangement with PMPSA to use KBI’s technology and IP to support the sale of disposable nicotine ENDS in PMI markets. PMPSA pays royalties to KBI. Under the August 2023 PMI License Amendment, royalties are calculated on liquid volume and paid quarterly. KBI’s license fees to Bidi are intended to be split 50/50 between KBI and Bidi. PMPSA has broad control over sales and branding in PMI markets.

IP and GoFire assets

In May 2023 the company acquired GoFire’s vaporization/inhalation-related IP portfolio, consisting of 19 existing and 47 pending patents and related trademarks. These assets are being evaluated for licensing across cannabis, hemp/CBD, nicotine, nutraceuticals and potential product development.

Corporate structure and subsidiaries

• Kaival Labs, Inc. (Delaware): Formed August 31, 2020 to develop branded and white-label products.
• Kaival Brands International, LLC (KBI) (Delaware): Formed March 11, 2022 to facilitate international licensing with PMPSA.
• KBI License with Bidi: Agreements grant Bidi an irrevocable license to certain PMPSA-related IP and require equitable sharing of license royalties with Bidi.
• Bidi Distribution Agreement (A&R Distribution; 2020–2024): Exclusive worldwide distribution right to distribute Bidi ENDS; sub-distribution agreements were terminated in 2024.

Key customers and concentration

• 2024 revenue concentration from a subset of customers:
  • QuikTrip Corporation: ~21%
  • GPM Investments: ~12%
  • FAVS Business, LLC: ~11%
• Accounts receivable concentration: In 2024 QuikTrip owed approximately $205, representing 100% of accounts receivable at that time. By October 31, 2025, accounts receivable from related parties was zero.

Employees and management

The company has four full-time employees, including two officers:

• Interim Chief Executive Officer: Mark Thoenes
• Interim Chief Financial Officer: Eric Morris

Financial and liquidity snapshot

• Cash and cash equivalents: approximately $0.5 million as of October 31, 2025.
• Operating cash runway: sufficient only for a very limited period under the current plan; additional funding is likely required.
• Related-party balances (as of October 31, 2025): receivables $0; payables around $50,000.
• 2024 inventory purchases for BIDI® Stick products from Bidi: about $0.3 million (100% from Bidi).
• 2025 lease actions: the company ceased use of its Florida office space, recognized a lease-related net gain of approximately $59,000 from termination, and reached a settlement on January 7, 2026 that eliminated further lease payments.

Principal risks and regulatory context

• ITC case and PMTA/MDO dynamics: The ITC action halted BIDI Stick imports and sales in the U.S., materially affecting revenues and access to Bidi-related IP. FDA PMTA developments (MDOs for Classic BIDI Stick and non-tobacco flavored BIDI Sticks, including a November 2025 MDO) introduce regulatory risk for ENDS products and the company’s ability to monetize assets and licensing rights.
• Going concern and capital needs: The company has ongoing losses and requires additional funding to support operations, payables, and growth; management has expressed substantial doubt about the ability to continue as a going concern without additional financing.
• Intellectual property and dependence on Bidi: The company’s access to certain IP rights depends on Bidi, which could affect strategic flexibility if the Bidi relationship changes.
• Internal control weaknesses: Material weaknesses in internal controls were identified as of October 31, 2025; remediation is underway.

Notable transactions and milestones

• 2023: GoFire asset acquisition (May 2023) and PMI License Amendment (August 2023).
• 2024: Reverse stock split (1-for-21) approved; termination and settlement of certain lease and distribution arrangements; ITC actions affecting Bidi-related revenues.
• 2025: Termination/settlement of the Florida lease; ongoing efforts to pursue licensing and monetization of the GoFire IP and the PMI license ecosystem.

Summary

Kaival Brands Innovations Group, Inc. is focused on ENDS-related IP and licensing. It shifted from direct distribution of BIDI® Sticks to primarily monetizing international licensing royalties under the PMI framework, while pursuing licensing and commercialization opportunities for the GoFire IP portfolio. The company operates with a small team, has a limited revenue base with prior customer concentration, faces regulatory and legal headwinds from FDA and ITC actions, and requires additional capital to fund ongoing operations.