Nick Anderson

Nick Anderson with Roth Capital Partners asked about the U.S. retail landscape for vape products, specifically the implications of Walgreens resuming sales, general retailer sentiment, and the potential for increased shelf space once regulatory clarity emerges for flavored products. He also inquired about the Charlie's partnership for IKE Tech, seeking details on expected production volumes, target regions, and whether this deal is attracting interest from other potential partners. Finally, he asked about the surge in Chinese vape imports in the second half of 2025, its drivers, and the effectiveness of state-level measures against illicit vape sales.

Answer

Michael Wang (CEO, Ispire Technology Inc.) explained that Walgreens' decision reflects a broader retail demand for e-cigarettes, especially flavored ones, with large chains eager for legal, FDA-authorized options to avoid compliance issues and boost foot traffic. He emphasized that age-gating technology is crucial for unlocking the legal flavored market. Regarding the Charlie's partnership, Mr. Wang stated it's a groundbreaking deal with initial volumes projected at 2-3 million chips per month, aiming for 10 million monthly devices/chips over 12 months, with results expected next quarter. He noted significant interest from cannabis MSOs for age-gated products but highlighted Ispire's current focus on the higher-volume nicotine sector. For Chinese imports, Mr. Wang attributed the H2 2025 surge to manufacturers rushing products before a new 13% VAT on e-cigarette exports takes effect on April 1st, 2026. He added that U.S. state enforcement efforts have had minimal impact on the illicit market's demand, reinforcing the need for age-gating solutions.

Nick Anderson with Roth Capital Partners inquired about the U.S. retail landscape for vape products, specifically the implications of Walgreens resuming sales, retailer demand for flavored e-cigarettes, and potential shelf space allocation. He also asked for more details on the IIQ (IKE Tech) partnership with Charlie's, including expected production volumes, regional focus, and its impact on other potential clients. Finally, he sought clarification on the spike in Chinese e-cigarette imports in the second half of 2025 and the effectiveness of U.S. state measures against illicit vape products.

Answer

CEO Michael Wang explained that Walgreens' move reflects a broader retail demand for e-cigarettes, especially flavored ones, which convenience stores are 'desperate for' due to lost traffic from FDA compliance issues. He emphasized that enforcement against illicit products needs to be coupled with solutions like age-gating. Regarding the Charlie's partnership, Mr. Wang stated it's a groundbreaking deal, with initial volumes projected at 2-3 million chips per month, aiming for 10 million devices monthly over 12 months, with results expected next quarter. He noted interest from cannabis MSOs but current focus on the nicotine sector. For Chinese imports, Mr. Wang attributed the H2 2025 surge to manufacturers rushing products before a new 13% VAT tax on e-cigarette exports takes effect on April 1st, 2026. He added that U.S. state enforcement efforts have had minimal impact on the illicit market demand.

Nick Anderson asked for an update on the UK supply agreement, including early client feedback and future product iterations. He also questioned how the tariff landscape is influencing the onboarding of larger clients and the expansion roadmap for Ispire's Malaysian facility. Finally, he sought clarity on whether Q4 cannabis revenue represents a new run rate and the potential impact of rescheduling on Ispire's U.S. cannabis strategy.

Answer

CEO Michael Wang reported that while version one of the UK ODM product faced challenges due to the disposable ban, version two, launched in summer, is 'truly taking off,' contributing significantly to the $18 million backlog, with further iterations planned. He confirmed that tariffs are driving many companies to shift production outside China, accelerating interest in Ispire's Malaysian facilities. Mr. Wang noted that Ispire is expanding its second Malaysian facility to house up to 80 production lines and is considering a much larger third facility. Regarding cannabis, he stated that fiscal Q4 2025 was the 'bottom' for cannabis revenue, with new high-quality customers and products expected to drive growth, and that Ispire would re-evaluate investment if rescheduling occurs.

Nick Anderson, Director and Research Analyst at ROTH Capital Partners, asked about the early feedback and order trends for Ispire Technology's U.K. supply agreement, inquiring if the current product SKU would be leveraged for other clients or if further iterations are planned. He also questioned the impact of the tariff landscape on onboarding larger clients and the expansion roadmap for the Malaysian facility, and sought clarity on whether Q4 2025 cannabis revenue represents a realistic run rate, future segment outlook, and the potential influence of rescheduling on Ispire's U.S. cannabis strategy.

Answer

Co-CEO Michael Wang reported that while the initial U.K. product version faced challenges, a redesigned Version 2, launched in summer 2025, is performing very well and contributing to the $18 million backlog, with a next iteration planned for year-end. Mr. Wang confirmed that tariffs are driving companies to shift production, validating Ispire's strategic Malaysian expansion, which includes plans for a much larger third facility to accommodate significant ODM opportunities. He also indicated that Q4 fiscal 2025 was the low point for cannabis revenue, with current volumes already higher due to new high-quality customers and upcoming product launches, and that Ispire would re-evaluate investment in the cannabis sector if rescheduling occurs.

Nick Anderson from ROTH Capital Partners, LLC asked for an update on the UK supply agreement, specifically regarding early client feedback, order trends for the current product, and plans for future product iterations or leveraging the SKU with other clients. He also inquired about the impact of the tariff landscape on attracting larger clients and how this might influence the expansion roadmap for Ispire Technology Inc.'s Malaysian manufacturing facility. Finally, Mr. Anderson sought clarity on whether the Q4 cannabis revenue represents a realistic run rate for the U.S. business going forward and how potential rescheduling of cannabis would affect Ispire's strategy in that segment.

Answer

Co-CEO Michael Wang reported that the initial version of the UK ODM product faced challenges due to market dynamics, but a significantly upgraded "version two," launched in summer 2025, is performing very well, contributing to an $18 million backlog. He confirmed that a third iteration is expected by year-end. Regarding tariffs, Mr. Wang noted an increase in inbound interest from brands and manufacturers seeking to diversify supply chains outside China, accelerating Ispire's plans for a much larger third facility in Malaysia beyond the current 80-line capacity. For cannabis, Mr. Wang stated that fiscal Q4 2025 was the bottom for cannabis revenue, with new high-quality customers and upcoming product launches expected to drive higher volumes. He affirmed that rescheduling would prompt a re-evaluation of investment in the cannabis sector.

Nick Anderson asked about the promotional environment in the modern oral category, how Turning Point Brands is positioning its products amid aggressive marketing, and whether the company would consider pursuing Modified Risk Tobacco Product (MRTP) applications.

Answer

CEO Graham Purdy stated that the company views the heavy promotional environment as a positive for building overall category awareness. He emphasized that TPB's products are positioned as premium offerings with unique benefits, though occasional promotional partnerships are possible. Purdy confirmed that the company has no current plans to pursue MRTP applications and remains focused on the PMTA process.

Nick Anderson from Roth Capital Partners, LLC inquired about the promotional environment in the modern oral category, noting aggressive competitor activity and asking how Turning Point Brands is positioning its products in response. He also asked if the company would consider pursuing Modified Risk Tobacco Product (MRTP) applications for its offerings.

Answer

CEO Graham Purdy stated that the competitive promotional environment is beneficial for building overall category awareness. He expressed confidence that TPB's products have unique consumer benefits in mouthfeel and satisfaction, allowing them to maintain a premium position without engaging in heavy discounting, though tactical promotions with retail partners are possible. Regarding MRTP, Purdy confirmed the company has no current plans to pursue that path and remains focused on the PMTA process.

Nick Anderson of Roth Capital Partners, LLC asked about the promotional environment in the modern oral category, how Turning Point Brands is positioning its products amid aggressive competitor marketing, and whether the company would consider pursuing Modified Risk Tobacco Product (MRTP) applications.

Answer

CEO Graham Purdy stated that the aggressive promotional environment is positive for building overall category awareness. He expressed confidence that TPB's products' unique benefits, like mouthfeel and satisfaction, support a premium positioning without needing to match every discount. Regarding MRTP, Purdy confirmed the company has no plans at this time and remains focused on the current PMTA process.

Nick Anderson of ROTH MKM questioned if the pricing strategy for 'Free' would mirror the competitive approach used for the Stoker's brand and also inquired about the growth potential and market opportunity for Zig-Zag branded cigars.

Answer

Executive Summer Frein clarified that 'Free' is positioned as a premium brand and its pricing strategy will reflect that, competing with other major premium offerings. CEO Graham Purdy described the cigar category as a 'massive opportunity' with a potential multi-billion dollar manufacturer revenue runway, noting that TPB is in the 'extreme early innings' but is well-positioned due to the iconic Zig-Zag brand and favorable product regulatory status.