Key Factors Affecting Our Performance

Ability to Grow Our Brand Awareness

Continued Execution of Omnichannel Strategy

Wipes and Skin and Personal Care product categories in 2021. During the three and six months ended June 30, 2022, the mix of revenue across channels was relatively balanced between Retail and Digital.

Components of Results of Operations

Our operating expenses consist of selling, general and administrative, marketing and research and development expenses.

Interest and Other Income (Expense), Net

The following table sets forth our condensed consolidated statements of operations data for each of the periods indicated:

(1) Includes stock-based compensation expense as follows:

The following table sets forth our condensed consolidated statements of operations data expressed as a percentage of revenue*:

* Amounts may not sum due to rounding.

Comparison of the Three and Six Months Ended June 30, 2022 and 2021

Cost of Revenue and Gross Profit

Selling, General and Administrative Expenses

(In thousands, except percentages) Research and development $ 1,823 $ 2,345 $ (522)

Interest and Other Income (Expense), Net

Refer to Note 6 included in these condensed consolidated financial statements for more information on the 2021 Credit Facility.

The following table summarizes our cash flows for the periods presented:

Our primary source of investing cash is the sale and maturity of short-term investments and our primary use of investing cash is the purchase of short-term investments and property and equipment.

Our financing activities primarily consisted of proceeds from sales of securities, payment of offering costs, proceeds from stock option award exercises and principal payments of financing lease obligations.

We prepare and present our condensed consolidated financial statements in accordance with GAAP. However, management believes that adjusted EBITDA, a non-GAAP financial measure, provides investors with additional useful information in evaluating our performance.

We calculate adjusted EBITDA as net income (loss), adjusted to exclude: (1) interest and other (income) expense, net; (2) income tax provision; (3) depreciation and amortization; (4) stock-based compensation expense, including payroll tax; (5) the IPO bonuses in the second quarter of 2021, including associated payroll taxes and expenses, and third-party costs associated with our IPO in 2021; and (6) in certain periods, litigation and settlement fees associated with certain non-ordinary course litigation.

The following table presents a reconciliation of net income (loss), the most directly comparable financial measure stated in accordance with GAAP, to adjusted EBITDA, for each of the periods presented:

(1) Includes IPO-related costs, including transaction-related third-party expenses, which are generally incremental costs incurred associated with the preparation of the IPO.

As of June 30, 2022, there were no material changes to our material cash requirements from those described under "Management's Discussion and Analysis of Financial Condition and Results of Operations" in our Annual Report.

Critical Accounting Policies and Estimates

and 13 to our condensed consolidated financial statements included in this Quarterly Report on Form 10-Q for a discussion of the adoption of ASC 842 and related policy changes.

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