Koss Corporation operates in the audio/video industry segment of the home entertainment and communication industry through its design, manufacture and sale of stereo headphones and related accessory products. The Company reports its results as a single reporting segment, as the Company’s only business line is the design, manufacture and sale of stereo headphones and related personal listening accessories. The Company sources complete stereo headphones manufactured to its specifications from various manufacturers in Asia as well as raw materials used to produce stereo headphones at its plant in Milwaukee, Wisconsin.

Koss Corporation generates revenue through the sale of stereo headphones and related personal listening accessories. Approximately 84% of the Company’s fiscal year 2025 sales were from stereo headphones used for listening to music. The remaining approximately 16% of the Company’s sales were from headphones used in communications, education settings, and in conjunction with metal detectors, as well as sold to original equipment manufacturers. The Company’s products are sold through U. S. distributors, international distributors, audio specialty stores, the internet, national retailers, grocery stores, electronics retailers, and prisons under the “Koss” name as well as private label.

The company operates through the following segments:

• Koss Corporation: This segment encompasses the design, manufacture and sale of stereo headphones and related personal listening accessories. The Company markets a line of products used by consumers to listen to music, to work and study from home, to communicate via telephone or internet, and to listen to other audio-related media. The Company distributes these products through distributors and retail channels in the U. S. and independent distributors throughout the rest of the world.

Koss Corporation competes with all major competitors in the stereo headphone market, many of which are large and diversified and have greater total assets and resources than the Company. The extent to which retailers and consumers view the Company as a pioneer in the creation of the personal listening industry, an innovative vendor of high-quality stereo headphone products, and a provider of excellent after-sales customer service and direct sales, is the extent to which the Company offers a competitive advantage. The Company relies upon its unique sound, quality workmanship, brand identification, engineering skills, and customer service, as well as its intellectual property portfolio, to support its competitive position.

The Company markets its products through many domestic retail outlets and numerous retailers worldwide. The Company also markets products directly to several OEMs for use in their products. In the fiscal years ended June 30, 2025 and 2024, the Company’s largest sales concentration was represented by its own DTC offerings via the Amazon portal and were approximately 19% and 17% of net sales in fiscal years 2025 and 2024, respectively. The Company’s five largest customers accounted for approximately 50% and 46% of net sales in fiscal years 2025 and 2024, respectively.