Management's Discussion and Analysis of Financial Condition and Results of Operations

You should read the following discussion and analysis of our financial condition and results of operations together with our financial statements and the related notes and other financial information included elsewhere in this offering. Some of the information contained in this discussion and analysis, including information regarding the strategy and plans for our business, includes forward-looking statements that involve risks and uncertainties. You should review the "Risk Factors" section for a discussion of important factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis.Overview

Botanical inspired nonalcoholic spirits, bringing sophistication & flavor to every drinking occasion

Milestones

Curated Beverages USA Inc. was incorporated in the State of Delaware in April 2022.

Since then, we have:

• $1M revenue in 2025, our third year of operations, with 82% growth rate.
• 50,000 bottles shipped to date, and growing
• Updated to all-natural preservatives, perfectly positioning product for natural grocery channel
• Two products awarded Gold and Double Gold at the prestigious San Francisco World Spirits Competition
• Our Blood Orange Aperitif was named a must-try aperitif in both alc and non-alc categories by SFWSC
• Team with CPG and retail expertise from SAB Miller, e.l.f. Cosmetics, and Walmart
• Launched in Whole Foods Market and Raleys

Historical Results of Operations

• Revenues & Gross Margin. For the period ended December 31, 2025, the Company had revenues of $1,008,144 compared to the year ended December 31, 2024, when the Company had revenues of $552,712. Our gross margin was 73.1% in fiscal year 2025, and 71.98% in 2024.
• Assets. As of December 31, 2025, the Company had total assets of $320,287, including $50,740 in cash. As of December 31, 2024, the Company had $162,008 in total assets, including $21,883 in cash.
• Net Loss. The Company has had net losses of $179,886 and net losses of $323,313 for the fiscal years ended December 31, 2025 and December 31, 2024, respectively.
• Liabilities. The Company's liabilities totaled $208,120 for the fiscal year ended December 31, 2025 and $143,453 for the fiscal year ended December 31, 2024.

Related Party Transaction

Refer to Question 26 of this Form C for disclosure of all related party transactions.

Liquidity & Capital Resources

To-date, the company has been financed with $241,695 in equity and $552,500 in SAFEs.

After the conclusion of this Offering, should we hit our minimum funding target, our projected runway is 6 months before we need to raise further capital.

We will likely require additional financing in excess of the proceeds from the Offering in order to perform operations over the lifetime of the Company. We plan to raise capital in 12 months. Except as otherwise described in this Form C, we do not have additional sources of capital other than the proceeds from the offering. Because of the complexities and uncertainties in establishing a new business strategy, it is not possible to adequately project whether the proceeds of this offering will be sufficient to enable us to implement our strategy. This complexity and uncertainty will be increased if less than the maximum amount of securities offered in this offering is sold. The Company intends to raise additional capital in the future from investors. Although capital may be available for early-stage companies, there is no guarantee that the Company will receive any investments from investors.

Runway & Short/Mid Term Expenses

Curated Beverages USA Inc. cash in hand is $73,339, as of April 2025. Over the last three months, revenues have averaged $82,376/month, cost of goods sold has averaged $18,404/month, and operational expenses have averaged $90,328/month, for an average burn rate of $26,356 per month. Our intent is to be profitable in 24 months.

Since December 31, 2025, the business has continued to grow while improving our loss ratio year-over-year. This enhanced profitability is driven by higher sales volumes covering fixed costs more effectively, alongside operational savings from transitioning warehousing and fulfillment to a third-party logistics provider. We did absorb higher tariff costs in Q1 2026, however we expect this to be refunded through the Tariff Refund Act of 2026. 

Over the next six months, we expect monthly revenues to average $110K against expenses of approximately $125K, reflecting a continued but narrowing monthly burn as we scale. Profitability will continue to improve as increased sales volume drives better fixed cost absorption and we expand our retail footprint -- most notably through our recent placement in Whole Foods Market. We anticipate reaching profitability in the second half of 2028.

We are not currently profitable. Our primary focus is growth and building brand awareness to secure placement in chain retail. We expect to need $500k in funding in order to reach profitability at the end of 2028. 

We currently have sufficient funds to cover operating expenses through the end of June 2026. In parallel, we have applied for a line of credit to provide additional operating flexibility ahead of our planned capital raise in the second half of the year. That raise -- targeting growth capital to fuel expanded retail placements and broader market development -- is already in early stages with prospective investors. Together, these sources are designed to bridge us through to a stronger revenue base.

All projections in the above narrative are forward-looking and not guaranteed.