1. John Deere for high-tech indoor cannabis farms.

2. Applied Materials for the cannabis cultivation industry.

• Vertical Farming Units: Precision hardware systems designed for cultivating cannabis and hemp.
• Agrify Insights Software-as-a-Service (SaaS): Software for managing and optimizing cultivation processes.
• Integrated Grow Racks: Hardware structures specifically designed for plant growth.
• LED Grow Lights: Energy-efficient lighting solutions optimized for plant cultivation.
• Third-Party Cultivation Products: Non-proprietary items like air cleaning systems and pesticide-free surface protection products.
• Consulting Services: Expert advice and guidance for cannabis and hemp operations.
• Engineering Services: Design and development support for cultivation and extraction solutions.
• Construction Services: Building and installation support for cultivation facilities.

Here are the key risks to RYTHM, Inc.'s business:

1. Regulatory Uncertainty and Potential Federal Prohibition of Hemp-Derived THC Products

   A primary risk for RYTHM, Inc. stems from the evolving and uncertain regulatory landscape surrounding the cannabis and hemp industries, particularly concerning hemp-derived THC products. The company itself has identified the risk that Congress may not amend or repeal the pending federal prohibition on hemp-derived THC products, which is currently slated to take effect in November 2026. Such a federal prohibition or adverse regulatory changes could severely impact or even eliminate RYTHM's current business model, which heavily relies on its portfolio of hemp-derived THC brands and products, including Señorita THC Margaritas and RYTHM Beverages. States also have varied and often conflicting regulations for hemp-derived products, leading to legal challenges, enforcement actions, and a lack of uniformity in product standards, labeling, and warnings. This fragmented and unpredictable regulatory environment creates significant operational and strategic challenges, as the legality of RYTHM's key product offerings remains precarious.

2. Financial Viability and Challenges in Achieving Sustained Profitability

   RYTHM, Inc. faces significant financial risks, characterized by ongoing operating losses and a continued net loss. For the fourth quarter of 2025, the company reported an operating loss of $12.9 million and a net loss of $13.6 million, contributing to a full-year 2025 net loss of $33.3 million. The company is experiencing a notable cash burn from its operations. Furthermore, RYTHM has a substantial debt load, with approximately $80 million in debt maturing by 2027, making its future operations highly dependent on favorable legislative outcomes and access to financing. The company's strategic pivot from a cultivation technology provider to a branded consumer packaged goods (CPG) company is a high-stakes move, and there is a risk that the new leadership may not be able to successfully scale the CPG platform to profitability. Technically, the company's total liabilities can exceed its total assets when excluding intangible assets, indicating potential insolvency on a tangible basis.

3. Product Liability and Consumer Safety Risks in the THC Beverage Market

   As RYTHM focuses on THC-infused beverages, it is exposed to distinct product liability and consumer safety risks that blend concerns from both the alcohol and cannabis markets. These include challenges related to ensuring product safety, accurate dosing, appropriate packaging, responsible marketing practices, and potential liabilities associated with impaired driving. Unlike alcohol, the THC market lacks established guidelines for standard serving sizes, which can lead to overconsumption risks due to the delayed onset of effects. There are also concerns regarding the co-consumption of THC beverages with alcohol, which can amplify impairment. The industry is under scrutiny for marketing and advertising practices, with risks of appealing to minors or making unsubstantiated health claims. Insurers are often hesitant to provide coverage for hemp-derived THC products due to these liability and compliance concerns, which could leave RYTHM vulnerable to significant legal and financial repercussions from potential product liability lawsuits.

Rythm (symbol: RYM), officially known as RYTHM, Inc., is a public company that transitioned from Agrify Corporation on September 2, 2025, to focus on hemp-derived THC brands and products. The company's main products and services include hemp-derived THC beverages, cannabis flower, vapes, and concentrates. The addressable markets for these products are primarily within the United States.

The addressable markets for Rythm's main products and services in the U.S. are:

• Overall U.S. Cannabis Market: The U.S. cannabis market was estimated at USD 38.50 billion in 2024 and is projected to reach USD 44.30 billion in 2025. It is expected to grow to USD 76.39 billion by 2030, with a compound annual growth rate (CAGR) of 11.51% from 2025 to 2030. Other projections indicate the market could reach almost USD 47 billion in 2026 and USD 55.43 billion by 2030. Some forecasts are even more optimistic, predicting the U.S. cannabis market size to exceed USD 110.80 billion by 2033 and potentially reach USD 428.22 billion by 2032.
• Cannabis Flower: Flower remains the largest cannabis product category in the U.S., accounting for 44% of total cannabis revenue. Its market share in the U.S. has consistently been between 40-50% in recent years. Sales of cannabis flower in the U.S. grew from USD 4.92 billion in 2020 to USD 5.49 billion in 2021.
• Cannabis Edibles and Beverages: The U.S. cannabis edibles industry was valued at USD 10.6 billion in 2024 and is anticipated to reach USD 47.1 billion by 2034. The global cannabis edibles market, in which North America holds an 86% share, was estimated at USD 12.3 billion in 2024 and is expected to grow to USD 54 billion by 2034, with a CAGR of 15.9% from 2025 to 2034. The U.S. cannabis-infused edible products market size is projected to be valued at US$14.0 billion in 2026 and reach US$33.0 billion by 2033, growing at a CAGR of 14% during that period. The THC drinks category alone is approaching $1 billion today and is projected to grow to over $10 billion in the long term.
• Cannabis Concentrates and Vapes: The U.S. cannabis extract market size was estimated at USD 9.55 billion in 2024 and is expected to grow to approximately USD 50.83 billion by 2034, with a CAGR of 18.19% from 2025 to 2034. The cannabis concentrate market in North America, which is the largest regional market, was valued at USD 41.44 billion in 2024 and is expected to reach USD 196.31 billion by 2032, with a CAGR of 21.46%. Vapes and concentrates collectively account for 26% and 17% of U.S. cannabis revenue, respectively.

Here are 3-5 expected drivers of future revenue growth for Rythm (symbol: RYM) over the next 2-3 years:

1. Expansion of Hemp-Derived THC Product Distribution: Rythm is actively increasing the availability and visibility of its hemp-derived THC products across the United States. The company's strategy involves broad consumer access, with products distributed through thousands of physical locations and online channels. A significant recent example is the multi-year partnership with Chicago's United Center, making Rythm and Señorita hemp-derived THC beverages available at a major U.S. arena starting in February 2026. This expansion into new sales channels and high-visibility venues is expected to drive increased revenue.
2. Growth of Brand Portfolio, Particularly in THC Beverages: Rythm's strategic shift in August 2025 involved acquiring a portfolio of established brand intellectual property, including RYTHM, Señorita THC Margaritas, incredibles, Dogwalkers, and Beboe, among others. The company emphasizes its RYTHM-branded and Señorita THC Margaritas as key beverage offerings, with the United Center partnership specifically highlighting these products. The continued growth and market penetration of these brands, especially within the burgeoning THC beverage segment, are anticipated revenue drivers.
3. Strategic Repositioning as a Branded Consumer Products Business: Following its name change from Agrify Corporation in August/September 2025, Rythm repositioned itself as a branded consumer products business focused on hemp-derived THC, moving away from its previous focus on cultivation and extraction hardware and software. This strategic evolution allows the company to leverage brand recognition and directly address the growing consumer market for hemp-derived THC products, which is a new avenue for revenue generation.

Capital Allocation Decisions for Rythm (RYM)

Share Issuance

• The company's financing structure involved a reliance on strategic equity raises to fund a major business pivot.
• An increase in cash balance in the third quarter of 2025 was attributed to capital raising rather than operational activities.

Outbound Investments

• Agrify Corporation, the company's former name, acquired Señorita in December 2024.
• In August 2025, Agrify Corporation acquired all equity interests in VCP IP Holdings, LLC, which included intellectual property rights to several brands such as RYTHM, Beboe, and Dogwalkers.
• The company's capital allocation priorities in 2022 included strategic and accretive mergers and acquisitions, with a focus on internal integration after largely completing acquisitions in the extraction sector.

Capital Expenditures

• Capital expenditures totaled -$5.07 million over the trailing twelve months as of an August 2025 reference point.
• In 2022, the primary focus of capital deployment was on Total Turn-Key (TTK) projects.
• The company has shifted from a capital-intensive cultivation technology model to a branded consumer product focus, including the sale of its cultivation business in January 2025.