Charles & Colvard (CTHR) 10-Q 5 May 22 2022 Q3 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	9 Months Ended
	Mar. 31, 2022	Apr. 29, 2022
Cover [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Quarterly Report	true
Document Period End Date	Mar. 31, 2022
Current Fiscal Year End Date	--06-30
Document Fiscal Year Focus	2022
Document Fiscal Period Focus	Q3
Document Transition Report	false
Entity File Number	000-23329
Entity Registrant Name	Charles & Colvard, Ltd.
Entity Central Index Key	0001015155
Entity Incorporation, State or Country Code	NC
Entity Tax Identification Number	56-1928817
Entity Address, Address Line One	170 Southport Drive
Entity Address, City or Town	Morrisville
Entity Address, State or Province	NC
Entity Address, Postal Zip Code	27560
City Area Code	919
Local Phone Number	468-0399
Title of 12(b) Security	Common Stock, no par value per share
Trading Symbol	CTHR
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		30,688,796

CONDENSED CONSOLIDATED BALANCE

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($)	Mar. 31, 2022	Jun. 30, 2021
Current assets:
Cash and cash equivalents	$ 16,861,685	$ 21,302,317
Restricted cash	5,050,000	144,634
Accounts receivable, net	1,565,541	1,662,074
Inventory, net	13,440,016	11,450,141
Note receivable	250,000	250,000
Prepaid expenses and other assets	1,328,244	952,065
Total current assets	38,495,486	35,761,231
Long-term assets:
Inventory, net	19,063,408	17,722,579
Property and equipment, net	1,781,966	875,897
Intangible assets, net	242,554	209,658
Operating lease right-of-use assets	2,935,124	3,952,146
Deferred income taxes, net	5,867,662	6,350,830
Other assets	49,658	49,658
Total long-term assets	29,940,372	29,160,768
TOTAL ASSETS	68,435,858	64,921,999
Current liabilities:
Accounts payable	3,130,684	2,774,373
Operating lease liabilities	850,781	566,083
Accrued expenses and other liabilities	2,053,873	2,281,807
Total current liabilities	6,035,338	5,622,263
Long-term liabilities:
Noncurrent operating lease liabilities	3,039,216	3,600,842
Accrued income taxes	11,292	9,878
Total long-term liabilities	3,050,508	3,610,720
Total liabilities	9,085,846	9,232,983
Commitments and contingencies (Note 9)
Shareholders' equity:
Common stock, no par value; 50,000,000 shares authorized; 30,688,796 and 29,913,095 shares issued and outstanding at March 31, 2022 and June 30, 2021, respectively	57,066,143	56,057,109
Additional paid-in capital	25,927,410	25,608,593
Accumulated deficit	(23,643,541)	(25,976,686)
Total shareholders' equity	59,350,012	55,689,016
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY	$ 68,435,858	$ 64,921,999

CONDENSED CONSOLIDATED BALANC_2

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Mar. 31, 2022	Jun. 30, 2021
Shareholders' equity
Common stock, par value (in dollars per share)	$ 0	$ 0
Common stock, shares authorized (in shares)	50,000,000	50,000,000
Common stock, shares issued (in shares)	30,688,796	29,913,095
Common stock, shares outstanding (in shares)	30,688,796	29,913,095

CONDENSED CONSOLIDATED STATEMEN

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($)	3 Months Ended		9 Months Ended
	Mar. 31, 2022	Mar. 31, 2021	Mar. 31, 2022	Mar. 31, 2021
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS [Abstract]
Net sales	$ 9,751,835	$ 9,436,056	$ 33,785,281	$ 29,509,140
Costs and expenses:
Cost of goods sold	5,296,530	5,093,452	17,347,026	15,457,215
Sales and marketing	2,932,587	2,211,350	9,741,774	6,339,854
General and administrative	1,106,850	1,092,683	3,880,684	3,278,246
Total costs and expenses	9,335,967	8,397,485	30,969,484	25,075,315
Income from operations	415,868	1,038,571	2,815,797	4,433,825
Other income (expense):
Interest income	1,120	540	1,964	5,126
Interest expense	0	(2,412)	0	(7,318)
Loss on foreign currency exchange	0	0	(34)	(603)
Total other income (expense), net	1,120	(1,872)	1,930	(2,795)
Income before income taxes	416,988	1,036,699	2,817,727	4,431,030
Income tax expense	(78,480)	(472)	(484,582)	(1,460)
Net income	$ 338,508	$ 1,036,227	$ 2,333,145	$ 4,429,570
Net income per common share:
Basic (in dollars per share)	$ 0.01	$ 0.04	$ 0.08	$ 0.15
Diluted (in dollars per share)	$ 0.01	$ 0.03	$ 0.07	$ 0.15
Weighted average number of shares used in computing net income per common share:
Basic (in shares)	30,484,897	29,320,434	30,286,195	28,967,946
Diluted (in shares)	31,268,410	30,525,438	31,271,677	29,667,729

CONDENSED CONSOLIDATED STATEM_2

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY - USD ($)	Common Stock [Member]	Additional Paid-in Capital [Member]	Accumulated Deficit [Member]	Total
Balance at Jun. 30, 2020	$ 54,342,864	$ 25,880,165	$ (38,787,452)	$ 41,435,577
Balance (in shares) at Jun. 30, 2020	28,949,410
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock-based compensation	$ 0	107,355	0	107,355
Issuance of restricted stock	$ 0	0	0	0
Issuance of restricted stock (in shares)	178,750
Retirement of restricted stock	$ 0	0	0	0
Retirement of restricted stock (in shares)	(162,500)
Net income	$ 0	0	874,266	874,266
Balance at Sep. 30, 2020	$ 54,342,864	25,987,520	(37,913,186)	42,417,198
Balance (in shares) at Sep. 30, 2020	28,965,660
Balance at Jun. 30, 2020	$ 54,342,864	25,880,165	(38,787,452)	41,435,577
Balance (in shares) at Jun. 30, 2020	28,949,410
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income				4,429,570
Balance at Mar. 31, 2021	$ 55,932,808	25,575,521	(34,357,882)	47,150,447
Balance (in shares) at Mar. 31, 2021	29,852,950
Balance at Sep. 30, 2020	$ 54,342,864	25,987,520	(37,913,186)	42,417,198
Balance (in shares) at Sep. 30, 2020	28,965,660
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock-based compensation	$ 0	87,938	0	87,938
Stock option exercises	$ 177,325	(62,326)	0	114,999
Stock option exercises (in shares)	126,666
Net income	$ 0	0	2,519,077	2,519,077
Balance at Dec. 31, 2020	$ 54,520,189	26,013,132	(35,394,109)	45,139,212
Balance (in shares) at Dec. 31, 2020	29,092,326
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock-based compensation	$ 0	76,916	0	76,916
Stock option exercises	$ 1,412,619	(514,527)	0	898,092
Stock option exercises (in shares)	760,624
Net income	$ 0	0	1,036,227	1,036,227
Balance at Mar. 31, 2021	$ 55,932,808	25,575,521	(34,357,882)	47,150,447
Balance (in shares) at Mar. 31, 2021	29,852,950
Balance at Jun. 30, 2021	$ 56,057,109	25,608,593	(25,976,686)	55,689,016
Balance (in shares) at Jun. 30, 2021	29,913,095
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock-based compensation	$ 0	279,407	0	279,407
Issuance of restricted stock	$ 0	0	0	0
Issuance of restricted stock (in shares)	242,725
Stock option exercises	$ 397,112	(139,742)	0	257,370
Stock option exercises (in shares)	183,637
Net income	$ 0	0	827,025	827,025
Balance at Sep. 30, 2021	$ 56,454,221	25,748,258	(25,149,661)	57,052,818
Balance (in shares) at Sep. 30, 2021	30,339,457
Balance at Jun. 30, 2021	$ 56,057,109	25,608,593	(25,976,686)	55,689,016
Balance (in shares) at Jun. 30, 2021	29,913,095
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income				2,333,145
Balance at Mar. 31, 2022	$ 57,066,143	25,927,410	(23,643,541)	59,350,012
Balance (in shares) at Mar. 31, 2022	30,688,796
Balance at Sep. 30, 2021	$ 56,454,221	25,748,258	(25,149,661)	57,052,818
Balance (in shares) at Sep. 30, 2021	30,339,457
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock-based compensation	$ 0	199,004	0	199,004
Stock option exercises	$ 447,877	(159,329)	0	288,548
Stock option exercises (in shares)	255,590
Net income	$ 0	0	1,167,612	1,167,612
Balance at Dec. 31, 2021	$ 56,902,098	25,787,933	(23,982,049)	58,707,982
Balance (in shares) at Dec. 31, 2021	30,595,047
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock-based compensation	$ 0	198,523	0	198,523
Stock option exercises	$ 164,045	(59,046)	0	104,999
Stock option exercises (in shares)	93,749
Net income	$ 0	0	338,508	338,508
Balance at Mar. 31, 2022	$ 57,066,143	$ 25,927,410	$ (23,643,541)	$ 59,350,012
Balance (in shares) at Mar. 31, 2022	30,688,796

CONDENSED CONSOLIDATED STATEM_3

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)	9 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$ 2,333,145	$ 4,429,570
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	350,198	419,511
Stock-based compensation	676,934	272,209
Provision for uncollectible accounts	26,000	53,514
(Recovery of) Provision for sales returns	(25,000)	67,000
Inventory write-off	232,000	128,000
Provision for accounts receivable discounts	3,269	29,123
Deferred income taxes	483,168	0
Changes in operating assets and liabilities:
Accounts receivable	92,264	(1,617,077)
Inventory	(3,562,704)	1,559,759
Prepaid expenses and other assets, net	640,843	(3,451,872)
Accounts payable	356,311	(827,665)
Accrued income taxes	1,414	1,460
Accrued expenses and other liabilities	(504,862)	3,604,002
Net cash provided by operating activities	1,102,980	4,667,534
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment	(1,250,296)	(346,112)
Payment to fund note receivable	0	(250,000)
Payments for intangible assets	(38,867)	(26,374)
Net cash used in investing activities	(1,289,163)	(622,486)
CASH FLOWS FROM FINANCING ACTIVITIES:
Stock option exercises	650,917	1,013,091
Net cash provided by financing activities	650,917	1,013,091
NET INCREASE IN CASH, CASH EQUIVALENTS, AND RESTRICTED CASH	464,734	5,058,139
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH, BEGINNING OF PERIOD	21,446,951	14,617,234
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH, END OF PERIOD	21,911,685	19,675,373
Supplemental disclosure of non-cash investing and financing activities:
Additions to right-of-use assets in connection with operating lease liabilities	0	3,908,249
Supplemental disclosure of cash flow information:
Cash paid during the period for income taxes	$ 0	$ 9,050

DESCRIPTION OF BUSINESS

DESCRIPTION OF BUSINESS	9 Months Ended
	Mar. 31, 2022
DESCRIPTION OF BUSINESS [Abstract]
DESCRIPTION OF BUSINESS	1. DESCRIPTION OF BUSINESS Charles & Colvard, Ltd. (the “Company”), a North Carolina corporation, was founded in 1995. The Company manufactures, markets, and distributes Charles & Colvard Created Moissanite ® Forever One™ Caydia ® The Company sells loose moissanite jewels, loose lab grown diamonds, and finished jewelry featuring both moissanite and lab grown diamonds at wholesale prices to distributors, manufacturers, retailers, and designers, including some of the largest distributors and jewelry manufacturers in the world. The Company’s finished jewelry and loose moissanite jewels and lab grown diamonds that are mounted into fine jewelry by other manufacturers are sold at retail outlets and via the Internet. The Company sells at retail prices to end-consumers through its wholly owned operating subsidiary, charlesandcolvard.com, LLC, third-party online marketplaces, drop-ship, and other pure-play, exclusively e-commerce outlets. The Company also sells at discount retail prices to end-consumers through moissaniteoutlet.com, LLC, a wholly owned operating subsidiary of charlesandcolvard.com, LLC, and third-party online marketplaces.

BASIS OF PRESENTATION AND SIGNI

BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES	9 Months Ended
	Mar. 31, 2022
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES [Abstract]
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES	2. BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation and Principles of Consolidation The accompanying unaudited condensed consolidated financial statements included in this Quarterly Report on Form 10-Q have been prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information. However, certain information or footnote disclosures normally included in complete financial statements prepared in accordance with U.S. GAAP have been condensed, or omitted, pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). In the opinion of the Company’s management, the unaudited condensed consolidated financial statements in this Quarterly Report on Form 10-Q include all normal and recurring adjustments necessary for the fair statement of the results for the interim periods presented. The results for the nine months ended March 31, 2022 are not necessarily indicative of the results to be expected for the fiscal year ending June 30, 2022. The condensed consolidated financial statements as of March 31, 2022 and for the three and nine months ended March 31, 2022 and 2021 included in this Quarterly Report on Form 10-Q are unaudited. The balance sheet as of June 30, 2021 is derived from the audited financial statements as of that date. The accompanying statements should be read in conjunction with the audited financial statements and related notes contained in Item 8 of the Company’s Annual Report on Form 10-K (the “2021 Annual Report”) for the fiscal year ended June 30, 2021 filed with the SEC on September 3, 2021. The accompanying condensed consolidated financial statements as of March 31, 2022, for the three and nine months ended March 31, 2022 and 2021, and as of June 30, 2021, include the accounts of the Company and its wholly owned subsidiaries charlesandcolvard.com, LLC, including its wholly-owned subsidiary, moissaniteoulet.com, LLC, which was formed and incorporated as of February 24, 2022 Significant Accounting Policies – Use of Estimates Cash and Cash Equivalents – Restricted Cash – In accordance with cash management process requirements related to the Company’s asset-based revolving credit facility from White Oak Commercial Finance, LLC (“White Oak”), which the Company had in place prior to obtaining the JPMorgan Chase Credit Facility, there were access and usage restrictions on certain cash deposit balances for periods of up to two The reconciliation of cash, cash equivalents, and restricted cash, as presented on the Condensed Consolidated Statements of Cash Flows, consist of the following as of the dates presented: March 31, 2022 June 30, 2021 Cash and cash equivalents $ 16,861,685 $ 21,302,317 Restricted cash 5,050,000 144,634 Total cash, cash equivalents, and restricted cash $ 21,911,685 $ 21,446,951 Recently Adopted/Issued Accounting Pronouncements – In March 2020, and as updated in January 2021, in response to concerns about structural risks of interbank offered rates (“IBORs”), and, particularly, the risk of cessation of the London Interbank Offered Rate (“LIBOR”), the FASB issued new guidance to ease the burden in accounting for or recognizing the effects of reference interest rate reform on financial reporting. The new guidance is effective as of March 12, 2020 through December 31, 2022. As described in more detail in Note 10, “Debt”, borrowings under the Company’s new line of credit are based on a rate equal to the one-month LIBOR. As of March 31, 2022, the Company had not borrowed against its line of credit, and therefore, is not subject to recognizing or disclosing any effect of reference rate reform as of March 31, 2022.

SEGMENT INFORMATION AND GEOGRAP

SEGMENT INFORMATION AND GEOGRAPHIC DATA	9 Months Ended
	Mar. 31, 2022
SEGMENT INFORMATION AND GEOGRAPHIC DATA [Abstract]
SEGMENT INFORMATION AND GEOGRAPHIC DATA	3. SEGMENT INFORMATION AND GEOGRAPHIC DATA The Company reports segment information based on the “management” approach. The management approach designates the internal reporting used by management for making operating decisions and assessing performance as the source of the Company’s operating and reportable segments. The Company manages its business through two operating and reportable segments based on its distribution channels to sell its product lines, loose jewels and finished jewelry: its “Online Channels” segment, which consists of e-commerce outlets including charlesandcolvard.com, moissaniteoutlet.com, third-party online marketplaces, drop-ship retail, and other pure-play, exclusively e-commerce outlets; and its “Traditional” segment, which consists of wholesale and retail customers. The accounting policies of the Online Channels segment and Traditional segment are the same as those described in Note 2, “Basis of Presentation and Significant Accounting Policies” of this Quarterly Report on Form 10-Q and in the Notes to the Consolidated Financial Statements in the 2021 Annual Report. The Company evaluates the financial performance of its segments based on net sales; product line gross profit, or the excess of product line sales over product line cost of goods sold; and operating income. The Company’s product line cost of goods sold is defined as product cost of goods sold, excluding non-capitalized expenses from the Company’s manufacturing and production control departments, comprising personnel costs, depreciation, leases, utilities, and corporate overhead allocations; freight out; inventory write-downs; and other inventory adjustments, comprising costs of quality issues, and damaged goods. The Company allocates certain general and administrative expenses between its Online Channels segment and its Traditional segment based on net sales and number of employees to arrive at segment operating income. Unallocated expenses remain in its Traditional segment. Summary financial information by reportable segment is as follows: Three Months Ended March 31, 2022 Online Channels Traditional Total Net sales Finished jewelry $ 5,720,197 $ 1,700,394 $ 7,420,591 Loose jewels 634,617 1,696,627 2,331,244 Total $ 6,354,814 $ 3,397,021 $ 9,751,835 Product line cost of goods sold Finished jewelry $ 2,560,952 $ 1,148,912 $ 3,709,864 Loose jewels 229,714 784,272 1,013,986 Total $ 2,790,666 $ 1,933,184 $ 4,723,850 Product line gross profit Finished jewelry $ 3,159,245 $ 551,482 $ 3,710,727 Loose jewels 404,903 912,355 1,317,258 Total $ 3,564,148 $ 1,463,837 $ 5,027,985 Operating income $ 350,276 $ 65,592 $ 415,868 Depreciation and amortization $ 52,613 $ 59,374 $ 111,987 Capital expenditures $ 28,145 $ 446,445 $ 474,590 Three Months Ended March 31, 2021 Online Channels Traditional Total Net sales Finished jewelry $ 4,902,964 $ 1,316,928 $ 6,219,892 Loose jewels 680,804 2,535,360 3,216,164 Total $ 5,583,768 $ 3,852,288 $ 9,436,056 Product line cost of goods sold Finished jewelry $ 2,045,519 $ 1,006,417 $ 3,051,936 Loose jewels 246,302 1,222,036 1,468,338 Total $ 2,291,821 $ 2,228,453 $ 4,520,274 Product line gross profit Finished jewelry $ 2,857,445 $ 310,511 $ 3,167,956 Loose jewels 434,502 1,313,324 1,747,826 Total $ 3,291,947 $ 1,623,835 $ 4,915,782 Operating income $ 751,953 $ 286,618 $ 1,038,571 Depreciation and amortization $ 67,373 $ 81,077 $ 148,450 Capital expenditures $ 22,770 $ 55,858 $ 78,628 Nine Months Ended March 31, 2022 Online Channels Traditional Total Net sales Finished jewelry $ 18,659,690 $ 4,986,354 $ 23,646,044 Loose jewels 2,388,584 7,750,653 10,139,237 Total $ 21,048,274 $ 12,737,007 $ 33,785,281 Product line cost of goods sold Finished jewelry $ 7,705,127 $ 3,043,196 $ 10,748,323 Loose jewels 877,604 3,630,393 4,507,997 Total $ 8,582,731 $ 6,673,589 $ 15,256,320 Product line gross profit Finished jewelry $ 10,954,563 $ 1,943,158 $ 12,897,721 Loose jewels 1,510,980 4,120,260 5,631,240 Total $ 12,465,543 $ 6,063,418 $ 18,528,961 Operating income $ 2,104,674 $ 711,123 $ 2,815,797 Depreciation and amortization $ 173,786 $ 176,412 $ 350,198 Capital expenditures $ 114,445 $ 1,135,851 $ 1,250,296 Nine Months Ended March 31, 2021 Online Channels Traditional Total Net sales Finished jewelry $ 15,114,765 $ 3,705,663 $ 18,820,428 Loose jewels 2,520,576 8,168,136 10,688,712 Total $ 17,635,341 $ 11,873,799 $ 29,509,140 Product line cost of goods sold Finished jewelry $ 6,242,635 $ 2,565,737 $ 8,808,372 Loose jewels 947,417 4,070,446 5,017,863 Total $ 7,190,052 $ 6,636,183 $ 13,826,235 Product line gross profit Finished jewelry $ 8,872,130 $ 1,139,926 $ 10,012,056 Loose jewels 1,573,159 4,097,690 5,670,849 Total $ 10,445,289 $ 5,237,616 $ 15,682,905 Operating income $ 3,021,067 $ 1,412,758 $ 4,433,825 Depreciation and amortization $ 180,946 $ 238,565 $ 419,511 Capital expenditures $ 195,695 $ 150,417 $ 346,112 The Company does not allocate any assets to the reportable segments, and, therefore, no asset information is reported to the chief operating decision maker or disclosed in the financial information for each segment. A reconciliation of the Company’s product line cost of goods sold to cost of goods sold as reported in the condensed consolidated financial statements is as follows: Three Months Ended March 31, Nine Months Ended March 31, 2022 2021 2022 2021 Product line cost of goods sold $ 4,723,850 $ 4,520,274 $ 15,256,320 $ 13,826,235 Non-capitalized manufacturing and production control expenses 484,299 398,073 1,243,528 1,122,715 Freight out 294,143 191,700 976,855 683,580 Inventory write-off - 23,000 232,000 128,000 Other inventory adjustments (205,762 ) (39,595 ) (361,677 ) (303,315 ) Cost of goods sold $ 5,296,530 $ 5,093,452 $ 17,347,026 $ 15,457,215 The Company recognizes sales by geographic area based on the country in which the customer is based. Sales to international end consumers made through the Company’s transactional websites, charlesandcolvard.com and moissaniteoutlet.com, are included in international sales for financial reporting purposes. A portion of the Company’s Traditional segment sales made to international wholesale distributors represents products sold internationally that may be re-imported to U.S. retailers. The following presents net sales by geographic area: Three Months Ended March 31, Nine Months Ended March 31, 2022 2021 2022 2021 Net sales United States $ 9,390,774 $ 8,969,267 $ 32,237,221 $ 27,857,667 International 361,061 466,789 1,548,060 1,651,473 Total $ 9,751,835 $ 9,436,056 $ 33,785,281 $ 29,509,140

FAIR VALUE MEASUREMENTS

FAIR VALUE MEASUREMENTS	9 Months Ended
	Mar. 31, 2022
FAIR VALUE MEASUREMENTS [Abstract]
FAIR VALUE MEASUREMENTS	4. FAIR VALUE MEASUREMENTS Under U.S. GAAP, fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. U.S. GAAP also establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are obtained from independent sources and can be validated by a third party, whereas unobservable inputs reflect assumptions regarding what a third party would use in pricing an asset or liability. The fair value hierarchy consists of three levels based on the reliability of inputs, as follows: Level 1. Level 2. Level 3. The Company evaluates assets and liabilities subject to fair value measurements on a recurring and non-recurring basis to determine the appropriate level to classify them for each reporting period. This determination requires significant judgments to be made by management of the Company. The financial instruments identified as subject to fair value measurements on a recurring basis are cash and cash equivalents, notes receivable, trade accounts receivable, and trade accounts payable. All financial instruments are reflected in the condensed consolidated balance sheets at carrying value, which approximates fair value due to the short-term nature of these financial instruments. Assets that are measured at fair value on a non-recurring basis include property and equipment, leasehold improvements, and intangible assets comprising patents, license rights, and trademarks. These items are recognized at fair value when they are considered to be impaired. For the three and nine months ended March 31, 2022 and 2021, no impairment was recorded.

INVENTORIES

INVENTORIES	9 Months Ended
	Mar. 31, 2022
INVENTORIES [Abstract]
INVENTORIES	5. INVENTORIES The Company’s total inventories, net of reserves, consisted of the following as of the dates presented: March 31, 2022 June 30, 2021 Finished jewelry: Raw materials $ 1,469,003 $ 1,476,514 Work-in-process 1,279,987 779,593 Finished goods 11,386,771 8,025,816 Finished goods on consignment 2,258,071 2,050,372 Total finished jewelry $ 16,393,832 $ 12,332,295 Loose jewels: Raw materials $ 1,692,819 $ 1,775,505 Work-in-process 8,285,457 9,893,443 Finished goods 5,714,303 4,942,192 Finished goods on consignment 328,167 154,968 Total loose jewels 16,020,746 16,766,108 Total supplies inventory 88,846 74,317 Total inventory $ 32,503,424 $ 29,172,720 As of the dates presented, the Company’s total inventories, net of reserves, are classified as follows: March 31, 2022 June 30, 2021 Short-term portion $ 13,440,016 $ 11,450,141 Long-term portion 19,063,408 17,722,579 Total $ 32,503,424 $ 29,172,720 The Company’s work-in-process inventories include raw SiC crystals on which processing costs, such as labor and sawing, have been incurred; and components, such as metal castings and finished goods set with moissanite jewels, that have been issued to jobs in the manufacture of finished jewelry. The Company’s moissanite jewel manufacturing process involves the production of intermediary shapes, called “preforms,” that vary depending upon the expected size and shape of the finished jewel. To maximize manufacturing efficiencies, preforms may be made in advance of current finished inventory needs but remain in work-in-process inventories. As of March 31, 2022 and June 30, 2021, work-in-process inventories issued to active production jobs approximated $2.44 million and $2.23 million, respectively. The Company’s moissanite and lab grown diamond jewels do not degrade in quality over time and inventory generally consists of the shapes and sizes most commonly used in the jewelry industry. In addition, approximately one-half The Company manufactures finished jewelry featuring moissanite and lab grown diamonds. Relative to loose moissanite jewels and lab grown diamonds, finished jewelry is more fashion-oriented and subject to styling trends that could render certain designs obsolete over time. The majority of the Company’s finished jewelry featuring moissanite and lab grown diamonds is held in inventory for resale and largely consists of such core designs as stud earrings, solitaire and three-stone rings, pendants, and bracelets that tend not to be subject to significant obsolescence risk due to their classic styling. In addition, the Company generally holds smaller quantities of designer-inspired and trend moissanite fashion jewelry that is available for resale through retail companies and through its Online Channels segment. The Company also carries a limited amount of inventory as part of its sample line that the Company uses in the selling process to its customers. The Company’s continuing operating subsidiaries carry no net inventories, and inventory is transferred without intercompany markup from the parent entity as product line cost of goods sold when sold to the end consumer. The Company’s inventories are stated at the lower of cost or net realizable value on an average cost basis. Each accounting period the Company evaluates the valuation and classification of inventories including the need for potential adjustments to inventory-related reserves, which include significant estimates by management, including the effect of market factors and sales trends. .

NOTE RECEIVABLE

NOTE RECEIVABLE	9 Months Ended
	Mar. 31, 2022
NOTE RECEIVABLE [Abstract]
NOTE RECEIVABLE	6. NOTE RECEIVABLE On March 5, 2021, the Company entered into a $250,000 convertible promissory note agreement (the “Convertible Promissory Note”) with an unrelated third-party strategic marketing partner. The Convertible Promissory Note is unsecured and originally matured on March 5, 2022. In February 2022, the Company entered into an amendment to the Convertible Promissory Note that was effective as of December 9, 2021 and changed the maturity date to September 30, 2022 (the “Maturity Date”). Convertible is accrued at a simple rate of 0.14% per annum and will accrue until the Convertible Promissory Note is converted in accordance with the conversion privileges contained within the Convertible Promissory Note or is repaid. Convertible Promissory Note Subject to the borrower’s completion of a specified equity financing transaction (an “Equity Financing”) on or prior to the Maturity Date, the unpaid principal amount, including accrued and unpaid interest, automatically converts into equity units of the most senior class of equity securities issued to investors in the Equity Financing at the lesser of 80% of the per unit price of the units purchased by investors or the price equal to $33,500,000 divided by the aggregate number of outstanding units of the borrower immediately prior to the closing of the financing. Unless converted as provided in the Convertible Promissory Note, the principal amount, including accrued and unpaid interest, will, on the Maturity Date, at the Company’s option either ( i ii

ACCRUED EXPENSES AND OTHER LIAB

ACCRUED EXPENSES AND OTHER LIABILITIES	9 Months Ended
	Mar. 31, 2022
ACCRUED EXPENSES AND OTHER LIABILITIES [Abstract]
ACCRUED EXPENSES AND OTHER LIABILITIES	7. ACCRUED EXPENSES AND OTHER LIABILITIES Accrued expenses and other liabilities consist of the following as of the dates presented: March 31, 2022 June 30, 2021 Accrued sales tax $ 811,366 $ 555,547 Accrued compensation and related benefits 631,117 866,705 Deferred revenue 505,148 774,891 Accrued cooperative advertising 89,763 68,185 Accrued income taxes 16,478 16,478 Other 1 1 Total accrued expenses and other liabilities $ 2,053,873 $ 2,281,807

INCOME TAXES

INCOME TAXES	9 Months Ended
	Mar. 31, 2022
INCOME TAXES [Abstract]
INCOME TAXES	8. INCOME TAXES For each of the three and nine months ended March 31, 2022, the Company’s statutory tax rate was 22.24% and consisted of the federal income tax rate of 21% and a blended state income tax rate of 1.24%, net of the federal benefit. For each of the three and nine months ended March 31 March 31 As of each reporting date, the Company’s management considers new evidence, both positive and negative, that could impact its view with regard to future realization of deferred tax assets. As of June 30, 2021, cumulative positive taxable income over the last three tax years had been generated in the U.S., as compared to the negative evidence of cumulative losses in previous years. The Company’s management also determined that its expectations of future taxable income in upcoming tax years, including estimated growth rates applied to future expected taxable income that included significant management estimates and assumptions, would be sufficient to result in full utilization of the Company’s federal net operating loss carryforwards and certain of the deferred tax assets prior to any statutory expiration. As a result, the Company’s management determined that sufficient positive evidence existed as of June 30, 2021, to conclude that it was more likely than not deferred tax assets of approximately $6.35 million would be realizable, and it reduced the Company’s valuation allowance accordingly. Accordingly, the Company recognized a net income tax expense of approximately $78,000 and $485,000 for the three and nine months ended March 31 1,500 March 31 the Company records estimated taxes $500 for each of the three months ended March 31, 2022 and 2021, respectively, and approximately $1,500 for each of the nine months ended March 31, 2022 and 2021, respectively As of March 31, 2022 March 31

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES	9 Months Ended
	Mar. 31, 2022
COMMITMENTS AND CONTINGENCIES [Abstract]
COMMITMENTS AND CONTINGENCIES	9. COMMITMENTS AND CONTINGENCIES Lease Arrangements On December 9, 2013, the Company entered into a Lease Agreement, as amended on December 23, 2013, April 15, 2014, and January 29, 2021 (the “Lease Agreement”), for its corporate headquarters, which occupies approximately 36,350 square feet of office, storage and light manufacturing space and is classified as an operating lease for financial reporting purposes. The expiration date of the base term of the Lease Agreement in effect as of March 31, 2022 is October 31, 2026 and the terms of the Lease Agreement contain no early termination provisions. Provided there is no outstanding uncured event of default under the Lease Agreement, the Company has an option to extend the lease term for a period of five years. The Company’s option to extend the term of the Lease Agreement must be exercised in writing on or before 270 days prior to expiration of the then-current term. If the option is exercised, the monthly minimum rent for each of the extended terms will be adjusted to the then prevailing fair market rate. The Company took possession of the leased property on May 23, 2014, once certain improvements to the leased space were completed and did not have access to the property before this date. Upon execution of the third amendment to the Lease Agreement (the “Lease Amendment”) on January 29, 2021, the Lease Amendment included a rent abatement in the amount of approximately $214,000, which is reflected in the rent payments used in the calculation of the right-of-use (“ROU”) asset and lease liability once remeasured upon the execution of the Lease Amendment to extend the lease term. The Lease Amendment also included an allowance for leasehold improvements offered by the landlord in an amount not to exceed approximately $545,000. During the three months ended March 31, 2022, the Company was reimbursed $506,054 by the landlord for qualified leasehold improvements in accordance with the terms of the Lease Amendment. This reimbursement by the landlord reduced the remaining ROU asset by the same amount and will be recognized prospectively over the remaining term of the lease. The Company has no other material operating leases and is not party to leases that would qualify for classification as a finance lease, variable lease, or short-term lease. As of March 31, 2022, the Company’s balance sheet classifications of its leases are as follows: Operating Leases: Noncurrent operating lease ROU assets $ 2,935,124 Current operating lease liabilities $ 850,781 Noncurrent operating lease liabilities 3,039,216 Total operating lease liabilities $ 3,889,997 The Company’s total operating lease cost was approximately $193,000 and $192,000 for the three months ended March 31, 2022 and 2021, respectively. The Company’s total operating lease cost was approximately $596,000 and $473,000 for the nine months ended March 31, 2022 and 2021, respectively. As of March 31, 2021, the Company’s estimated incremental borrowing rate used and assumed discount rate with respect to operating leases was 2.81% and the remaining operating lease term was 4.58 years. As of March 31, 2022, the Company’s remaining future payments under operating leases for each fiscal year ending June 30 are as follows: 2022 $ 213,521 2023 869,742 2024 893,660 2025 918,236 2026 943,487 2027 317,327 Total lease payments 4,155,973 Less: imputed interest 265,976 Present value of lease payments 3,889,997 Less: current lease liability 850,781 Total long-term lease liability $ 3,039,216 The Company makes cash payments for amounts included in the measurement of its lease liabilities. During the three months ended March 31, 2022 and 2021, cash paid for operating leases was approximately $160,000 in each period presented. During the nine months ended March 31, 2022 and 2021, cash paid for operating leases was approximately $330,000 and $481,000, respectively. Upon the execution of the Lease Amendment, the Company recorded additional ROU assets in the amount of approximately $3.9 million obtained in exchange for the additional operating lease liability during the fiscal year ended June 30, 2021. Purchase Commitments On December 12, 2014, the Company entered into an exclusive supply agreement (the “Supply Agreement”) with Cree, Inc., now known as Wolfspeed, Inc. (“Wolfspeed”). Under the Supply Agreement, subject to certain terms and conditions, the Company agreed to exclusively purchase from Wolfspeed, and Wolfspeed agreed to exclusively supply, 100% of the Company’s required SiC materials in quarterly installments that must equal or exceed a set minimum order quantity. The initial term of the Supply Agreement was scheduled to expire on June 24, 2018, unless extended by the parties. Effective June 22, 2018, the Supply Agreement was amended to extend the expiration date to June 25, 2023. The Supply Agreement was also amended to (i) provide the Company with one option, subject to certain conditions, to unilaterally extend the term of the Supply Agreement for an additional two-year period following expiration of the initial term; (ii) establish a process by which Wolfspeed may begin producing alternate SiC material based on the Company’s specifications that will give the Company the flexibility to use the materials in a broader variety of its products; and (iii) permit the Company to purchase certain amounts of SiC materials from third parties under limited conditions. Effective June 30, 2020, the Supply Agreement was further amended to extend the expiration date to June 29, 2025, which may be extended again by mutual agreement of the parties. The Supply Agreement was also amended to, among other things, (i) spread the Company’s total purchase commitment under the Supply Agreement in the amount of approximately $52.95 million over the term of the Supply Agreement, as amended; (ii) establish a process by which Wolfspeed has agreed to accept purchase orders in excess of the agreed-upon minimum purchase commitment, subject to certain conditions; and (iii) permit the Company to purchase revised amounts of SiC materials from third parties under limited conditions. The Company’s total purchase commitment under the Supply Agreement, as amended, until June 2025 is approximately $52.95 million, of which approximately $28.35 million remains to be purchased as of March 31, 2022. Over the life of the Supply Agreement, as amended, the Company’s future minimum annual purchase commitments of SiC crystals range from approximately $4.00 million to $10.00 million each year. During the nine months ended March 31, 2022, the Company purchased approximately $4.49 million of SiC crystals from Wolfspeed pursuant to the terms of the Supply Agreement, as amended. During the nine months ended March 31, 2021, the Company purchased approximately $2.28 million of SiC crystals from Wolfspeed pursuant to the terms of the Supply Agreement, as amended. COVID-19 The evolving COVID-19 pandemic continues to present unprecedented worldwide economic and business challenges in the Company’s fiscal year ending June 30, 2022 (“Fiscal 2022”). The Company’s management has taken measures to protect the health and safety of the Company’s employees, work with its customers and suppliers to minimize disruptions, and support its community in addressing the challenges posed by the ongoing COVID-19 pandemic and its evolving viral variants. The Company has experienced impacts on its business related to the COVID-19 pandemic, primarily in increased coronavirus-related costs, including at times using accelerated payments in some cases to the Company’s suppliers that are due by their terms in future periods. The Company expects to continue accelerating payments to certain suppliers through at least the fourth quarter of Fiscal 2022. The Company is continuing to see a sharp increase in international and domestic freight costs, with limited availability and long delays causing disruption in the global supply chain. Accordingly, the Company’s management is taking steps where possible to mitigate such potential delays in supplier deliveries by accelerating orders and increasing order quantities. Following the government mandated shut down during the early days of the pandemic, work in the Company’s production and distribution facilities has continued throughout the pandemic, consistent with guidance from federal, state, and local officials to minimize the spread of COVID-19. The Company’s management continues to take actions to equip its employees with personal protective equipment, establish minimum staffing and social distancing policies, sanitize workspaces, adopt alternate work schedules, and institute other measures aimed to sustain production and related services while minimizing the transmission of COVID-19, including measures to encourage all employees to be fully vaccinated and to provide evidence of vaccination status in line with state and local guidelines. In addition, the Company has maintained a flexible teleworking policy for its employees who can meet customer commitments remotely, and a portion of the Company’s workforce continues teleworking. Although the COVID-19 pandemic did not have a significant adverse impact on the Company’s financial results in the nine months ended March 31, 2022, the ultimate impact of COVID-19 on the Company’s operations and financial performance in future periods, including management’s ability to execute its strategic initiatives in the expected timeframes, remains uncertain and will depend on future pandemic related developments, including the duration of the pandemic, any potential subsequent waves of COVID-19 and its variant viral infections, the effectiveness, distribution and acceptance of COVID-19 vaccines and boosters, and related government actions to prevent and manage disease spread, all of which are uncertain and cannot be predicted. The Company cannot at this time predict the full impact of the COVID-19 pandemic, but the Company’s management believes there is a risk that the COVID-19 pandemic could adversely impact the Company’s future business, financial condition, results of operations and/or cash flows.

DEBT

DEBT	9 Months Ended
	Mar. 31, 2022
DEBT [Abstract]
DEBT	10. DEBT Line of Credit Effective July 7, the Company obtained from JPMorgan Chase Bank, N.A. (“JPMorgan Chase”) a cash collateralized line of credit facility (the “JPMorgan Chase Credit Facility”). The JPMorgan Chase Credit Facility may be used for general corporate and working capital purposes, including permitted acquisitions and certain additional indebtedness for obligations under capital and operating leases. JPMorgan Chase Credit Facility, which is scheduled to mature on July 31, 2022, is secured by a cash deposit in the amount of held by JPMorgan Chase as collateral for the . Each advance accrues interest at a rate equal to JPMorgan Chase’s monthly LIBOR rate multiplied by a statutory reserve rate for eurocurrency funding to which JPMorgan Chase is subject with respect to the adjusted LIBOR rate as established by the U.S. Federal Reserve Board, plus a margin of 1.25% per annum. If the JPMorgan Chase monthly LIBOR rate would no longer be appropriate, JPMorgan Chase would select an alternate rate that gives due consideration to the prevailing market convention for determining a rate of interest for loans in U.S. dollars. Interest is calculated monthly on an actual/ day basis and payable monthly in arrears. Principal outstanding during an event of default, at JPMorgan Chase’s option, accrues interest at a rate of 3% per annum in excess of the above rate. Any advance may be prepaid in whole or in part without penalty at any time. As of March 31, 2022, the Company had not borrowed against the JPMorgan Chase Credit Facility. Prior to obtaining the JPMorgan Chase Credit Facility, the Company and its wholly owned subsidiary, charlesandcolvard.com, LLC (collectively, the “Borrowers”), had a $5.00 million asset-based revolving credit facility (the “White Oak Credit Facility”) from White Oak Commercial Finance, LLC (“White Oak”), which was terminated by the Company in accordance with its terms as of July The effective date of the White Oak Credit Facility was July and it was scheduled to mature on July 13, 2021 Available advances could have been in the form of either revolving or non-revolving. During the first year of the term of the White Oak Credit Facility, any revolving advances would have accrued interest at a rate equal to one-month LIBOR (reset monthly, and subject to a floor) plus 3.75%, and any non-revolving advances would have accrued interest at such LIBOR rate plus 4.75%. Thereafter, the interest margins would have been reduced upon the Company’s achievement of a specified fixed charge coverage ratio during the period of any outstanding advances. However, any advances were in all cases subject to a minimum interest rate of 5.50% and interest would have been calculated on an actual/ basis and payable monthly in arrears. Principal outstanding during an event of default, which did not occur during the term of the White Oak would have accrued interest at a rate in excess of the rate that would have been otherwise applicable The Company had not borrowed against the White Oak Credit Facility . Paycheck Protection Program Loan On June 18, 2020, the Company received the proceeds from a loan pursuant to the Paycheck Protection Program under the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”), as administered by the U.S. Small Business Administration (the “SBA”) . The loan in the principal amount of was disbursed by the Lender pursuant to a promissory note issued by the Company (the “Promissory Note”) on June Pursuant to its terms, the Promissory Note was scheduled to mature on June 18, 2022. However, on June in accordance with applicable provisions of the CARES Act the Company filed its PPP Loan forgiveness application with the Lender for forgiveness of the full amount of the PPP Loan proceeds . Effective June the Company’s PPP Loan forgiveness was approved and processed by the SBA for the full principal of the PPP Loan in the amount of . Accordingly, the full amount of the gain in connection with the extinguishment of this debt was recognized in the In accordance with the terms of the Promissory Note, during the period of time the principal of the PPP Loan was outstanding, interest was accrued by the Company at a fixed rate of 1% per annum. In connection with the Company’s PPP Loan forgiveness, the SBA also approved forgiveness of accrued interest amounts that would have been otherwise payable by the Company to the Lender. Accordingly, the benefit from the forgiveness of the inception to-date interest expense in the amount of approximately was recognized and included within the gain on extinguishment of debt in the consolidated statement of operations for the fiscal year ended June The Company had no outstanding debt as of March 31, 2022

SHAREHOLDERS' EQUITY AND STOCK-

SHAREHOLDERS' EQUITY AND STOCK-BASED COMPENSATION	9 Months Ended
	Mar. 31, 2022
SHAREHOLDERS' EQUITY AND STOCK-BASED COMPENSATION [Abstract]
STOCK-BASED COMPENSATION	11. SHAREHOLDERS’ EQUITY AND STOCK-BASED COMPENSATION Stock-Based Compensation The following table summarizes the components of the Company’s stock-based compensation included in net income for the periods presented: Three Months Ended March 31, Nine Months Ended March 31, 2022 2021 2022 2021 Employee stock options $ 60,045 $ 45,312 $ 187,059 $ 186,528 Restricted stock awards 138,478 31,604 489,875 85,681 Totals $ 198,523 $ 76,916 $ 676,934 $ 272,209 No stock-based compensation was capitalized as a cost of inventory during the three and nine months ended March 31, 2022 and 2021. Stock Options The following is a summary of the stock option activity for the nine months ended March 31, 2022: Shares Weighted Average Exercise Price Outstanding, June 30, 2021 2,235,286 $ 1.24 Granted 249,793 $ 2.66 Exercised (532,976 ) $ 1.22 Forfeited (24,753 ) $ 1.04 Expired (169,297 ) $ 3.12 Outstanding, March 31, 2022 1,758,053 $ 1.27 The total fair value of stock options that vested during the nine months ended March 31, 2022 was approximately $188,000. The following table summarizes information about stock options outstanding at March 31, 2022: Options Outstanding Options Exercisable Options Vested or Expected to Vest Balance as of 3/31/2022 Weighted Average Remaining Contractual Life (Years) Weighted Average Exercise Price Balance as of 3/31/2022 Weighted Average Remaining Contractual Life (Years) Weighted Average Exercise Price Balance as of 3/31/2022 Weighted Average Remaining Contractual Life (Years) Weighted Average Exercise Price 1,758,053 6.53 $ 1.27 1,289,070 5.64 $ 1.08 1,688,085 6.42 $ 1.25 As of March 31, 2022, the unrecognized stock-based compensation expense related to unvested stock options was approximately $334,000, which is expected to be recognized over a weighted average period of approximately 24 months. The aggregate intrinsic value of stock options outstanding, exercisable, and vested or expected to vest at March 31, 2022 was approximately $973,000. These amounts are before applicable income taxes and represent the closing market price of the Company’s common stock at March 31, 2022 less the grant price, multiplied by the number of stock options that had a grant price that is less than the closing market price. These values represent the amount that would have been received by the optionees had these stock options been exercised on that date. During the nine months ended March 31, 2022 and 2021, the aggregate intrinsic value of stock options exercised was approximately $829,000 and $1.2 million, respectively. During the nine months ended March 31, 2022 and 2021, the total estimated tax benefit associated with certain stock options that were exercised was approximately $93,000 and $0, respectively. Restricted Stock The following is a summary of the restricted stock activity for the nine months ended March 31, 2022: Shares Weighted Average Grant Date Fair Value Unvested, June 30, 2021 178,750 $ 0.72 Granted 242,725 $ 2.75 Vested (242,725 ) $ 1.25 Unvested, March 31, 2022 178,750 $ 2.75 The unvested restricted shares as of March 31, 2022 are all performance-based restricted shares that are scheduled to vest, subject to achievement of the underlying performance goals, in July 2022. As of March 31, 2022, the estimated unrecognized stock-based compensation expense related to unvested restricted shares subject to achievement of performance goals was approximately $188,000, all of which is expected to be recognized over a weighted average period of approximately four months .
SHAREHOLDERS' EQUITY	Dividends The Company has paid no cash dividends during the current fiscal year through March 31, 2022.

NET INCOME PER COMMON SHARE

NET INCOME PER COMMON SHARE	9 Months Ended
	Mar. 31, 2022
NET INCOME PER COMMON SHARE [Abstract]
NET INCOME PER COMMON SHARE	12. NET INCOME PER COMMON SHARE Basic net income per common share is computed by dividing net income by the weighted average number of common shares outstanding during the periods. Diluted net income per common share is computed using the weighted average number of common and dilutive common equivalent shares outstanding during the periods. Common equivalent shares consist of stock options and unvested restricted shares that are computed using the treasury stock method. Anti-dilutive stock awards consist of stock options that would have been anti-dilutive in the application of the treasury stock method. The following table reconciles the differences between the basic and diluted net income per share presentations: Three Months Ended March 31, Nine Months Ended March 31, 2022 2021 2022 2021 Numerator: Net income $ 338,508 $ 1,036,227 $ 2,333,145 $ 4,429,570 Denominator: Weighted average common shares outstanding: Basic 30,484,897 29,320,434 30,286,195 28,967,946 Effect of dilutive securities 783,513 1,205,004 985,482 699,783 Diluted 31,268,410 30,525,438 31,271,677 29,667,729 Net income per common share: Basic $ 0.01 $ 0.04 $ 0.08 $ 0.15 Diluted $ 0.01 $ 0.03 $ 0.07 $ 0.15 For the three and nine months ended March 31, 2022 stock options to purchase approximately 975,000 and 773,000 shares, respectively, and for the three and nine months ended March 31, 2021, stock options to purchase approximately 1.09 million shares and 1.60 million shares, respectively,

MAJOR CUSTOMERS AND CONCENTRATI

MAJOR CUSTOMERS AND CONCENTRATION OF CREDIT RISK	9 Months Ended
	Mar. 31, 2022
MAJOR CUSTOMERS AND CONCENTRATION OF CREDIT RISK [Abstract]
MAJOR CUSTOMERS AND CONCENTRATION OF CREDIT RISK	13. MAJOR CUSTOMERS AND CONCENTRATION OF CREDIT RISK Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash on deposit and cash equivalents held with banks and trade accounts receivable. The Company places cash deposits with federally insured financial institutions and maintains its cash at banks and financial institutions it considers to be of high credit quality. However, the Company’s cash deposits may at times exceed the Federal Deposit Insurance Corporation’s insurable limits. Accordingly, balances in excess of federally insured limitations may not be insured. The Company has not experienced losses on these accounts, and management believes that the Company is not exposed to significant risks on such accounts. Trade receivables potentially subject the Company to credit risk. Payment terms on trade receivables for the Company’s Traditional segment customers are generally between 30 and 90 days, though it may offer extended terms with specific customers and on significant orders from time to time. The Company extends credit to its customers based upon a number of factors, including an evaluation of the customer’s financial condition and credit history that is verified through trade association reference services, the customer’s payment history with the Company, the customer’s reputation in the trade, and/or an evaluation of the Company’s opportunity to introduce its moissanite jewels or finished jewelry featuring moissanite to new or expanded markets. Collateral is not generally required from customers. The need for an allowance for doubtful accounts is determined based upon factors surrounding the credit risk of specific customers, historical trends, and other information. At times, a portion of the Company’s accounts receivable will be due from customers that have individual balances of 10% or more of the Company’s total gross accounts receivable. The following is a summary of customers that represent 10% or more of total gross accounts receivable as of the dates presented: March 31, 2022 June 30, 2021 Customer A 36 % 30 % Customer B 11 % 14 % Customer C * % 22 % * Customer C did not have individual balances that represented 10% or more of total gross accounts receivable as of March 31, 2022. A significant portion of sales is derived from certain customer relationships. The following is a summary of customers that represent greater than or equal to 10% of total net sales for the periods presented: Three Months Ended March 31, Nine Months Ended March 31, 2022 2021 2022 2021 Customer A 13 % 15 % 14 % 13 % Customer C * % 13 % * % 11 % * Customer C did not have net sales that represented 10% or more of total net sales for the three and nine months ended March 31, 2022.

SUBSEQUENT EVENT

SUBSEQUENT EVENT	9 Months Ended
	Mar. 31, 2022
SUBSEQUENT EVENT [Abstract]
SUBSEQUENT EVENT	14. SUBSEQUENT EVENT Pursuant to authority granted by the Company’s Board of Directors on April 29, 2022, the Company can repurchase up to approximately $5.00 million in shares outstanding of the Company’s common stock over the three-year period ending April 29, 2025. Pursuant to the terms of the repurchase authorization, the common stock share repurchases are generally at the discretion of the Company’s management. At May 5, 2022, no shares of Company’s common stock had been purchased pursuant to the repurchase authorization.

BASIS OF PRESENTATION AND SIG_2

BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES (Policies)	9 Months Ended
	Mar. 31, 2022
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES [Abstract]
Basis of Presentation	The accompanying unaudited condensed consolidated financial statements included in this Quarterly Report on Form 10-Q have been prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information. However, certain information or footnote disclosures normally included in complete financial statements prepared in accordance with U.S. GAAP have been condensed, or omitted, pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). In the opinion of the Company’s management, the unaudited condensed consolidated financial statements in this Quarterly Report on Form 10-Q include all normal and recurring adjustments necessary for the fair statement of the results for the interim periods presented. The results for the nine months ended March 31, 2022 are not necessarily indicative of the results to be expected for the fiscal year ending June 30, 2022. The condensed consolidated financial statements as of March 31, 2022 and for the three and nine months ended March 31, 2022 and 2021 included in this Quarterly Report on Form 10-Q are unaudited. The balance sheet as of June 30, 2021 is derived from the audited financial statements as of that date. The accompanying statements should be read in conjunction with the audited financial statements and related notes contained in Item 8 of the Company’s Annual Report on Form 10-K (the “2021 Annual Report”) for the fiscal year ended June 30, 2021 filed with the SEC on September 3, 2021.
Principles of Consolidation	The accompanying condensed consolidated financial statements as of March 31, 2022, for the three and nine months ended March 31, 2022 and 2021, and as of June 30, 2021, include the accounts of the Company and its wholly owned subsidiaries charlesandcolvard.com, LLC, including its wholly-owned subsidiary, moissaniteoulet.com, LLC, which was formed and incorporated as of February 24, 2022
Use of Estimates	Use of Estimates
Cash and Cash Equivalents	Cash and Cash Equivalents –
Restricted Cash	Restricted Cash – In accordance with cash management process requirements related to the Company’s asset-based revolving credit facility from White Oak Commercial Finance, LLC (“White Oak”), which the Company had in place prior to obtaining the JPMorgan Chase Credit Facility, there were access and usage restrictions on certain cash deposit balances for periods of up to two The reconciliation of cash, cash equivalents, and restricted cash, as presented on the Condensed Consolidated Statements of Cash Flows, consist of the following as of the dates presented: March 31, 2022 June 30, 2021 Cash and cash equivalents $ 16,861,685 $ 21,302,317 Restricted cash 5,050,000 144,634 Total cash, cash equivalents, and restricted cash $ 21,911,685 $ 21,446,951
Recently Adopted/Issued Accounting Pronouncements	Recently Adopted/Issued Accounting Pronouncements – In March 2020, and as updated in January 2021, in response to concerns about structural risks of interbank offered rates (“IBORs”), and, particularly, the risk of cessation of the London Interbank Offered Rate (“LIBOR”), the FASB issued new guidance to ease the burden in accounting for or recognizing the effects of reference interest rate reform on financial reporting. The new guidance is effective as of March 12, 2020 through December 31, 2022. As described in more detail in Note 10, “Debt”, borrowings under the Company’s new line of credit are based on a rate equal to the one-month LIBOR. As of March 31, 2022, the Company had not borrowed against its line of credit, and therefore, is not subject to recognizing or disclosing any effect of reference rate reform as of March 31, 2022.

BASIS OF PRESENTATION AND SIG_3

BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES (Tables)	9 Months Ended
	Mar. 31, 2022
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES [Abstract]
Cash, Cash Equivalents and Restricted Cash	The reconciliation of cash, cash equivalents, and restricted cash, as presented on the Condensed Consolidated Statements of Cash Flows, consist of the following as of the dates presented: March 31, 2022 June 30, 2021 Cash and cash equivalents $ 16,861,685 $ 21,302,317 Restricted cash 5,050,000 144,634 Total cash, cash equivalents, and restricted cash $ 21,911,685 $ 21,446,951

SEGMENT INFORMATION AND GEOGR_2

SEGMENT INFORMATION AND GEOGRAPHIC DATA (Tables)	9 Months Ended
	Mar. 31, 2022
SEGMENT INFORMATION AND GEOGRAPHIC DATA [Abstract]
Summary Financial Information by Reportable Segment	Summary financial information by reportable segment is as follows: Three Months Ended March 31, 2022 Online Channels Traditional Total Net sales Finished jewelry $ 5,720,197 $ 1,700,394 $ 7,420,591 Loose jewels 634,617 1,696,627 2,331,244 Total $ 6,354,814 $ 3,397,021 $ 9,751,835 Product line cost of goods sold Finished jewelry $ 2,560,952 $ 1,148,912 $ 3,709,864 Loose jewels 229,714 784,272 1,013,986 Total $ 2,790,666 $ 1,933,184 $ 4,723,850 Product line gross profit Finished jewelry $ 3,159,245 $ 551,482 $ 3,710,727 Loose jewels 404,903 912,355 1,317,258 Total $ 3,564,148 $ 1,463,837 $ 5,027,985 Operating income $ 350,276 $ 65,592 $ 415,868 Depreciation and amortization $ 52,613 $ 59,374 $ 111,987 Capital expenditures $ 28,145 $ 446,445 $ 474,590 Three Months Ended March 31, 2021 Online Channels Traditional Total Net sales Finished jewelry $ 4,902,964 $ 1,316,928 $ 6,219,892 Loose jewels 680,804 2,535,360 3,216,164 Total $ 5,583,768 $ 3,852,288 $ 9,436,056 Product line cost of goods sold Finished jewelry $ 2,045,519 $ 1,006,417 $ 3,051,936 Loose jewels 246,302 1,222,036 1,468,338 Total $ 2,291,821 $ 2,228,453 $ 4,520,274 Product line gross profit Finished jewelry $ 2,857,445 $ 310,511 $ 3,167,956 Loose jewels 434,502 1,313,324 1,747,826 Total $ 3,291,947 $ 1,623,835 $ 4,915,782 Operating income $ 751,953 $ 286,618 $ 1,038,571 Depreciation and amortization $ 67,373 $ 81,077 $ 148,450 Capital expenditures $ 22,770 $ 55,858 $ 78,628 Nine Months Ended March 31, 2022 Online Channels Traditional Total Net sales Finished jewelry $ 18,659,690 $ 4,986,354 $ 23,646,044 Loose jewels 2,388,584 7,750,653 10,139,237 Total $ 21,048,274 $ 12,737,007 $ 33,785,281 Product line cost of goods sold Finished jewelry $ 7,705,127 $ 3,043,196 $ 10,748,323 Loose jewels 877,604 3,630,393 4,507,997 Total $ 8,582,731 $ 6,673,589 $ 15,256,320 Product line gross profit Finished jewelry $ 10,954,563 $ 1,943,158 $ 12,897,721 Loose jewels 1,510,980 4,120,260 5,631,240 Total $ 12,465,543 $ 6,063,418 $ 18,528,961 Operating income $ 2,104,674 $ 711,123 $ 2,815,797 Depreciation and amortization $ 173,786 $ 176,412 $ 350,198 Capital expenditures $ 114,445 $ 1,135,851 $ 1,250,296 Nine Months Ended March 31, 2021 Online Channels Traditional Total Net sales Finished jewelry $ 15,114,765 $ 3,705,663 $ 18,820,428 Loose jewels 2,520,576 8,168,136 10,688,712 Total $ 17,635,341 $ 11,873,799 $ 29,509,140 Product line cost of goods sold Finished jewelry $ 6,242,635 $ 2,565,737 $ 8,808,372 Loose jewels 947,417 4,070,446 5,017,863 Total $ 7,190,052 $ 6,636,183 $ 13,826,235 Product line gross profit Finished jewelry $ 8,872,130 $ 1,139,926 $ 10,012,056 Loose jewels 1,573,159 4,097,690 5,670,849 Total $ 10,445,289 $ 5,237,616 $ 15,682,905 Operating income $ 3,021,067 $ 1,412,758 $ 4,433,825 Depreciation and amortization $ 180,946 $ 238,565 $ 419,511 Capital expenditures $ 195,695 $ 150,417 $ 346,112
Reconciliation of Product Line Cost of Goods Sold	A reconciliation of the Company’s product line cost of goods sold to cost of goods sold as reported in the condensed consolidated financial statements is as follows: Three Months Ended March 31, Nine Months Ended March 31, 2022 2021 2022 2021 Product line cost of goods sold $ 4,723,850 $ 4,520,274 $ 15,256,320 $ 13,826,235 Non-capitalized manufacturing and production control expenses 484,299 398,073 1,243,528 1,122,715 Freight out 294,143 191,700 976,855 683,580 Inventory write-off - 23,000 232,000 128,000 Other inventory adjustments (205,762 ) (39,595 ) (361,677 ) (303,315 ) Cost of goods sold $ 5,296,530 $ 5,093,452 $ 17,347,026 $ 15,457,215
Net Sales by Geographic Area	The following presents net sales by geographic area: Three Months Ended March 31, Nine Months Ended March 31, 2022 2021 2022 2021 Net sales United States $ 9,390,774 $ 8,969,267 $ 32,237,221 $ 27,857,667 International 361,061 466,789 1,548,060 1,651,473 Total $ 9,751,835 $ 9,436,056 $ 33,785,281 $ 29,509,140

INVENTORIES (Tables)

INVENTORIES (Tables)	9 Months Ended
	Mar. 31, 2022
INVENTORIES [Abstract]
Inventories	The Company’s total inventories, net of reserves, consisted of the following as of the dates presented: March 31, 2022 June 30, 2021 Finished jewelry: Raw materials $ 1,469,003 $ 1,476,514 Work-in-process 1,279,987 779,593 Finished goods 11,386,771 8,025,816 Finished goods on consignment 2,258,071 2,050,372 Total finished jewelry $ 16,393,832 $ 12,332,295 Loose jewels: Raw materials $ 1,692,819 $ 1,775,505 Work-in-process 8,285,457 9,893,443 Finished goods 5,714,303 4,942,192 Finished goods on consignment 328,167 154,968 Total loose jewels 16,020,746 16,766,108 Total supplies inventory 88,846 74,317 Total inventory $ 32,503,424 $ 29,172,720 As of the dates presented, the Company’s total inventories, net of reserves, are classified as follows: March 31, 2022 June 30, 2021 Short-term portion $ 13,440,016 $ 11,450,141 Long-term portion 19,063,408 17,722,579 Total $ 32,503,424 $ 29,172,720

ACCRUED EXPENSES AND OTHER LI_2

ACCRUED EXPENSES AND OTHER LIABILITIES (Tables)	9 Months Ended
	Mar. 31, 2022
ACCRUED EXPENSES AND OTHER LIABILITIES [Abstract]
Accrued Expenses and Other Liabilities	Accrued expenses and other liabilities consist of the following as of the dates presented: March 31, 2022 June 30, 2021 Accrued sales tax $ 811,366 $ 555,547 Accrued compensation and related benefits 631,117 866,705 Deferred revenue 505,148 774,891 Accrued cooperative advertising 89,763 68,185 Accrued income taxes 16,478 16,478 Other 1 1 Total accrued expenses and other liabilities $ 2,053,873 $ 2,281,807

COMMITMENTS AND CONTINGENCIES (

COMMITMENTS AND CONTINGENCIES (Tables)	9 Months Ended
	Mar. 31, 2022
COMMITMENTS AND CONTINGENCIES [Abstract]
Balance Sheet Classifications of Leases	As of March 31, 2022, the Company’s balance sheet classifications of its leases are as follows: Operating Leases: Noncurrent operating lease ROU assets $ 2,935,124 Current operating lease liabilities $ 850,781 Noncurrent operating lease liabilities 3,039,216 Total operating lease liabilities $ 3,889,997
Remaining Future Payments Under Operating Leases	As of March 31, 2022, the Company’s remaining future payments under operating leases for each fiscal year ending June 30 are as follows: 2022 $ 213,521 2023 869,742 2024 893,660 2025 918,236 2026 943,487 2027 317,327 Total lease payments 4,155,973 Less: imputed interest 265,976 Present value of lease payments 3,889,997 Less: current lease liability 850,781 Total long-term lease liability $ 3,039,216

SHAREHOLDERS' EQUITY AND STOC_2

SHAREHOLDERS' EQUITY AND STOCK-BASED COMPENSATION (Tables)	9 Months Ended
	Mar. 31, 2022
SHAREHOLDERS' EQUITY AND STOCK-BASED COMPENSATION [Abstract]
Stock-Based Compensation	The following table summarizes the components of the Company’s stock-based compensation included in net income for the periods presented: Three Months Ended March 31, Nine Months Ended March 31, 2022 2021 2022 2021 Employee stock options $ 60,045 $ 45,312 $ 187,059 $ 186,528 Restricted stock awards 138,478 31,604 489,875 85,681 Totals $ 198,523 $ 76,916 $ 676,934 $ 272,209
Stock Option Activity	The following is a summary of the stock option activity for the nine months ended March 31, 2022: Shares Weighted Average Exercise Price Outstanding, June 30, 2021 2,235,286 $ 1.24 Granted 249,793 $ 2.66 Exercised (532,976 ) $ 1.22 Forfeited (24,753 ) $ 1.04 Expired (169,297 ) $ 3.12 Outstanding, March 31, 2022 1,758,053 $ 1.27
Stock Options Outstanding	The following table summarizes information about stock options outstanding at March 31, 2022: Options Outstanding Options Exercisable Options Vested or Expected to Vest Balance as of 3/31/2022 Weighted Average Remaining Contractual Life (Years) Weighted Average Exercise Price Balance as of 3/31/2022 Weighted Average Remaining Contractual Life (Years) Weighted Average Exercise Price Balance as of 3/31/2022 Weighted Average Remaining Contractual Life (Years) Weighted Average Exercise Price 1,758,053 6.53 $ 1.27 1,289,070 5.64 $ 1.08 1,688,085 6.42 $ 1.25
Restricted Stock Activity	The following is a summary of the restricted stock activity for the nine months ended March 31, 2022: Shares Weighted Average Grant Date Fair Value Unvested, June 30, 2021 178,750 $ 0.72 Granted 242,725 $ 2.75 Vested (242,725 ) $ 1.25 Unvested, March 31, 2022 178,750 $ 2.75

NET INCOME PER COMMON SHARE (Ta

NET INCOME PER COMMON SHARE (Tables)	9 Months Ended
	Mar. 31, 2022
NET INCOME PER COMMON SHARE [Abstract]
Basic and Diluted Net Income per Share	The following table reconciles the differences between the basic and diluted net income per share presentations: Three Months Ended March 31, Nine Months Ended March 31, 2022 2021 2022 2021 Numerator: Net income $ 338,508 $ 1,036,227 $ 2,333,145 $ 4,429,570 Denominator: Weighted average common shares outstanding: Basic 30,484,897 29,320,434 30,286,195 28,967,946 Effect of dilutive securities 783,513 1,205,004 985,482 699,783 Diluted 31,268,410 30,525,438 31,271,677 29,667,729 Net income per common share: Basic $ 0.01 $ 0.04 $ 0.08 $ 0.15 Diluted $ 0.01 $ 0.03 $ 0.07 $ 0.15

MAJOR CUSTOMERS AND CONCENTRA_2

MAJOR CUSTOMERS AND CONCENTRATION OF CREDIT RISK (Tables)	9 Months Ended
	Mar. 31, 2022
MAJOR CUSTOMERS AND CONCENTRATION OF CREDIT RISK [Abstract]
Major Customers	The following is a summary of customers that represent 10% or more of total gross accounts receivable as of the dates presented: March 31, 2022 June 30, 2021 Customer A 36 % 30 % Customer B 11 % 14 % Customer C * % 22 % * Customer C did not have individual balances that represented 10% or more of total gross accounts receivable as of March 31, 2022. A significant portion of sales is derived from certain customer relationships. The following is a summary of customers that represent greater than or equal to 10% of total net sales for the periods presented: Three Months Ended March 31, Nine Months Ended March 31, 2022 2021 2022 2021 Customer A 13 % 15 % 14 % 13 % Customer C * % 13 % * % 11 % * Customer C did not have net sales that represented 10% or more of total net sales for the three and nine months ended March 31, 2022.

BASIS OF PRESENTATION AND SIG_4

BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES, Restricted Cash (Details) - USD ($)	9 Months Ended
	Mar. 31, 2022	Jul. 09, 2021	Jun. 30, 2021	Mar. 31, 2021	Jun. 30, 2020
Cash, Cash Equivalents and Restricted Cash [Abstract]
Cash and cash equivalents	$ 16,861,685		$ 21,302,317
Restricted cash	5,050,000		144,634
Total cash, cash equivalents, and restricted cash	21,911,685		$ 21,446,951	$ 19,675,373	$ 14,617,234
JPMorgan Chase Credit Facility [Member]
Restricted Cash [Abstract]
Borrowing capacity	5,000,000
Cash deposit	$ 5,050,000
White Oak Credit Facility [Member]
Restricted Cash [Abstract]
Borrowing capacity		$ 5,000,000
White Oak Credit Facility [Member] | Maximum [Member]
Restricted Cash [Abstract]
Restriction period on access and usage of certain cash deposit balances	2 days

BASIS OF PRESENTATION AND SIG_5

BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES, Recently Adopted/Issued Accounting Pronouncements (Details) - JPMorgan Chase Credit Facility [Member]	9 Months Ended
	Mar. 31, 2022USD ($)
Recently Adopted/Issued Accounting Pronouncements [Abstract]
Borrowings against line of credit	$ 0
LIBOR [Member]
Recently Adopted/Issued Accounting Pronouncements [Abstract]
Term of variable rate	1 month

SEGMENT INFORMATION AND GEOGR_3

SEGMENT INFORMATION AND GEOGRAPHIC DATA, Summary Financial Information by Reportable Segment (Details)	3 Months Ended		9 Months Ended
	Mar. 31, 2022USD ($)	Mar. 31, 2021USD ($)	Mar. 31, 2022USD ($)Segment	Mar. 31, 2021USD ($)
SEGMENT INFORMATION AND GEOGRAPHIC DATA [Abstract]
Number of operating segments | Segment			2
Number of reportable segments | Segment			2
Summary Information by Reportable Segment [Abstract]
Net sales	$ 9,751,835	$ 9,436,056	$ 33,785,281	$ 29,509,140
Product line cost of goods sold	5,296,530	5,093,452	17,347,026	15,457,215
Operating income	415,868	1,038,571	2,815,797	4,433,825
Depreciation and amortization	111,987	148,450	350,198	419,511
Capital expenditures	474,590	78,628	1,250,296	346,112
Product Line [Member]
Summary Information by Reportable Segment [Abstract]
Product line cost of goods sold	4,723,850	4,520,274	15,256,320	13,826,235
Product line gross profit	5,027,985	4,915,782	18,528,961	15,682,905
Finished Jewelry [Member]
Summary Information by Reportable Segment [Abstract]
Net sales	7,420,591	6,219,892	23,646,044	18,820,428
Product line cost of goods sold	3,709,864	3,051,936	10,748,323	8,808,372
Product line gross profit	3,710,727	3,167,956	12,897,721	10,012,056
Loose Jewels [Member]
Summary Information by Reportable Segment [Abstract]
Net sales	2,331,244	3,216,164	10,139,237	10,688,712
Product line cost of goods sold	1,013,986	1,468,338	4,507,997	5,017,863
Product line gross profit	1,317,258	1,747,826	5,631,240	5,670,849
Operating and Reportable Segments [Member] | Online Channels [Member]
Summary Information by Reportable Segment [Abstract]
Net sales	6,354,814	5,583,768	21,048,274	17,635,341
Product line cost of goods sold	2,790,666	2,291,821	8,582,731	7,190,052
Product line gross profit	3,564,148	3,291,947	12,465,543	10,445,289
Operating income	350,276	751,953	2,104,674	3,021,067
Depreciation and amortization	52,613	67,373	173,786	180,946
Capital expenditures	28,145	22,770	114,445	195,695
Operating and Reportable Segments [Member] | Online Channels [Member] | Finished Jewelry [Member]
Summary Information by Reportable Segment [Abstract]
Net sales	5,720,197	4,902,964	18,659,690	15,114,765
Product line cost of goods sold	2,560,952	2,045,519	7,705,127	6,242,635
Product line gross profit	3,159,245	2,857,445	10,954,563	8,872,130
Operating and Reportable Segments [Member] | Online Channels [Member] | Loose Jewels [Member]
Summary Information by Reportable Segment [Abstract]
Net sales	634,617	680,804	2,388,584	2,520,576
Product line cost of goods sold	229,714	246,302	877,604	947,417
Product line gross profit	404,903	434,502	1,510,980	1,573,159
Operating and Reportable Segments [Member] | Traditional [Member]
Summary Information by Reportable Segment [Abstract]
Net sales	3,397,021	3,852,288	12,737,007	11,873,799
Product line cost of goods sold	1,933,184	2,228,453	6,673,589	6,636,183
Product line gross profit	1,463,837	1,623,835	6,063,418	5,237,616
Operating income	65,592	286,618	711,123	1,412,758
Depreciation and amortization	59,374	81,077	176,412	238,565
Capital expenditures	446,445	55,858	1,135,851	150,417
Operating and Reportable Segments [Member] | Traditional [Member] | Finished Jewelry [Member]
Summary Information by Reportable Segment [Abstract]
Net sales	1,700,394	1,316,928	4,986,354	3,705,663
Product line cost of goods sold	1,148,912	1,006,417	3,043,196	2,565,737
Product line gross profit	551,482	310,511	1,943,158	1,139,926
Operating and Reportable Segments [Member] | Traditional [Member] | Loose Jewels [Member]
Summary Information by Reportable Segment [Abstract]
Net sales	1,696,627	2,535,360	7,750,653	8,168,136
Product line cost of goods sold	784,272	1,222,036	3,630,393	4,070,446
Product line gross profit	$ 912,355	$ 1,313,324	$ 4,120,260	$ 4,097,690

SEGMENT INFORMATION AND GEOGR_4

SEGMENT INFORMATION AND GEOGRAPHIC DATA, Reconciliation of Cost of Goods Sold (Details) - USD ($)	3 Months Ended		9 Months Ended
	Mar. 31, 2022	Mar. 31, 2021	Mar. 31, 2022	Mar. 31, 2021
Reconciliation of Cost of Goods Sold [Abstract]
Cost of goods sold	$ 5,296,530	$ 5,093,452	$ 17,347,026	$ 15,457,215
Inventory write-off			232,000	128,000
Product Line [Member]
Reconciliation of Cost of Goods Sold [Abstract]
Cost of goods sold	4,723,850	4,520,274	15,256,320	13,826,235
Segment Reconciling Item [Member]
Reconciliation of Cost of Goods Sold [Abstract]
Non-capitalized manufacturing and production control expenses	484,299	398,073	1,243,528	1,122,715
Freight out	294,143	191,700	976,855	683,580
Inventory write-off	0	23,000	232,000	128,000
Other inventory adjustments	$ (205,762)	$ (39,595)	$ (361,677)	$ (303,315)

SEGMENT INFORMATION AND GEOGR_5

SEGMENT INFORMATION AND GEOGRAPHIC DATA, Net Sales by Geographic Area (Details) - USD ($)	3 Months Ended		9 Months Ended
	Mar. 31, 2022	Mar. 31, 2021	Mar. 31, 2022	Mar. 31, 2021
Net Sales by Geographic Area [Abstract]
Net sales	$ 9,751,835	$ 9,436,056	$ 33,785,281	$ 29,509,140
Reportable Geographical Component [Member] | United States [Member]
Net Sales by Geographic Area [Abstract]
Net sales	9,390,774	8,969,267	32,237,221	27,857,667
Reportable Geographical Component [Member] | International [Member]
Net Sales by Geographic Area [Abstract]
Net sales	$ 361,061	$ 466,789	$ 1,548,060	$ 1,651,473

FAIR VALUE MEASUREMENTS (Detail

FAIR VALUE MEASUREMENTS (Details) - USD ($)	3 Months Ended		9 Months Ended
	Mar. 31, 2022	Mar. 31, 2021	Mar. 31, 2022	Mar. 31, 2021
FAIR VALUE MEASUREMENTS [Abstract]
Asset impairment	$ 0	$ 0	$ 0	$ 0

INVENTORIES (Details)

INVENTORIES (Details) - USD ($)	9 Months Ended
	Mar. 31, 2022	Jun. 30, 2021
Inventories [Abstract]
Total supplies inventory	$ 88,846	$ 74,317
Total inventory	32,503,424	29,172,720
Short-term portion	13,440,016	11,450,141
Long-term portion	19,063,408	17,722,579
Work-in-process inventories issued to active production jobs	$ 2,440,000	2,230,000
Percentage of jewel inventory not mounted in finished jewelry settings	50.00%
Finished Jewelry [Member]
Inventories [Abstract]
Raw materials	$ 1,469,003	1,476,514
Work-in-process	1,279,987	779,593
Finished goods	11,386,771	8,025,816
Finished goods on consignment	2,258,071	2,050,372
Total	16,393,832	12,332,295
Loose Jewels [Member]
Inventories [Abstract]
Raw materials	1,692,819	1,775,505
Work-in-process	8,285,457	9,893,443
Finished goods	5,714,303	4,942,192
Finished goods on consignment	328,167	154,968
Total	$ 16,020,746	$ 16,766,108

NOTE RECEIVABLE (Details)

NOTE RECEIVABLE (Details) - Convertible Promissory Note [Member] - USD ($)	Mar. 31, 2022	Mar. 05, 2021
Note Receivable [Abstract]
Note receivable		$ 250,000
Interest rate	0.14%
Interest rate during event of default	5.00%
Percentage of per unit price of units purchased by investors	80.00%
Value used to compute equity securities received upon conversion	$ 33,500,000

ACCRUED EXPENSES AND OTHER LI_3

ACCRUED EXPENSES AND OTHER LIABILITIES (Details) - USD ($)	Mar. 31, 2022	Jun. 30, 2021
ACCRUED EXPENSES AND OTHER LIABILITIES [Abstract]
Accrued sales tax	$ 811,366	$ 555,547
Accrued compensation and related benefits	631,117	866,705
Deferred revenue	505,148	774,891
Accrued cooperative advertising	89,763	68,185
Accrued income taxes	16,478	16,478
Other	1	1
Total accrued expenses and other liabilities	$ 2,053,873	$ 2,281,807

INCOME TAXES (Details)

INCOME TAXES (Details) - USD ($)	3 Months Ended		9 Months Ended
	Mar. 31, 2022	Mar. 31, 2021	Mar. 31, 2022	Mar. 31, 2021	Jun. 30, 2021
INCOME TAXES [Abstract]
Combined federal and state statutory tax rate	22.24%	22.11%	22.24%	22.11%
Federal income tax rate	21.00%	21.00%	21.00%	21.00%
State income tax rate	1.24%	1.11%	1.24%	1.11%
Effective tax rate			17.20%
Deferred tax assets	$ 5,867,662		$ 5,867,662		$ 6,350,830
Income tax expense	78,480	$ 472	484,582	$ 1,460
Deferred income tax expense	78,000		483,168	0
Income tax expense (benefit) for estimated tax, penalties, and interest for other uncertain tax positions	$ 500	$ 500	$ 1,500	$ 1,500

COMMITMENTS AND CONTINGENCIES,

COMMITMENTS AND CONTINGENCIES, Lease Arrangements (Details)	Jan. 29, 2021USD ($)	Mar. 31, 2022USD ($)ft²	Mar. 31, 2021USD ($)	Mar. 31, 2022USD ($)ft²	Mar. 31, 2021USD ($)	Jun. 30, 2021USD ($)
COMMITMENTS AND CONTINGENCIES [Abstract]
Area leased under operating lease | ft²		36,350		36,350
Period of extension on option		5 years		5 years
Minimum notice period for extension of lease term				270 days
Rent abatement	$ 214,000
Allowance for leasehold improvements	$ 545,000
Reimbursement for leasehold improvements		$ 506,054
Balance Sheet Classifications of Leases [Abstract]
Noncurrent operating lease ROU assets		2,935,124		$ 2,935,124		$ 3,952,146
Operating Lease Liabilities [Abstract]
Current operating lease liabilities		850,781		850,781		566,083
Noncurrent operating lease liabilities		3,039,216		3,039,216		3,600,842
Total operating lease liabilities		3,889,997		3,889,997
Operating lease cost		193,000	$ 192,000	596,000	$ 473,000
Assumed discount rate			2.81%		2.81%
Remaining operating lease term			4 years 6 months 29 days		4 years 6 months 29 days
Future Lease Payments Under Operating Leases [Abstract]
2022		213,521		213,521
2023		869,742		869,742
2024		893,660		893,660
2025		918,236		918,236
2026		943,487		943,487
2027		317,327		317,327
Total lease payments		4,155,973		4,155,973
Less: imputed interest		265,976		265,976
Total operating lease liabilities		3,889,997		3,889,997
Less: current lease liability		850,781		850,781		566,083
Total long-term lease liability		3,039,216		3,039,216		3,600,842
Cash paid for operating leases		$ 160,000	$ 160,000	330,000	$ 481,000
ROU assets obtained in exchange for new operating lease liabilities				$ 0	$ 3,908,249	$ 3,900,000

COMMITMENTS AND CONTINGENCIES_2

COMMITMENTS AND CONTINGENCIES, Purchase Commitments (Details) - SiC Materials [Member] $ in Thousands	9 Months Ended
	Mar. 31, 2022USD ($)Option	Mar. 31, 2021USD ($)
Purchase Commitments [Abstract]
Percentage of materials committed to be purchased	100.00%
Number of options to extend term of exclusive supply agreement | Option	1
Extension period of exclusive supply agreement	2 years
Total purchase commitment	$ 52,950
Remaining purchase commitment	28,350
Purchases	4,490	$ 2,280
Minimum [Member]
Purchase Commitments [Abstract]
Future minimum annual purchase commitments	4,000
Maximum [Member]
Purchase Commitments [Abstract]
Future minimum annual purchase commitments	$ 10,000

DEBT, JPMorgan Chase Credit Fac

DEBT, JPMorgan Chase Credit Facility (Details) - JPMorgan Chase Credit Facility [Member] $ in Thousands	9 Months Ended
	Mar. 31, 2022USD ($)
Line of Credit [Abstract]
Borrowing capacity	$ 5,000
Cash deposit	$ 5,050
Interest rate premium in excess of rate otherwise applicable charged during an event of default	3.00%
Credit facility outstanding	$ 0
LIBOR [Member]
Line of Credit [Abstract]
Basis spread on variable rate	1.25%

DEBT, White Oak Credit Facility

DEBT, White Oak Credit Facility (Details) - USD ($) $ in Thousands	Jul. 09, 2021	Mar. 31, 2022
White Oak Credit Facility [Member]
Line of Credit [Abstract]
Borrowing capacity	$ 5,000
Interest rate premium in excess of rate otherwise applicable charged during an event of default	2.00%
Credit facility outstanding	$ 0
White Oak Credit Facility [Member] | Minimum [Member]
Line of Credit [Abstract]
Interest rate	5.50%
Revolving Advances [Member]
Line of Credit [Abstract]
Interest rate floor	1.25%
Revolving Advances [Member] | LIBOR [Member]
Line of Credit [Abstract]
Term of variable rate		1 month
Basis spread on variable rate	3.75%
Non-Revolving Advances [Member] | LIBOR [Member]
Line of Credit [Abstract]
Basis spread on variable rate	4.75%

DEBT, Paycheck Protection Progr

DEBT, Paycheck Protection Program Loan (Details) - USD ($)	12 Months Ended
	Jun. 30, 2021	Mar. 31, 2022	Jun. 18, 2020
Paycheck Protection Program Loan [Abstract]
Long-term debt		$ 0
PPP Loan [Member]
Paycheck Protection Program Loan [Abstract]
Principal amount			$ 965,000
Forgiveness of loan principal amount	$ 965,000
Fixed interest rate			1.00%
PPP Loan [Member] | Gain on Extinguishment of Debt [Member]
Paycheck Protection Program Loan [Abstract]
Forgiveness of inception-to-date interest expense	$ 9,000

SHAREHOLDERS' EQUITY AND STOC_3

SHAREHOLDERS' EQUITY AND STOCK-BASED COMPENSATION, Dividends (Details)	9 Months Ended
	Mar. 31, 2022USD ($)
Dividends [Abstract]
Cash dividends	$ 0

SHAREHOLDERS' EQUITY AND STOC_4

SHAREHOLDERS' EQUITY AND STOCK-BASED COMPENSATION, Stock-Based Compensation (Details) - USD ($)	3 Months Ended		9 Months Ended
	Mar. 31, 2022	Mar. 31, 2021	Mar. 31, 2022	Mar. 31, 2021
Stock-Based Compensation [Abstract]
Employee stock options	$ 60,045	$ 45,312	$ 187,059	$ 186,528
Restricted stock awards	138,478	31,604	489,875	85,681
Totals	198,523	76,916	676,934	272,209
Stock-based compensation capitalized as a cost of inventory	$ 0	$ 0	$ 0	$ 0

SHAREHOLDERS' EQUITY AND STOC_5

SHAREHOLDERS' EQUITY AND STOCK-BASED COMPENSATION, Stock Option Activity (Details) - Stock Options [Member] $ / shares in Units, $ in Thousands	9 Months Ended
	Mar. 31, 2022USD ($)$ / sharesshares
Stock Option Activity [Roll Forward]
Outstanding, beginning balance (in shares) | shares	2,235,286
Granted (in shares) | shares	249,793
Exercised (in shares) | shares	(532,976)
Forfeited (in shares) | shares	(24,753)
Expired (in shares) | shares	(169,297)
Outstanding, ending balance (in shares) | shares	1,758,053
Weighted Average Exercise Price [Roll Forward]
Outstanding, beginning balance (in dollars per share) | $ / shares	$ 1.24
Granted (in dollars per share) | $ / shares	2.66
Exercised (in dollars per share) | $ / shares	1.22
Forfeited (in dollars per share) | $ / shares	1.04
Expired (in dollars per share) | $ / shares	3.12
Outstanding, ending balance (in dollars per share) | $ / shares	$ 1.27
Fair Value of Stock Options [Abstract]
Fair value of stock options vested | $	$ 188

SHAREHOLDERS' EQUITY AND STOC_6

SHAREHOLDERS' EQUITY AND STOCK-BASED COMPENSATION, Stock Options Outstanding (Details) - Stock Options [Member] - USD ($) $ / shares in Units, $ in Thousands	9 Months Ended
	Mar. 31, 2022	Mar. 31, 2021	Jun. 30, 2021
Stock Options Outstanding and Exercisable [Abstract]
Options outstanding, balance as of end of period (in shares)	1,758,053		2,235,286
Options outstanding, weighted average remaining contractual life	6 years 6 months 10 days
Options outstanding, weighted average exercise price (in dollars per share)	$ 1.27		$ 1.24
Options exercisable, balance as of end of period (in shares)	1,289,070
Options exercisable, weighted average remaining contractual life	5 years 7 months 20 days
Options exercisable, weighted average exercise price (in dollars per share)	$ 1.08
Options Vested or Expected to Vest [Abstract]
Options vested or expected to vest, balance as of end of period (in shares)	1,688,085
Options vested or expected to vest, weighted average remaining contractual life	6 years 5 months 1 day
Options vested or expected to vest, weighted average exercise price (in dollars per share)	$ 1.25
Unrecognized Stock-Based Compensation Expense [Abstract]
Unrecognized stock-based compensation expense	$ 334
Unrecognized stock-based compensation expense, period for recognition	24 months
Options outstanding, aggregate intrinsic value	$ 973
Options exercisable, aggregate intrinsic value	973
Options vested or expected to vest, aggregate intrinsic value	973
Options exercised, aggregate intrinsic value	829	$ 1,200
Tax benefit associated with stock options exercised	$ 93	$ 0

SHAREHOLDERS' EQUITY AND STOC_7

SHAREHOLDERS' EQUITY AND STOCK-BASED COMPENSATION, Restricted Stock Activity (Details) - Restricted Stock [Member] $ / shares in Units, $ in Thousands	9 Months Ended
	Mar. 31, 2022USD ($)$ / sharesshares
Restricted Stock Activity [Roll Forward]
Unvested, beginning balance (in shares) | shares	178,750
Granted (in shares) | shares	242,725
Vested (in shares) | shares	(242,725)
Unvested, ending balance (in shares) | shares	178,750
Weighted Average Grant Date Fair Value [Roll Forward]
Unvested, beginning balance (in dollars per share) | $ / shares	$ 0.72
Granted (in dollars per share) | $ / shares	2.75
Vested (in dollars per share) | $ / shares	1.25
Unvested, ending balance (in dollars per share) | $ / shares	$ 2.75
Unrecognized Stock-Based Compensation Expense [Abstract]
Unrecognized stock-based compensation expense | $	$ 188
Unrecognized stock-based compensation expense, period for recognition	4 months

NET INCOME PER COMMON SHARE (De

NET INCOME PER COMMON SHARE (Details) - USD ($)	3 Months Ended						9 Months Ended
	Mar. 31, 2022	Dec. 31, 2021	Sep. 30, 2021	Mar. 31, 2021	Dec. 31, 2020	Sep. 30, 2020	Mar. 31, 2022	Mar. 31, 2021
Numerator [Abstract]
Net income	$ 338,508	$ 1,167,612	$ 827,025	$ 1,036,227	$ 2,519,077	$ 874,266	$ 2,333,145	$ 4,429,570
Denominator [Abstract]
Weighted average common shares outstanding, Basic (in shares)	30,484,897			29,320,434			30,286,195	28,967,946
Effect of dilutive securities (in shares)	783,513			1,205,004			985,482	699,783
Weighted average common shares outstanding, Diluted (in shares)	31,268,410			30,525,438			31,271,677	29,667,729
Net income per common share: [Abstract]
Basic (in dollars per share)	$ 0.01			$ 0.04			$ 0.08	$ 0.15
Diluted (in dollars per share)	$ 0.01			$ 0.03			$ 0.07	$ 0.15
Stock Options [Member]
Net Income per Common Share [Abstract]
Shares excluded from the computation of diluted net income per common share (in shares)	975,000			1,090,000			773,000	1,600,000
Restricted Stock [Member]
Net Income per Common Share [Abstract]
Shares excluded from the computation of diluted net income per common share (in shares)	179,000			179,000			179,000	179,000

MAJOR CUSTOMERS AND CONCENTRA_3

MAJOR CUSTOMERS AND CONCENTRATION OF CREDIT RISK (Details)	3 Months Ended			9 Months Ended			12 Months Ended
	Mar. 31, 2022		Mar. 31, 2021	Mar. 31, 2022		Mar. 31, 2021	Jun. 30, 2021
Minimum [Member]
Major Customers and Concentration of Credit Risk [Abstract]
Payment terms on trade receivables				30 days
Maximum [Member]
Major Customers and Concentration of Credit Risk [Abstract]
Payment terms on trade receivables				90 days
Trade Accounts Receivable [Member] | Customer Concentration Risk [Member] | Customer A [Member]
Major Customers and Concentration of Credit Risk [Abstract]
Concentration risk, percentage				36.00%			30.00%
Trade Accounts Receivable [Member] | Customer Concentration Risk [Member] | Customer B [Member]
Major Customers and Concentration of Credit Risk [Abstract]
Concentration risk, percentage				11.00%			14.00%
Trade Accounts Receivable [Member] | Customer Concentration Risk [Member] | Customer C [Member]
Major Customers and Concentration of Credit Risk [Abstract]
Concentration risk, percentage					[1]		22.00%
Total Net Sales [Member] | Customer Concentration Risk [Member] | Customer A [Member]
Major Customers and Concentration of Credit Risk [Abstract]
Concentration risk, percentage	13.00%		15.00%	14.00%		13.00%
Total Net Sales [Member] | Customer Concentration Risk [Member] | Customer C [Member]
Major Customers and Concentration of Credit Risk [Abstract]
Concentration risk, percentage		[2]	13.00%		[2]	11.00%
[1]	Customer C did not have individual balances that represented 10% or more of total gross accounts receivable as of March 31, 2022.
[2]	Customer C did not have net sales that represented 10% or more of total net sales for the three and nine months ended March 31, 2022.

SUBSEQUENT EVENT (Details)

SUBSEQUENT EVENT (Details) - Subsequent Event [Member] - USD ($) $ in Thousands	May 05, 2022	Apr. 29, 2022
Subsequent Event [Abstract]
Period over which common stock can be repurchased		3 years
Number of shares repurchased (in shares)	0
Maximum [Member]
Subsequent Event [Abstract]
Authorized amount of common stock that can be repurchased		$ 5,000