SOCKET MOBILE, INC.
For the period ended Mar 31, 2026. Filed May 13, 2026.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2026 · Filed May 13, 2026
SCKT$0.28+0.7%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-09-30; filed 2025-11-07.
0000944075-25-000083
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-03-31; filed 2026-05-13.
0000944075-26-000040
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 51 previous paragraphs and 45 current paragraphs.
27 unchanged; 5 reworded; 13 added; 18 removed; 1 previous and 0 current paragraphs rearranged.
Tables are not compared: 1 previous and 1 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (13)
Current report
XtremeScan family. Our XtremeScan product line consists of two configurations: XtremeScan, and XtremeScan Meg. This product family marks a significant milestone in our commitment to delivering high-quality data capture solutions for customers in industrial, manufacturing, warehousing, oil and gas, and airports. XtremeScan enables iPhones to withstand harsh industrial conditions, offering robust scanning capabilities with military-grade durability. XtremeScan Meg devices cater to the growing number of workers using a single phone for both personal and business needs. The Bring Your Own Device (BYOD) market is a significant yet underserved segment where we see strong growth potential. XtremeScan is fully compatible with iPhone 17e, a durable, cost-effective device designed for industrial environments. With an extra-long battery life, enhanced drop resistance, and the trusted iOS platform, it is expected to become the go-to device for demanding industrial sectors. XtremeScan, combined with iPhone 17e, will empower industrial businesses with durable, adaptable, and future-ready data capture technology.
Current report
DuraScan® Family. Our DuraScan® family includes the 600 Series NFC & RFID readers (D600), 700 Series companion scanners (D720, D730, D740, D745, D755, D760, D762, D764, D765), 800 Series attachable scanners (D800, D820, D840, D860), and the Wearable 900 Series (DW930, DW940). Designed for rugged work environments, DuraScan data readers offer exceptional durability, making them ideal for industries such as warehousing, manufacturing, and distribution.
Current report
SocketScan family. Our SocketScan family offers a range of versatile solutions designed for seamless integration into various business applications. It includes the 300 Series countertop readers (S320, S370), the 500 Series NFC Mobile Wallet Reader (S550), the 700 Series companion scanners (S720, S730, S740), the 700 Series Bluetooth Low Energy scanners (S721, S741), and the 800 Series attachable scanners (S800, S820, S840, S860). With an easy setup process and user-friendly design, SocketScan enhances efficiency by delivering fast, high-performance 1D/2D scanning while reducing human errors. Whether scanning barcodes, reading NFC data, or handling combo applications, SocketScan ensures accuracy and reliability across diverse industries.
Current report
DuraSled Family. Our DuraSled (DS800, DS820, DS840, DS860) integrates a smartphone with a high-performance, protective barcode sled scanner, creating a one-handed solution. Designed for efficiency, these sled scanners offer native support with select Apple and Samsung smartphones, enabling full application control of a one-handed data collection experience.
Current report
Total revenues for the first quarter of 2026 were approximately $3.7 million, reflecting a 7% decline compared to $4.0 million in the same period last year. This decrease is primarily attributed to weaker demand in both domestic and international markets. In Q1, we experienced reduced purchasing activity from key customers, which negatively impacted sales volumes. While we remain confident in our long-term growth prospects, these short-term fluctuations are largely due to less robust demand for our products during this quarter.
Current report
Our gross profit margin on sales reached 51.3% in Q1 2026, a slight increase from 50.4% in the same period last year. Despite the lower revenue in this quarter, we have successfully maintained our gross margin, demonstrating effective cost control and operational efficiency.
Current report
In the first quarter of 2026, research and development expenses were approximately $1,090,000, reflecting a 4% decrease compared to approximately $1,132,000 in Q1 2025.
Current report
Sales and marketing expenses in the first quarter of 2026 totaled approximately $902,000, reflecting a 19% decrease compared to approximately $1,106,000 in the same quarter last year. This decrease was primarily driven by reduced headcount.
Current report
In the first quarter of 2026, the Company incurred approximately $665,000 in general and administrative expenses, reflecting a 2% increase from approximately $653,000 in the same quarter of 2025.
Current report
No income tax expense was recorded for the first quarter of 2026 or 2025.
Current report
As reflected in our Condensed Statements of Cash Flows, we used net cash of $768,856 in operating activities in the first quarter of 2026, compared to $732,970 in the same period last year. To calculate our net cash used in operating activities, we adjusted our net loss of $899,576 and $994,140 in the first quarter of 2026 and 2025, respectively, by adding back non-cash expenses such as stock-based compensation expense, depreciation and amortization, and deferred tax expenses and benefits, which amounted to $598,645 and $540,117 in the first quarters of 2026 and 2025, respectively. In addition, we analyze changes in operating assets and liabilities as a source or use of cash. In the first quarter of 2026, changes in operating assets and liabilities resulted in a net cash outflow of $467,925, primarily driven by increases in accounts receivable due to an increase in shipments toward the end of the quarter and lower accrued payroll and related expenses. This cash outflow was partially offset by a decrease in inventory levels. In the first quarter of 2025, changes in operating assets and liabilities resulted in a net cash outflow of $278,947, primarily driven by increases in accounts receivable due to customer payment delays and higher inventory levels resulting from slower sales. This cash outflow was partially offset by an increase in accounts payable, reflecting our cash management efforts.
Current report
In the first quarters of 2026 and 2025, we invested $53,332 and $52,304, respectively, in manufacturing tooling costs, computer software development costs, and leasehold improvements,
Current report
Net cash provided by financing activities for the three months ended March 31, 2026 was $500,000, compared to zero in the comparable period a year ago. Financing activities in 2026 consisted of proceeds from a subordinated convertible note.
Removed paragraphs (18)
Previous report
XtremeScan Family. XtremeScan combines the versatility and user-friendliness of iPhones with the ruggedness and top-of-the-line protection required for extreme, industrial work environments. XtremeScan Case XC100 offers ultimate iPhone protection with its rugged outer shell and fully enclosed, rubberized shielding for maximum durability. It's the toughest iPhone case on the market, offering military-grade protection against drops, dirt, water, and even more unpredictable elements found in harsh industrial environments. XtremeScan XS930 & XS940 are built upon the XtremeScan Case and provide the same rugged iPhone protection, adding a high-performance Socket Mobile data reader. With both 1D (XS930) and powerful 1D/2D (XS940) options, these data readers can scan through various types of packaging materials under different lighting conditions. They provide the perfect solution for users who wish to utilize iPhones for data capture within rough, industrial settings. XtremeScan Grip XG930 & XG940 provides 1D or 1D/2D barcode scanning capabilities and builds even further on the XS by providing an added pistol grip handle. The ergonomic grip enables an easy point-and-shoot approach and comfort during extended scanning sessions. In March 2025, the Company released XtremeScan iXG and iXS Series, powered by iOS 18.3 and featuring a fully integrated iPhone 16e. These devices are designed to serve as full-featured handheld computers, combining high-performance long-range barcode scanning with the connectivity, app ecosystem, and user-friendly interface of the iOS platform.
Previous report
SocketScan Family. Our SocketScan family consists of the 300 Series (S320), 700 Series (S700, S720, S730, S740) companion scanners, and 800 Series (S800, S820, S840, S860) attachable scanners. The S320 is a compact reader designed specifically for reading QR codes, making it ideal for applications such as access control, ticketing, and event check-in. The 700 Series are available in multiple vivid colors: blue, green, red, white, yellow, and black. The S720 reads both 1D and 2D barcodes on paper and screen, serving as a drop-in replacement for our previously popular S700 model while also adding QR code functionality. The 800 Series comprises 1D linear imaging (S800) and 2D (S820, S840, S860) scanners, which can be easily clipped onto smartphones, tablets, and other mobile devices using an easily detachable clip or DuraCase, creating a one-handed solution. The S860 includes MRZ (machine-readable zone) support, allowing it to scan passports, visas, and other travel documents in addition to barcodes. Additionally, the 800 Series scanners may be used as stand-alone devices as well.
Previous report
DuraScan® Family. Our DuraScan® family comprises the 700 Series (D700, D720, D730, D740, D745, D755, D760, D762) companion scanners, the 800 Series (D800, D820, D840, D860) attachable scanners, and the Wearable Series (DW930, DW940), all designed with IP54-rated durable casings to withstand challenging environments. The D720 offers an affordable entry point into 2D scanning, while the D820 provides a basic and cost-effective upgrade to 2D capabilities. The D745 and D755 are medical-grade, universal scanners suitable for healthcare settings. The D760 and D860 include MRZ (machine-readable zone) support, enabling the scanning of passports, visas, and other travel documents. The newly introduced D762 enhances the lineup with an extended scanning range of up to 14 feet, making it ideal for logistics and warehouse operations where scanning from a distance is beneficial. Additionally, the 800 Series scanners can function as stand-alone devices, offering flexibility across various applications. DuraScan Wear DW930 & DW940 are the first wearable additions to the DuraScan Product Family, introducing a new era of innovative scanning technologies for the Company. The DW930 offers 1D laser scanning technology, while the DW940 provides powerful 1D/2D barcode scanning functionality. Their glove-like, wearable design allows workers to use both hands freely, enhancing speed and flexibility. This makes them perfect for scanning in industries such as warehousing, manufacturing, and distribution.
Previous report
DuraSled Family. Our DuraSled (DS800, DS820, DS840, DS860) is a barcode scanning sled designed for durability. It combines a phone with a scanner to create a one-handed solution. DuraSled protects phones from impact damage and provides a robust charging solution for all environments. It iseasy-to-use and ideal for delivery services, stock counting, ticketing and other App-driven mobile solutions. The DuraSled products are compatible with Apple and Samsung devices. The DS820 provides a basic and affordable option for those who wish to upgrade to 2D scanning.
Previous report
*NFC & RFID Contactless Reader/Writer.*The product line consists of the D600, S550 and S370. The D600 is an ergonomically handheld model with an IP54-rated outer casing that can read and write various types of electronic SmartTags or transfer data with near-field communication. The S550 is a contactless membership card reader/writer designed for tap-and-go smart card and Near Field Communication (“NFC”) applications. The S370 supports both barcode scanning and NFC reading and writing technologies. It provides App providers the ability to read both QR code-based and NFC-based credentials, enabling them to accept multiple formats with just one device. Additionally, the S370 can read credentials following ISO 18013-5, the Mobile Driver’s License (mDL) standard being adopted in some states and countries.
Previous report
Total revenues for the third quarter of 2025 were approximately $3.1 million, representing a 20% decline compared to $3.9 million in the same period last year. For the nine-month period, revenue decreased by 20.2% to approximately $11.1 million from $13.9 million in the prior year. The decrease primarily reflects slower distributor bookings and reduced channel inventory during the quarter. In addition, several deployment deals were delayed as customers remained cautious with spending and focused on cash preservation
Previous report
Our gross profit margin on sales reached 47.7% in Q3 2025, slightly lower from 49% in the same period last year. For the nine-month period, the margin was 49.5%, down from 50.1% in 2024. The decline primarily reflects the impact of fixed overhead costs spread over a lower revenue base.
Previous report
Research and development expense in the three and nine months ended September 30, 2025, were approximately $1.0 million and $3.3 million, respectively, representing decreases of 12% and 10% compared to $1.2 million and $3.6 million in the corresponding periods a year ago. The reduction in expenses primarily reflects management-implemented cost-saving measures which resulted in lower employee costs. We anticipate a slight increase in the general and administrative expenses for the remainder of the year.
Previous report
Sales and marketing expenses in the three and nine months ended September 30, 2025, were approximately $0.9 million and $3.1 million, respectively, representing decreases of 17% and 7% compared to $1.1 million and $3.3 million in the corresponding periods a year ago. The reduction was primarily driven by cost-cutting initiatives, particularly lower employee-related costs. We anticipate a slight increase in the general and administrative expenses for the remainder of the year.
Previous report
General and administrative expenses in the three and nine months ended September 30, 2025 were approximately $0.58 million and $1.8 million, respectively, representing a decrease of 10% and 15% compared to expenses of approximately $0.64 million and $2.1 million in the corresponding periods a year ago. The reduction was primarily driven by cost-cutting initiatives, including lower employee-related costs and reduced spending on outside professional services. We anticipate a slight decrease in the general and administrative expenses for the remainder of the year.
Previous report
We did not record any income tax expense for the three and nine months ended September 30, 2025 and 2024. As of September 30, 2025 and December 31, 2024, our deferred tax assets, primarily representing future income tax savings from the application of net operating loss carry forwards, were valued at $10,663,419 and $10,663,419, respectively.
Previous report
As reflected in our Statements of Cash Flows, net cash used in operating activities was approximately $1,600,000 in the first nine months of 2025, compared to net cash used in operating activities of approximately $434,000 in the first nine months of 2024. We calculate net cash used in operating activities by adjusting our net loss (approximately a net loss of approximately $3.0 million and $2.3 million in the first nine months of 2025 and 2024, respectively) with items that did not require the use of cash. Those items include stock-based compensation expense, depreciation and amortization of equipment and intangible assets, amortization of debt discount and operating lease ROU assets, and deferred tax benefits. These amounts totaled approximately $1.9 million and $2.0 million in the first nine months of 2025 and 2024, respectively. In addition, we report increases in assets and reductions in liabilities as uses of cash and decreases in assets and increases in liabilities as sources of cash, together referred to as changes in operating assets and liabilities.
Previous report
In the first nine months of 2025, changes in operating assets and liabilities resulted in net cash used in operating activities of approximately $513,000, primarily due to operating lease payments, a reduction in accrued payroll expenses, an increase in prepaid expenses, and a decrease in accounts payable. These uses of cash were partially offset by cash released from lower inventory balance as of September 30, 2025.
Previous report
In the first nine months of 2024, changes in operating assets and liabilities resulted in net cash used in operating activities of approximately $120,000, primarily due to operating lease payments. This was partially offset by a release of cash from a reduced accounts receivable balance as of September 30, resulting from lower shipment levels at the end of the quarter.
Previous report
In the first nine months of 2025 and 2024, we invested approximately $376,000 and $564,000, respectively, in manufacturing tooling, firmware development, website development, and leasehold improvements. In 2024, these investing activities were offset by proceeds from a tenant improvements allowance amounting to $72,800.
Previous report
Net cash provided by financing activities was approximately $1.5 million in the first nine months of 2025, compared to net cash provided of approximately $1.0 million in the comparable period a year ago. In 2025, financing activities consisted of the completion of secured subordinated note financing of $1,500,000. In contrast, financing activities in 2024 consisted primarily of the completion of secured subordinated note financing of approximately $989,000, and the proceeds of employee stock options in the amount of $23,750.
Previous report
Index
Reworded paragraphs (5)
Previous wording
We are a leading provider of data capture and delivery solutions for enhanced productivity in workforce mobilization. Our products are incorporated into mobile applications used in point of sale (POS), commercial services (field workers), asset tracking, manufacturing process and quality control, transportation and logistics (goods tracking and movement), event management (ticketing, entry,access control, and identification), medical and education. Our primary products are cordless data capture devices incorporating barcode scanning or RFID/Near Field Communications (NFC) technologies that connect over Bluetooth. All products work with applications running on smartphones, mobile computers and tablets using operating systems from Apple® (iOS), Google™ (Android™) and Microsoft® (Windows®). We offer an easy-to-use software developer kit (CaptureSDK) to application providers, which enables them to provide their users with our advanced barcode scanning features. Our products are integrated in their application solutions and are marketed by the application providers or the resellers of their applications. The number of our registered application providers for data capture applications continues to grow.
Current wording
Our primary products are cordless data capture devices incorporating barcode scanning or RFID/Near Field Communications (NFC) technologies that connect over Bluetooth. All products work with applications running on smartphones, mobile computers and tablets using operating systems from Apple® (iOS), Google™ (Android™) and Microsoft® (Windows®). We offer an easy-to-use software developer kit (CaptureSDK) to app providers, which enables them to provide their consumers with our advanced barcode scanning features. Our products are integrated by the app providers and are marketed by the app providers or their resellers. The number of app providers supporting our data capture solutions continues to grow.
Previous wording
SocketCam Family. Our camera-based barcode scanning software includes SocketCam C820 and C860 for both iOS and Android. The C820 is a free, easily integrated camera scanning solution. The C860 offers a significant upgrade for users with advanced scanning needs. It stands out due to its swift and accurate reading of damaged barcodes, coupled with exceptional performance in poor lighting conditions, setting it apart from others in the industry. The C820 and C860 enable App providers to service a wide range of customers with various data capture requirements, from price-sensitive to performance-sensitive. End-users whose data capture requirements exceed the capabilities of the free camera-based scanners will have the choice of upgrading to an advanced camera-based scanner, C860, or purchase a Socket hardware scanner.
Current wording
SocketCam family. Our camera-based barcode scanning software includes SocketCam C820 and C860, compatible with both iOS and Android. The C820 is a free, easily integrated camera scanning solution, while the C860 offers a significant upgrade for users with advanced scanning needs. The C860 stands out due to its swift and accurate reading of damaged barcodes and exceptional performance in poor lighting conditions, setting it apart in the industry. Both C820 and C860 enable App providers to serve a wide range of customers with diverse data capture requirements, from price-sensitive to performance-sensitive. End-users needing more than a free camera-based scanners can upgrade to advanced C860 or opt for a Socket hardware scanner.
Previous wording
Software Developer Kit (CaptureSDK). Our Software Developer Kit (CaptureSDK) supports all our data capture devices with a single integration, making it easier for App providers to integrate our data capture capabilities into their applications. With the installation of our data capture software, the App providers’ customers can choose any of our products that work best for them. Our CaptureSDK enables the App providers to modify captured data, control the placement of the barcoded or RFID data in their applications, and control the feedback to the user that the transaction and transmission were successfully completed. Our CaptureSDK also supports the built-in camera in a customer’s smartphone or tablet to be used for occasional or lower-volume data collection requirements. The CaptureSDK uses tools integrated with software building environments such as Swift Package Manager, Maven and NuGet, adds support for high-level frameworks such as MAUI, ReactNative, Java, JavaScript, and Flutter and adds other features to make it easier for App providers to integrate our data capture software into their applications.
Current wording
Software Developer Kit (CaptureSDK). Our CaptureSDK supports all Socket Mobile data capture devices through a single integration, simplifying the process for app developers to incorporate our data capture capabilities into their applications. By installing our SDK, developers enable their customers to select the most suitable Socket Mobile products for their needs. CaptureSDK allows developers to modify captured data, control the placement of barcode or RFID data within their applications, and manage user feedback to confirm successful transactions and data transmissions. Additionally, CaptureSDK includes SocketCam, a feature that enables the use of a device's built-in camera for occasional or lower-volume data collection requirements. CaptureSDK is compatible with development tools such as Swift Package Manager, Maven, and NuGet, and supports high-level frameworks including MAUI, React Native, Java, JavaScript, and Flutter, facilitating seamless integration of our data capture solutions into diverse applications.
Previous wording
We design our own products and are responsible for all associated test equipment. We subcontract the manufacturing of all our product components to independent third-party contract manufacturers located in the United States, Mexico, Taiwan, Singapore, Malaysia and China that have the equipment, know-how and capacity to manufacture products to our specifications. We perform final product assembly, testing and packaging at, and distribute our products from, our Fremont, California facility. We offer our products worldwide through two-tier distribution enabling customers to purchase from large numbers of online resellers around the world including application providers who resell their own solutions along with our data capture products. Our products are also available on our online stores.
Current wording
We design our own products and are responsible for all associated test equipment. We subcontract the manufacturing of all our product components to independent third-party contract manufacturers located in the United States, Mexico, Taiwan, Singapore, Malaysia and China that have the equipment, know-how and capacity to manufacture products to our specifications. We perform final product assembly, testing and packaging at, and distribute our products from, our Fremont, California facility. We offer our products worldwide through two-tier distribution enabling customers to purchase from large numbers of online resellers around the world including app providers who resell their own solutions along with our data capture products. Our products are also available on our online stores.
Previous wording
Interest expense, net of interest income, in the three and nine months ended September 30, 2025 was approximately $140,000 and $355,000, respectively, compared to approximately $84,000 and $229,000, respectively, in the same periods one year ago. Interest expense was related to interest on the secured subordinated convertible notes payable (see “NOTE 6 — Secured Subordinated Convertible Notes Payable” of the notes to consolidated financial statements for more information).
Current wording
Interest expense and other, net of interest income and other, was approximately $140,000 in the first quarter of 2026 compared to $100,000 in the first quarter of 2025. Interest expenses in the first quarter of both 2026 and 2025 were related to interest on secured subordinated convertible notes payable (see “NOTE 6 — Secured Subordinated Convertible Notes Payable” for more information). There were no outstanding balances of credit lines during the first three months of 2026 or 2025.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
There were no outstanding balances of credit lines during the three and nine months ended September 30, 2025 and 2024.