Axe Compute Inc.
For the period ended Dec 31, 2025. Filed Mar 31, 2026.
View on SEC.govAbout this filing
A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2025 · Filed Mar 31, 2026
AGPU$6.73+11.2%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2024-12-31; filed 2025-03-31.
0001171843-25-001863
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSCurrent report: 10-K
Period ended 2025-12-31; filed 2026-03-31.
0001171843-26-002094
ITEM 7. 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.
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ITEM 7.** MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
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Overview
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Axe Compute Inc. is a technology company focused on providing high-performance computing infrastructure for artificial intelligence workloads by enabling enterprise access to large-scale GPU capacity through the decentralized Aethir network. The company plans to operate as an infrastructure provider that secures compute resources, including bare-metal GPUs, through digital assets tied to AI infrastructure and deploys those resources to enterprise customers under service agreements to support AI model training and production workloads. Axe Compute emerged from the rebranding of the Company’s Legacy Business and continues to operate certain AI-driven drug discovery activities developed by the Legacy Business while shifting its strategic focus toward scalable compute infrastructure and digital asset-enabled access to distributed GPU networks. As part of this transition, the company is evaluating strategic alternatives for non-core assets of the Legacy Business, including its Helomics biobank business, which contains a large collection of oncology research materials and historical drug response data.
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The Compute Industry
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We embarked upon this direction because the global compute market represents a significant and rapidly growing commercial opportunity. According to Research and Markets (2026), the global compute market is estimated to be valued at over $1 trillion in 2026, with a compound annual growth rate of approximately 9.9%, and is expected to nearly double in value by 2032. When focused specifically on AI-related computing services, many forecasters estimate growth rates exceeding 30% annually, with the AI compute market anticipated to reach a total value in excess of $1 trillion by 2034 (Cognitive Market Research; Statifacts, 2025). McKinsey & Company estimated in 2025 that over 50% of all data center capacity was already dedicated to AI workloads, an amount they expect to grow by a factor of 3.5 times by 2030, and that approximately $6.7 trillion will be spent on data centers globally between 2025 and 2030, of which approximately 65.7% will be GPU-related. Gartner estimates worldwide AI spending will total $2.5 trillion in 2026 alone. Despite this unprecedented level of investment, demand continues to significantly outpace supply: as of early 2026, North American data center vacancy rates reached a record low of 1.6%, data center demand increased 24% in 2025, and average lead times for data center GPUs stand at 36 to 52 weeks (CBRE Investment Management, 2026). The Company believes this supply-demand imbalance creates a significant opportunity for its GPU compute business, which operates through the Aethir network to provide distributed GPU compute capacity for AI and other high-performance computing workloads.
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Our ATH Treasury Strategy
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On September 29, 2025, the Company announced the launch of its Treasury Strategy focused on ATH. Aethir is a leading decentralized physical infrastructure network developed by DCI, that provides a decentralized GPU network, connecting producers and consumers of GPU compute power at enterprise scale, supporting applications such as artificial intelligence computation, gaming and cloud workloads. ATH functions as a proxy for a unit of GPU compute power and serves as a medium of exchange and unit of incentives for participants in the Aethir network. Participants in the Aethir network can generate yield or other rewards by staking or lending ATH or by otherwise serving as a source of ATH liquidity.
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Pursuant to the Treasury Strategy, the Company intends to continue acquiring additional ATH in the open market and to earn yield on its ATH treasury holdings by engaging in ATH staking and other activities. As a holder of ATH, the Company accrues unrealized gains or losses from any appreciation or depreciation, as applicable, in the value of ATH tokens, which trade on various cryptocurrency exchanges.
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The Company’s management is focusing its resources on the Treasury Strategy, and a significant portion of the Company’s balance sheet will be allocated to holding ATH pursuant to its Treasury Strategy.
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Currently, the Treasury Strategy is primarily dedicated to ATH, and the Company does not intend to allocate treasury assets to other digital assets in the near term. As a result, the Company’s assets will be highly concentrated in a single digital asset. Adverse developments specific to ATH, its protocol, or its network could have a disproportionate impact on the Company’s financial condition and results of operations.
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The Company's Treasury Strategy is intended to bring value to its stockholders through the following:
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ATH and the Aethir Network
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Listed on June 12, 2024, ATH is the native cryptocurrency of the Aethir network. It is a core component of the Aethir ecosystem, serving as the primary medium of exchange for transactions within the network. There is a fixed, total supply of 42 billion ATH tokens.
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Key Functions of ATH:
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Government Regulation
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Both our business segments are subject to or impacted by extensive and frequently changing laws and regulations in the United States (at both the federal and state levels) and the other jurisdictions in which we conduct business, including some specific to our business, some specific to our industry, and others relating to conducting business generally (e.g., U.S. Foreign Corrupt Practices Act). We also are subject to inspections and audits by governmental agencies
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The laws and regulations applicable to ATH and other digital assets are evolving and subject to interpretation and change.
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Governments around the world have reacted differently to digital assets. Certain governments have deemed them illegal, and others have allowed their use and trade without restriction, while in some jurisdictions, such as the U.S., digital assets are subject to overlapping, uncertain and evolving regulatory requirements.
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As digital assets have grown in both popularity and market size, the U.S. Executive Branch, Congress and a number of U.S. federal and state agencies, including the Financial Crimes Enforcement Network, the Commodity Futures Trading Commission (“CFTC”), the SEC, the Financial Industry Regulatory Authority, the Consumer Financial Protection Bureau, the Department of Justice, the Department of Homeland Security, the Federal Bureau of Investigation, the IRS, and state financial regulators, have been examining the operations of digital asset networks, digital asset users and digital asset exchanges, with particular focus on the extent to which digital assets can be used to violate state or federal laws, including to facilitate the laundering of proceeds of illegal activities or the funding of criminal or terrorist enterprises, and the safety and soundness and consumer-protective safeguards of exchanges or other service-providers that hold, transfer, trade or exchange digital assets for users. Many of these state and federal agencies have issued consumer advisories regarding the risks posed by digital assets to investors. In addition, federal and state agencies, and other countries have issued rules or guidance regarding the treatment of digital asset transactions and requirements for businesses engaged in activities related to digital assets.
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Depending on the regulatory characterization of ATH, the markets for ATH and cryptocurrency in general, and our activities in particular, our business and inter-connectivity with Aethir may be subject to regulation by one or more regulators in the United States and globally. Ongoing and future regulatory actions may alter, to a materially adverse extent, the nature of digital assets markets, the participation of industry participants, including service providers and financial institutions in these markets, and our ability to pursue our business strategy utilizing Aethir. Additionally, U.S. state and federal and foreign regulators and legislatures have taken action against industry participants, including digital assets businesses, and enacted restrictive regimes in response to adverse publicity arising from hacks, consumer harm, or criminal activity stemming from digital assets activity.
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The CFTC takes the position that some digital assets fall within the definition of a “commodity” under the Commodities Exchange Act of 1936, as amended (the “CEA”). Under the CEA, the CFTC has broad enforcement authority to police market manipulation and fraud in spot digital assets markets in which we may transact. Beyond instances of fraud or manipulation, the CFTC generally does not oversee cash or spot market exchanges or transactions involving digital asset commodities that do not utilize margin, leverage, or financing. In addition, CFTC regulations and CFTC oversight and enforcement authority apply with respect to futures, swaps, other derivative products and certain retail leveraged commodity transactions involving digital asset commodities, including the markets on which these products trade.
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The SEC and its staff have taken the position that certain other digital assets fall within the definition of a “security” under the U.S. federal securities laws. Public statements made by senior officials and senior members of the staff at the SEC indicate that the SEC does not consider specific digital assets, like Bitcoin, to be a security under the federal securities laws. However, such statements are not official policy statements by the SEC and reflect only the speakers’ views, which are not binding on the SEC or any other agency or court and cannot be generalized to any other digital assets.
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In addition, because transactions in ATH provide a degree of anonymity, they are susceptible to misuse for criminal activities, such as money laundering. This misuse, or the perception of such misuse, could lead to greater regulatory oversight of ATH and Aethir networks, and there is the possibility that law enforcement agencies could close or blacklist such Aethir networks or other Aethir-related infrastructure with little or no notice and prevent users from accessing or retrieving ATH held via such platforms or infrastructure. For example, the U.S. Treasury Department’s Office of Foreign Assets Control has issued updated advisories regarding the use of virtual currencies, added a number of digital asset exchanges and service providers to the Specially Designated Nationals and Blocked Persons list and engaged in several enforcement actions, including a series of enforcement actions that have either shut down or significantly curtailed the operations of several smaller digital asset exchanges associated with Russian and/or North Korean nationals. Additionally, in January 2025, the Consumer Financial Protection Bureau announced that it is seeking public input on privacy protections and surveillance in digital payments, particularly those offered through large technology platforms.
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As noted above, activities involving ATH and other digital assets may fall within the jurisdiction of more than one financial regulator and various courts and such laws and regulations are rapidly evolving and increasing in scope. In the U.S., regulation on stablecoins was recently signed into U.S. federal law through the GENIUS Act which established the first comprehensive regulatory framework specifically for “payment stablecoins” - digital assets designed to maintain a stable value pegged to a fiat currency (typically the U.S. dollar) and intended for use in payments or transfers. The GENIUS Act aims to foster innovation in the stablecoin sector while ensuring financial stability, consumer protection, and compliance with anti-money laundering standards.
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The regulatory landscape for digital assets continues to evolve rapidly across different jurisdictions, and we may become subject to new laws and regulations that could materially affect our business operations, compliance obligations, and financial performance. For a comprehensive discussion of the risks that existing and future regulations pose to our business, including specific regulatory developments that may materially affect our operations, see the section entitled “Risk Factors” in this Report.
Current report
On March 20, 2025, the Company completed the sale of assets related to its wholly owned subsidiary, Skyline Medical Inc., to DeRoyal Industries, Inc., a global manufacturer and supplier of medical products. Skyline Medical produced the FDA-cleared STREAMWAY System and associated products for automated medical fluid waste management and patient-to-drain medical fluid disposal and was previously classified as the Company’s Eagan operating segment.
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On September 19, 2025, the Company’s stockholders approved a one-for-fifteen (1-for-15) reverse stock split of the Company’s common stock, which became effective at 12:01 a.m. on Tuesday, September 30, 2025.
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On October 8, 2025, the Company announced the closing of two previously announced private investment in public equity transactions (“PIPEs”) totaling approximately $343.5 million to support the Company’s adoption of a digital asset treasury strategy focused on ATH, the native utility token of the Aethir ecosystem. The Company raised an aggregate of approximately $343.5 million in the PIPEs from the purchase and sale of (i) an aggregate of approximately 4.4 million shares of common stock (or pre-funded warrants to purchase shares of common stock in lieu thereof) for a purchase price of $11.6265 per share (the “Offering Price”) of common stock (or per pre-funded warrant in lieu thereof) for aggregate cash gross proceeds of approximately $50.8 million (the “Cash PIPE”), and (ii) pre-funded warrants to purchase up to approximately 14.9 million shares of common stock for a purchase price of $11.6165 per pre-funded warrant in exchange for approximately $292.7 million in notional value representing approximately $173.3 million in discounted value of in-kind contributions of locked and unlocked ATH (the “Crypto PIPE”). The pre-funded warrants issued in the Crypto PIPE became exercisable immediately following the Company’s receipt of shareholder approval for the exercise of such pre-funded warrants. The PIPEs closed concurrently on October 7, 2025. The Company has used the cash and in-kind contribution of ATH to fund the Company’s digital asset treasury strategy as well as for working capital and general corporate purposes.
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On December 1, 2025, we received formal notice from the Nasdaq Hearings Panel (the “Panel”) of The Nasdaq Stock Market LLC (“Nasdaq”) notifying us that we were in compliance with the stockholders’ equity requirement set forth in Nasdaq Listing Rule 5550(b)(1) (the “Stockholders’ Equity Requirement”). Accordingly, the previously disclosed listing matter has been closed. Nasdaq’s notice further stated that pursuant to Listing Rule 5815(d)(4)(B), the Company will be subject to a mandatory panel monitor for a period of one year from December 1, 2025. If, within that one-year monitoring period, the Nasdaq Listing Qualification Staff (the “Staff”) finds the Company again out of compliance with the Stockholders’ Equity Requirement, notwithstanding Rule 5810(c)(2), the Company will not be permitted to provide the Staff with a plan of compliance with respect to that deficiency and Staff will not be permitted to grant additional time for the Company to regain compliance with respect to that deficiency, nor will the Company be afforded an applicable cure or compliance period pursuant to Nasdaq Listing Rule 5810(c)(3). Instead, the Staff will issue a delist determination letter and the Company will have an opportunity to request a new hearing with the initial Panel or a newly convened hearings panel if the initial Panel is unavailable.
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On December 11, 2025, we changed our corporate name from Predictive Oncology Inc. to Axe Compute Inc. following the filing of a Certificate of Amendment to our Certificate of Incorporation with the Secretary of State of the State of Delaware (the “Name Change”). Beginning on December 12, 2025, our common stock began trading on the Nasdaq Capital Market under the ticker symbol “AGPU.” In connection with the Name Change, we announced an expansion of our business strategy to include high-performance enterprise artificial intelligence infrastructure. Our historical oncology drug discovery and biomedical research operations, or Legacy Business, includes our AI-driven tumor drug-response prediction platforms, proprietary tumor biobank and related laboratory and biomarker testing services, and were developed under our prior Predictive Oncology business model. We intend to evaluate opportunities for the Legacy Business, including the potential use of the data assets and predictive models developed through those operations in connection with our expanded artificial intelligence infrastructure strategy.
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On February 6, 2026, our Board voted to terminate, without cause, the employment of Raymond F. Vennare as Chief Executive Officer, effective February 9, 2026. Mr. Vennare also resigned as Chairman and a member of the Board effective the same date. In connection with his termination, Mr. Vennare entered into a separation agreement providing for severance and other benefits. The Board appointed Chuck Nuzum, an existing member of the Board, as Chairman effective February 9, 2026. In addition, the Board appointed Christopher Miglino as Chief Executive Officer and as a member of the Board effective February 9, 2026. In connection with his appointment, we entered into an employment agreement with Mr. Miglino and granted him stock options to purchase 500,000 shares of our common stock as an inducement award.
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On February 24, 2026, we announced that we engaged Cardiff Advisory LLC to assist in exploring strategic alternatives for our Legacy Business. The strategic review process, which is being conducted under the oversight of our Board, may include a potential sale, partnership, licensing arrangement, joint venture or other transaction involving the Company’s biobank platform and related operations. The review reflects our continued focus on advancing our artificial intelligence compute infrastructure strategy while evaluating opportunities to maximize value from non-core legacy assets. There can be no assurance that the strategic review process will result in any transaction.
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On March 3, 2026, we announced that our Board appointed Dr. Theodore Zhu and Thorsten Dirks as members of the Board.
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As of December 31, 2025, the Company had approximately $10.8 million of cash and cash equivalents. Additionally, the Company has significant holdings in ATH digital assets that serve as potential sources of liquidity for the Company. However, management notes the market price has exhibited substantial volatility over the trailing 3-, 6-, and 9-month periods and acknowledges that ATH prices are subject to rapid fluctuations due to a myriad of factors including market sentiment, regulatory developments, network adoption, Aethir Foundation governance decisions, and broader crypto-asset market conditions.
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Additional sources of liquidity could include the Company’s ATM facility, of which $18.3 million remains available pursuant to the prospectus supplement filed on October 29, 2025, and the SEPA facility against which the Company could sell $10 million of shares of its common stock, each subject to certain limitations and conditions associated with the respective facilities.
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Revenue. We recorded revenue of $125,284 in 2025, compared to $84,812 in 2024. Revenues for the years ended December 31, 2025, and 2024, were derived from the Drug Discovery Services business. The increase in revenue from the comparative period was primarily due to completion of a tumor-specific 3D model in the 2025 period, which was not present in 2024.
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Gains (losses) on digital assets.* We recorded a loss on digital assets of $152,490,550 in the year ended December 31,2025, with no such losses recorded in the comparative period. The losses in the 2025 period *are derived from the losses on digital assets. This primarily represents the change in fair value of the Company’s ATH holdings, which were not present in the comparative period.
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*Cost of revenues.*Cost of revenues was $72,622 and $78,285 for the years ended December 31, 2025, and 2024, respectively. Cost of revenues for the year ended December 31, 2025, was relatively flat from the comparative period in 2024.
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General and administrative expenses. General and administrative expenses primarily consist of management salaries, professional fees, consulting fees, depreciation and amortization, office rents, and general office expenses. General and administrative expenses increased by $18,688,561 to $25,924,358 in 2025 from $7,235,797 in 2024. The increase was primarily due to an increase in stock-based compensation for employees and non-employees of $16.5 million, $15.4 million of which relates to warrants issued as compensation pursuant to the Strategic Advisor Agreement in connection with the Company’s Treasury Strategy, and an increase in professional service fees of $1.0 million. The Company incurred additional professional service fees in the current year in conjunction with the adoption of the Treasury Strategy.
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Research and development expenses. Research and development expenses primarily consist of expenses related to product development, prototyping and testing. Research and development expenses decreased by $94,239 to $2,147,222 in 2025 compared to $2,241,461 in 2024. Research and development expenses were largely unchanged from the comparative period in 2024.
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Information Regarding Forward-Looking Statements
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This Annual Report on Form 10-K contains “forward-looking statements” that indicate certain risks and uncertainties, many of which are beyond our control. Actual results could differ materially and adversely from those anticipated in such forward-looking statements as a result of certain factors, including but not limited to those set forth below and elsewhere in this report. Important factors that may cause actual results to differ from projections include:
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All statements, other than statements of historical facts, included in this report regarding our growth strategy, future operations, financial position, estimated revenue or losses, projected costs, prospects and plans, and objectives of management are forward-looking statements. When used in this report, the words “will,” “may,” “believe,” “anticipate,” “intend,” “estimate,” “expect,” “project,” “plan,” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words. All forward-looking statements speak only as of the date of this report. We do not undertake any obligation to update any forward-looking statements or other information contained herein. Potential investors should not place undue reliance on these forward-looking statements. Although we believe that our plans, intentions, and expectations reflected in or suggested by the forward-looking statements in this report are reasonable, we cannot assure potential investors that these plans, intentions or expectations will be achieved. We disclose important factors that could cause actual results to differ materially from expectations in the “Risk Factors” section and elsewhere in this report. These cautionary statements qualify all forward-looking statements attributable to us or persons acting on our behalf.
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Our mission is to change the landscape of oncology drug discovery and enable the development of more effective therapies for the treatment of cancer. By harnessing the power of machine learning and scientific rigor, we believe that we can improve the probability of success of advancing pharmaceutical and biological drug candidates with a higher degree of confidence.
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During the year ended December 31, 2024, our former Birmingham operating segment met the criteria under US GAAP to be reported as discontinued operations. As a result, as of December 31, 2024, we operated in two business areas. In our first area, we provide optimized, high-confidence drug-response predictions through the application of AI using our proprietary biobank of tumor samples to enable a more informed selection of drug/tumor combinations and increase the probability of success during development. We also create and develop tumor-specific 3D cell culture models mimicking the physiological environment of human tissue enabling better-informed decision-making during development. In our second business area, we produced the United States Food and Drug Administration (“FDA”)- cleared STREAMWAY® System and associated products for automated medical fluid waste management and patient-to-drain medical fluid disposal.
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As a result of the decision to discontinue our former Birmingham operating segment, as of December 31, 2024, we had two reportable segments, which have been delineated by location and business area:
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Renovaro Letter of Intent
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On January 1, 2025, we entered into a binding letter of intent (the “LOI”) with Renovaro, Inc. (NASDAQ: RENB) (“Renovaro”) for Predictive Oncology to be acquired by Renovaro in exchange for preferred stock of Renovaro (the “Renovaro Merger”). Under the terms of the LOI, Predictive Oncology will be merged into Renovaro in exchange for a newly created series of preferred stock of Renovaro. The preferred stock will be issued to shareholders of Predictive Oncology in a 1:1 exchange for their existing Predictive Oncology common stock.
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On February 28, 2025, we entered into the Extension Agreement with Renovaro, pursuant to which the parties amended the LOI to (i) eliminate Renovaro’s obligation to acquire certain shares of our common stock and (ii) extend the outside termination date of the LOI from February 28, 2025, to March 31, 2025. Additionally, pursuant to the Extension Agreement, Renovaro acquired 467,290 shares of our common stock in March 2025 for an aggregate purchase price of $500,000 and agreed to purchase an additional 901,298 shares of our common stock for an aggregate of $964,389 upon, and subject to, the execution of a definitive agreement in respect of the Renovaro Merger.
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February 2025 Registered Direct Offering
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Sale of Eagan Operating Segment Business
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On March 14, 2025, we entered into an asset purchase agreement and closed the transactions contemplated therein with DeRoyal Industries, Inc., a Tennessee corporation (“DeRoyal”), to sell and assign to DeRoyal assets and liabilities exclusively related to the business of providing products for automated, direct-to-drain medical fluid disposal, including our STREAMWAY® product line. The assets sold pursuant to the asset purchase agreement were operated by and reported in our Eagan reportable operating segment. As previously disclosed, the Eagan segment operated outside the core focus of Predictive Oncology, which is the use of artificial intelligence and machine learning to expedite early drug discovery and enable drug development for the benefit of cancer patients. This transaction was consummated in anticipation of our merger with Renovaro. The Eagan operating segment did not meet the criteria under US GAAP to be reported as discontinued operations as of and for the year ended December 31, 2024. Therefore, discussion of the Eagan segment’s business is included throughout this Annual Report on Form 10-K and reported within continuing operations in the consolidated financial statements. Going forward, our business will be limited to the Pittsburgh segment.
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As a result of the sale, we expect that our revenues in future periods will materially decline, as the Eagan reportable segment contributed 95% and 70% of our revenues from continuing operations for the years ended December 31, 2024, and 2023, respectively.
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March 2025 Warrant Exercises
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On March 25, 2025, certain of our warrant holders exercised 627,315 Series A Common Stock Purchase Warrants (the “Series A Warrants”) and 627,315 Series B Common Stock Purchase Warrants (the “Series B Warrants”) in exchange for a total of 1,254,630 shares of the Company’s common stock. Both the Series A Warrants and Series B Warrants were exercised at a price of $1.07, resulting in approximately $1.3 million of proceeds to the Company. The Series A Warrants and Series B Warrants were initially issued in a private placement to certain institutional and accredited investors in July 2024 and were registered in August 2024 on a shelf registration statement on Form S-3.
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Revenue. We recorded revenue of $1,623,817 in 2024, compared to $1,627,697 in 2023. Revenues for the years ended December 31, 2024, and 2023, were primarily derived from our Eagan operating segment. The Eagan operating segment contributed $1,539,005 and $1,135,101 for the years ended December 31, 2024, and 2023, respectively, while the Pittsburgh operating segment contributed $84,812 and $492,596, respectively. Revenues from the Eagan operating segment increased in 2024 primarily due to an increased number of STREAMWAY systems sold, while revenues from the Pittsburgh operating segment decreased in 2024 primarily due to decreased sales of 3D tumor-specific models.
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*Cost of sales.*Cost of sales was $826,137 and $609,212 for the years ended December 31, 2024, and 2023, respectively. Cost of sales increased primarily due to costs associated with Eagan operating segment, including increased volume of STREAMWAY systems sold and increased direct labor costs. The gross profit margin declined to 49% in 2024 from 64% in 2023, primarily due to the change in sales mix year over year with lower revenue in 2024 derived from higher margin contracted services provided by our Pittsburgh operating segment.
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General and administrative expense. General and administrative (“G&A”) expenses primarily consist of management salaries, professional fees, consulting fees, depreciation and amortization, office rents, and general office expenses. G&A expenses decreased by $961,025 to $7,419,892 in 2024 from $8,380,917 in 2023. The decrease was primarily due to decreases in employee-related expenses, including approximately $527,000 less in severance expense and lower costs associated with lower headcount. Additional decreases included lower legal fees and investor relations. These decreases were offset by higher professional fees, including consultants supporting our management team, and audit fees.
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Operations expense. Operations expenses primarily consist of expenses related to product development, prototyping and testing. Operations expenses decreased by $417,120 to $2,851,045 in 2024 compared to $3,268,165 in 2023. The decrease in operations expenses in 2024 was primarily due to lower employee-related expenses associated with lower headcount, decreased cloud computing expenses, and lower research and development expenses.
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*Other income.*We earned other income of $89,367 in 2024 compared to $152,685 in 2023. Other income primarily consists of interest income. The decrease in other income was primarily due to lower cash balances earning interest, partially offset by improved rates of return on those cash balances due to strategic deployment of cash reserves into money market funds.
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*Other expense.*We incurred other expenses of $11,478 in 2024 compared to $64,967 in 2023. Other expenses primarily consist of interest expense and, in the year ended December 31, 2023, losses on a note receivable deemed uncollectible. The decrease in other expenses was primarily due to the writing off a note receivable deemed uncollectible in 2023.
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Liquidity and Plan of Financing; Going Concern
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We continue to evaluate alternatives to obtain the required additional funding to maintain future operations, but there can be no assurances that such funding will be available under acceptable terms, if at all. Alternatives to obtain additional funding may include, but are not limited to, equity financing, issuing debt, entering into other financing arrangements, or monetizing operating businesses or assets. These possibilities, to the extent available, may be on terms that result in significant dilution to our existing stockholders or that result in our existing stockholders losing part or all of their investment. For example, in May 2024 we raised $3.58 million in net proceeds through an at-the-market offering of shares of our common stock and in July 2024, we raised $1.0 million in net proceeds through cash exercises of certain outstanding warrants pursuant to agreements with certain warrant holders to reduce the exercise price of those warrants and issue new warrants as consideration for the cash exercises, each described further below under “Financing Transactions.” In February 2025, we issued shares of our common stock in a registered direct offering for gross proceeds of $545 thousand. Also, in March 2025, pursuant to an extension agreement in connection with the LOI with Renovaro, Renovaro purchased shares of our common stock for an aggregate of $500 thousand. In March 2025, we entered into an asset purchase agreement pursuant to which we sold and assigned assets and liabilities exclusively related to the business of providing products for automated, direct-to-drain medical fluid disposal, including our STREAMWAY product line, for $625 thousand, plus assumed liabilities. Despite these sources of funding, we may be unable to access additional financing or obtain additional liquidity when needed or under acceptable terms, if at all. If such financing or adequate funds from operations are not available, we would be forced to limit our business activities and we could default on existing payment obligations, which would have a material adverse effect on our financial condition and results of operations, and may ultimately be required to cease our operations and liquidate our business. The consolidated financial statements as of and for the year ended December 31, 2024 included in this Annual Report on Form 10-K do not include any adjustments to the carrying amounts and classification of assets, liabilities, and reported expenses that may be necessary if we were unable to continue as a going concern.
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As described above under “Recent Developments,” on January 1, 2025, we entered into the LOI with Renovaro for Predictive Oncology to be acquired by Renovaro in exchange for preferred stock of Renovaro. Under the terms of the LOI, Predictive Oncology will be merged into Renovaro in exchange for a newly created series of preferred stock of Renovaro. The preferred stock will be issued to shareholders of Predictive Oncology in a 1:1 exchange for their existing Predictive Oncology common stock. The merger is subject to a minimum fundraising of $15 million by Renovaro, as well as formal approval by the shareholders of Predictive Oncology.
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On February 28, 2025, we entered into the Extension Agreement with Renovaro, pursuant to which the parties amended the LOI to (i) eliminate Renovaro’s obligation to acquire certain shares of our common stock and (ii) extend the outside termination date of the LOI from February 28, 2025, to March 31, 2025. Additionally, pursuant to the Extension Agreement, Renovaro acquired 467,290 shares of our common stock in March 2025 for an aggregate purchase price of $500,000 and agreed to purchase an additional 901,298 shares of our common stock for an aggregate of $964,389 upon, and subject to, the execution of a definitive agreement in respect of the Renovaro Merger.
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May 2024 At The Market Offering
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July 2024 Warrant Inducement Transaction
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On July 25, 2024, the Company entered into definitive agreements with certain of its existing warrant holders for the exercise of warrants to purchase an aggregate of 958,117 shares of its common stock having a current exercise price of $14.00 originally issued in February 2021, June 2021 and May 2022, at a reduced exercise price of $1.32 per share. The gross proceeds to the Company from the exercise of the existing warrants were approximately $1,265,000, prior to deducting placement agent fees and transaction expenses payable by the Company.
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In consideration for the immediate cash exercise of the warrants, the Company concurrently issued to the warrant holders new unregistered Series A warrants to purchase up to 958,117 shares of common stock (the “Series A Warrants”) and new Series B warrants to purchase up to 958,117 shares of common stock (the “Series B Warrants”). The Series A Warrants and the Series B Warrants have an exercise price of $1.07 per share and are exercisable immediately upon issuance. The Series A Warrants have a term equal to five years from the date of issuance, and the Series B Warrants have a term equal to 18 months from the date of issuance.
Previous report
The transactions described above closed on July 26, 2024. Wainwright acted as the exclusive placement agent for the above-mentioned transactions. The Company paid Wainwright as consideration (i) an aggregate cash fee equal to 7.0% of the gross proceeds from the exercise of the existing warrants, (ii) a management fee equal to 1.0% of the aggregate gross proceeds from the exercise of the existing warrants, (iii) $35,000 for expenses, and (iv) $15,950 for clearing fees. Additionally, the Company issued to Wainwright (or its designees) as compensation, warrants to purchase up to 67,068 shares of common stock of the Company (equal to 7.0% of the aggregate number of existing warrants exercised in the offering) (the “Placement Agent Warrants”). The Placement Agent Warrants have a term of five years from the closing of the offering and an exercise price of $1.65 per share.
Previous report
There were no material financing transactions during the year ended December 31, 2023.
Previous report
**ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
Reworded paragraphs (21)
Previous wording
We are a knowledge and science-driven company that applies artificial intelligence (“AI”) to support the discovery and development of optimal cancer therapies, which can ultimately lead to more effective treatments and improved patient outcomes. We use AI and a proprietary biobank of 150,000+ tumor samples, categorized by tumor type, to provide actionable insights about drug compounds to improve the drug discovery process and increase the probability of drug compound success. We offer a suite of solutions for oncology drug development from early discovery to clinical trials.
Current wording
Axe Compute also continues to operate its Legacy Business, which is designed to support the discovery and development of optimal cancer therapies. In the Legacy Business, the Company uses AI and its proprietary biobank of 150,000+ tumor samples, categorized by tumor type, to provide actionable insights about drug compounds to improve the drug discovery process and increase the probability of drug compound success. The Company also creates and develops tumor-specific 3D cell culture models mimicking the physiological environment of human tissue, enabling better-informed decision-making during drug development. In February 2026, the Company announced that it is exploring strategic alternatives for this oncology drug discovery solutions business, but the Company’s Board of Directors has not committed to a specific course of action. Accordingly, the oncology drug discovery solutions business did not meet the criteria under FASB ASC 205-20, Discontinued Operations to be classified as discontinued operations and held for sale, and therefore is reflected as continuing operations within these consolidated financial statements.
Previous wording
Since inception, we have been unprofitable. We incurred net losses of $12,664,388 and $13,983,967 for the years ended December 31, 2024, and December 31, 2023, respectively. As of December 31, 2024, and December 31, 2023, we had an accumulated deficit of $180,426,271 and $167,761,883, respectively.
Current wording
Since inception, we have been unprofitable. For the year ended December 31, 2025, our cash used in continuing operations was $9.876,039 and for the year ended December 31, 2024, was $10,103,084. We incurred losses from continuing operations of $232,853,647 and $10,224,655 for the years ended December 31, 2025, and December 31, 2024, respectively. As of December 31, 2025, and December 31, 2024, we had an accumulated deficit of $413,521,474 and $180,426,271, respectively.
Previous wording
We have never generated sufficient revenues to fund our capital requirements. We have funded our operations through a variety of debt and equity instruments. Since 2017, we have diversified our business by investing in ventures, including making significant loans and investments in early-stage companies. These activities led to the acquisition of Helomics Corporation in April 2019, two transactions to acquire the assets of three businesses in 2020, and the acquisition of zPREDICTA Inc. (“zPREDICTA”) in November 2021, each of which have accelerated our capital needs. See “Liquidity and Capital Resources – Liquidity and Plan of Financing; Going Concern” and “Liquidity and Capital Resources – Financing Transactions” below.
Current wording
We have never generated sufficient revenues to fund our capital requirements. We have funded our operations through a variety of debt and equity instruments. Since 2023, we have monetized certain assets and curtailed expenses. In September 2025, we adopted the Treasury Strategy, providing new sources of capital and creating additional capital needs. See “Liquidity and Capital Resources - Liquidity and Plan of Financing” and “Liquidity and Capital Resources - Financing Transactions” below.
Previous wording
Our future cash requirements and the adequacy of available funds depend on our ability to generate revenues from and reach profitability in our oncology business located in Pittsburgh, and the availability of future financing to fulfill our business plans. See “Liquidity and Capital Resources – Liquidity and Plan of Financing; Going Concern” below.
Current wording
Our future cash requirements and the adequacy of available funds depend on our ability to generate income from our compute services and Treasury Strategy, and the availability of future financing to fulfill our business plans. Management expects operating losses to continue in the near term while the Company scales its compute services and Treasury Strategy. See “Liquidity and Capital Resources - Liquidity and Plan of Financing” below. Our recent strategic pivot into compute services and adoption of the Treasury Strategy make prediction of future operating results difficult. We believe that period-to-period comparisons of our operating results should not be relied on as predictive of our future results.
Previous wording
*Sales and marketing expense.*Sales and marketing expenses consist of expenses required to market and sell our products including staff-related expenses for individuals performing this work. Sales and marketing expenses decreased by $20,926 to $1,466,213 in 2024 compared to $1,487,139 in 2023. The decrease in 2024 was primarily due to decreased staff-related expenses resulting from headcount reductions and revisions to employee sales commission structure, offset by increased severance incurred related to separation of a former executive.
Current wording
Sales and marketing expenses*.*Sales and marketing expenses consist of expenses required to market and sell our products. Sales and marketing expenses decreased by $426,952 to $406,247 in 2025 compared to $833,199 in 2024. The decrease in 2025 was primarily due to there no longer being staff-related expenses for sales and marketing and severance expenses incurred in the year ended December 31, 2024.
Previous wording
On December 31, 2024, we had $734,673 in cash and cash equivalents. Cash and cash equivalents decreased by $7,994,732 from the prior year due to the following factors.
Current wording
On December 31, 2025, we had $10,790,850 in cash and cash equivalents. Cash and cash equivalents increased by $10,179,028 from the prior year due to the following factors.
Previous wording
Net cash used in operating activities of continuing operations was $10,974,568 in 2024, compared to $11,784,070 in 2023. Cash used in operating activities of continuing operations decreased in 2024 primarily due to lower cash operating losses, partially offset by increases in cash used in working capital. Changes in cash used in working capital included increases in accounts receivable and decreases in accounts payable, offset by a decrease in prepaid expenses and other assets. The increase in accounts receivable was primarily due to timing of sales of STREAMWAY systems near year end where payment was collected after year end.
Current wording
Net cash used in operating activities of continuing operations was $9,876,039 in 2025, compared to $10,103,084 in 2024. Cash used in operating activities of continuing operations decreased in 2025 primarily due to lower cash operating losses and decreases in cash used in working capital. Changes in cash used in working capital included increases in accounts payable and accrued expenses, offset by a decrease in operating lease liability.
Previous wording
Net cash used in investing activities of continuing operations was $9,510 in 2024, compared to $47,550 in 2023. Cash used in investing activities of continuing operations decreased in 2024 primarily due to a decrease in the acquisition of property and equipment.
Current wording
Net cash used in investing activities of continuing operations was $32,616,819 in 2025, compared to $9,510 in 2024. Cash used in investing activities of continuing operations increased in 2025 due to digital asset purchases related to the Treasury Strategy adopted in the year ended December 31, 2025.
Previous wording
Net cash provided by financing activities of continuing operations was $3,939,194 in 2024 compared to $148,899 in 2023. Cash provided by financing activities of continuing operations in 2024 was primarily related to proceeds from the issuance of common stock pursuant to the ATM offering completed in May 2024 and proceeds from the exercise of warrants into common stock pursuant to the Warrant Inducement Transaction in July 2024 (as described below), while the cash provided in 2023 was primarily proceeds from financing insurance premiums over the insured period with a short-term note payable.
Current wording
Net cash provided by financing activities of continuing operations was $52,006,573 in 2025 compared to $3,939,194 in 2024. Cash provided by financing activities of continuing operations in 2025 was primarily related to the Cash PIPE Offering, related to proceeds from the exercise of warrants to purchase common stock, proceeds from the issuance of common stock pursuant to the ATM offering, proceeds from the issuance of common stock pursuant to the Extension Agreement with Renovaro, proceeds from the issuance of common stock pursuant to a Registered Direct Offering, and proceeds from private placements of common stock with accredited investors in May and August, while the cash provided in 2024 was primarily proceeds from the issuance of common stock pursuant to the ATM offering completed in May 2024 and proceeds from the exercise of warrants into common stock pursuant to the Warrant Inducement Transaction in July 2024.
Previous wording
Net cash used in discontinued operations was $949,103 in 2024, compared to $1,660,142 in 2023. Net cash used in operating activities of discontinued operations was $981,103 and $1,405,321 for the years ended December 31, 2024, and 2023, respectively. This change primarily relates to cash operating losses and the timing of the discontinuation of the Birmingham segment in the third quarter of 2024. Net cash provided by investing activities of discontinued operations was $32,000 for 2024, while net cash used in investing activities of discontinued operations was $254,821 for 2023.
Current wording
Net cash provided by (used in) discontinued operations was $542,462 in 2025, compared to $(1,820,587) in 2024. Net cash used in operating activities of discontinued operations was $82,538 and $1,852,587 for the years ended December 31, 2025, and 2024, respectively. This change primarily relates to decreased cash losses due to ceasing the discontinued operations. Net cash provided by investing activities of discontinued operations was $625,000 and $32,000 for the years ended December 31, 2025, and 2024, respectively. There was no cash provided by or used in financing activities of discontinued operations in either period presented.
Previous wording
We have incurred significant and recurring losses from operations for the past several years and, as of December 31, 2024, had an accumulated deficit of $180,426,271. We had cash and cash equivalents of $734,673 as of December 31, 2024, and need to raise significant additional capital to meet our operating needs. We had short-term obligations of $3,593,401 and long-term operating lease obligations of $1,558,239 as of December 31, 2024. We do not expect to generate sufficient operating revenue to sustain our operations in the near term. During the year ended December 31, 2024, we incurred negative cash flows from continuing operating activities of $10,974,568. Although we have attempted to improve our cash flows from continuing operating activities by bolstering revenues and curtailing expenses and continue to seek ways to generate revenue through business development activities, there is no guarantee that we will be able to improve our cash flows from continuing operating activities sufficiently or achieve profitability in the near term. As a result of these conditions, substantial doubt exists about our ability to continue as a going concern within one year after the date our consolidated financial statements included in this Annual Report on Form 10-K are issued.
Current wording
We have incurred significant and recurring losses from operations for the past several years and, as of December 31, 2025, had an accumulated deficit of $413,521,474. We had cash and cash equivalents of $10,790,850 as of December 31, 2025. We had short-term obligations of $4,266,896 and long-term operating lease obligations of $904,495 as of December 31, 2025. During the year ended December 31, 2025, we incurred negative cash flows from continuing operating activities of 9,876,039.
Previous wording
On February 18, 2025, we entered into a Securities Purchase Agreement (the “Purchase Agreement”) with several institutional and accredited investors for the sale by us of 363,336 shares (the “Registered Direct Shares”) of our common stock at a purchase price of $1.50 per share, in a registered direct offering. The offering closed on February 19, 2025. The gross proceeds to us from the offering were approximately $545,004, before deducting the placement agent’s fees and other offering expenses. The Registered Direct Shares were offered and sold by us pursuant to an effective shelf registration statement on Form S-3.
Current wording
On February 18, 2025, we entered into a Securities Purchase Agreement (the “Purchase Agreement”) with several institutional and accredited investors for the sale by us of 24,223 shares (the “Registered Direct Offering Shares”) of our common stock, par value $0.01 per share, at a purchase price of $22.50 per share, in a registered direct offering. The offering closed on February 19, 2025. Our gross proceeds from the offering were approximately $545,000, before deducting the placement agent’s fees and other offering expenses. We offered and sold the Registered Direct Offering Shares pursuant to an effective shelf registration statement on Form S-3, which was filed with the SEC on May 21, 2024, and subsequently declared effective on May 21, 2024 (File No. 333-279123), and a related prospectus supplement filed on February 19, 2025.
Previous wording
We agreed to pay H.C. Wainwright & Co., LLC, the placement agent (“Wainwright”) an aggregate fee equal to 7.0% of the gross proceeds received by us from the sale of the securities in the offering as well as a management fee equal to 1.0% of such gross proceeds, and $15,000 for fees and expenses of legal counsel. We also issued to Wainwright or its designees warrants to purchase up to 7.0% of the aggregate number of shares of common stock sold in the transactions, or warrants to purchase up to an aggregate of 25,434 shares of common stock (the “Registered Direct Offering Placement Agent Warrants”). The Registered Direct Offering Placement Agent Warrants are exercisable for five years from the commencement of sales in the offering and have an exercise price equal to 125% of the purchase price of share of common stock in the offering, or $1.875 per share. The Registered Direct Offering Placement Agent Warrants and the shares issuable upon exercise of the Registered Direct Offering Placement Agent Warrants were issued in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act as transactions not involving a public offering and in reliance on similar exemptions under applicable state laws.
Current wording
We agreed to pay Wainwright, as placement agent, an aggregate fee equal to 7.0% of the gross proceeds we received from the sale of the securities in the offering as well as a management fee equal to 1.0% of such gross proceeds, and $15,000 for fees and expenses of legal counsel. We also issued to Wainwright, or its designees, warrants to purchase up to 7.0% of the aggregate number of shares of our common stock sold in the transactions, or warrants to purchase up to an aggregate of 1,698 shares of our common stock (the “Registered Direct Offering Placement Agent Warrants”). The Registered Direct Offering Placement Agent Warrants are exercisable for five years from the commencement of sales in the offering and have an exercise price equal to 125% of the purchase price of shares of our common stock sold in the offering, or $28.13 per share. The Registered Direct Offering Placement Agent Warrants and the shares issuable upon exercise of the Registered Direct Offering Placement Agent Warrants were issued in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act as transactions not involving a public offering and in reliance on similar exemptions under applicable state laws.
Previous wording
On May 3, 2024, the Company entered into an ATM Sales Agreement (the “Sales Agreement”) with Wainwright, to sell shares of the Company’s common stock having an aggregate sales price of up to $3,696,000, from time to time, through an “at the market offering” program pursuant to which Wainwright acted as sales agent. Subject to the terms and conditions of the Sales Agreement, Wainwright was permitted to sell the shares by methods deemed to be an “at the market offering” as defined in Rule 415(a)(4) promulgated under the Securities Act of 1933, as amended. Under the Sales Agreement, Wainwright was entitled to compensation for its services of 3.0% of the gross sales price of all shares sold through Wainwright under the Sales Agreement. As of June 30, 2024, the Company sold 1,607,100 shares of common stock at an average price of approximately $2.30 per share, resulting in aggregate gross proceeds of approximately $3,696,000. No further shares are available to be sold under the Sales Agreement.
Current wording
On May 3, 2024, we entered into an ATM Sales Agreement (the “Sales Agreement”) with Wainwright, pursuant to which we may offer and sell, from time to time, through Wainwright, shares of our common stock through an “at the market offering” program pursuant to which Wainwright will act as sales agent. Subject to the terms and conditions of the Sales Agreement, Wainwright is permitted to sell the shares by methods deemed to be an “at the market offering” as defined in Rule 415(a)(4) promulgated under the Securities Act of 1933, as amended. The Sales Agreement provides that Wainwright will be entitled to compensation for its services of 3.0% of the gross sales price of all shares sold through Wainwright under the Sales Agreement. We are subject to certain restrictions on our ability to offer and sell shares of our common stock under the Sales Agreement.
Previous wording
Our significant accounting policies are described inNote 1–* Summary of Significant Accounting Policies* in Notes to Consolidated Financial Statements of this Annual Report on Form 10-K. We believe that the following discussion addresses our critical accounting estimates and reflects those areas that require more significant judgments and use of estimates and assumptions in the preparation of our audited consolidated Financial Statements.
Current wording
Our significant accounting policies are described inNote 2-* Summary of Significant Accounting Policies* in Notes to Consolidated Financial Statements of this Annual Report on Form 10-K. We believe that the following discussion addresses our critical accounting estimates and reflects those areas that require more significant judgments and use of estimates and assumptions in the preparation of our audited consolidated Financial Statements.
Previous wording
We generate revenues from Contract Research Organization (“CRO”) services related to the development of 3D tumor-specific in vitro models for oncology drug discovery and research. The specific pattern of revenue recognition for CRO services is determined on a case-by-case basis according to the facts and circumstances applicable to a given contract. We evaluate each product or service promised in a contract to determine whether it represents a distinct performance obligation. Determining whether services are considered distinct performance obligations that should be accounted for separately versus together may require significant judgment. Contracts for CRO services generally contain one performance obligation to perform research and deliver appropriate data or reporting. Revenues from CRO services are generally recognized at the point in time when data and reports are provided to customers. SeeNote 1–* Summary of Significant Accounting Policies* in Notes to Consolidated Financial Statements of this Annual Report on Form 10-K for further details of our revenue recognition policies.
Current wording
We generate revenues from Contract Research Organization (“CRO”) services related to the development of 3D tumor-specific in vitro models for oncology drug discovery and research. The specific pattern of revenue recognition for CRO services is determined on a case-by-case basis according to the facts and circumstances applicable to a given contract. We evaluate each product or service promised in a contract to determine whether it represents a distinct performance obligation. Determining whether services are considered distinct performance obligations that should be accounted for separately versus together may require significant judgment. Contracts for CRO services generally contain one performance obligation to perform research and deliver appropriate data or reporting. Revenues from CRO services are generally recognized at the point in time when data and reports are provided to customers. SeeNote2 - Summary of Significant Accounting Policies in Notes to Consolidated Financial Statements of this Annual Report on Form 10-K for further details of our revenue recognition policies.
Previous wording
We also have a collaboration arrangement, under which we have utilized our active learning technology, proprietary biobank, and know-how to provide predictive models of tumor responses to various drug compounds. This collaboration arrangement includes sales-based royalties, under which our collaboration partner is obligated to pay us revenue sharing fees that are based on the net revenue from the collaboration partner’s commercialized drugs. The percentage of net revenue varies depending on the stage of development. The revenue sharing fees represent variable consideration, which requires us to estimate the expected value of revenue sharing fees and extent to which those estimates are constrained. These estimates are reassessed at each reporting period. To date, we have not recognized revenues related to revenue sharing fees pursuant to our collaboration arrangement. SeeNote 3–* Collaborative Arrangements and Contracts with Customers*in Notes to Consolidated Financial Statements of this Annual Report on Form 10-K for further details of our collaboration arrangement.
Current wording
We also have a collaboration arrangement, under which we have utilized our active learning technology, proprietary biobank, and know-how to provide predictive models of tumor responses to various drug compounds. This collaboration arrangement includes sales-based royalties, under which our collaboration partner is obligated to pay us revenue sharing fees that are based on the net revenue from the collaboration partner’s commercialized drugs. The percentage of net revenue varies depending on the stage of development. The revenue sharing fees represent variable consideration, which requires us to estimate the expected value of revenue sharing fees and extent to which those estimates are constrained. These estimates are reassessed at each reporting period. To date, we have not recognized revenues related to revenue sharing fees pursuant to our collaboration arrangement. SeeNote**4-* Contracts with Customers*in Notes to Consolidated Financial Statements of this Annual Report on Form 10-K for further details of our collaboration arrangement.
Previous wording
Changes in the assumptions can materially affect the estimate of fair value of stock-based compensation and, consequently, the related expense recognizes that. We have been traded on the NASDAQ Capital Market exchange since 2015 and have experienced significant volatility in our stock price. The assumptions we use in calculating the fair value of stock-based payment awards represent our best estimates, which involve inherent uncertainties and the application of management's judgment. As a result, if factors change and we use different assumptions, our stock-based compensation expense could be materially different in the future. SeeNote 11–* Stockholders*’* Equity, Stock Options, and Warrants* in Notes to Consolidated Financial Statements of this Annual Report on Form 10-K for further details of our stock-based compensation.
Current wording
Changes in the assumptions can materially affect the estimate of fair value of stock-based compensation and, consequently, the related expense recognizes that. We have been traded on the NASDAQ Capital Market exchange since 2015 and have experienced significant volatility in our stock price. The assumptions we use in calculating the fair value of stock-based payment awards represent our best estimates, which involve inherent uncertainties and the application of management's judgment. As a result, if factors change and we use different assumptions, our stock-based compensation expense could be materially different in the future. SeeNote**12–* Stock**-Based Compensation** *in Notes to Consolidated Financial Statements of this Annual Report on Form 10-K for further details of our stock-based compensation.
Previous wording
The recoverability of an asset to be held and used is determined by comparing the carrying amount to the estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of the asset exceeds its estimated undiscounted future cash flows, we record an impairment charge in the amount by which the carrying amount of the asset exceeds its fair value, which is determined by either a quoted market price, if any, or a value determined utilizing discounted cash flow techniques. SeeNote 6–* Property and EquipmentandNote 7*–* Intangible Assets*in Notes to Consolidated Financial Statements of this Annual Report on Form 10-K for further details.
Current wording
The recoverability of an asset to be held and used is determined by comparing the carrying amount to the estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of the asset exceeds its estimated undiscounted future cash flows, we record an impairment charge in the amount by which the carrying amount of the asset exceeds its fair value, which is determined by either a quoted market price, if any, or a value determined utilizing discounted cash flow techniques. See*Note7 - Property and Equipment**, Net** *in Notes to Consolidated Financial Statements of this Annual Report on Form 10-K for further details.
Previous wording
Deferred income taxes are provided on a liability method, whereby deferred tax assets are recognized for deductible temporary differences and operating loss and tax credit carryforwards. Deferred tax liabilities are recognized for taxable temporary differences, which are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred income taxes are subject to certain limitations under Section 382. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. The Company recognizes the financial statement benefit of a tax position only after determining that the relevant tax authority would more likely than not sustain the position following an audit. For tax positions meeting the more-likely-than-not threshold, the amount recognized in the consolidated financial statements is the largest benefit that has a greater than 50 percent likelihood of being realized upon ultimate settlement with the relevant tax authority. SeeNote 12–* Income Taxes* in Notes to Consolidated Financial Statements of this Annual Report on Form 10-K for further details.
Current wording
Deferred income taxes are provided on a liability method, whereby deferred tax assets are recognized for deductible temporary differences and operating loss and tax credit carryforwards. Deferred tax liabilities are recognized for taxable temporary differences, which are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred income taxes are subject to certain limitations under Section 382. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. The Company recognizes the financial statement benefit of a tax position only after determining that the relevant tax authority would more likely than not sustain the position following an audit. For tax positions meeting the more-likely-than-not threshold, the amount recognized in the consolidated financial statements is the largest benefit that has a greater than 50 percent likelihood of being realized upon ultimate settlement with the relevant tax authority. SeeNote14 - Income Taxes in Notes to Consolidated Financial Statements of this Annual Report on Form 10-K for further details.
Previous wording
See “Recent Accounting Pronouncements” and “Recently Adopted Accounting Standards” underNote 1 - Summary of Significant Accounting Policiesin Notes to Consolidated Financial Statements of this Annual Report on Form 10-K.
Current wording
See “Recent Accounting Pronouncements” and “Recently Adopted Accounting Standards” underNote 2 - Summary of Significant Accounting Policiesin Notes to Consolidated Financial Statements of this Annual Report on Form 10-K.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
Our limited history of operations, especially in our drug discovery business, and our change in the emphasis of our business, starting in 2017, makes prediction of future operating results difficult. We believe that period-to-period comparisons of our operating results should not be relied on as predictive of our future results.