ClearPoint Neuro, Inc.

Previous wording

The following discussion and analysis of our financial condition and results of operations should be read together with our unaudited Condensed Consolidated Financial Statements and the related notes thereto appearing in Part I, Item 1 of this Quarterly Report. This discussion and analysis contains forward-looking statements that are based upon current expectations and involve risks, assumptions and uncertainties. You should review the section titled “Risk Factors” appearing in our 2024 Form 10-K and in Part II, Item 1.A of this Quarterly Report for a discussion of important risk factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements described in the following discussion and analysis. In addition, historical results and trends that might appear in this Quarterly Report should not be interpreted as being indicative of future operations.

Current wording

The following discussion and analysis of our financial condition and results of operations should be read together with our unaudited condensed consolidated financial statements and the related notes thereto appearing in Part I, Item 1 of this Quarterly Report. This discussion and analysis contains forward-looking statements that are based upon current expectations and involve risks, assumptions and uncertainties. You should review the section titled “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2025 ("2025 10-K") and in Part II, Item 1.A of this Quarterly Report for a discussion of important risk factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements described in the following discussion and analysis. In addition, historical results and trends that might appear in this Quarterly Report should not be interpreted as being indicative of future operations.

Previous wording

We are a commercial-stage medical device company that develops and commercializes innovative platforms for performing minimally invasive surgical procedures in the brain. We have deployed significant resources to fund our efforts to develop the capabilities for enabling neurosurgery interventions, building an intellectual property portfolio, and identifying and building out commercial applications for the technologies developed by our company.

Current wording

We are a commercial-stage medical device company that develops and commercializes integrated systems used in minimally invasive neurosurgical procedures in the brain. We have deployed significant resources to fund our efforts to develop the foundational capabilities for enabling MRI-guided interventions, building an intellectual property portfolio, and identifying and building out commercial applications for the technologies developed by our company. Over the past several years, we have expanded our capabilities beyond the MRI suite to include operating room based neurosurgical device products and a growing portfolio of services that support pharmaceutical and biotechnology partners developing gene and cell therapies. In 2025, with the acquisition of IRRAS, we expanded our portfolio into neurocritical care, focusing on treatments for intracerebral hemorrhage, intraventricular hemorrhage, and other conditions requiring intracranial fluid management.

Previous wording

The foundational part of our business is providing medical devices for neurosurgery applications. Our primary medical device product, the ClearPoint Navigation System (the "ClearPoint system"), is an integrated system comprised of hardware components, disposable components, and intuitive, menu-driven software, which is in commercial use globally. The primary applications for the ClearPoint system are to target and guide the insertion of deep brain stimulation electrodes, biopsy needles, and laser catheters, as well as the infusion of pharmaceuticals into the brain. The ClearPoint system was originally designed for use in an MRI setting. In 2021, we launched the SmartFrame Array Neuro Navigation System and Software, which allow for operating room placement of the ClearPoint system, and in 2024, we commenced limited market release of the SmartFrame OR Stereotactic System, which allows for complete procedures to be performed in the operating room. In 2022, we commercialized the ClearPoint Prism Neuro Laser Therapy System as our first therapy product offering. We have exclusive global commercialization rights to the ClearPoint Prism Neuro Laser Therapy System through our Swedish partner, CLS.

Current wording

Our primary medical device product, the ClearPoint system, is an integrated system comprised of hardware components, disposable components, and intuitive, menu-driven software. The primary applications for the ClearPoint system are to target and guide: (a) the insertion of deep brain stimulation electrodes, biopsy needles, and laser catheters; and (b) the infusion of pharmaceuticals into the brain. The ClearPoint system was originally designed for use in an MRI setting. In 2021, we launched the SmartFrame Array Neuro Navigation System and Software, which allows for operating room placement of the ClearPoint system and completion of the procedure in the MRI suite. In 2024, we introduced the SmartFrame OR Stereotactic System to the market, which allows for complete procedures to be performed in the operating room. In 2025, we released the ClearPoint Navigation Software Version 3.0, which allows for the ClearPoint system navigation software to support end-to-end procedures in the operating room.

Previous wording

The second part of our business is focused on partnerships in the biologics and drug delivery space. Our services include protocol consultation and solutions for preclinical study design and execution for studies relating to the delivery of pharmaceutical agents to the brain. Currently, we have more than 60 biologics and drug delivery customers who are evaluating using our products and services in trials to inject gene and cell therapies directly into the brain. These partnerships involve drug development programs that are at various stages of development ranging from preclinical research to late-stage regulatory trials for multiple distinct disease states. This part of our business potentially represents the largest opportunity for growth; however, our ability to grow in this market is dependent on our ability to maintain and establish new relationships with customers, such customers' continuation of research and development plans, and such customers' achievement of success in completion of clinical trials and subsequent regulatory approvals of their biologics and drugs.

Current wording

Currently, we have more than 60 biologics and drug delivery customers who are evaluating using our products and services in trials to inject gene and cell therapies directly into the brain. These partnerships involve drug development programs that are at various stages of development ranging from preclinical research to late-stage regulatory trials for multiple distinct disease states. This part of our business potentially represents the largest opportunity for growth; however, our ability to grow in this market is dependent on our ability to maintain and establish new relationships with pharmaceutical company customers, such customers' continuation of research and product development plans, such customers achieving success in completion of clinical trials and subsequent regulatory approvals of their drugs and biologics, and such customers’ realization of commercial success for their therapies, including overcoming barriers in reimbursement, physician adoption, and patient access to their therapies. In 2024, the U.S. Food and Drug Administration (the “FDA”) granted marketing authorization for our SmartFlow cannula to be used to deliver a gene therapy for the treatment of aromatic L-amino acid decarboxylase deficiency to regions of interest within the brain.

Previous wording

We continue to monitor the impacts of various macroeconomic trends, such as inflationary pressure, changes in monetary policy, decreasing consumer confidence and spending, the introduction of or changes in tariffs or trade barriers, and global or local recession. Such changes in domestic and global macroeconomic conditions may lead to increased costs for our business. Additionally, these macroeconomic trends could adversely affect our customers, which could impact their willingness to spend on our products and services, or their ability to make payments, which could harm our collection of accounts receivable and financial results. The world’s financial markets remain susceptible to significant stresses, resulting in reductions in available credit and government spending, economic downturn or stagnation, foreign currency fluctuations and volatility in the valuations of securities generally. As a result, funding through capital markets and other funding sources may not be available in the future on commercially reasonable terms, if at all. The rapid development and fluidity of these situations precludes any prediction as to the ultimate impact they will have on our business, financial condition, results of operation and cash flows, which will depend largely on future developments.

Current wording

We continue to monitor the impacts of various macroeconomic trends, such as inflationary pressure, changes in monetary policy, decreasing consumer confidence and spending, the introduction of or changes in tariffs or trade barriers, and global or local recession. Such changes in domestic and global macroeconomic conditions may lead to increased costs for our business. Additionally, these macroeconomic trends could adversely affect our customers, which could impact their willingness to spend on our products and services, or their ability to make payments, which could harm our collection of accounts receivable and financial results. The world’s financial markets remain susceptible to significant stresses, resulting in reductions in available credit and government spending, economic downturn or stagnation, foreign currency fluctuations and volatility in the valuations of securities generally. As a result, our ability to access capital markets and other funding sources may not be available in the future on commercially reasonable terms, if at all. The rapid development and fluidity of these situations precludes any prediction as to the ultimate impact they will have on our business, financial condition, results of operation and cash flows, which will depend largely on future developments.

Previous wording

In 2010, we received 510(k) clearance from the United States Food and Drug Administration (“FDA”) to market our ClearPoint system in the U.S. for general neurosurgical procedures; in February 2011 and May 2018, we also obtained CE marking for our ClearPoint system and SmartFlow cannula, respectively; and in June 2020, we obtained CE marking for version 2.0 of our ClearPoint software and our Inflexion head fixation frame. In January 2021, we received 510(k) clearance for the SmartFrame Array Neuro Navigation System. In September 2022, the ClearPoint Prism Neuro Laser Therapy System, for which we have exclusive global rights to commercialize, received 510(k) clearance through our Swedish partner, CLS. The Prism laser represents the first therapy product we have commercialized. In January 2024, we received 510(k) clearance from the FDA for the SmartFrame OR Stereotactic System.

Current wording

In 2010, we received 510(k) clearance from the FDA to market our ClearPoint system in the U.S. for general neurosurgical procedures; in February 2011 and May 2018, we also obtained CE marking for our ClearPoint system and SmartFlow Neuro cannula, respectively; and in June 2020 we obtained CE marking for version 2.0 of our ClearPoint software and our Inflexion head fixation frame. In January 2021, we received 510(k) clearance for the SmartFrame Array Neuro Navigation System. In September 2022, the ClearPoint Prism Neuro Laser Therapy System, for which we have exclusive global rights to commercialize, received 510(k) clearance through our Swedish partner, CLS. The Prism laser is the first therapy product we have commercialized. In January 2024, we received 510(k) clearance from the FDA for the SmartFrame OR Stereotactic System.

Previous wording

Future revenue from sales of our ClearPoint platform products and services is difficult to predict and may not be sufficient to offset our continuing research and development expenses and our increasing selling, general and administrative expenses.

Current wording

Generating recurring revenue from the sale of products is an important part of our business model for our ClearPoint system. Future revenue from sales of our ClearPoint platform products and services is difficult to predict and may not be sufficient to offset our continuing research and development expenses and our increasing selling, general and administrative expenses.

Previous wording

Generating recurring revenue from the sale of products is an important part of our business model for our ClearPoint system. Our product revenue was $5.4 million and $16.6 million for the three and nine months ended September 30, 2025, respectively, and was almost entirely related to our ClearPoint system. Our service revenue was $3.5 million and $9.9 million for the three and nine months ended September 30, 2025, respectively, of which 89% and 90%, respectively, is related to the biologics and drug delivery service line.

Current wording

Substantially all our revenue for the three months ended March 31, 2026 and 2025 relates to: (i) sales of our ClearPoint and IRRA flow system products and related services; and (ii) consulting services from our customers in the biologics and drug delivery space. Our product revenue was $8.8 million for the three months ended March 31, 2026, and was almost entirely related to our ClearPoint system. Our service revenue was $3.3 million for the three months ended March 31, 2026, of which 88% was related to the biologics and drug delivery service line.

Previous wording

Our revenue from sales of products and services to our biologics and drug delivery customers comes from pharmaceutical and biotech companies, academic institutions, or customer-sponsored contract research organizations that are developing methods to deliver a wide variety of molecules, genes or proteins to targeted brain tissue or structures that would need to bypass the blood-brain barrier for the treatment of a variety of disorders (our “Partners”). This is a novel area in which commercialization must be preceded by FDA-mandated clinical trials, which are expensive and time consuming to conduct, and for which the commercial success is uncertain, pending, in part, on the outcome of those trials. While our revenue from sales of products and services to our biologics and drug delivery customers is indicative of growth, the number of Partner relationships is also of importance as we recognize the possibility that some Partners’ research will reach commercial success, and others may not. To the extent our Partners achieve commercial success, our expectation is that we will share in such success through our Partners’ use of our products and services in their delivery of therapies. At September 30, 2025, we had more than 60 Partners, as compared to more than 50 Partners as of the same date in 2024.

Current wording

Our revenue from sales of products and services to our biologics and drug delivery customers comes from pharmaceutical and biotech companies, academic institutions, or customer-sponsored contract research organizations that are developing methods to deliver a wide variety of molecules, genes or proteins to targeted brain tissue or structures (our “Partners”) that would need to bypass the blood-brain barrier for the treatment of a variety of disorders. This is a novel area in which commercialization must be preceded by FDA-mandated clinical trials, which are expensive and time consuming to conduct, and for which the commercial success is uncertain, pending, in part, on the outcome of those trials. While our revenue from sales of products and services to our biologics and drug delivery customers is indicative of growth, the number of Partner relationships is also of importance as we recognize the possibility that some Partners’ research will reach commercial success, and others may not. To the extent our Partners achieve commercial success, our expectation is that we will share in such success through our Partners’ use of our products and services in their delivery of therapies. At March 31, 2026, we had more than 60 Partners, similar to the number of Partners as of the same date in 2025.

Previous wording

Cost of revenue includes the direct costs associated with the assembly and purchase of components for functional neurosurgery navigation products, biologics and drug delivery products, non-neurosurgery therapy products, and ClearPoint capital equipment and software that we have sold, and for which we have recognized the revenue in accordance with our revenue recognition policy, as well as labor hours and materials for the cost of providing preclinical, consulting, and service revenue. Cost of revenue also includes the allocation of manufacturing overhead costs and depreciation of loaned systems installed under our ClearPoint placement program, as well as provisions for obsolete, impaired, or excess inventory.

Current wording

Cost of revenue includes the direct costs associated with the assembly and purchase of components for neurosurgery navigation products, biologics and drug delivery products, non-neurosurgery therapy products, and capital equipment that we have sold, and for which we have recognized revenue in accordance with our revenue recognition policy, as well as labor hours for the cost of providing preclinical, consulting, and service revenue. Cost of revenue also includes the allocation of manufacturing overhead costs and depreciation of loaned systems installed under our ClearPoint placement program, as well as provisions for obsolete, impaired, or excess inventory.

Previous wording

Our research and development costs consist primarily of costs associated with the conceptualization, design, testing, and prototyping of our ClearPoint system products and enhancements. Such costs include salaries, travel, and benefits for research and development personnel; materials and laboratory supplies in research and development activities; outside consultant costs; and licensing costs related to technology not yet commercialized. We anticipate that, over time, our research and development costs may increase as we: (i) develop devices and services intended for delivery of therapeutics into the central nervous system; (ii) expand products into the operating room and therapeutics space; and (iii) expand the application of our technological platforms internationally.

Current wording

Our research and development costs consist primarily of costs associated with the conceptualization, design, testing, and prototyping of our ClearPoint system products, cannulas, and enhancements. Such costs include salaries, travel, and benefits for research and development personnel; materials and laboratory supplies in research and development activities; outside consultant costs; and licensing costs related to technology not yet commercialized. We anticipate that, over time, our research and development costs may increase as we: (i) develop devices and services for delivery of therapeutics into the central nervous system, (ii) expand products into the OR and therapeutics space, (iii) expand the application of our technological platforms internationally, and (iv) invest in the IRRA flow product portfolio and clinical evidence.

Previous wording

Our sales and marketing, and general and administrative expenses consist primarily of salaries, incentive-based compensation, travel and benefits, including share-based compensation; marketing costs; professional fees, including fees for outside attorneys and accountants; occupancy costs; insurance; and other general and administrative expenses, which include, but are not limited to, corporate licenses, director fees, hiring costs, taxes, postage, office supplies, information technology and meeting costs. Our sales and marketing expenses are expected to continue to increase due to costs associated with the continued commercialization of our products and services and the increased headcount necessary to support growth in operations.

Current wording

Our sales and marketing, and general and administrative expenses consist primarily of salaries, incentive-based compensation, travel and benefits, including related share-based compensation; marketing costs; professional fees, including fees for outside attorneys and accountants; occupancy costs; insurance; and other general and administrative expenses, which include, but are not limited to, corporate licenses, director fees, hiring costs, taxes, postage, office supplies, information technology and meeting costs. We expect increases in our sales and marketing expenses as a result of the larger combined sales organization, primarily reflecting higher salary and personnel-related costs associated with the larger commercial team following the IRRAS acquisition.

Previous wording

There have been no significant changes in our critical accounting policies and estimates during the nine months ended September 30, 2025, as compared to the critical accounting policies and estimates described in our 2024 Form 10-K.

Current wording

There have been no significant changes in our critical accounting policies and estimates during the three months ended March 31, 2026, as compared to the critical accounting policies and estimates described in our 2025 10-K.

Previous wording

Revenue. Total revenue was $8.9 million for the three months ended September 30, 2025, and $8.1 million for the three months ended September 30, 2024, which represents an increase of $0.7 million, or 9%.

Current wording

Revenue. Total revenue was $12.1 million for the three months ended March 31, 2026, and $8.5 million for the three months ended March 31, 2025, which represents an increase of $3.6 million, or 43%.

Previous wording

Biologics and drug delivery revenue, which includes sales of disposable products and services related to customer-sponsored preclinical and clinical trials, increased 6% to $13.8 million for the nine months ended September 30, 2025, from $13.1 million for the same period in 2024. This increase is primarily attributable to $0.7 million of higher product revenue resulting from greater demand for disposables as multiple partners progress in their trials.

Current wording

Biologics and drug delivery revenue, which includes sales of disposable products and services related to customer-sponsored preclinical and clinical trials utilizing our products, increased slightly to $4.8 million for the three months ended March 31, 2026 from $4.7 million for the three months ended March 31, 2025. This increase is attributable to higher product revenue.

Previous wording

Neurosurgery navigation and therapy revenue, which primarily consists of disposable product commercial sales related to cases utilizing the ClearPoint system, increased 20% to $3.4 million for the three months ended September 30, 2025, from $2.9 million for the same period in 2024. The increase is driven by higher sales of Prism Laser Therapy, and the introduction of our 3.0 operating room navigation software, which has positively impacted procedural volumes in the operating room during the three months ended September 30, 2025, compared to the same period in 2024.

Current wording

Neurosurgery navigation and therapy revenue, which primarily consists of disposable product commercial sales related to cases utilizing the ClearPoint and IRRA flow systems, increased 80% to $5.9 million for the three months ended March 31, 2026, from $3.3 million for the same period in 2025. The increase is driven primarily by additional revenues due to sales of the IRRA flow product as well as the introduction of our 3.0 operating room navigation software, which has positively impacted procedural volumes in the operating room during the three months ended March 31, 2026, compared to the same period in 2025. We acquired the IRRA flow product in connection with our acquisition of IRRAS in the fourth quarter of 2025.

Previous wording

Capital equipment and software revenue, consisting of sales of ClearPoint reusable hardware and software and related services, decreased 18% to $2.6 million for the nine months ended September 30, 2025, from $3.2 million for the same period in 2024 due to a decrease in the placements of ClearPoint navigation capital and software and Prism laser units.

Current wording

Capital equipment and software revenue, consisting of sales of ClearPoint and IRRA flow reusable hardware and software and related services, increased 177% to $1.4 million for the three months ended March 31, 2026, from $0.5 million for the same period in 2025 primarily due to an increase in placements of ClearPoint navigation capital and software, IRRA flow control units, and Prism laser units.

Previous wording

Cost of Revenue and Gross Profit. Cost of revenue was $3.3 million, resulting in gross profit of $5.6 million for the three months ended September 30, 2025, and was $3.3 million, resulting in gross profit of $4.8 million for the three months ended September 30, 2024. Gross margin was 63% for the three months ended September 30, 2025, as compared to 60% in the same period in 2024. The increase in gross margin is primarily due to higher margins on biologics and drug delivery service revenue and mix of product sold for the three months ended September 30, 2025, as compared to the same period in 2024.

Current wording

Cost of Revenue and Gross Profit. Cost of revenue was $4.4 million, resulting in gross profit of $7.8 million for the three months ended March 31, 2026, and was $3.4 million, resulting in gross profit of $5.1 million for the three months ended March 31, 2025. Gross margin was 64% for the three months ended March 31, 2026, as compared to 60% in the same period in 2025. The increase in gross margin is primarily due to lower excess and obsolete inventory for the three months ended March 31, 2026, as compared to the same period in 2025.

Previous wording

Research and Development Costs. Research and development costs were $3.5 million for the three months ended September 30, 2025, compared to $3.3 million for the same period in 2024, an increase of $0.1 million, or 4%. The increase was due primarily to higher product and software development costs.

Current wording

Research and Development Costs. Research and development costs were $4.5 million for the three months ended March 31, 2026, compared to $3.4 million for the same period in 2025, an increase of $1.1 million, or 34%. The increase was due primarily to higher personnel costs of $0.6 million, and higher product and software development costs of $0.3 million.

Previous wording

Sales and Marketing Expenses. Sales and marketing expenses were $3.8 million for the three months ended September 30, 2025, compared to $3.5 million for the same period in 2024, an increase of $0.3 million, or 8%. This increase was due primarily to additional personnel costs, including share-based compensation, resulting from increases in headcount.

Current wording

Sales and Marketing Expenses. Sales and marketing expenses were $6.7 million for the three months ended March 31, 2026, compared to $3.8 million for the same period in 2025, an increase of $2.9 million, or 75%. This increase was due primarily to additional personnel costs of $1.9 million and increases in travel costs of $0.5 million, resulting from the expansion of our clinical and sales teams, as well as additional amortization expense of acquired intangibles of $0.2 million.

Previous wording

General and Administrative Expenses. General and administrative expenses were $3.6 million for the three months ended September 30, 2025, compared to $3.1 million for the same period in 2024, an increase of $0.4 million, or 14%. This increase was due primarily to higher personnel costs, including share-based compensation, of $0.2 million, as well as higher professional fees and information technology costs, each in the amount of $0.1 million.

Current wording

General and Administrative Expenses. General and administrative expenses were $5.0 million for the three months ended March 31, 2026, compared to $4.1 million for the same period in 2025, an increase of $0.9 million, or 22%. This increase was due primarily to higher occupancy costs of $0.7 million and higher personnel costs of $0.2 million.

Previous wording

Interest Income (Expense), net. Net interest expense was $0.5 million for the three months ended September 30, 2025, compared to net interest income of $0.2 million for the three months ended September 30, 2024. Interest expense increased from $0.2 million in the three months ended September 30, 2024 to $0.9 million in the three months ended September 30, 2025 as a result of the note payable entered into in May 2025. This was partially offset by interest income of $0.4 million in the three months ended September 30, 2025, which increased slightly from $0.3 million in the three months ended September 30, 2024, due to higher investment in U.S. Government debt securities. See Note 6 to the Condensed Consolidated Financial Statements included in Part 1, Item 1 in this Quarterly Report for additional information with respect to the note payable.

Current wording

Interest Income. Interest income was $0.4 million for the three months ended March 31, 2026, compared to $0.2 million for the three months ended March 31, 2025. The increase is due to higher investment in U.S. government debt securities.

Previous wording

We have incurred net losses since our inception, which has resulted in a cumulative deficit at September 30, 2025 of $209.1 million. In addition, our use of cash from operations amounted to $11.8 million for the nine months ended September 30, 2025, and $9.0 million for the year ended December 31, 2024. Since inception, we have financed our operations principally from the sale of equity securities and the issuance of notes payable.

Current wording

We have incurred net losses since our inception as we have devoted substantial efforts to research and development, which has resulted in a cumulative deficit at March 31, 2026 of $226.5 million. Our use of cash from operations amounted to $8.0 million for the three months ended March 31, 2026, and $23.9 million for the year ended December 31, 2025. Since inception, we have financed our operations principally from the sale of equity securities and the issuance of notes payable.

Previous wording

In May 2025, the Company entered into the 2025 SPA with the 2025 Investor relating to the purchase and sale in a registered direct offering of an aggregate of 275,808 shares of Company’s common stock, par value $0.01 per share at a price of $12.69 per share, based on the trailing 30-trading day volume-weighted average price of the Company’s common stock. The aggregate net proceeds to the Company from the offering totaled approximately $3.3 million after deducting offering expenses payable by the Company.

Current wording

In May 2025, we received net proceeds of approximately $3.3 million, after deducting offering expenses payable by the Company, from a registered direct offering. See Note 10 to the condensed consolidated financial statements included elsewhere in this Quarterly Report.

Previous wording

In March 2024, we completed a public offering of 2,653,848 shares of our common stock from which the net proceeds totaled approximately $16.2 million after deducting our payment of underwriting discounts and commissions and other offering expenses. In November 2024, we entered into an ATM Agreement pursuant to which we may offer and sell, from time to time, shares of our common stock, having aggregate sales proceeds of up to $50 million, subject to the terms and conditions of the ATM Agreement. We have not issued any shares of common stock under the ATM Agreement.

Current wording

In November 2024, we established an at-the-market equity offering program under which we may offer and sell, from time to time, shares of our common stock having aggregate sales proceeds of up to $50 million. As of March 31, 2026, we did not sell any shares of common stock under our at-the-market equity offering program. See Note 10 to the condensed consolidated financial statements included elsewhere in this Quarterly Report.

Previous wording

As a result of these transactions and our business operations, our cash and cash equivalents totaled $38.2 million at September 30, 2025. In management’s opinion, based on our current forecasts for revenue, expense and cash flows, our existing cash and cash equivalent balances at September 30, 2025, are sufficient to support our operations and meet our obligations for at least the next twelve months.

Current wording

Our cash and cash equivalents totaled $35.6 million at March 31, 2026. In management’s opinion, based on our current forecasts, our cash and cash equivalent balances at March 31, 2026 are sufficient to support our operations and meet our obligations for at least the next twelve months from the date of issuance of the condensed consolidated financial statements included elsewhere in this Quarterly Report.

Previous wording

Cash activity for the nine months ended September 30, 2025 and 2024 is summarized as follows:

Current wording

Cash activity for the three months ended March 31, 2026 and 2025 is summarized as follows:

Previous wording

Net Cash Flows from Operating Activities. Net cash flows used in operating activities for the nine months ended September 30, 2025 were $11.8 million, an increase of $4.1 million from the nine months ended September 30, 2024. This increase was primarily due to a higher net loss of $4.2 million and increased working capital requirements, mainly due to higher payments made as a result of bonus payouts. This was partially offset by an increase in non-cash expenses, including share-based compensation and the allowance for credit losses.

Current wording

Net Cash Flows Used in Operating Activities. Net cash flows used in operating activities for the three months ended March 31, 2026 were $8.0 million, an increase of $1.8 million from the three months ended March 31, 2025. This increase was primarily due to a higher net loss of $3.5 million, which was partially offset by higher non-cash expenses of $1.3 million attributed to amortization of intangible assets, share-based compensation, and payment-in-kind interest. The changes in operating assets and liabilities of $0.4 million were driven primarily by increased accounts receivable balances, reflecting higher revenues and slower collections, partially offset by lower cash use in paying down liabilities.

Previous wording

Net Cash Flows from Investing Activities. Net cash flows used in investing activities for the nine months ended September 30, 2025 were $0.5 million and related to equipment acquisitions.

Current wording

Net Cash Flows Used in Investing Activities. Net cash flows used in investing activities for the three months ended March 31, 2026 and March 31, 2025 were $0.6 million and $0.2 million, respectively, and related to equipment acquisitions.

Previous wording

Net Cash Flows from Financing Activities. Net cash flows provided by financing activities for the nine months ended September 30, 2025 consisted primarily of proceeds, net of financing costs and discount, of $28.7 million from the issuance of the note payable; proceeds, net of offering costs, of $3.3 million from the registered direct offering of common stock; partially offset by $1.7 million in payments for taxes related to shares withheld in connection with the vesting of restricted stock awards.

Current wording

Net Cash Flows Used in Financing Activities. Net cash flows used in financing activities for the three months ended March 31, 2026 and March 31, 2025 consisted primarily of $2.0 million and $1.3 million, respectively, in payments for taxes related to shares withheld in connection with the vesting of restricted stock.

Previous wording

To date, we have not achieved profitability. We may continue to incur net losses as we continue our efforts to expand the commercialization of our products and services and pursue additional applications for our technology platforms. Our cash balances are primarily held in a variety of demand accounts with a view to liquidity and capital preservation.

Current wording

To date, we have not achieved profitability. We expect to continue to incur net losses as we continue our efforts to expand the commercialization of our products and services and pursue additional applications for our technology platforms. Our cash balances are primarily held in a variety of demand accounts with a view to liquidity and capital preservation.

Previous wording

the cost and timing of regulatory filings, clearances and approvals; and

Current wording

the cost and timing of regulatory filings, clearances and approvals;

Previous wording

the ultimate duration and impact of macroeconomic trends, including inflationary pressures, changes in monetary policy, decreasing consumer confidence and spending, the introduction of or changes in tariffs or trade barriers, global or local recession, and geopolitical instability;

Current wording

the duration and impact of macroeconomic trends, including inflationary pressures, changes in monetary policy, decreasing consumer confidence and spending, the introduction of or changes in tariffs or trade barriers, global or local recession and geopolitical instability; and