Ondas Inc.
For the period ended Dec 31, 2025. Filed Mar 30, 2026.
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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 30, 2026
ONDS$5.34+18.0%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 2025-03-12.
0001213900-25-022968
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2025-12-31; filed 2026-03-30.
0001213900-26-035981
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.
Compared 61 previous paragraphs and 53 current paragraphs.
10 unchanged; 12 reworded; 31 added; 38 removed; 1 previous and 0 current paragraphs rearranged.
Tables are not compared: 17 previous and 11 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (31)
Current report
Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) is designed to provide material information relevant to an assessment of the Company’s financial condition and results of operations, including an evaluation of the amounts and certainty of cash flows from operations and from outside sources. This MD&A is designed to focus specifically on material events and uncertainties known to management that are reasonably likely to cause reported financial information not to be necessarily indicative of future operating results or of future financial condition. This includes descriptions and amounts of matters that have had a material impact on reported operations, as well as matters that are reasonably likely based on management’s assessment to have a material impact on future operations.
Current report
Ondas, Inc. (together with its subsidiaries, the “Company,” “Ondas,” “we,” “us,” or “our”) is a defense, security, and critical infrastructure technology company organized around three business units: Ondas Autonomous Systems Inc. (“OAS”), Ondas Networks Inc. (“Ondas Networks”), and Ondas Capital Inc. (“Ondas Capital”). Through these business units, we develop and commercialize autonomous systems, private wireless networking technologies, and strategic investment and partnership initiatives that support the scaling and adoption of mission-critical solutions for governments and industrial customers.
Current report
We manage these business units as distinct operating platforms aligned to complementary end markets and customer requirements. Our approach is designed to combine advanced autonomy, secure communications, and integrated operating capabilities to help customers improve situational awareness, operational resilience, and safety and security outcomes in complex, regulated, and often contested environments.
Current report
We operate in two reportable segments, Ondas Networks and OAS. We organize our operating segments based primarily on the nature of the products, solutions and services offered. Operational results for Ondas Capital are not material for the year ended December 31, 2025 and have been included in the corporate results with Ondas Inc. For additional information regarding our reportable segments, refer to Note 15 in the accompanying Consolidated Financial Statements.
Current report
Comparison of Results for the Year Ended December 31, 2025 and 2024
Current report
Revenue, net by reportable segment for the years ended December 31, 2025 and 2024 are as follows:
Current report
Revenue, net increased $43.5 million to $50.7 million for the year ended December 31, 2025 from $7.2 million for the year ended December 31, 2024. Revenues in our OAS segment increased by $44.5 million, primarily due to $26.9 million in revenue generated by companies acquired during the year. OAS revenue also increased by $17.6 million attributable to Airobotics, of which approximately $16.4 million relates to product sales and approximately $1.2 million relates to service revenue from sales of our Optimus System™ and Iron Drone Raider™. These increases were offset by a decrease of $952 thousand in Ondas Networks revenue, primarily related to decreased development revenue.
Current report
Cost of goods sold increased to $30.6 million for the year ended December 31, 2025, from $6.9 million for the year ended December 31, 2024. The $23.7 million increase was primarily due to activity from acquisitions and an increase in revenues discussed above, in addition to increased labor and material costs**.**
Current report
Gross margin percentage increased to 40% for the year ended December 31, 2025, compared to 5% for the year ended December 31, 2024. The 35% increase in gross margin percentage is primarily due to the more favorable mix of revenue, with significant increases in revenue generated by product sales offsetting fixed service delivery costs at OAS.
Current report
General and administrative expenses (“G&A”) increased $27.3 million, or 159%, to $44.5 million for the year ended December 31, 2025, from $17.2 million for the year ended December 31, 2024. This increase is primarily due to (i) an increase of $11.7 million in stock-based compensation for awards granted during the year; (ii) an increase of $6.5 million in human resource costs, including benefits from increased headcount as we build out our management team; (iii) an increase of $4.9 million in professional fees and consulting costs primarily related to legal, accounting and due diligence fees associated with the acquisitions completed during the year; and (iv) an increase of $4.7 million related to general and administrative expense attributable to companies acquired during the year. These increases were partially offset by a decrease of approximately $435 thousand primarily in rent and facilities charges.
Current report
Sales and marketing expenses (“S&M”) increased $7.9 million, or 147%, to $13.2 million for the year ended December 31, 2025, from $5.3 million for the year ended December 31, 2024. This increase is primarily due to (i) an increase of $4.1 million in human resource costs, including benefits from increased headcount and an increase in taxable fringe benefit expense; (ii) an increase of $1.3 million in other S&M costs primarily related to increased marketing and advertising costs, use of third-party contractors and consultants, and increased attendance at trade shows and other marketing events; and (iii) an in increase of $2 million related to S&M attributable to companies acquired during the year. The remaining increase of $567 thousand is related to increased stock-based compensation for awards granted during the year and increased travel and entertainment costs.
Current report
Research and development expenses (“R&D”) increased $8.4 million, or 67%, to $20.9 million for the year ended December 31, 2025, from $12.5 million for the year ended December 31, 2024, of which $3 million related to companies acquired during the year ended December 31, 2025. Other increases in R&D include, (i) an increase of $2.8 million in human resource costs, including benefits from increased headcount, and (ii) an increase of $1.8 million in other R&D costs primarily related to increased cloud-based software expenses, use of third-party consultants and allocation of general expenses to research and development, and a one-time settlement of all amounts due to a vendor under previous development and manufacturing agreements, which reduced other R&D costs for the year ended December 31, 2024. The remaining increase of $862 thousand is related to increased stock-based compensation for awards granted during the year and increased travel and entertainment costs.
Current report
The Company recorded income tax expense of $488 thousand for the year ended December 31, 2025, and an income tax provision of $0 for the year ended December 31, 2024. The 2025 income tax expense is attributable to earnings in foreign jurisdictions.
Current report
Net loss increased $95.4 million, or 251%, to $133.4 million for the year ended December 31, 2025, from $38 million for the year ended December 31, 2024. For the year ended December 31, 2025, $1.4 million of net loss was attributable to noncontrolling interests (“NCI”), related to the subsidiaries in which we acquired less than 100% ownership during 2025. These subsidiaries incurred operating losses due to early-stage operating performance. Net loss per share of common stock basic and diluted was $(0.62) and $(0.61) for the years ended December 31, 2025 and 2024, respectively.
Current report
Non-GAAP Measures
Current report
As required by the rules of the Securities and Exchange Commission (“SEC”), we provide a reconciliation of our non-GAAP financial measures to the most directly comparable GAAP measures. These reconciliations are set forth in the tables below.
Current report
We believe that adjusted earnings before interest, taxes, depreciation, and amortization (“Adjusted EBITDA”) is a useful supplemental measure for evaluating our operating performance and period to period trends because it eliminates the impact of items that primarily reflect our capital structure, tax position, non-cash accounting charges, acquisition-related transaction costs, and other items that management does not consider indicative of ongoing operating performance. Adjusted EBITDA should be considered in addition to, and not as a substitute for, net income (loss) and other measures prepared in accordance with GAAP. Adjusted EBITDA removes the effects of interest and financing-related items, depreciation and amortization, income taxes, stock-based compensation, acquisition-related expenses, and other non-operating gains and losses. Management believes that excluding these items enhances comparability across periods and facilitates analysis of underlying operating trends. Other companies may calculate similarly titled non-GAAP measures differently, and therefore our Adjusted EBITDA may not be comparable to measures used by other companies.
Current report
Cash Operating Expense is a non-GAAP financial measure that represents total operating expenses excluding depreciation, amortization of intangible assets, and stock-based compensation. The most directly comparable GAAP measure to Cash Operating Expense is total operating expenses. Management believes Cash Operating Expense provides useful supplemental information by isolating recurring, cash-based operating costs and facilitating meaningful period-to-period comparisons. Management uses this measure for internal cost management, budgeting, and liquidity planning, and to evaluate operating trends exclusive of non-cash accounting charges. Cash Operating Expense should be considered in addition to, and not as a substitute for, total operating expenses prepared in accordance with GAAP.
Current report
Management uses Adjusted EBITDA and Cash Operating Expense, together with GAAP results, in making operating and planning decisions and in evaluating the Company’s ongoing performance.
Current report
The increase in cash flows used in investing activities of $258.4 million primarily relates to cash paid, net of cash acquired, for acquisitions of $206.8 million, purchases of long-term equity investments of $35.6 million, and purchases of short-term investments of $15.4 million.
Current report
The increase in cash provided by financing activities of $812.5 million primarily relates to the net proceeds of approximately $829.5 million received from equity offerings consummated in 2025, during the year ended December 31, 2025, compared to the net proceeds received from the sale of Common Stock in the Company of approximately $7.3 million during the year ended December 31, 2024, combined with proceeds of approximately $1.2 million from the exercise of warrants in OAS, the increase in proceeds from the exercise of stock options and warrants of approximately $30.8 million during the year ended December 31, 2025. These increases were partially offset by the decrease in net proceeds of $37.3 million from the issuance of notes payable and convertible notes payable and a decrease in net proceeds of $4.4 million from the sale of preferred stock in Ondas Networks during the year ended December 31, 2024.
Current report
In January 2026, we raised approximately $1 billion in gross proceeds from the sale of common stock and warrants in the Company.
Current report
The accounting estimates discussed below represent those estimates that management believes are critical to an understanding of our financial condition and results of operations.
Current report
*Acquired intangible assets.*During 2025, we completed multiple acquisitions that were accounted for as business combinations under ASC 805. Business combination accounting requires significant judgment in estimating the fair value of assets acquired, liabilities assumed, noncontrolling interests, redeemable noncontrolling interests, and goodwill as of the acquisition date. Acquired intangible assets, such as developed technology, customer relationships, trade names, and non-compete agreements, which are valued using income-based valuation techniques, including discounted cash flow, relief-from-royalty, and multi-period excess earnings methods, or cost-based techniques. These techniques require assumptions regarding future revenues, customer attrition, royalty rates, useful lives, and discount rates. Because the fair value measurements recorded in connection with these acquisitions resulted in significant balances of goodwill and identifiable intangible assets, and affect our future amortization expense and potential impairment assessments, relatively small changes in key assumptions could materially impact our consolidated financial position and results of operations.
Current report
Deferred tax assets and liabilities may arise from differences between the assigned fair values of acquired assets and their tax bases. Estimation related to these assets and liabilities requires judgment regarding applicable tax laws, tax rates, and the realizability of deferred tax assets. Noncontrolling interests are measured at fair value at the acquisition date using valuation techniques consistent with those applied to the acquired business. Redeemable noncontrolling interests are classified outside of permanent equity and subsequently adjusted to redemption value, requiring ongoing judgment related to accretion amounts and income or loss attribution. Changes in underlying assumptions could result in material changes to the recorded purchase price allocation, goodwill, or future amortization expense.
Current report
Impairment of long-lived assets, including goodwill. Goodwill is not amortized but is tested for impairment at least annually and whenever events or changes in circumstances indicate that impairment may exist. As of December 31, 2025, goodwill represented a significant portion of our total assets. Our goodwill impairment analysis requires judgment in identifying reporting units and assessing qualitative and quantitative impairment indicators.
Current report
*Valuation of Government Grant Liability.*We receive research and development grants from the Israel Innovation Authority (“IIA”). These grants are royalty-bearing and are recognized as a liability rather than income. The government grant liability is initially and subsequently measured at fair value using a discounted cash flow model. Significant assumptions include the financial statement classification, projected future revenues from products developed with grant funding, royalty rates, timing of payments, and discount rates. The liability is remeasured each reporting period, with changes in fair value recognized in earnings. Because the valuation depends on commercialization success and future sales volumes, changes in assumptions may materially affect our results of operations.
Current report
Valuation of Warrant Liabilities. Certain warrants issued in connection with equity and debt financings are classified as liabilities and measured at fair value at each reporting date. Fair value is determined using either option-pricing models, including Monte Carlo simulations and Black-Scholes-Merton. These models require assumptions regarding common stock volatility, risk-free interest rates, expected term, and stock price. Due to the sensitivity of these assumptions, changes in market conditions or estimates can result in significant volatility in earnings.
Current report
Fair Value of Investments. We hold investments, including investments without readily determinable fair values. Investments with observable market prices are measured using quoted prices, while other investments are valued using models that incorporate unobservable inputs. These valuation techniques require judgment regarding expected cash flows, volatility, discount rates, and the likelihood of liquidity events. Changes in assumptions or market conditions could result in material changes to the carrying value of our investments and related unrealized gains or losses.
Current report
*Revenue Recognition.*We enter into complex customer arrangements that may include development services, system integration, deployment, and ongoing support. Revenue recognition requires judgment in identifying distinct performance obligations, determining whether revenue is recognized over time or at a point in time, and measuring progress toward completion. For development and long-term service arrangements, revenue is generally recognized over time using cost-to-cost or milestone-based methods. These methods require estimates of total expected costs, project timelines, and the achievement of contractual milestones. Revisions to these estimates may result in changes to the amount or timing of revenue recognized.
Current report
On July 4, 2025, an act to provide for reconciliation to title II of H. Con. Res. 14 (known commonly as the One Big Beautiful Bill Act (“OBBBA”)) was enacted into law. The OBBBA includes eliminating the requirement to capitalize U.S. R&D, permanent extension of certain provisions of the Tax Cuts & Jobs Act of 2017 and other corporate tax impacts. The Company has considered the impact on the Consolidated Financial Statements and concluded it is immaterial. Refer to Note 16 in the accompanying Consolidated Financial Statements for discussion related to Tax Reform.
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Previous report
General
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Overview
Previous report
Ondas Holdings Inc. (“Ondas Holdings,” the “Company,” “we” or “our”) is a leading provider of private wireless, drone, and automated data solutions through its subsidiaries Ondas Networks Inc., a Texas corporation (“Ondas Networks”), Ondas Autonomous Systems Inc., a Nevada corporation (“OAS”), which wholly-owns Airobotics Ltd., an Israeli company (“Airobotics”), and American Robotics, Inc., a Delaware corporation (“American Robotics”).
Previous report
Ondas Networks provides wireless connectivity solutions. OAS provides drone and automated data solutions through its subsidiaries Airobotics and American Robotics. Ondas Networks and OAS together provide users in rail, energy, mining, public safety and critical infrastructure and government markets with improved connectivity, data collection capabilities, and data collection and information processing capabilities. We operate Ondas Networks and OAS as separate business segments, and the following is a discussion of each segment. See Note 1, Note 2, and Note 12 of the accompanying Consolidated Financial Statements for further information regarding our segments.
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Ondas Networks Segment
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Ondas Networks provides wireless connectivity solutions enabling mission-critical Industrial Internet applications and services. We refer to these applications as the Mission-Critical Internet of Things (“MC-IoT”). Our wireless networking products are applicable to a wide range of MC-IoT applications, which are most often located at the very edge of large industrial networks. These applications require secure, real-time connectivity with the ability to process large amounts of data at the edge of large industrial networks. Such applications are required in all of the major critical infrastructure markets, including rail, electric grids, drone operations, oil and gas, and public safety, homeland security and government, where secure, reliable and fast operational decisions are required in order to improve efficiency and ensure a high degree of safety and security. Our MC-IoT intellectual property has been adopted by the Institute of Electrical and Electronics Engineers (“IEEE”), the leading worldwide standards body in data networking protocols, and forms the core of the IEEE 802.16 standard. Because standards-based communications solutions are preferred by our mission-critical customers and ecosystem partners, we continue to take a leadership position in IEEE as it relates to wireless networking for industrial markets.
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We design, develop, manufacture, sell and support FullMAX, our patented, Software Defined Radio (“SDR”) platform for secure, private, wide-area broadband networks. Our customers install FullMAX systems in order to upgrade and expand their legacy wide-area network infrastructure. By upgrading their legacy systems, customers benefit from significant increases in data throughput which enables new applications. We have targeted the North American freight rail operators for the initial adoption of our FullMAX platform. These rail operators currently operate legacy communications systems utilizing dated narrowband wireless technologies for voice and data communications. These legacy wireless networks have limited data capacity and are unable to support the adoption of new, intelligent train control and management systems. The freight rail operators through the Association of American Railroads (“AAR”), its advisory subsidiary MxV Rail, as well as the American Railway Engineering and Maintenance Association (“AREMA”), have adopted the IEEE 802.16 standard for future private wireless networks.
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Our software-based FullMAX platform is an important and timely upgrade solution for privately-owned and operated wireless wide-area networks, leveraging Internet Protocol-based communications to provide security, more reliability and significant data throughput for our mission-critical infrastructure customers. We believe industrial and critical infrastructure markets throughout the globe have reached an inflection point where legacy serial and analog based protocols no longer meet industry needs. In addition to offering enhanced data throughput, FullMAX is an intelligent networking platform enabling the adoption of sophisticated operating systems and equipment supporting next-generation MC-IoT applications over wide field areas. These new MC-IoT applications and related equipment require more processing power at the edge of large industrial networks and the efficient utilization of network capacity and scarce bandwidth.
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Industry Partnerships
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Ondas Networks continues to develop partnerships in the rail space to develop and market wireless communications products and services based on Ondas Networks’ technology. Our partnership with Siemens Mobility (“Siemens”) is geared to market our FullMAX-based networking technology and services and to jointly develop certain wireless communications products for the North American Rail Industry based on Siemens’ Advanced Train Control System (“ATCS”) protocol and our FullMAX MC-IoT platform. We are working with other industry partners to commercialize our platform technologies for specific use cases and to drive broad industry adoption of dot16 applications.
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OAS Segment
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Our OAS business unit develops and integrates drone-based solutions focusing on high-performance critical applications for government and Tier-1 commercial enterprises. Ondas is marketing comprehensive drone-based solutions to address the needs of governmental and commercial customers based on its commercially available platforms: the Optimus System™, a fully autonomous drone platform capable of continuous and multipurpose aerial data capturing and analytics, and the Iron Drone Raider™, a fully autonomous interceptor drone designed to neutralize small hostile drones.
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Our unique, fully autonomous platforms enable cutting-edge aerial capabilities and are designed to serve and protect critical infrastructure and operations. Our business focuses on end-user entities in defense, homeland security, public safety, smart city, airport authorities, and other governmental entities together with commercial operators of critical industrial and technology facilities such as oil & gas, seaports, mining, and heavy construction as well as for data centers and semiconductor fabs. For these industries, OAS provides specialized real-time aerial data capturing and aerial protection solutions in the most complex environments such as urban areas, sensitive and critical facilities and field area operations, and high-priority projects. In addition, we offer a wide suite of supplementary, enabling services for successful implementation such as AI data analytics, data automation, IT implementation, safety planning, certification, training, and maintenance, handling all the complex aspects of such high-performance drone operations.
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Our portfolio companies, American Robotics and Airobotics, form a unique, powerful, and synergistic combination covering all the aspects required for successful Aerospace business together with data technologies and services for digital transformation industries. Our companies are specialized in addressing all the challenges arising along these types of product lifecycles including research and development, manufacturing, certification, and ongoing support.
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OAS and its portfolio companies have already gained a track record of industry-leading regulatory successes including the securing of the first-of-its-kind Type Certification (TC) from the FAA for the Optimus 1-EX UAV on September 25, 2023, becoming the first autonomous security data capture UAV to achieve this distinction. TC, recognized as the highest echelon of Airworthiness Certification, streamline operational approvals for broad flight operations over people and infrastructure. The certification verifies the compliance of the system’s design with the required FAA airworthiness and noise standards, ensuring safe operation within the US National Airspace System (NAS) thereby significantly broadening the range of operational scenarios and scaling up of operations for automated UAS. Achieving FAA Type Certification will enable drone operations beyond-visual-line-of-sight (BVLOS) without a human operator on-site. With a strong footprint in the US market and worldwide, we believe that OAS is well-positioned with proven technology, a unique offering, and strong capabilities to strategically transform critical operations with our cutting-edge drone tech and capabilities.
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War in Israel
Previous report
On October 7, 2023, the State of Israel, where Airobotics’ main offices and facilities are located, suffered a surprise attack by hostile forces from the Gaza Strip, which led to the Security Cabinet of the State of Israel declaring a state of war in Israel. This military operation and related activities are on-going as of the date of this filing.
Previous report
The Company is closely monitoring how the military operation and related activities could adversely affect its anticipated milestones and its Israel-based activities to support future operations, including the Company’s ability to import materials that are required to construct the Optimus System™ and to ship them outside of Israel. Although there have been disruptions in our business and operations, the Company has determined that there have not been any materially adverse effects on its business or operations. The Company does not believe the disruptions in its business and operations will have an enduring impact on its business and operations, but it continues to monitor the situation, as any future escalation or change could result in a material adverse effect on the ability of the Company’s Israeli office to support the Company’s activities. The Company does not have any specific contingency plans in the event of any such escalation or change.
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Year ended December 31, 2024 compared to year ended December 31, 2023
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Revenues
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Revenue decreased by $8,498,736 to $7,192,694 for the year ended December 31, 2024 from $15,691,430 for the year ended December 31, 2023. Revenues during the year ended December 31, 2024 included $2,796,178 for products, $2,491,955 for service and subscriptions, and $1,904,561 for development agreements, primarily with Siemens. Revenues during the same period in 2023 included $12,102,388 for products, $2,126,560 for service and subscriptions, and $1,462,482 for development agreements primarily with Siemens. The decrease in our revenues was primarily the result of a decrease of approximately $5,221,000 in product sales, mainly to Siemens, at Ondas Networks, as further orders have been delayed by the railroads, as they work on implementing the 900 MHz band network; a decrease of approximately $4,085,000 in decreased product sales at OAS, who had multi-drone orders during the year ended December 31, 2023, but no comparable sales until the second half of 2024. These decreases were offset by an increase of approximately $344,000 in maintenance, service, support, and subscriptions revenue and an increase of approximately $33,000 in development revenue at OAS due to new orders at Airobotics and American Robotics. Further offset by an increase of approximately $21,000 in service revenue at Ondas Networks, and an increase of approximately $409,000 in development revenue to Siemens, related to a new development agreement at Ondas Networks.
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Cost of goods sold
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Cost of goods sold decreased by $2,462,745 to $6,847,511 for the year ended December 31, 2024 from $9,310,256 for the year ended December 31, 2023. The decrease in cost of goods sold was primarily a result of decreased revenue for the year ended December 31, 2024, as compared to the year ended December 31, 2023. Cost of goods sold at OAS did not decrease in the same ratio as revenue because of fixed manufacturing costs.
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Gross profit
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Our gross profit decreased by $6,035,991 to $345,183 for the year ended December 31, 2024 compared to $6,381,174 for the year ended December 31, 2023 based on the changes in revenues and cost of goods sold as discussed above. Gross profit for the years ended December 31, 2024 and 2023 was 5% and 41%, respectively. The decrease in gross margin of 36% is due to the change in the mix of revenues during the year ended December 31, 2024, which included development projects with lower gross margins as compared to product revenue with higher gross margins during the year ended December 31, 2023, as well as certain fixed costs related to OAS delivery.
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Operating Expenses
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Our principal operating costs include the following items as a percentage of total operating expenses:
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Operating expenses for the year ended December 31, 2024 decreased by $11,155,987, or 24%, as a result of the following items:
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The decrease in operating expenses was primarily due to:
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Operating Loss
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As a result of the foregoing, our operating loss decreased by $5,119,996, or 13%, to $34,609,304 for the year ended December 31, 2024, compared with $39,729,300 for the year ended December 31, 2023. Operating loss decreased primarily as a result of a decrease in operating expenses as described above, partially offset by decreased revenue and gross margin for the year ended December 31, 2024.
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Total Other Income (Expense), net
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Net Loss
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As a result of the net effects of the foregoing, net loss decreased by $6,837,115, or 15%, to $38,007,757 for the year ended December 31, 2024, compared with $44,844,872 for the year ended December 31, 2023. Net loss per share of common stock, basic and diluted, was $(0.61) for the year ended December 31, 2024, compared with $(0.88) for the year ended December 31, 2023.
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The increase in cash flows used in investing activities of $2,267,949, relates to an increase of approximately $1,452,000 in payments made for purchase of equipment, software intangibles and patent costs, and a decrease of approximately $47,000 from net of proceeds from sale of equipment, combined with a decrease of approximately $1,049,000 for cash acquired with the Airobotics acquisition in the year ended December 31, 2023, partially offset by the decrease of approximately $280,000 for cash paid for asset acquisitions in the year ended December 31, 2023.
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The increase in cash provided by financing activities of $31,448,470 was due to an increase in net proceeds from convertible debt of approximately $27,687,000, increase in net proceeds from notes payable of approximately $1,422,000, increase in proceeds from exercise of options and warrants of approximately $18,000, increase in net proceeds of approximately $110,000 from government grants, and approximately $7,304,000 in net proceeds from the sale of the Company’s Common Stock and warrants. Combined with a decrease of approximately $4,355,000 in cash payments on the 2022 Convertible Exchange Notes and a decrease of approximately $1,140,000 in cash payments for Airobotics related debt. This was partially offset by a decrease in net proceeds of approximately $10,317,000 from the sale of noncontrolling interest in Ondas Networks and an increase of approximately $271,000 in cash payments on the government grants liability.
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In 2024, we raised approximately $36,997,000 of net proceeds from issuance of convertible notes in Ondas Holdings, Ondas Networks, and OAS; approximately $1,422,000 of net proceeds from issuance of secured notes in Ondas Networks; approximately $7,304,000 of net proceeds from issuing common stock in Ondas Holdings, warrants in Ondas Holdings, and warrants in OAS; and approximately $4,375,000 in net proceeds from issuing additional redeemable preference shares in Ondas Networks and warrants in Ondas Holdings.
Previous report
In addition, the global economy has recently seen a rise in tariffs and threats of tariffs. While tariffs have not had a material impact on our business, financial condition or results of operations to date, new tariffs could increase the costs of raw materials and other goods, both for us and our suppliers, which could impact our business, particularly as we begin to scale our manufacturing operations.
Reworded paragraphs (12)
Previous wording
Total other expense, net, decreased by $1,717,119, to $3,398,453 for the year ended December 31, 2024, compared with $5,115,572 for the year ended December 31, 2023. Total other expense, net decreased primarily as a result of a decrease of approximately $574,000 from the change in fair value of government grant liability; a decrease in interest expense of approximately $534,000 primarily related to amortization of debt discount and debt issuance costs; an increase in interest income of approximately $111,000 due to interest earned on cash deposits; a decrease of approximately $161,000 in other expense primarily related to an impairment of deferred offering costs of approximately $116,000 related to the termination of the ATM Agreement during the year ended December 31, 2023; and a decrease in foreign exchange loss, net of approximately $337,000.
Current wording
Total other expense, net increased $71.1 million, or 2,093%, to $74.5 million for the year ended December 31, 2025, from $3.4 million for the year ended December 31, 2024. Total other expense, net increased primarily as a result of the net loss of $82.2 million related to the change in fair value of our warrant liability, an increase of approximately $2.9 million in interest expense, amortization of debt discount and debt issuance costs, and an increase in other expense of approximately $299 thousand from the change in fair value of government grant liability. This was offset by the increase of approximately $14.3 million in interest and dividend income and unrealized gain on our equity security investments from the cash raised from our equity offerings consummated in 2025.
Previous wording
The principal use of cash in operating activities for the year ended December 31, 2024, was to fund the Company’s current expenses primarily related to operating activities necessary to allow us to service and support customers.
Current wording
The principal use of cash in operating activities for the year ended December 31, 2025, was to fund the Company’s current expenses primarily related to operating activities necessary to allow us to service and support customers for the year ended December 31, 2025.
Previous wording
The decrease in cash flows used in operating activities of $549,896 was primarily due to a decrease in net loss of approximately $6,837,000, of which approximately $1,409,000 relates to non-cash and credits, including depreciation, amortization of debt discount and issuance costs, amortization of intangibles assets and right of use asset, stock-based compensation, and change in fair value of government grant liability; approximately $4,011,000 relates to non-cash impairment of long-term assets; offset by changes in operating assets and liabilities resulting in a cash outflow of approximately $867,000.
Current wording
The increase in cash flows used in operating activities of $5.3 million primarily relates to an increase in net loss of $95.4 million, of which approximately $96.6 million related to non-cash charges and credits, which primarily includes investment gains, change in fair value of warrant liability, amortization of debt discount and issuance costs, and stock-based compensation, offset by changes in operating assets and liabilities resulting in a cash outflow of approximately $6.5 million for the year ended December 31, 2025.
Previous wording
We have incurred losses since inception and have funded our operations primarily through debt and the sale of capital stock. On December 31, 2024, we had an accumulated deficit of approximately $236,368,000. On December 31, 2024, we had net long-term borrowings outstanding of approximately $18,057,000 net of debt discount and issuance costs of approximately $1,682,000 and short-term borrowings outstanding of approximately $38,747,000, net of debt discount and issuance costs of approximately $5,825,000. On December 31, 2024, we had cash and restricted cash of approximately $29,999,000 and a working capital deficit of approximately $3,056,000. We had approximately $33,470,000 of net cash flows used in operations for the year ended December 31, 2024.
Current wording
We have incurred losses since inception and have funded our operations primarily through debt and the sale of capital stock. As of December 31, 2025, we had an accumulated deficit of $368.4 million. On December 31, 2025, we had net long-term borrowings outstanding of approximately $3.8 million and short-term borrowings outstanding of approximately $9.4 million, including accrued interest of $721 thousand. On December 31, 2025, we had cash, cash equivalents, and restricted cash of approximately $594.4 million and working capital of $544 million. We had $38.7 million of net cash flows used in operations for the year ended December 31, 2025.
Previous wording
In January 2025, we raised approximately $931,000 in gross proceeds from issuance of convertible notes in Ondas Networks.
Current wording
In 2025, we raised $829.5 million of net proceeds from the sale of common stock and warrants, $30.8 million from the exercise of stock options and warrants, $1.2 million from the exercise of warrants in OAS, and $923 thousand from issuance of convertible notes in Ondas Networks (collectively referred to as the “2025 Offerings”).
Previous wording
We expect to fund our operations for the next twelve months from the filing date of this Annual Report on Form 10-K from the cash on hand as of December 31, 2024, proceeds from the 2025 financing activity discussed above, gross profits generated from revenue growth, potential prepayments from customers for purchase orders, potential proceeds from warrants issued and outstanding, and additional funds that we may seek through equity or debt offerings and/or borrowings under additional notes payable, lines of credit or other sources. There is substantial doubt that the funding plans will be successful and therefore the conditions discussed above have not been alleviated. As a result, there is substantial doubt about the Company’s ability to continue as a going concern for one year from March 12, 2025, the date the Consolidated Financial Statements were available to be issued.
Current wording
We expect to fund our operations for the next twelve months from the filing date of this Annual Report on Form 10-K from the cash on hand as of December 31, 2025, proceeds from the 2026 financing activity discussed above, gross profits generated from revenue growth, potential prepayments from customers for purchase orders, potential proceeds from warrants issued and outstanding, and additional funds that we may seek through equity or debt offerings and/or borrowings under additional notes payable, lines of credit or other sources.
Previous wording
The preparation of financial statements in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) requires management to make estimates and assumptions that affect reported amounts and related disclosures in the financial statements. Management considers an accounting estimate to be critical if:
Current wording
The preparation of financial statements in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) requires management to make estimates and assumptions that affect reported amounts and related disclosures in the financial statements. Management considers an accounting estimate to be critical if (1) the estimate requires assumptions to be made that were uncertain at the time the estimate was made, and (2) changes in the estimate or different estimates that could have been selected could have a material impact on our results of operations or financial condition. We base our estimates and judgments on our experience, our current knowledge, our beliefs of what could occur in the future, our observation of trends in the industry, information provided by our customers and information available from other sources. Actual results may differ from these estimates under different assumptions or conditions.
Previous wording
Impairment of Long-Lived Assets. Carrying values of property and equipment and finite-lived intangible assets are reviewed for impairment whenever events or changes in circumstances indicate that their carrying values may not be recoverable. If impairment indicators are present, we determine whether an impairment loss should be recognized by testing the applicable asset or asset group’s carrying value for recoverability. This assessment requires the exercise of judgment in assessing the future use of and projected value to be derived from the eventual disposal of the assets to be held and used. Assessments also consider changes in asset utilization, including the temporary idling of capacity and the expected timing for placing this capacity back into production. If the carrying value of the assets are not recoverable, then a loss is recorded for the difference between the assets’ fair value and respective carrying value. The fair value of the assets is determined using an “income approach” based upon a forecast of all the expected discounted future net cash flows associated with the subject assets. Some of the more significant estimates and assumptions include: market size and growth, market share, projected selling prices, manufacturing cost and discount rate. Our estimates are based upon historical experience, commercial relationships, market conditions and available external information about future trends.
Current wording
The carrying values of property and equipment and other finite-lived intangible assets are reviewed for impairment whenever events or changes in circumstances indicate that their carrying values may not be recoverable. If impairment indicators are present, we determine whether an impairment loss should be recognized by testing the applicable asset or asset group’s carrying value for recoverability. This assessment requires the exercise of judgment in assessing the future use of and projected value to be derived from the eventual disposal of the assets to be held and used. Assessments also consider changes in asset utilization, including the temporary idling of capacity and the expected timing for placing this capacity back into production. If the carrying value of the assets is not recoverable, then a loss is recorded for the difference between the assets’ fair value and respective carrying value. The fair value of the assets is determined using an “income approach” based upon a forecast of all the expected discounted future net cash flows associated with the subject assets. Some of the more significant estimates and assumptions include: market size and growth, market share, projected selling prices, manufacturing cost and discount rate. Our estimates are based upon historical experience, commercial relationships, market conditions and available external information about future trends.
Previous wording
Income Taxes. As part of the process of preparing our Consolidated Financial Statements, we are required to estimate income taxes in each of the jurisdictions in which we operate. Our provision for income taxes is determined using the asset and liability approach to account for income taxes. A current liability is recorded for the estimated taxes payable for the current year. Deferred tax assets and liabilities are recorded for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using the enacted tax rates in effect for the year in which the timing differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of changes in tax rates or tax laws are recognized in the provision for income taxes in the period that includes the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount more-likely-than-not to be realized. Changes in valuation allowances will flow through the statement of operations unless related to deferred tax assets that expire unutilized or are modified through translation, in which case both the deferred tax asset and related valuation allowance are similarly adjusted. Where a valuation allowance was established through purchase accounting for acquired deferred tax assets, any future change will be credited or charged to income tax expense. See Note 13 – Income Taxes in the accompanying Consolidated Financial Statements for discussion related to Tax Reform.
Current wording
Income Taxes. As part of the process of preparing our Consolidated Financial Statements, we are required to estimate income taxes in each of the jurisdictions in which we operate. Our provision for income taxes is determined using the asset and liability approach to account for income taxes. A current liability is recorded for the estimated taxes payable for the current year. Deferred tax assets and liabilities are recorded for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using the enacted tax rates in effect for the year in which the timing differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of changes in tax rates or tax laws are recognized in the provision for income taxes in the period that includes the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount more-likely-than-not to be realized. Changes in valuation allowances will flow through the statement of operations unless related to deferred tax assets that expire unutilized or are modified through translation, in which case both the deferred tax asset and related valuation allowance are similarly adjusted. Where a valuation allowance was established through purchase accounting for acquired deferred tax assets, any future change will be credited or charged to income tax expense.
Previous wording
Complex Derivative Financial Instruments. From time to time, we sell common stock, and we issue convertible debt, both with common stock purchase warrants, which may include terms requiring conversion price or exercise price adjustments based on subsequent issuance of securities at prices lower than those in the agreements of such securities. In these situations, the instruments may be accounted for as liabilities and recorded at fair value each reporting period. Due to the complexity of the agreement, we use an outside expert to assist in providing the mark to market fair valuation of the liabilities over the reporting periods in which the original agreement was in effect. It was determined that a Binomial Lattice option pricing model using a Monte Carlo simulation would provide the most accuracy given all the potential variables encompassing a future dilutive event. This model incorporated transaction assumptions such as our stock price, contractual terms, maturity, risk free rates, as well as estimates about future financings, volatility, and holder behavior. Although we believe our estimates and assumptions used to calculate the fair valuation liabilities and related expense were reasonable, these assumptions involved complex judgments about future events, which are open to interpretation and inherent uncertainty. In addition, significant changes to our assumptions could significantly impact the amount of expense recorded in a given period.
Current wording
Complex Derivative Financial Instruments. From time to time, we issue convertible debt, convertible preferred stock, common stock purchase warrants, and other freestanding financial instruments which may be accounted for as liabilities and recorded at fair value each reporting period. Due to the complexity of certain agreements, we may use an outside expert to assist in measuring the fair value of these liabilities. The valuation techniques may require judgment regarding estimates about future financings, volatility, and holder behavior. These assumptions may involve complex judgments about future events, which are open to interpretation with inherent uncertainty. In addition, significant changes to our assumptions could significantly impact these fair value estimates and the resulting changes in fair value recognized within earnings in a given period.
Previous wording
Recently Accounting Pronouncements and SEC Rules
Current wording
Recent Accounting Pronouncements and SEC Rules
Previous wording
See Note 2 to our Consolidated Financial Statements included elsewhere in this Form 10-K for recently adopted accounting pronouncements and SEC rules and recently issued accounting pronouncements not yet adopted as of the date of this report.
Current wording
Refer to Note 2 to our Consolidated Financial Statements included elsewhere in this Form 10-K for recently adopted accounting pronouncements and SEC rules and recently issued accounting pronouncements not yet adopted as of the date of this report.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
We base our estimates and judgments on our experience, our current knowledge, our beliefs of what could occur in the future, our observation of trends in the industry, information provided by our customers and information available from other sources. Actual results may differ from these estimates under different assumptions or conditions. We have identified the following accounting policies and estimates as those that we believe are most critical to our financial condition and results of operations and that require management’s most subjective and complex judgments in estimating the effect of inherent uncertainties: share-based compensation expense, income taxes, complex derivative financial instruments and impairment of long-lived assets including intangible assets acquired in business combinations.