CID Holdco, Inc.
For the period ended Mar 31, 2026. Filed May 12, 2026.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2026 · Filed May 12, 2026
DAIC$1.01-2.9%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-09-30; filed 2025-11-13.
0001213900-25-110130
Item 2. – Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-03-31; filed 2026-05-12.
0001213900-26-055091
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 121 previous paragraphs and 92 current paragraphs.
45 unchanged; 31 reworded; 16 added; 44 removed; 1 previous and 0 current paragraphs rearranged.
Tables are not compared: 15 previous and 6 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 (16)
Current report
Please read the following discussion and analysis of our financial condition and results of operations together with our condensed consolidated financial statements and related notes included in this filing. Some of the information contained in this discussion and analysis, including information regarding our plans and strategy for our business, includes forward-looking statements that involve risks and uncertainties. When reviewing the discussion below, you should carefully consider the substantial risks and uncertainties that could impact our business, results of operations, and financial condition. In particular, we encourage you to review the risks and uncertainties described under “Risks Relating to Our Business and Industry” in our Annual Report on Form 10-K filed with the SEC on March 11, 2026, as well as other risk factors disclosed elsewhere in that filing and in this Report. These risks and uncertainties could cause actual results to differ materially from those projected in forward-looking statements contained in this Form 10-Q or implied by past results and trends. Forward-looking statements are statements that attempt to forecast or anticipate future developments in our business, financial condition, or results of operations. These statements speak only as of their respective dates (unless otherwise indicated), and we undertake no obligation to update or revise them in light of future developments.
Current report
Revenue decreased by $340,284, or (96.5)%, for the three months ended March 31, 2026 compared to the three months ended March 31, 2025. Our revenue for the three months ended March 31, 2026 was comprised of subscription service revenue, while our revenue for the three months ended March 31, 2025 was primarily comprised of $250,000 related to the development of product specifications, $98,161 for the amortization of a customer exclusivity agreement, as well as subscription service revenue.
Current report
Cost of goods sold decreased by $14,412, or (84.4)%, for the three months ended March 31, 2026 compared to the three months ended March 31, 2025. The decrease was primarily attributable to lower service costs associated with third-party software licensing.
Current report
Our gross margin was 78.2% for the three months ended March 31, 2026 compared to 95.2% for the three months ended March 31, 2025. The decrease in gross margin is primarily attributable to changes in the mix of services provided during the periods.
Current report
Research and development expense increased by $217,441, or 55.2%, for the three months ended March 31, 2026 compared to the three months ended March 31, 2025. The increase was primarily driven by higher labor expenses of $339,292 and R&D cloud costs of $73,929, partially offset by a decrease in R&D compliance and testing expenses of $205,446. Additionally, as the software was placed into service as of January 1, 2026, the Company ceased capitalizing software development costs, which primarily consisted of labor costs, and began amortizing the related asset, contributing to higher labor costs recognized in expense during the period.
Current report
Sales and marketing expenses increased by $230,396, or 33.7%, for the three months ended March 31, 2026 compared to the three months ended March 31, 2025. The increase reflects our continued pivot toward market-facing initiatives and was primarily driven by increased spending of $164,196 on brand-related marketing activities, events and sponsorships, and $72,915 on customer relationship management and marketing software tools.
Current report
General and administrative expenses for the three months ended March 31, 2026 and 2025 are summarized as follows:
Current report
General and administrative expenses increased by $1,798,981, or 291.2%, for the three months ended March 31, 2026 compared to the three months ended March 31, 2025. The increase was primarily due to incremental expenses of $1,277,526 related to operating as a public company, including legal, auditing, accounting and board of director fees, as well as higher labor costs of $443,686 associated with the continued ramp-up of the business.
Current report
The decrease in the liability balance of SAFE agreements for the three months ended March 31, 2026, compared to March 31, 2025, was primarily attributable to the conversion of the SAFE notes into company shares upon the closing of the Business Combination. Upon conversion, the related liabilities were reclassified to equity.
Current report
On October 13, December 30, December 31, 2025, and February 10, 2026, the Company delivered purchase notices for 30,000, 500,000, 1,000,000, and 20,000 shares, respectively, at settlement prices of $2.62, $0.32, $0.32, and $0.26 per share. This resulted in gross proceeds of $78,516, $159,500, $317,000, and $5,164, respectively. The Company issued 30,000 shares in October 2025, 1,000,000 shares in December 2025, 500,000 shares in January 2026, and 20,000 shares in February 2026. Because the shares were issued to New Circle at prices determined using a discounted VWAP formula, the cash proceeds received were below the fair value of the shares on the respective issuance dates. The Company measured the shares at fair value on the date cash was received and recognized the difference between (i) the fair value of the shares issued and (ii) the proceeds calculated pursuant to the discounted VWAP pricing terms. For the three months ended March 31, 2026, the Company recorded a loss of $1,256 on the issuance of shares in the statement of operations.
Current report
As of March 31, 2026, Edmund Nabrotzky, Chief Executive Officer of the Company, Charles Maddox, Chief Financial Officer and Chief Operating Officer of the Company, and Vijayan Nambiar, Chief Technology Officer of the Company loaned the Company an aggregate of $349,996 and may make additional loans to the Company up to an aggregate amount of $600,000 (collectively, the “Executive Loans”). The Executive Loans have been made, on the terms and conditions of an unsecured, subordinated promissory note (the “Executive Notes”). The Executive Notes accrue interest at a rate of 7.5% per annum, and will be paid in quarterly installments on July 1, 2026, October 1, 2026 with a final payment by December 31, 2026. All of the Company’s obligations and payments under the Executive Notes are subordinated to the Company’s obligations under the loan agreement with J.J. Astor & Co.
Current report
Subsequent to the end of the first quarter, on April 17, 2026, the Company entered into a financing arrangement with an investor consisting of an equity purchase facility and senior secured convertible promissory notes. Under the equity purchase facility, the Company may sell up to $10,000,000 of its common stock over time through purchase notices, subject to specified pricing terms and ownership limitations. In addition, the Company entered into a note purchase agreement with the investor pursuant to which the investor agreed to purchase senior secured convertible promissory notes in an aggregate principal amount of up to $2,875,000, reflecting a 20% original issue discount applied to aggregate loan proceeds of up to $2,300,000. The notes bear interest at 8% per annum and are issued at a discount. The convertible notes are secured by substantially all of the Company’s assets and are convertible into common stock at a discount to market price, with provisions for a reduced conversion price upon certain events of default. The note is currently structured as a second priority lien, subordinated to the Company’s obligations to J.J. Astor & Co. pursuant to a loan agreement dated December 5, 2025, until those obligations are discharged in full. In connection with the financing, the investor will receive commitment shares valued at $120,000 and warrants to purchase up to $2,000,000 of common stock at an exercise price equal to 99% of the closing market price on the trading day prior to exercise. Total share issuances under the agreements are subject to a 19.99% cap of the Company’s outstanding shares unless stockholder approval is obtained. The Company expects to use the proceeds primarily for general corporate purposes, including supporting liquidity and servicing existing debt obligations.
Current report
Cash provided by operating activities was $0.1 million for the three months ended March 31, 2026. This consisted of a net loss of $4.5 million adjusted for non-cash charges of $0.4 million and net changes in operating assets and liabilities of $4.2 million. The non-cash charges were primarily driven by fair value of shares issued for services of $0.1 million and depreciation and amortization of $0.2 million. Changes in operating assets and liabilities were primarily attributable to decreases in accounts receivable of $3.5 million, increases in accounts payable of $1.4 million and accrued expenses of $0.2 million, partially offset by increase in inventory of $0.9 million.
Current report
There were no investing activities for the three months ended March 31, 2026.
Current report
Cash used by financing activities was $0.1 million for the three months ended March 31, 2026. This consisted primarily of proceeds from issuance of short-term loans to related parties of $0.3 million, offset by repayments of short-term loans of $0.5 million.
Current report
There have been no material changes to our critical accounting policies and estimates from those disclosed in our Annual Report on Form 10-K filed with the SEC on March 11, 2026. Refer to the section titled “Critical Accounting Policies and Estimates” included in that filing for a discussion of our significant judgments and estimates.
Removed paragraphs (44)
Previous report
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the unaudited condensed consolidated financial statements and related notes included elsewhere in this Quarterly Report on Form 10-Q and the audited financial statements of SEE ID as of and for the fiscal years ended December 31, 2024 and 2023 and the audited financial statements of SUAC as of and for the fiscal years ended December 31, 2024 and 2023 each included in thein the Current Report on Form 8-K filed with the SEC on June 26, 2025*. In addition to the unaudited condensed consolidated financial information, the following discussion contains forward-looking statements that reflect our plans, estimates, beliefs, and expectations that involve risks and uncertainties. Our actual results and the timing of events could differ materially from those discussed in these forward-looking statements. Factors that could cause or contribute to these differences include those discussed below and elsewhere in this Quarterly Report on Form 10-Q, particularly in Item 1A. “Risk Factors” and “Special Note Regarding Forward-Looking Statements”. Defined terms included below have the same meaning as terms defined and included elsewhere in this Quarterly Report on Form 10-Q.*
Previous report
Transaction costs
Previous report
The Company accounts for transaction costs incurred in connection with the Business Combination that occurred in June 2025, and therefore transaction costs expensed were not a component of our results of operations during 2024. Costs that are directly attributable to the issuance of equity instruments, such as legal, accounting, and advisory fees related to the merger and recapitalization, are recorded as a reduction to additional paid-in capital. All other transaction costs have been expensed as incurred.
Previous report
Loss from extinguishment of debt
Previous report
Prior to the Closing of the Business Combination, one lender elected to convert a portion of its outstanding principal and accrued interest into shares of Common Stock. In connection with the bridge loan conversion, the Company derecognized the liability, issued shares of Common Stock and recognized a loss on debt extinguishment, based on the fair value of the Common Stock at the date of Closing.
Previous report
For the three months ended September 30, 2025, total revenue increased by approximately $697 thousand, or 853.6%, to $778 thousand compared to $82 thousand for the same period in 2024. The increase was primarily attributable to product revenue recognized during the current quarter from sales of bridges, gateways, and labels to existing customers, partially offset by a $196 thousand revenue reversal tied to an updated estimate based on the timing of actual revenue recognized compared to the estimate utilized related to the $2 million exclusivity client payment. Based on expected $175 million client spend over the 5-year term to retain exclusivity, the Company refined its estimate to recognize the exclusivity payment as revenue across the full 5 years.
Previous report
Total cost of goods sold increased by $480 thousand, or 6,005.9%, to $488 thousand, reflecting higher material and labor costs associated with increased product sales. As a result, gross profit increased by $217 thousand, or 294.1%, to $290 thousand, compared to $74 thousand for the same period in 2024. Gross margin decreased to 37.3% from 90.2%, primarily due to the higher proportion of product sales, which generally carry lower margins.
Previous report
For the nine months ended September 30, 2025, total revenue increased by approximately $1,074 thousand, or 585.0%, to $1,258 thousand compared to $184 thousand for the same period in 2024. The increase was primarily attributable to product revenue recognized during the current period from sales of bridges, gateways, and labels to existing customers. Total cost of goods sold increased by $555 thousand, or 3,079.8%, to $573 thousand, reflecting higher material and labor costs associated with increased product sales. As a result, gross profit increased by $520 thousand, or 313.7%, to $685 thousand compared to $166 thousand for the same period in 2024. Gross margin decreased to 54.5% from 90.2%, primarily due to the higher proportion of product sales, which generally carry lower margins.
Previous report
Research and development (“R&D”) expenses were $397 thousand for the three months ended September 30, 2025, an increase of $210 thousand, or 112.7%, compared to $187 thousand for the same period in 2024. The increase was primarily driven by the onboarding of additional software and hardware development contractors, as well as higher personnel-related and prototype development costs to support new product initiatives. Our spending for research and development reflects our growing capacity to satisfy customer feature requests and continued investment in our technology roadmap. As a percentage of revenue, R&D expenses decreased to 51.0% from 228.7%, primarily due to significantly higher revenue in the current period.
Previous report
For the nine months ended September 30, 2025, research and development (“R&D”) expenses increased by $512 thousand, or 111.4%, to $973 thousand compared to $460 thousand in the prior-year period. The year-to-date increase was primarily driven by onboarding additional development contractors and expanding engineering activities in support of the Company’s long-term product innovation goals. R&D expenses represented 77.3% of total revenue for the nine months ended September 30, 2025, compared to 250.5% in the same period of 2024, reflecting improved operating leverage as revenue expanded.
Previous report
For the three months ended September 30, 2025, sales and marketing expenses totaled $1,112 thousand, an increase of $473 thousand, or 74.1%, compared to $639 thousand for the same period in 2024. The increase was primarily driven by enhanced functionality in our customer relationship management software, as well as additional investment in customer support to expand our sales and marketing capabilities We expect to further increase spending in the following quarter to leverage additional public investment and strengthen this department to drive growth.
Previous report
For the nine months ended September 30, 2025, sales and marketing expenses totaled $2,565 thousand, an increase of $802 thousand, or 45.5%, compared to $1,763 thousand in the same period of 2024, demonstrating the Company’s ongoing commitment to market expansion and revenue growth.
Previous report
General and administrative expense for the three and nine months ended September 30, 2025 and 2024 are summarized as follows:
Previous report
For the three months ended September 30, 2025, general and administrative expenses totaled $2,743 thousand, an increase of $2,236 thousand, or 441.1%, compared to $507 thousand in the same period last year. The increase is primarily driven by labor costs related to the ramp-up of operations, higher administrative support for business functions, and increased back-office headcount. For the nine months ended September 30, 2025, general and administrative expenses totaled $4,185 thousand, up $3,120 thousand, or 293.1%, compared to $1,064 thousand in the prior year, reflecting the continued expansion of operational infrastructure to support company growth.
Previous report
Acquisition and integration
Previous report
Acquisition and integration expense for the three and nine months ended September 30, 2025 and 2024 are summarized as follows:
Previous report
For the three months ended September 30, 2025, acquisition and integration expenses were $243 thousand, a decrease of $392 thousand, or 61.7%, compared to $635 thousand in the same period of 2024. The decrease reflects lower professional and consulting costs as the Company completed the Business Combination on June 18, 2025. For the nine months ended September 30, 2025, acquisition and integration expenses totaled $1,155 thousand, a decline of $346 thousand, or 23.1%, compared to $1,501 thousand in the prior year period. These expenses primarily consisted of accounting, auditing, and legal fees incurred in connection with the Business Combination, as well as other costs related to transaction execution and post-acquisition integration activities.
Previous report
Other expenses – SAFE agreements
Previous report
The tables below summarize the change in the fair value of SAFE agreements and the SAFE agreements activity for the three and nine months ended September 30, 2025 and 2024:
Previous report
For the three months ended September 30, 2025, there was no change in the fair value of SAFE notes, compared to a decrease of $0.8 million in the same period of 2024, representing a 100% decline. For the nine months ended September 30, 2025, the Company recorded a decrease in fair value of $17.4 million, compared to a decrease of $14.2 million in the prior year, an increase of $3.1 million, or 22%.
Previous report
At the beginning of the three-month period, no SAFE agreements were outstanding, compared to $22.7 million at the same point in 2024. During the nine months ended September 30, 2025, SAFE agreements at fair value decreased from $23.3 million to zero, following the conversion of all outstanding notes into 2,909,057 shares of Common Stock. No new SAFE agreements were issued for cash during the three months ended September 30, 2025. The change in fair value of $17.4 million for the nine months ended September 30, 2025, was based on the fair value of Common Stock at closing of $14.00 per share.
Previous report
The decrease in the balance of SAFE agreements was primarily driven by the increased estimated fair value of the Company and the higher probability of the Business Combination, which closed on June 18, 2025, qualifying as an “Equity Financing” under the terms of the Company’s SAFE agreements. As a result, all outstanding SAFE notes were converted into Common Stock, and no SAFE notes remained outstanding as of September 30, 2025.
Previous report
No purchase notices were issued during the three and nine months ended September 30, 2025. On October 13, 2025, the Company issued a purchase notice to sell 30,000 shares of its common stock. The purchase price was settled at $2.6172 per share, resulting in total cash proceeds of $78,516.
Previous report
Cash used in operating activities was $8.2 million for the nine months ended September 30, 2025. This consisted of a net loss of $34.4 million, adjusted for non-cash charges of $18.6 million, and changes in our operating assets and liabilities of $7.6 million. The non-cash charges were primarily composed of change in fair value of SAFE note expense of $17.4 million and loss on extinguishment of debt of $5.7 million.
Previous report
Cash used in investing activities was $1.4 million for the nine months ended September 30, 2025, which primarily consisted of $484 thousand of property and equipment purchases and $899 thousand of capital expenditures for internal-use software development costs.
Previous report
Cash provided by financing activities was $10.3 million for the nine months ended September 30, 2025, which primarily consisted of $10.8 million in proceeds from PIPE investors.
Previous report
While our significant accounting policies are more fully described in Note 2 to our condensed consolidated financial statements, we believe that the following accounting policies are the most critical to fully understanding and evaluating our financial condition and results of operations.
Previous report
Accounting for SAFE Agreements
Previous report
In accordance with FASB ASC 815 40,Contracts in Entity’s Own Equity, the Company determined the SAFE agreements are freestanding financial instruments and, accordingly, are classified as “liabilities” in the accompanying condensed consolidated balance sheets. The SAFE agreements are carried at estimated fair value determined by the Company using a probability weighted expected return method.
Previous report
Revenue Recognition
Previous report
The Company recognizes revenue in accordance with ASC 606,Revenue from Contracts with Customers. Revenue is recognized when promised goods or services are transferred to customers in an amount that reflects the consideration to which we expect to be entitled in exchange for those goods or services.
Previous report
We determine revenue recognition through the following steps:
Previous report
The Company primarily recognizes revenue from the sale and delivery of products. As it is still in the early stages of developing its software-as-a-service (SaaS) product, most revenue is derived from product sales, including bridges, gateways, and labels.
Previous report
We also offer feasibility studies which allow customers to gain insight into how data driven tracking could improve their business. As part of our studies, off-the-shelf components are installed on customer-owned assets which enable data to be captured by our beta Zero Infrastructure Mesh (“ZIM”) technology network. These feasibility studies allow the refinement of our software protocols and provide essential information for the continued development of our solution. Customers receive the information captured in our feasibility study reports.
Previous report
Our contracts with customers include various performance obligations which are satisfied at a point in time or over time. In reaching this conclusion, we considered the context of the contract and the nature of our promises to provide the customers with products and services.
Previous report
The product performance obligations are satisfied at a point in time, as our customers do not consume the benefits until the products are delivered. Accordingly, the consideration related to the performance obligations are recognized on when control of the products are transferred to the customer which is upon acceptance.
Previous report
The estimates involved in revenue recognition pertain to determination of the stand-alone selling price. Management considered the data inputs for the stand-alone selling price and determined that the adjusted market assessment approach provided the best estimate of the stand-alone selling price and the total products and services to be delivered over the term of the contract. The estimates applied have been reasonable in the past and the likelihood of change in estimate to impact the stand-alone selling price is remote.
Previous report
The Company entered into an exclusivity agreement on November 8, 2024, and a partner agreement on December 18, 2024, with a major reseller. The exclusivity agreement grants the reseller the exclusive right to sell the Company’s products for one year, with automatic renewal for up to four additional one-year periods if specified sales targets are achieved. The partner agreement provides a 5% purchasing incentive based on the reseller’s quarterly growth in total solution purchases and requires the Company to contribute at least 1% of revenue toward marketing activities, paid as a rebate. Management concluded that the exclusivity agreement, partner agreement, and future product purchase orders should be combined and accounted for as a single contract under ASC 606,Revenue from Contracts with Customers.
Previous report
In November 2024, the Company received a $2,000,000 payment from the reseller for a five-year exclusivity right, including four successive one year automatic renewal periods, granting the reseller exclusive rights to distribute the Company’s products to its customers. Since exclusivity does not represent a distinct performance obligation under ASC 606, the payment was recorded as deferred revenue. Revenue will be recognized over the contract term in proportion to the products and services delivered, based on estimated total sales over the five-year period. These estimates will be reviewed quarterly and adjusted based on the reseller’s actual performance. If the reseller fails to meet sales targets and the agreement is terminated, any remaining deferred revenue will be recognized at that time.
Previous report
Under ASC 606, both the incentive and rebate represent variable consideration, as they depend on actual sales volume. Management will estimate expected sales and related rebates to determine the transaction price and recognize revenue accordingly. The purchasing incentive and marketing rebate are not separate performance obligations, and variable consideration related to these incentives will be included in revenue only when it is probable that no significant reversal will occur once uncertainties are resolved. The Company will accrue the incentive amount at the end of each quarter when sales revenue is finalized.
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Reworded paragraphs (31)
Previous wording
Item 2. Management’s Discussion and Analysis of Financial Conditions and Results of Operations
Current wording
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
Previous wording
CID Holdco, Inc. (the “Company”, or “CID Holdco”, or “CID”), formerly known as SEE ID Inc., dba Dot AI (the “Legacy Company” or “SEE ID”), was incorporated in Delaware with its headquarters in Las Vegas, Nevada. The Company helps businesses transform their operations by optimizing safety, security and efficiency of operations through real-time tracking of resources. Through CID Holdco’s extensive research and development initiatives, CID Holdco’s main focus includes areas such as Industrial IoT, Indoor & Outdoor tracking with seamless transitions, Passive RFID (including Bluetooth and 5G), Collision Avoidance, real-time locating system, Dolly Management, and related supported software applications.
Current wording
CID Holdco, Inc. (the “Company”, or “CID Holdco”, or “CID”), formerly known as SEE ID Inc., dba Dot AI (the “Legacy Company” or “SEE ID”), was incorporated in Delaware with its headquarters in Las Vegas, Nevada. The Company helps businesses transform their operations by optimizing safety, security, and efficiency of operations through real-time tracking of resources. Through the Company’s extensive research and development initiatives, the Company’s main focus includes areas such as Industrial IoT, Indoor & Outdoor tracking with seamless transitions, Passive RFID (including Bluetooth and 5G), Collision Avoidance, real-time locating system, Dolly Management, and related supported software applications.
Previous wording
CID Holdco is the developer of an asset tracking platform intended to push the limits of near real-time precision-based location technology. CID Holdco’s platform leverages the technologies including the patented passive and active RFID tracking solutions, low power edge camera platforms utilizing artificial intelligence, enabling users to give accuracy to all mapping technologies in areas that are troublesome. Through its technological solutions, CID Holdco serves multiple industries including construction, military, mining, retail, warehousing and manufacturing.
Current wording
The Company is the developer of an asset tracking platform intended to push the limits of near real-time precision-based location technology. The Company’s platform leverages the technologies including the patented passive and active RFID tracking solutions, low power edge camera platforms utilizing artificial intelligence, enabling users to give accuracy to all mapping technologies in areas that are troublesome. Through its technological solutions, the Company serves multiple industries including construction, military, mining, retail, warehousing, and manufacturing.
Previous wording
We are headquartered in Las Vegas, NV with our management and administrative staff located in Bethesda, MD for East Coast customer engagements and government lobbying activity. We also manufacture hardware in Puerto Rico through our wholly owned subsidiary Dot Works. Our embedded development team and Design for Manufacturing (“DFM”) capability is built around our CTO in Worcester, MA and our core software team is in Bangalore, India.
Current wording
The Company is headquartered in Las Vegas, NV with our management and administrative staff located in Bethesda, MD for East Coast customer engagements and government lobbying activity. We also manufacture hardware in Puerto Rico through our wholly owned subsidiary Dot Works. Our embedded development team and Design for Manufacturing (“DFM”) capability is built around our Chief Technology Officer (“CTO”) in Worcester, MA and our core software team is in Bangalore, India.
Previous wording
Throughout the notes to the condensed consolidated financial statements, unless otherwise noted or otherwise suggested by context, the “Company”, “we”, “us”, “our” refers to the Legacy Company prior to the consummation of the Business Combination, and the Company after the consummation of the Business Combination.
Current wording
Throughout this Quarterly Report, unless otherwise noted or otherwise suggested by context, the “Company”, “we”, “us”, “our” refers to SEE ID and Dot Works, as applicable, prior to the consummation of the Business Combination (as defined below), and CID Holdco, SEE ID, and Dot Works, collectively, after the consummation of the Business Combination.
Previous wording
On June 18, 2025 (the “Closing Date”) the Company consummated the Business Combination transactions by and among the Company, ShoulderUp Technology Acquisition Corp (“SUAC” or “ShoulderUp”), ShoulderUp Merger Sub, Inc., SEI Merger Sub, Inc., and SEE ID, Inc. Pursuant to the Business Combination Agreement, on the Closing Date, (i) ShoulderUp Merger Sub merged with and into SUAC (the “ShoulderUp Merger”), with SUAC surviving the ShoulderUp Merger as a wholly-owned subsidiary of the Company (“SUAC Surviving Company”); and (ii) simultaneously with the ShoulderUp Merger, SEI Merger Sub merged with and into SEE ID (“the SEE ID Merger”), with SEE ID surviving the SEE ID Merger as a wholly-owned subsidiary of the Company (the “Surviving Company”) (the ShoulderUp Merger and the SEE ID Merger, together the “Mergers” and together with the other transactions contemplated by the Business Combination Agreement, the “Business Combination”).
Current wording
On June 18, 2025 (the “Closing Date”) the Company consummated the Business Combination transactions by and among the Company, ShoulderUp Technology Acquisition Corp (“SUAC” or “ShoulderUp”), ShoulderUp Merger Sub, Inc., SEI Merger Sub, Inc., and SEE ID, Inc. Pursuant to the Business Combination Agreement, on the Closing Date, (i) ShoulderUp Merger Sub merged with and into SUAC (the “ShoulderUp Merger”), with SUAC surviving the ShoulderUp Merger as a wholly-owned subsidiary of the Company; and (ii) simultaneously with the ShoulderUp Merger, SEI Merger Sub merged with and into SEE ID (“the SEE ID Merger”), with SEE ID surviving the SEE ID Merger as a wholly-owned subsidiary of the Company (the ShoulderUp Merger and the SEE ID Merger, together the “Mergers” and together with the other transactions contemplated by the Business Combination Agreement, the “Business Combination”).
Previous wording
In connection with the Business Combination, CID Holdco filed a registration statement on Form S-4 (File No. 333-282600) (as amended, the “Registration Statement”) with the U.S. Securities and Exchange Commission (the “SEC”). On June 18, 2025, the Registration Statement was declared effective by the SEC. At Closing, the assets and liabilities of Legacy Company were combined with the assets and liabilities ShoulderUp Technology Acquisition Corp on a historical cost basis. All Legacy Company Common Stock was exchanged for Common Stock of the Company based upon the exchange ratio as defined in the Business Combination Agreement as Aggregate Merger Consideration (13,000,000 CID Holdco shares) divided by the Company Fully Diluted Common Stock (159,915,641) or 8.129%. Stock options of Legacy Company were not exercised and remain outstanding after giving into effect the exchange ratio. In connection with the Business Combination, we incurred transaction costs, settled certain SUAC related party notes through the issuance of common shares, converted SAFE notes into Common Stock of the Company, and raised cash proceeds from PIPE investors. Additional information regarding the Business Combination and Reverse Recapitalization is provided in Note 3 to the unaudited condensed consolidated financial statements.
Current wording
In connection with the Business Combination, CID Holdco filed a registration statement on Form S-4 (File No. 333-282600) (as amended, the “Registration Statement”) with the U.S. Securities and Exchange Commission (the “SEC”). On June 18, 2025, the Registration Statement was declared effective by the SEC. At Closing, the assets and liabilities of Legacy Company were combined with the assets and liabilities ShoulderUp Technology Acquisition Corp on a historical cost basis. All Legacy Company Common Stock was exchanged for Common Stock of the Company based upon the exchange ratio as defined in the Business Combination Agreement as Aggregate Merger Consideration (13,000,000 CID Holdco shares) divided by the Company Fully Diluted Common Stock (159,915,641) or 8.129%. Stock options of Legacy Company were not exercised and remain outstanding after giving into effect the exchange ratio. In connection with the Business Combination, we incurred transaction costs, settled certain SUAC related party notes through the issuance of common shares, converted SAFE notes into Common Stock of the Company, and raised cash proceeds from PIPE investors. Additional information regarding the Business Combination and Reverse Recapitalization is provided in Note 3 to the condensed consolidated financial statements.
Previous wording
We believe that we have a substantial opportunity to grow our customer base. We intend to drive new customers by continuing to invest significantly in sales and marketing to engage our prospective customers, increase brand awareness, and drive adoption of our Dot Cloud platform. Our ability to attract new customers depends on a number of factors, including the effectiveness of our sales and marketing efforts, macroeconomic factors and their impact on our customers’ businesses, and the success of our efforts to expand internationally.
Current wording
We believe that we have a substantial opportunity to grow our customer base. We intend to drive new customer acquisition by continuing to invest significantly in sales and marketing to engage our prospective customers, increase brand awareness, and drive adoption of our Dot Cloud platform. Our ability to attract new customers depends on a number of factors, including the effectiveness of our sales and marketing efforts, macroeconomic factors and their impact on our customers’ businesses, and the success of our efforts to expand internationally.
Previous wording
We believe that there is a significant opportunity to expand sales to existing customers following their initial adoption of our Dot Cloud. We will expand our customer base by selling more applications and expanding use of existing applications across geographies and divisions. Our ability to expand within our customer base will depend on a number of factors, including our customers’ satisfaction, pricing, competition, macroeconomic factors, and changes in our customers’ spending levels. While there are many factors involved in this expansion, the Customer Success department will be the key internal driver to retention and expansion of customer revenue. At this juncture, it is not a significant part of our operational expense but will require additional investment as our bookings increase and our channel support requirements come online.
Current wording
We believe that there is a significant opportunity to expand sales to existing customers following their initial adoption of our Dot Cloud. We will expand our customer base by selling more applications and expanding use of existing applications across geographies and divisions. Our ability to expand within our customer base will depend on a number of factors, including our customers’ satisfaction, pricing, competition, macroeconomic factors, and changes in our customers’ spending levels. While there are many factors involved in this expansion, the Customer Success department will be the key internal driver to retention and expansion of customer revenue. At this juncture, it is not a significant part of our operational expense but will be built out as our bookings increase and our channel support requirements come online.
Previous wording
Our market leadership is supported by continuous innovation in our Dot Cloud, our inventions in IoT data collection and our advances in applying AI to our customer problem sets. We will continuously invest in adding new applications and methods to our solutions. As such, spending on research and development will always be an important part of our strategy.
Current wording
Our market leadership is supported by continuous innovation in our Dot Cloud, our inventions in IoT data collection and our advances in applying AI to our customer problem sets. We will continuously invest in adding new applications and methods to our solutions. As such, spending on research and development will always be an important part of our strategy, however, the driving force that will fuel our company is market growth. Our recent pivot to move most of our spending to Sales and Marketing shows a commitment to our go-to-market strategy. We recognize the need to increase adoption and expand brand awareness as we increase market share.
Previous wording
Cost of goods sold will consists primarily of cellular-related costs, third-party cloud infrastructure expenses, customer support costs, warranty charges, employee-related costs directly associated with our customer support and operations, including salaries, employee benefits and share-based compensation, amortization of internal-use software development, certain cloud computing implementation costs, expenses related to shipping and handling, packaging, fulfillment, warehousing, write-downs of excess and obsolete inventory, and allocated overhead costs.
Current wording
Cost of goods sold consists primarily of cellular-related costs, third-party cloud infrastructure expenses, customer support costs, warranty charges, employee-related costs directly associated with our customer support and operations, including salaries, employee benefits and share-based compensation, amortization of internal-use software development, certain cloud computing implementation costs, expenses related to shipping and handling, packaging, fulfillment, warehousing, write-downs of excess and obsolete inventory, and allocated overhead costs.
Previous wording
Interest expense consists primarily of interest incurred for our short-term bridge loans.
Current wording
Interest expense consists primarily of interest incurred for our short-term loans.
Previous wording
Our total revenue, cost of goods sold, gross profit, and gross margin for the three and nine months ended September 30, 2025 and 2024 are summarized as follows:
Current wording
Our total revenue, cost of goods sold, gross profit, and gross margin for the three months ended March 31, 2026 and 2025 are summarized as follows:
Previous wording
Research and development expenses for the three and nine months ended September 30, 2025 and 2024 are summarized as follows:
Current wording
Research and development expenses for the three months ended March 31, 2026 and 2025 are summarized as follows:
Previous wording
Sales and marketing expenses for the three and nine months ended September 30, 2025 and 2024 are summarized as follows:
Current wording
Sales and marketing expenses for the three months ended March 31, 2026 and 2025 are summarized as follows:
Previous wording
Liquidity is a measure of our ability to access sufficient cash flows to meet the short-term and long-term cash requirements of our business operations. To date, we have funded our operations primarily with proceeds from the issuance of common shares to PIPE investors contemporaneously with the close of the Business Combination. Our future capital requirements will depend on many factors, including, but not limited to, our growth, our ability to attract and retain customers, the continued market acceptance of our solution, the timing and extent of spending necessary to support our efforts to develop our Dot Cloud and meet our performance obligations related to subscription sales of the same, the expansion of sales and marketing activities, and the impact of macroeconomic conditions on us and our customers’ and partners’ businesses. Further, we may enter into arrangements to acquire or invest in businesses, products, services, and technologies. We will need to raise additional capital in the future to finance our operations and expand our business.
Current wording
Liquidity is a measure of our ability to access sufficient cash flows to meet the short-term and long-term cash requirements of our business operations. To date, we have funded our operations primarily with proceeds from the issuance of shares of our Common Stock to PIPE investors contemporaneously with the close of the Business Combination, proceeds from bridge loans and other short-term borrowings. Our future capital requirements will depend on many factors, including, but not limited to, our growth, our ability to attract and retain customers, the continued market acceptance of our solution, the timing and extent of spending necessary to support our efforts to develop our Dot Cloud and meet our performance obligations related to subscription sales of the same, the expansion of sales and marketing activities, and the impact of macroeconomic conditions on us and our customers’ and partners’ businesses. Further, we may enter into arrangements to acquire or invest in businesses, products, services, and technologies. We will need to raise additional capital in the future to finance our operations and expand our business.
Previous wording
In connection with the Company’s assessment of going concern considerations in accordance with FASB ASC Topic 205-40, “Presentation of Financial Statements — Going Concern,” management anticipates the Company will continue to incur substantial operating losses for the next several years and will need to obtain additional near-term financing in order to continue its research and development activities. Our ability to continue as a going concern is dependent on its ability to raise additional capital to fund research and development activities and meet obligations on a timely basis. However, there can be no assurance that sufficient funding will be available to allow us to successfully continue our research and development activities and commercialize our products.
Current wording
In connection with the Company’s assessment of going concern considerations in accordance with the Financial Accounting Standards Board (“FASB”) ASC Topic 205-40,Presentation of Financial Statements — Going Concern, management anticipates the Company will continue to incur substantial operating losses for the next several years and will need to obtain additional near-term financing in order to continue its research and development activities. Our ability to continue as a going concern is dependent on our ability to raise additional capital to fund research and development activities and meet obligations on a timely basis; however, there can be no assurance that sufficient funding will be available to allow us to successfully continue our research and development activities and commercialize our products.
Previous wording
If the Company is unable to obtain necessary funds through its business operations and the proceeds realized through the business combination, significant reductions in spending and the delay or cancellation of planned activities may be necessary. These actions would have a material adverse effect on our business, results of operations, and prospects. These conditions raise substantial doubt about our ability to continue as a going concern within one year from the date these interim unaudited consolidated financial statements are issued.
Current wording
If the Company is unable to obtain necessary funds through its business operations and the proceeds realized through the Business Combination, significant reductions in spending and the delay or cancellation of planned activities may be necessary. These actions would have a material adverse effect on our business, results of operations, and prospects. These conditions raise substantial doubt about our ability to continue as a going concern within one year from the date these condensed consolidated financial statements are issued.
Previous wording
As of September 30, 2025 and December 31, 2024, we had cash of $1,418,834 and $721,032, respectively, and working capital deficit of $5,404,007 and $1,215,988, respectively.
Current wording
As of March 31, 2026 and December 31, 2025, we had cash of $853,728 and $865,624, respectively, deficits in working capital of $5,828,944 and $1,730,095, respectively, and accumulated deficits of $65,916,502 and $61,451,334, respectively.
Previous wording
To date, we have funded our operations primarily with proceeds from the issuance of common shares to PIPE investors contemporaneously with the close of the Business Combination in the amount of $10,837,643 and proceeds from the issuance of bridge loans. As of September 30, 2025, we had cash of $1,418,834. In the future, we expect to finance our cash needs through a combination of equity, debt financings, and improvement of cash from operations derived from selling subscriptions to our platform.
Current wording
To date, we have funded our operations primarily through proceeds from the issuance of common shares to PIPE investors in connection with the closing of the Business Combination, totaling $10,837,643, proceeds from bridge loans and other short-term borrowings. In the future, we expect to finance our cash needs through a combination of equity, debt financings, and improvement of cash from operations derived from selling subscriptions to our platform.
Previous wording
As part of its funding efforts, on June 18, 2025, the Company entered into a Standby Equity Purchase Agreement (“SEPA”) with New Circle Principal Investment LLC (“New Circle”), which provides the Company the right, but not the obligation, to direct New Circle from time to time to purchase up to $50 million of the Company’s Common Shares during the commitment period ending June 18, 2028, at a discount of the volume-weighted average price (VWAP) over a defined pricing period. Under the SEPA, the Company may sell shares to the New Circle at a price based on either: option 1 – 97% of the lowest daily VWAP over the three trading days following the purchase notice, or option 2 – the greater of 85% of the VWAP or the lowest sale price on a specific trading day determined by the timing of the notice.
Current wording
As part of its funding efforts, on June 18, 2025, the Company entered into a Standby Equity Purchase Agreement (“SEPA”) with New Circle Principal Investment LLC (“New Circle”), which provides the Company the right, but not the obligation, to direct New Circle from time to time to purchase up to $50 million of shares of the Company’s Common Shares during the commitment period ending June 18, 2028, at a discount of the VWAP over a defined pricing period. Under the SEPA, the Company may sell shares to New Circle at a price based on either: option 1 – 97% of the lowest daily VWAP over the three trading days following the purchase notice, or option 2 – the greater of 85% of the VWAP or the lowest sale price on a specific trading day determined by the timing of the notice.
Previous wording
Before the Company elects to sell shares by issuing a purchase notice, the SEPA represents a purchased put option on the Company’s equity. Once the Company delivers a purchase notice under the SEPA, the related number of shares to be issued constitutes a forward contract to issue common stock. As the feature is embedded in an equity host, meets the definition of a derivative, and does not qualify for the equity scope exception under ASC 815Derivatives and Hedging, it must be bifurcated and accounted for separately as a derivative asset or liability, depending on changes in the underlying stock price relative to the pegged discounted VWAP. The derivative is measured at fair value, with changes in fair value recognized in net income. The fair value of the purchased put option was determined to be de minimis as of September 30, 2025, and therefore was not recorded on the Company’s balance sheet as of that date.
Current wording
Before the Company elects to sell shares by issuing a purchase notice, the SEPA represents a purchased put option on the Company’s equity. Once the Company delivers a purchase notice under the SEPA, the related number of shares to be issued constitutes a forward contract to issue shares of Common Stock. As the feature is embedded in an equity host, meets the definition of a derivative, and does not qualify for the equity scope exception under ASC 815,Derivatives and Hedging, it must be bifurcated and accounted for separately as a derivative asset or liability, depending on changes in the underlying stock price relative to the pegged discounted VWAP. The derivative is measured at fair value, with changes in fair value recognized in net income. The fair value of the purchased put option was determined to be de minimis as of March 31, 2026, and therefore was not recorded on the Company’s balance sheet as of that date.
Previous wording
Comparison of Three and nine months Ended September 30, 2025 and 2024.
Current wording
Comparison of three months ended March 31, 2026 and 2025
Previous wording
Our largest source of operating cash is investments made by our shareholders. Our primary uses of cash from operating activities are for employee-related expenditures, sales and marketing expenses, inventory purchases, and research & development activities. We generated negative cash flows from operations in the preceding two fiscal years. We have supplemented working capital through net proceeds from the sale of equity securities and bridge loans.
Current wording
Our largest source of operating cash is investments made by our shareholders. Our primary uses of cash from operating activities are for employee-related expenditures, sales and marketing expenses, inventory purchases, and research & development activities. We have supplemented working capital through net proceeds from the sale of equity securities and bridge loans.
Previous wording
Cash used in operating activities was $3.1 million for the nine months ended September 30, 2024. This consisted of a net loss of $18.9 million, adjusted for non-cash charges of $14.4 million, and changes in our operating assets and liabilities of $1.3 million. The non-cash charges were primarily composed of change in fair value SAFE note expense of $14.2 million.
Current wording
Cash used in operating activities was $1.7 million for the three months ended March 31, 2025. This consisted of a net loss of $1.3 million, adjusted for non-cash charges of approximately $0.6 million and net changes in operating assets and liabilities of approximately $0.2 million. Non-cash charges were primarily driven by a $0.6 million change in the fair value of SAFE notes. Changes in operating assets and liabilities were primarily attributable to a decrease in deferred revenue of $0.1 million and increase in interest payable of $0.2 million.
Previous wording
Cash used in investing activities was $579 thousand for the nine months ended September 30, 2024, which consisted of capital expenditures for internal-use software development costs.
Current wording
Cash used in investing activities was $0.3 million for the three months ended March 31, 2025, which consisted of capital expenditures for internal-use software development costs.
Previous wording
Cash provided by financing activities was $3.8 million for the nine months ended September 30, 2024, which consisted of $3.8 million of proceeds from issuance of SAFE notes.
Current wording
Cash provided by financing activities was $1.6 million for the three months ended March 31, 2025, which consisted of proceeds from the issuance of bridge loans.
Previous wording
Our estimated future obligations consist of leases and non-cancelable purchase commitments as of September 30, 2025. For additional discussion on our leases and other commitments, refer to Note 13 –Leases and Note 15 –Commitments and Contingencies to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q.
Current wording
Our estimated future obligations consist of leases and non-cancelable purchase commitments as of March 31, 2026. For additional discussion on our leases and other commitments, refer to Note 13 –Leases and Note 17 –Commitments and Contingencies to our condensed consolidated financial statements for the three months ended March 31, 2026 included elsewhere in this Quarterly Report on Form 10-Q.
Previous wording
Our management’s discussion and analysis of our financial condition and results of operations is based on our financial statements, which have been prepared in accordance with generally accepted accounting principles in the United States, or GAAP. The preparation of these financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported revenues and expenses during the reporting periods. We evaluate these estimates and judgments on an ongoing basis. We base our estimates on historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Our actual results may differ from these estimates under different assumptions or conditions.
Current wording
Our management’s discussion and analysis of our financial condition and results of operations is based on our financial statements, which have been prepared in accordance with U.S. GAAP. The preparation of these financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, and expenses, as well as related disclosures. Actual results may differ from those estimates under different assumptions or conditions.
Previous wording
We describe the recently issued accounting pronouncements that apply in Note 2 of the unaudited condensed consolidated financial statements as of and for the three and nine months ended September 30, 2025.
Current wording
We describe the recently issued accounting pronouncements that apply in Note 2 of the condensed consolidated financial statements as of and for the three months ended March 31, 2026.
Previous wording
Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non- emerging growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that when an accounting standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised accounting standard at the time private companies adopt the new or revised standard.
Current wording
Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to nonemerging growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that when an accounting standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised accounting standard at the time private companies adopt the new or revised standard.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
However, the driving force that will fuel our company is market growth. Our recent pivot to move most of our spending to Sales and Marketing shows a commitment to our go-to-market strategy. We recognize the need to increase adoption and expand brand awareness as we increase market share. This fiscal year is a critical period to add productive resources to ensure success is sustained.