Peraso Inc.
For the period ended Mar 31, 2026. Filed May 14, 2026.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2026 · Filed May 14, 2026
PRSO$0.35+0.2%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 2025-11-12.
0001213900-25-108587
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-03-31; filed 2026-05-14.
0001213900-26-056603
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 73 previous paragraphs and 66 current paragraphs.
37 unchanged; 23 reworded; 5 added; 12 removed; 1 previous and 1 current paragraphs rearranged.
Tables are not compared: 23 previous and 21 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 (5)
Current report
On January 21, 2026, Mobix Labs issued a press release, and we filed a Current Report on Form 8-K disclosing that the Company and Mobix Labs continue to engage in discussions regarding a potential strategic transaction and are conducting customary, confidential diligence and that Mobix Labs delivered to the Company a non-binding indication of interest contemplating a potential all-stock transaction at a premium to the Company’s trading price, subject to further diligence, negotiation, and the execution of definitive documentation.
Current report
ATM Offering
Current report
On August 30, 2024, we entered into an At The Market Offering Agreement (the “Sales Agreement”) with Ladenburg Thalmann & Co. Inc. (“Ladenburg”) with respect to an “at the market” offering program, under which we may, from time to time, in our sole discretion, issue and sell through Ladenburg, acting as agent or principal, shares of our common stock. The Sales Agreement provides that Ladenburg will be entitled to compensation for its services equal to 3.0% of the gross proceeds from sales of any shares of common stock pursuant to the Sales Agreement in addition to the reimbursement of certain expenses. We have no obligation to sell any shares pursuant to the Sales Agreement and either we or Ladenburg may terminate the Sales Agreement in accordance with its terms. During the twelve months ended December 31, 2025 and 2024, we sold 3,713,939 and 251,621 shares, respectively, of common stock for net proceeds of approximately $4,351,100 and $336,000, respectively, pursuant to the Sales Agreement. During the three months ended March 31, 2026, we sold 2,371,943 shares of common stock for net proceeds of approximately $2,303,484 pursuant to the Sales Agreement. Subsequent to March 31, 2026, we have sold 2,104,742 shares of common stock for net proceeds of approximately $2,061,205 through May 12, 2026. We currently have no amounts registered for sale under the Sales Agreement. We intend to file a new prospectus supplement under our existing shelf registration statement on Form S-3 following the filing of this Quarterly Report on Form 10-Q to register additional shares of common stock for sale under the Sales Agreement. The amount available for sale under any such prospectus supplement will be subject to limitations under General Instruction I.B.6 of Form S-3, which limits the aggregate market value of securities that may be sold by us during any 12-month period, as well as market conditions and other factors.
Current report
Gross profit decreased for the three months ended March 31, 2026 compared with the same period of 2025, primarily due to the reduction in product revenues, partially offset by increased services and other revenues. During the three months ended March 31, 2026 and 2025, mmWave inventory with values of approximately $182,000 and $94,000, respectively, which was written down prior to January 1, 2026, was sold to customers.
Current report
Net cash provided by financing activities for the three months ended March 31, 2025 comprised $0.4 million of net proceeds from sales of our common stock under the Sales Agreement, partially offset by repayment of financing lease liabilities.
Removed paragraphs (12)
Previous report
2025 Warrant Inducement Offering
Previous report
On September 11, 2025, we entered into an inducement offer letter agreement (the “2025 Inducement Letter”) with a holder (the “Series C Holder”) of Series C Warrants to purchase up to an aggregate of 952,380 shares of common stock, having an original exercise price of $1.61 per share, issued to the Series C Holder on November 6, 2024. Pursuant to the 2025 Inducement Letter, the Series C Holder agreed to exercise for cash its Series C Warrants at a reduced exercise price of $1.18 per share in consideration for our agreement to issue in a private placement new Series E common stock purchase warrants (the “Series E Warrants”) to purchase an aggregate of 952,380 shares of common stock. The Series E Warrants have an exercise price of $1.25 per share, will be exercisable upon the six-month anniversary of the date of issuance and will have a term of exercise of 5.5 years from the initial exercise date. The warrant inducement offering closed on September 12, 2025, and resulted in net proceeds to us of approximately $0.9 million, after deducting placement agent fees and other offering expenses payable by us.
Previous report
Compliance with Nasdaq Minimum Bid Price Requirement
Previous report
On September 5, 2025, we received a letter from the Listing Qualifications Staff of The Nasdaq Stock Market LLC (“Nasdaq”) indicating that, based upon the closing bid price of our common stock for the 30 consecutive business days ending on September 4, 2025, we no longer met the requirement to maintain a minimum bid price of $1 per share, as set forth in Nasdaq Listing Rule 5550(a)(2). On September 19, 2025, we received a notification letter from Nasdaq notifying us that we had regained compliance with the minimum bid price requirement.
Previous report
Gross profit remained flat for the three months ended September 30, 2025 compared with the same period of 2024, despite the decrease in total net revenue, primarily due to product revenue mix, increased contribution from royalty and other revenues and sales of mmWave inventory with a cost of approximately $0.3 million that had been written down in prior periods.
Previous report
Gross profit remained relatively flat for the nine months ended September 30, 2025 compared with the same period of 2024, despite the decrease in total net revenue, primarily due to product revenue mix and sales of mmWave inventory with a cost of approximately $0.6 million that had been written down in prior periods.
Previous report
The decrease for the three and nine months ended September 30, 2025 compared with the same periods of 2024 was primarily due to: i) reduced salary and consulting costs, as we implemented reductions in force during 2024 and terminated consultant contracts, ii) reduced rent expense, as our San Jose office lease expired in January 2025, and iii) reduced software license expense, as during the three and nine months ended September 30, 2024, we accrued the value of certain of our software license obligations (see Note 4 to the condensed consolidated financial statements in Part I, Item 1 of this Quarterly Report on Form 10-Q).
Previous report
Severance and Software License Obligations
Previous report
In November 2023, we implemented an employee lay-off and terminated certain consulting positions (the “Reductions”) to reduce operating expenses and cash burn, as we prioritized business activities and projects that we believe will have a higher return on investment. As part of the Reductions, we implemented a temporary lay-off that impacted 16 employees (the “Employees”) of Peraso Tech. During the six months ended June 30, 2024, we determined that we would not recall any of the 11 Employees that remained on our payroll and commenced notifying the remaining Employees that their employment would be terminated. As a result, we recorded severance charges of approximately $0.4 million for each of the three and six months ended June 30, 2024. The severance liabilities were fully paid as of September 30, 2025.
Previous report
As a result of the decision to not recall the Employees, we determined that it was probable that a number of our non-cancelable licenses for computer-aided design software would not be utilized during the remaining license terms. During the three months ended June 30, 2024, we expensed the value of the remaining contractual liabilities and recorded liabilities of approximately $1.6 million. During the three months ended June 30, 2025, a licensor terminated one of the license agreements and initiated a refund of approximately $56,300 for amounts previously paid by us. As a result, we reversed approximately $222,600 of expense and approximately $166,300 of the related contractual liabilities for this licensor during the three months ended June 30, 2025. As of September 30, 2025, the remaining contractual liabilities of approximately $0.2 million were recorded in accounts payable and are expected to be paid by December 31, 2025.
Previous report
Net cash provided by financing activities of $3.6 million for the nine months ended September 30, 2024 primarily comprised $3.4 million in net proceeds from a public offering of our common stock and common stock purchase warrants completed in February 2024 and a $0.1 million sale of unregistered stock to a member of our board of directors, $0.2 million of net proceeds from at-the-market sales of stock, which was partially offset by $0.1 million for repayment of finance lease liabilities.
Previous report
As further discussed in Note 9 to the condensed consolidated financial statements, we completed warrant inducement offerings in September 2025 and November 2024 for net proceeds of approximately $0.9 million and $2.6 million, respectively. Additionally, as further discussed in Note 8 to the condensed consolidated financial statements, on August 30, 2024, we entered into the Sales Agreement with Ladenburg, pursuant to which we may offer and sell, from time to time at our sole discretion, shares of our common stock through Ladenburg as agent and/or principal (subject to the limitations of General Instruction I.B.6 of Form S-3) through an at-the-market program. During the three and nine months ended September 30, 2025, we sold 733,049 and 2,003,207 shares of common stock for proceeds of approximately $751,200 and $2,270,200 (net of commissions of approximately $23,000 and $70,000 paid to Ladenburg), respectively, pursuant to the Sales Agreement. On October 10, 2025, we increased the maximum aggregate offering amount of common stock issuable pursuant to the Sales Agreement to $1,750,000. Further, during 2023 and 2024, we implemented reductions in our workforce and eliminated 19 full-time equivalent positions. These cost reduction actions were intended to preserve cash, as we kept capital expenditures to minimum levels in order to reduce operating costs and our short-term cash needs.
Reworded paragraphs (23)
Previous wording
Our strategy and primary business objective is to be a profitable, IP-rich fabless semiconductor company offering integrated circuits, or ICs, antenna modules and related non-recurring engineering services. We specialize in the development of mmWave semiconductors, primarily in the unlicensed 60 GHz spectrum band for 802.11ad/ay-compliant devices and in the 28/39 GHz spectrum bands for 5G-compliant devices. We derive our revenue from selling semiconductor devices, as well as antenna modules based on using those mmWave semiconductor devices. We have pioneered a high-volume mmWave IC production test methodology using standard, low-cost production test equipment. It has taken us several years to refine performance of this production test methodology, and we believe this places us in a leadership position in addressing the operational challenges of delivering mmWave products into high-volume markets. We also produce and sell complete mmWave antenna modules. The primary advantage provided by our antenna modules is that our proprietary mmWave ICs and the antenna are integrated into a single device. A differentiating characteristic of mmWave technology is that the RF amplifiers must be as close as possible to the antenna to minimize loss. With our module, we can guarantee the performance of the amplifier/antenna interface and simplify customers’ radio frequency, or RF, engineering, facilitating more opportunities for customer prospects that have not provided RF-type systems, as well as shortening the time to market for new products.
Current wording
Our strategy and primary business objective is to be a profitable, IP-rich fabless semiconductor company offering integrated circuits, or ICs, antenna modules and related non-recurring engineering services. We specialize in the development of mmWave semiconductors, primarily in the unlicensed 60 GHz spectrum band for 802.11ad/ay-compliant devices and in the 28/39 GHz spectrum bands for 5G-compliant devices. We derive our revenue from selling semiconductor devices, as well as antenna modules based on using those mmWave semiconductor devices. We have pioneered a high-volume mmWave IC production test methodology using standard, low-cost production test equipment. It has taken us several years to refine performance of this production test methodology, and we believe this places us in a leadership position in addressing the operational challenges of delivering mmWave products into high-volume markets. We also produce and sell complete mmWave antenna modules. The primary advantage provided by our antenna modules is that our proprietary mmWave ICs and the antenna are integrated into a single device. A differentiating characteristic of mmWave technology is that the RF amplifiers must be as close as possible to the antenna to minimize loss. Our module is designed to enhance the performance of the amplifier/antenna interface and simplify customers’ radio frequency (“RF”) engineering, facilitating more opportunities for customer prospects that have not provided RF-type systems, as well as shortening the time to market for new products.
Previous wording
We also had a memory product line comprising our Bandwidth Engine IC products. Taiwan Semiconductor Manufacturing Corporation, or TSMC, the sole foundry that manufactured the wafers used to produce our memory IC products, discontinued the foundry process used to produce such wafers. As a result, in May 2023, we initiated an end-of-life, or EOL, of our memory IC products, and, in March 2025, we fulfilled all then-outstanding EOL orders for our memory IC products. Since March 2025, we received additional purchase orders totaling approximately $452,800 from customers for remaining inventory. We recorded approximately $72,000 of product revenue from these purchase orders during the three months ended September 30, 2025.
Current wording
We also had a memory product line comprising our Bandwidth Engine IC products. Taiwan Semiconductor Manufacturing Corporation, or TSMC, the sole foundry that manufactured the wafers used to produce our memory IC products, discontinued the foundry process used to produce such wafers. As a result, in May 2023, we initiated an end-of-life, or EOL, of our memory IC products, and, in March 2025, we fulfilled all then-outstanding EOL orders for our memory IC products. Subsequent to March 2025, we received additional purchase orders and recorded revenue totaling approximately $0.5 million during the second half of 2025. During the three months ended March 31, 2026, we received an additional purchase order and recorded revenue totaling approximately $20,000.
Previous wording
We incurred net losses of approximately $3.5 million for the nine months ended September 30, 2025 and $10.7 million for the year ended December 31, 2024, and we had an accumulated deficit of approximately $180.6 million as of September 30, 2025. These and prior year losses have resulted in significant negative cash flows and historically have required us to raise substantial amounts of additional capital. As discussed below, this raises significant doubt about our ability to continue as a going concern. We will need to increase revenues substantially beyond levels that we have attained in the past in order to generate sustainable operating profit and sufficient cash flows to continue doing business without raising additional capital from time to time.
Current wording
We incurred net losses of approximately $2.5 million for the three months ended March 31, 2026 and $4.8 million for the year ended December 31, 2025, and we had an accumulated deficit of approximately $184.4 million as of March 31, 2026. These and prior year losses have resulted in significant negative cash flows and historically have required us to raise substantial amounts of additional capital. As discussed below, this raises significant doubt about our ability to continue as a going concern. We will need to increase revenues substantially beyond levels that we have attained in the past in order to generate sustainable operating profit and sufficient cash flows to continue doing business without raising additional capital from time to time.
Previous wording
Our board of directors is evaluating the Company’s options to enhance stockholder value. Our board of directors and management team are committed to acting in the best interests of all stockholders. Consistent with its fiduciary duties and in consultation with the Company’s financial and legal advisors, our board of directors will carefully review Mobix Labs’ proposal to determine the course of action that it believes is in the best interest of the Company and its stockholders. We do not intend to make further comments regarding potential transactions or provide any public updates regarding proposed or potential transactions, unless required by applicable law or a regulatory body. There can be no assurance that any transaction will be completed at this price or at any other price with such third party or any other third party.
Current wording
Our board of directors continues to evaluate the Company’s options to enhance stockholder value. Our board of directors and management team are committed to acting in the best interests of all stockholders. Consistent with its fiduciary duties and in consultation with the Company’s financial and legal advisors, our board of directors will continue to carefully review Mobix Labs’ proposal to determine the course of action that it believes is in the best interest of the Company and its stockholders. We do not intend to make further comments regarding potential transactions or provide any public updates regarding proposed or potential transactions, unless required by applicable law or a regulatory body. There can be no assurance that any transaction will be completed with Mobix Labs or any other third party.
Previous wording
The following table details revenue by product category for the three and nine months ended September 30, 2025 and 2024:
Current wording
The following table details revenue by product category for the three months ended March 31, 2026 and 2025:
Previous wording
Product revenue decreased for the three and nine months ended September 30, 2025 compared with the same periods of 2024 primarily due to the decrease in our memory IC product shipments attributable to the significant reduction in EOL shipments subsequent to March 2025. The decreases were partially offset by an increase in shipments of our mmWave ICs and antenna modules.
Current wording
Product revenue decreased for the three months ended March 31, 2026 compared with the same period of 2025 primarily due to the decrease in sales of our memory IC products due to the significant decrease in EOL shipments and decreases in shipments of our mmWave ICs and antenna modules. The decline in mmWave product shipments during the three months ended March 31, 2026 also reflected the delayed shipment of a sizable order due to material availability constraints from one of our suppliers, as well as subdued near-term demand from existing fixed wireless access customers. The delayed order was shipped subsequent to March 31, 2026.
Previous wording
Royalty and other revenue includes royalty, non-recurring engineering services and license revenues. The increase in royalty and other revenue for the three months ended September 30, 2025 compared with the same period of 2024 was primarily due to an increase in non-recurring engineering services revenue related to our mmWave technology attributable to a statement of work entered into in July 2025. The decrease in royalty and other revenue for the nine months ended September 30, 2025 compared with the same period of 2024 was primarily due to a decrease in royalty revenues from licensees of our memory technology due to reduced shipments by these licensees, which we attribute to the discontinuation of the foundry process by TSMC.
Current wording
Services and other revenue includes royalty, non-recurring engineering services and license revenues. The increase in services and other revenue for the three months ended March 31, 2026 compared with the same period of 2025 was primarily due to an increase in non-recurring engineering services revenue related to our mmWave technology, partially offset by a decrease in royalties from licensees of our memory technology due to reduced shipments by these licensees, which we attribute to the discontinuation of the foundry process by TSMC.
Previous wording
Cost of net revenue is primarily comprised of direct and indirect costs related to the sale of our products, including depreciation of production-related fixed assets and, prior to January 1, 2025, amortization of intangible assets.
Current wording
Cost of net revenue is primarily comprised of direct and indirect costs related to the sale of our products, including depreciation of production-related fixed assets.
Previous wording
Cost of net revenue decreased for the three months ended September 30, 2025 when compared with the same period in 2024, primarily related to the decrease in product revenue and amortization of developed technology intangible assets of approximately $0.6 million, as these assets were fully amortized as of December 31, 2024. Cost of net revenue decreased for the nine months ended September 30, 2025 when compared with the same period in 2024, primarily related to the decrease in product revenue and amortization of developed technology intangible assets of approximately $1.7 million, as these assets were fully amortized as of December 31, 2024.
Current wording
Cost of net revenue decreased for the three months ended March 31, 2026 when compared with the same period in 2025, primarily related to the decrease in product revenue.
Previous wording
Our research and development, or R&D, expenses include costs related to the development of our products. We expense R&D costs as they are incurred.
Current wording
Our research and development, or R&D, expenses include costs related to the development of our products, including facility allocations. We expense R&D costs as they are incurred.
Previous wording
We expect that total R&D expenses will decrease during the remainder of 2025 compared with the prior period of 2024, as a result of our cost reduction initiatives.
Current wording
We expect that total R&D expenses will remain flat for the remainder of 2026 compared with the prior periods of 2025.
Previous wording
Selling, general and administrative, or SG&A, expenses consist primarily of personnel and related overhead costs for sales, marketing, finance, human resources and general management and amortization of certain intangible assets.
Current wording
Selling, general and administrative, or SG&A, expenses consist primarily of personnel and related overhead costs for sales, marketing, finance, human resources and general management.
Previous wording
The decrease for the three months ended September 30, 2025 compared with the same period of 2024 was primarily attributable to reductions in expenses for facilities, stock based compensation and amortization of purchased intangible assets for customer relationships of approximately $0.3 million, which were fully amortized as of December 31, 2024. The decrease for the nine months ended September 30, 2025 compared with the same period of 2024 was primarily attributable to reductions in expenses for facilities, stock based compensation and amortization of purchased intangible assets for customer relationships of approximately $0.8 million, which were fully amortized as of December 31, 2024. These decreases were partially offset by increases in consulting and professional services costs. We expect that total SG&A expense will remain flat or slightly decrease for the remainder of 2025 compared with 2024, as we continue to manage our SG&A costs.
Current wording
The decrease for the three months ended March 31, 2026 compared with the same period of 2025 was primarily attributable to reductions in expenses for facilities and stock based compensation. These decreases were partially offset by increases in consulting and professional services costs. We expect that total SG&A expense will remain flat or slightly decrease for the remainder of 2026 compared with 2025, as we continue to manage our SG&A expenses.
Previous wording
As of September 30, 2025, we had cash and cash equivalents of $1.9 million and working capital of $3.1 million.
Current wording
As of March 31, 2026, we had cash and cash equivalents of $2.7 million and working capital of $4.0 million.
Previous wording
Net cash used in operating activities was $4.6 million for the first nine months of 2025, which primarily resulted from our net loss of $3.5 million, as increased by $1.7 million in net changes in assets and liabilities, and partially offset by non-cash charges of $0.2 million of depreciation and amortization and $0.4 million of stock based compensation. The changes in assets and liabilities primarily related to the timing of collections of receivables, purchases of inventory and other vendor payables and prepayments.
Current wording
Net cash used in operating activities was $1.0 million for the first three months of 2025, which primarily resulted from our net loss of $0.5 million, as adjusted for cash outflows of $0.7 million in net changes in assets and liabilities, and partially offset by non-cash charges of $0.1 million of depreciation and amortization and $0.1 million of stock based compensation. The changes in assets and liabilities primarily related to the timing of collections of receivables, purchases of inventory and other vendor payables and prepayments.
Previous wording
Net cash used in investing activities was approximately $79,000 for the first nine months of 2025, which was attributable to the purchase of fixed assets.
Current wording
Net cash used in investing activities of approximately $0.2 million for the three months ended March 31, 2026 which was attributable to the purchase of fixed assets.
Previous wording
For the nine months ended September 30, 2024, no cash was provided by or used in investing activities.
Current wording
For the three months ended March 31, 2025 no cash was provided by or used in investing activities.
Previous wording
Net cash provided by financing activities of $3.2 million for the nine months ended September 30, 2025 primarily comprised $2.3 million of net proceeds from at-the-market sales of stock and $0.9 million in net proceeds from a warrant inducement offering completed in September 2025.
Current wording
Net cash provided by financing activities of $2.3 million for the three months ended March 31, 2026 primarily comprised $2.3 million of net proceeds from sales of our common stock under the Sales Agreement.
Previous wording
Our primary purchase obligations include non-cancelable purchase orders for inventory. At September 30, 2025, we had outstanding non-cancelable purchase orders for inventory, primarily wafers and substrates, and related expenditures of approximately $2.7 million.
Current wording
Our primary purchase obligations include non-cancelable purchase orders for inventory. At March 31, 2026, we had outstanding non-cancelable purchase orders for inventory, primarily wafers and substrates, and related expenditures of approximately $3.2 million.
Previous wording
We incurred net losses of approximately $3.5 million for the nine months ended September 30, 2025 and $10.7 million for the year ended December 31, 2024, and we had an accumulated deficit of approximately $180.6 million as of September 30, 2025. These and prior year losses have resulted in significant negative cash flows and have required us to raise substantial amounts of additional capital. To date, we have primarily financed our operations through loans, offerings of common stock and warrants and issuances of convertible notes.
Current wording
We incurred net losses of approximately $2.5 million for the three months ended March 31, 2026 and $4.8 million for the year ended December 31, 2025, and we had an accumulated deficit of approximately $184.4 million as of March 31, 2026. These and prior year losses have resulted in significant negative cash flows and have required us to raise substantial amounts of additional capital. To date, we have primarily financed our operations through loans, offerings of common stock and warrants and issuances of convertible notes.
Previous wording
We expect to continue to incur operating losses during 2025, as we do not expect any further shipments or to generate any meaningful revenue from shipments of our memory products after March 2025, with the exception of two purchase orders received in September 2025, and as we continue to secure new customers for and continue to invest in the development of our mmWave products. Further, we expect our cash expenditures to continue to exceed receipts for at least the next 12 months, as our revenues will not be sufficient to offset our operating expenses. In addition, we have incurred and may continue to incur substantial costs related to our strategic alternative exploration process, including our evaluation of Mobix Labs’ proposal, which costs include the fees of our financial and legal advisors. We believe that our existing cash and cash equivalents as of September 30, 2025 and expected receipts associated with forecasted product sales will enable us to meet our capital needs into the first quarter of 2026.
Current wording
We expect to continue to incur operating losses during 2026, as we do not expect to generate any meaningful revenue from shipments of our remaining memory products and as we continue to secure new customers for and continue to invest in the development of our mmWave products. Further, we expect our cash expenditures to continue to exceed receipts for at least the next 12 months, as our revenues will not be sufficient to offset our operating expenses. In addition, we have incurred and may continue to incur substantial costs related to our strategic alternative exploration process, which costs include the fees of our financial and legal advisors. We believe that our existing cash and cash equivalents as of March 31, 2026 and expected receipts associated with forecasted product sales will enable us to meet our capital needs into the fourth quarter of 2026.
Previous wording
We will need to increase revenues beyond the levels that we have attained in the past in order to generate sustainable operating profit and sufficient cash flows to continue doing business without raising additional capital from time to time. As a result of our expected operating losses and cash burn and recurring losses from operations, if we are unable to raise sufficient capital through additional debt or equity arrangements, there will be uncertainty regarding our ability to maintain liquidity sufficient to operate our business effectively, which raises substantial doubt as to our ability to continue as a going concern within one year from the date of issuance of our condensed consolidated financial statements. In addition, the Company’s independent registered public accounting firm, in its report on the Company’s consolidated financial statements for the year ended December 31, 2024, expressed substantial doubt about the Company’s ability to continue as a going concern. The condensed consolidated financial statements presented in Part I, Item 1 of this Quarterly Report on Form 10-Q have been prepared assuming that we will continue as a going concern, and do not include any adjustments that might result from the outcome of this uncertainty. There can be no assurance that such additional capital, whether in the form of debt or equity financing, will be sufficient or available and, if available, that such capital will be offered on terms and conditions acceptable to us. We are currently seeking additional financing in order to meet our cash requirements for the foreseeable future. If we are unsuccessful in these efforts, we will need to implement additional cost reduction strategies, which could further affect our near- and long-term business plan. These cost reduction strategies may include, but are not limited to, reducing headcount and curtailing business activities.
Current wording
We will need to increase revenues beyond the levels that we have attained in the past in order to generate sustainable operating profit and sufficient cash flows to continue doing business without raising additional capital from time to time. As a result of our expected operating losses and cash burn and recurring losses from operations, if we are unable to raise sufficient capital through additional debt or equity arrangements, there will be uncertainty regarding our ability to maintain liquidity sufficient to operate our business effectively, which raises substantial doubt as to our ability to continue as a going concern within one year from the date of issuance of our condensed consolidated financial statements. In addition, our independent registered public accounting firm, in its report on our consolidated financial statements for the year ended December 31, 2025, expressed substantial doubt about our ability to continue as a going concern. The condensed consolidated financial statements presented in Part I, Item 1 of this Quarterly Report on Form 10-Q have been prepared assuming that we will continue as a going concern, and do not include any adjustments that might result from the outcome of this uncertainty. There can be no assurance that such additional capital, whether in the form of debt or equity financing, will be sufficient or available and, if available, that such capital will be offered on terms and conditions acceptable to us. We are currently selling shares of our common stock under the Sales Agreement and seeking additional financing in order to meet our cash requirements for the foreseeable future. If we are unsuccessful in these efforts, we will need to implement additional cost reduction strategies, which could further affect our near- and long-term business plan. These cost reduction strategies may include, but are not limited to, reducing headcount and curtailing business activities.
Previous wording
In the ordinary course of business, we enter into contractual arrangements under which we may agree to indemnify the counter-party from losses relating to a breach of representations and warranties, a failure to perform certain covenants, or claims and losses arising from certain external events as outlined within the contract, which may include, for example, losses arising from litigation or claims relating to past performance. Such indemnification clauses may not be subject to maximum loss clauses. We have also entered into indemnification agreements with our officers and directors. No material amounts related to these indemnifications are reflected in our condensed consolidated financial statements for the three and nine months ended September 30, 2025.
Current wording
In the ordinary course of business, we enter into contractual arrangements under which we may agree to indemnify the counter-party from losses relating to a breach of representations and warranties, a failure to perform certain covenants, or claims and losses arising from certain external events as outlined within the contract, which may include, for example, losses arising from litigation or claims relating to past performance. Such indemnification clauses may not be subject to maximum loss clauses. We have also entered into indemnification agreements with our officers and directors. No material amounts related to these indemnifications are reflected in our condensed consolidated financial statements for the three months ended March 31, 2026.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
Net cash used in operating activities was $2.3 million for the first three months of 2026, which primarily resulted from our net loss of $2.5 million, as partially offset by non-cash charges of $0.1 million of depreciation and amortization and $0.1 million of stock based compensation.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
Net cash used in operating activities was $3.9 million for the first nine months of 2024, which primarily resulted from our net loss of $9.2 million, as adjusted for a $1.6 million non-cash gain on the change in fair value of warrant liability, and partially offset by non-cash charges of $3.0 million of depreciation and amortization, $3.3 million of stock based compensation and $0.6 million in net changes in assets and liabilities. The changes in assets and liabilities primarily related to the timing of accruals for software licenses, accrued severance benefits and accounts receivable collections, and other vendor payables and prepayments.