ACTELIS NETWORKS INC
For the period ended Jun 30, 2026. Filed Aug 13, 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.
Jun 30, 2026 · Filed Aug 13, 2026
ASNS$0.080.0%Stored close · as of Jul 8, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2026-03-31; filed 2026-05-14.
0001213900-26-056772
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-06-30; filed 2026-08-13.
0001213900-26-089172
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 64 previous paragraphs and 63 current paragraphs.
21 unchanged; 15 reworded; 26 added; 27 removed; 1 previous and 1 current paragraphs rearranged.
Tables are not compared: 14 previous and 4 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 (26)
Current report
The table below provides our results of operations for the periods indicated.
Current report
Our revenues for the six months ended June 30, 2026, amounted to $2 million, compared to approximately $1.7 million for the six months ended June 30, 2025. The increase was primarily attributable to an expansion of the Company’s sales footprint, including delivery of a renewal order to a large U.S. carrier for software and service , with revenue increases of 39% in North America, 15% in Europe, the Middle East and Africa.
Current report
Our cost of revenues for the three months ended June 30, 2026, amounted to $0.6 million, compared to approximately $0.6 million for the three months ended June 30, 2025. The expense remained consistent with the prior-year period despite higher revenue, primarily due to an improved software sales mix and higher gross margins.
Current report
Our cost of revenues for the six months ended June 30, 2026, amounted to $1.3 million, compared to approximately $1.1 million for the six months ended June 30, 2025. The increase was primarily attributable to higher sales volume during the period and in line with the increase in revenue and software revenue mix.
Current report
Our research and development expenses for the six months ended June 30, 2026, amounted to $1.3 million, compared to $1.4 million for the six months ended June 30, 2025. The Company implemented cost reduction measures during the period; however, the resulting savings were significantly offset by the unfavorable impact of foreign exchange rate fluctuations.
Current report
Our sales and marketing expenses for the three months ended June 30, 2026, amounted to $0.8 million, compared to $0.7 million for the three months ended June 30, 2025 driven by investments in new sales resources for the Federal market and marketing, and higher commission payout due to higher revenues. At the same time, some cost reduction measures were implemented that were offset by the unfavorable impact of foreign exchange rate fluctuations.
Current report
Our sales and marketing expenses for the six months ended June 30, 2026, amounted to $1.4 million, compared to $1.4 million for the six months ended June 30, 2025. The investments in new resources, higher commission payout due to higher revenues and unfavorable impact of foreign exchange rate fluctuations were offset by cost reduction measures during the period.
Current report
Our general and administrative expenses for the three months ended June 30, 2026, amounted to $0.7 million, compared to $0.7 million for the three months ended June 30, 2025. The expenses remained unchanged because the cost reduction measures implemented during the period with the help of AI and other operating measures were offset by the unfavorable impact of public Company expenses and foreign exchange rate fluctuations.
Current report
Operating (Loss) Income
Current report
Our operating loss for the six months ended June 30, 2026, was $3.4 million, compared to an operating loss of approximately $3.6 million for the six months ended June 30, 2025. The decrease was primarily attributable to increased revenues and resulting higher gross margin coupled with the cost reduction measures implemented during the period, almost entirely offset by the unfavorable impact of foreign exchange rate fluctuations amounting to approximately $280,000.
Current report
Our financial income, net for the three months ended June 30, 2026, was $189,000(including $106,000 interest expenses) compared to financial expense, net of $128,000 (including $22,000 interest expenses) for the three months ended June 30, 2025. Financial expenses reflected a $400,000 gain from the change in the fair value of pre-funded warrants classified as liabilities, which was substantially offset by foreign exchange losses, primarily due to fluctuations in the NIS against the U.S. dollar.
Current report
Our net loss for the three months ended June 30, 2026 was $1.4 million, or $(0.05) per basic and diluted share, compared to net loss of approximately $1.9 million, or $(2.08) per basic and diluted share for the three months ended June 30, 2025. The decrease was primarily due to higher sales, improved gross margins, and continued efforts to reduce operating expenses as well as income from the reduction in warrant liability fair value. These favorable factors were partially offset by the adverse impact of foreign exchange rate.
Current report
Our net loss for the six months ended June 30, 2026 was $3.8 million, or $(0.19) per basic and diluted share, compared to net loss of approximately $3.8 million, or $(4.26) per basic and diluted share for the six months ended June 30, 2025. The net loss remained relatively unchanged compared to the prior year six months, as improvements in sales, gross margins, and operating expense management were offset by unfavorable foreign exchange rate impact as well as financial expenses associated with warrants granted.
Current report
On September 27, 2025, we entered into common stock purchase agreement (the “ELOC Purchase Agreement”), with an effective date of October 1, 2025 (the “Commencement Date”), and the registration rights agreement (the “White Lion RRA”) with White Lion Capital LLC, a Nevada limited liability company (“White Lion”). Pursuant to the ELOC Purchase Agreement, the Company has the right, but not the obligation to require White Lion to purchase, from time to time, up to $30,000,000 (the “Commitment Amount”) in aggregate gross purchase price of newly issued shares of the Company’s common stock for the 36-month period beginning on the Commencement Date, subject to certain limitations and conditions set forth in the ELOC Purchase Agreement.
Current report
As consideration for White Lion’s irrevocable commitment to purchase the Company’s common stock up to the Commitment Amount, the Company agreed to issue commitment shares (“Commitment Shares”) equal to the commitment amount of $750,000 (the “Commitment Fee Amount”) divided by the lowest traded price of the Company’s common stock during the 30 business days prior to the issuance of the commitment shares.
Current report
If at any point during the term of the ELOC Purchase Agreement the Company failed to be listed on the Nasdaq Capital Market, the Commitment Fee Amount will increase to $1,000,000 if remedied within six months or less, to $1,250,000 if remedied after six months but before twelve months, and $1,500,000 if not remedied within twelve months (the “Delisting Penalty Provision”).
Current report
Subject to the satisfaction of certain customary conditions including, without limitation, the effectiveness of a registration statement registering the shares issuable pursuant to the ELOC Purchase Agreement, the Company’s right to sell shares to White Lion will commence on the Commencement Date and extend until 36 months through the Commitment Period, unless the Company has exercised its right in full to sell shares to White Lion under the ELOC Purchase Agreement prior to such date. During such term, subject to the terms and conditions of the ELOC Purchase Agreement, the Company shall notify White Lion through a purchase notice (“Purchase Notice”) when the Company exercises its right to sell shares (the effective date of such notice, a “Notice Date”). The Purchase Notice may be a Regular Purchase Notice or a Rapid Purchase Notice, each as described in the form of ELOC Purchase Agreement. In the event the Company was delisted from the Nasdaq Capital Market, White Lion would only be obligated to make any Purchase Notices at a value equal to $0.0001 per share of common stock (the “Delisting Purchase Notice Mechanism”). On April 10, 2026, the Company was delisted from the Nasdaq Capital Market triggering the Delisting Purchase Notice Mechanism.
Current report
On July 1, 2026, the Company and White Lion entered into the Amendment to the ELOC Purchase Agreement pursuant to which the Company agreed to issue to White Lion an aggregate of 9,850,000 shares of common stock (the “Amendment Commitment Securities”) in exchange for White Lion’s right to receive shares of common stock under the Commitment Shares provisions and the Delisting Penalty Provision due to the Company’s delisting from the Nasdaq Capital Market in April 2026. The Amendment Commitment Securities is comprised of (i) 3,000,000 shares of common stock, (ii) 3,850,000 pre-funded warrants (“Amendment Commitment Pre-Funded Warrants”), and (iii) 3,000,000 common warrants (“Amendment Commitment Common Warrants”).
Current report
The Amendment Commitment Pre-Funded Warrants will have an initial exercise date at the earlier of (i) the effective date of a reverse stock split of the Company’s common stock, and (ii) the effective date of an increase in the Company’s authorized share count sufficient for the issuance of the shares underlying the Amendment Commitment Pre-Funded Warrants (the “Pre-Funded Warrant Initial Exercise Date”). The exercise price of the Amendment Commitment Pre-Funded Warrants is $0.0001 per share, and the warrants shall be exercisable from the Pre-Funded Warrant Initial Exercise Date until exercised in full.
Current report
The Amendment Commitment Common Warrants will have an initial exercise date on the date on which the Company successfully lists its common stock on an “Eligible Market”, as such term is defined in the Amendment Commitment Common Warrants (the “Common Warrant Initial Exercise Date”). The exercise price of the Amendment Commitment Common Warrants is $0.20 per share, and the warrants shall be exercisable until the eighteen month anniversary of the Common Warrant Initial Exercise Date.
Current report
In addition, pursuant to the ELOC Purchase Agreement Amendment, the Company and White Lion agreed to remove the Delisting Purchase Notice Mechanism and replace it with amended purchase notice mechanisms which will allow the Company to more effectively utilize Purchase Notices under the ELOC Purchase Agreement while the Company remains delisted from the Nasdaq Capital Market.
Current report
Under an amended Rapid Purchase Notice Option 1, the purchase price to be paid by White Lion shall mean (a) ninety-seven percent (97.0%) multiplied by the lowest traded price of the common stock on Rapid Purchase Notice Date, minus (b) $0.005 (provided that, notwithstanding anything in the ELOC Purchase Agreement to the contrary, if the Company, at any time, combines (by any reverse stock split, stock dividend, stock combination, recapitalization, or other similar transaction) one or more classes of its outstanding common stock into a smaller number of shares, the $0.005 amount shall not be proportionately increased or otherwise adjusted).
Current report
Under an amended Rapid Purchase Notice Option 2, the purchase price to be paid by White Lion shall mean (a) ninety-seven percent (97.0%) multiplied by the lowest traded price of the common stock two hours following the written confirmation of the acceptance of the Rapid Purchase Notice by White Lion, minus (b) $0.005 (provided that, notwithstanding anything in the ELOC Purchase Agreement to the contrary, if the Company, at any time, combines (by any reverse stock split, stock dividend, stock combination, recapitalization, or other similar transaction) one or more classes of its outstanding common stock into a smaller number of shares, the $0.005 amount shall not be proportionately increased or otherwise adjusted).
Current report
Under an amended Regular Purchase Notice Option, the purchase price to be paid by White Lion shall mean shall mean (a) (i) ninety-seven percent (97.0%) multiplied by the lower of (i) the lowest daily VWAP of the common stock during the Regular Purchase Valuation Period (as such term is defined in the ELOC Purchase Agreement) or (ii) the closing price of common stock one Business Day prior to the delivery of the applicable Regular Purchase Notice, minus (b) $0.005 (provided that, notwithstanding anything in the ELOC Purchase Agreement to the contrary, if the Company, at any time, combines (by any reverse stock split, stock dividend, stock combination, recapitalization, or other similar transaction) one or more classes of its outstanding common stock into a smaller number of shares, the $0.005 amount shall not be proportionately increased or otherwise adjusted).
Current report
Cash used in operating activities amounted to $3.6 million for the six months ended June 30, 2026, compared to approximately $3.2 million for the six months ended June 30, 2025. The increase is mainly associated with an increase in payment on trade payables during the period as well as approximately $277,000 of additional operating expense cash usage due to negative foreign exchange rate.
Current report
Net cash used in investing activities was $51,000 for the six months ended June 30, 2026, compared to approximately $4,000 for the six months ended June 30, 2025. The increase is associated with an increase in the purchase of assets during the period.
Removed paragraphs (27)
Previous report
The following discussion and analysis should be read in conjunction with our condensed consolidated financial statements and related Notes included elsewhere in this Quarterly Report on Form 10-Q and the Consolidated Financial Statements and related Notes contained in our Annual Report on Form 10-K for the year ended December 31, 2025.
Previous report
This Quarterly Report on Form 10-Q includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), that are not historical facts and involve risks and uncertainties that could cause actual results to differ materially from those expected and projected. All statements other than statements of historical fact included in this Form 10-Q including, without limitation, statements in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations” regarding the Actelis Networks Inc.’s (the “Company”, “we”) financial position, business strategy and the plans and objectives of management for future operations, are forward-looking statements. Words such as “expect,” “believe,” “anticipate,” “intend,” “estimate,” “seek” and variations and similar words and expressions are intended to identify such forward-looking statements. Such forward-looking statements relate to future events or future performances, but reflect management’s current beliefs, based on information currently available. A number of factors could cause actual events, performances or results to differ materially from the events, performance and results discussed in the forward-looking statements. For information identifying important factors that could cause actual results to differ materially from those anticipated in the forward-looking statements, please refer to Part II, Item 1A of this Quarterly Report on Form 10-Q and the Risk Factors section of our Annual Report on Form 10-K for the year ended December 31, 2025, filed on March 18, 2026, with the U.S. Securities and Exchange Commission (the “SEC”). The Company’s securities filings can be accessed on the EDGAR section of the SEC’s website at www.sec.gov.
Previous report
In addition, forward-looking statements contained in this Quarterly Report on Form 10-Q include, but are not limited to, statements about:
Previous report
We may not actually achieve the plans, intentions or expectations disclosed in our forward-looking statements, and you should not place undue reliance on our forward-looking statements. Actual results or events could differ materially from the plans, intentions and expectations disclosed in the forward-looking statements we make. In addition, statements that “we believe” and similar statements reflect our beliefs and opinions on the relevant subject. Forward-looking statements are based on our management’s current expectations, estimates, forecasts and projections about our business and the industry in which we operate and our management’s beliefs and assumptions, and are not guarantees of future performance or development and involve known and unknown risks, uncertainties and other factors that are in some cases beyond our control. These statements are based upon information available to us as of the date of this Quarterly Report on Form 10-Q, and while we believe such information forms a reasonable basis for such statements, such information may be limited or incomplete, and our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information. As a result, any or all of our forward-looking statements in this Quarterly Report on Form 10-Q may turn out to be inaccurate.
Previous report
The forward-looking statements included in this Quarterly Report on Form 10-Q speak only as of the date of this filing. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee that future results, levels of activity, performance and events and circumstances reflected in the forward-looking statements will be achieved or will occur. Except as required by law, we assume no obligation to update or revise these forward-looking statements for any reason, even if new information becomes available in the future. You should, however, review the factors and risks we describe in the reports we will file from time to time with the SEC after the date hereof.
Previous report
Recent Developments
Previous report
Nasdaq Delisting
Previous report
On February 4, 2026, the Company received a written notice (the “Notice”) from the Nasdaq Listing Qualifications Department of The Nasdaq Stock Market LLC (“Nasdaq”) indicating that the Nasdaq staff (the “Staff”) had determined to delist the Company’s securities from The Nasdaq Capital Market. As disclosed in the Notice, the Staff determined that the Company’s common stock failed to maintain a minimum bid price of $1.00 per share for 30 consecutive business days, in violation of Nasdaq Listing Rule 5550(a)(2) (the “Bid Price Rule”). While companies are typically afforded a 180-calendar-day compliance period to comply with the Nasdaq Listing Rule, the Staff concluded that the Company is not eligible for the compliance period pursuant to Nasdaq Listing Rule 5810(c)(3)(A)(iv) due to the fact that the Company effected a reverse stock split within the prior one-year period, specifically a 1-for-10 reverse stock split on November 18, 2025, and therefore was subject to immediate delisting.
Previous report
The Company requested an appeal hearing, which stayed the suspension and delisting action. At the appeal hearing, the Company presented to the Nasdaq Hearings Panel its plan to regain compliance with the Bid Price Rule.
Previous report
On April 8, 2026, Nasdaq delivered a letter to the Company confirming to the Company that it had denied the Company’s request for continued listing and therefore that trading of the Company’s common stock, par value $0.0001 per share (“Common Stock”), would be suspended at the open of trading on April 10, 2026. As a result, the Company’s Common Stock began trading on the OTCID basic market starting April 10, 2026.
Previous report
On April 24, 2026, the Company announced that it had been approved for and commenced trading on the OTCQB Venture Market operated by OTC Markets Group, effective at the open of business on April 24, 2026. The Company’s common stock continues to trade under the symbol “ASNS.”
Previous report
The OTCQB is a significantly more limited market than the Nasdaq Capital Market, and quotation on any OTC market will result in a less liquid market for existing and potential holders of Common Stock to trade their shares and could further depress the trading price of the Common Stock. We can provide no assurance that the Common Stock will continue to trade on this market, whether broker-dealers will provide and continue to provide public quotes of the Common Stock on this market, or whether the trading volume of the Common Stock will be sufficient to provide for an efficient trading market.
Previous report
We also intend to apply our Common Stock for up-listing back onto the Nasdaq Capital Market. We do not currently meet all of the requirements for initial listing and may not meet all of the requirements for uplisting in the future. We are working to meet all of the requirements for initial listing in order to be approved to list our Common Stock on the Nasdaq Capital Market in the future and expect that a reverse stock split will be necessary for us to meet the minimum bid price and/or minimum closing stock price requirements of Nasdaq. On April 13, 2026, we received shareholder approval at a special meeting of our shareholders to conduct a reverse split of our Common Stock at a ratio between 1-for-10 and 1-for-2025, for a period of one year from the date of the special meeting. We may not be able to meet the initial listing standards of the Nasdaq Capital Market even after a reverse stock split, we may meet such listing standards without having to affect a reverse stock split, and/or may have our application to Nasdaq rejected.
Previous report
Issuer Purchases of Equity Securities
Previous report
On November 17, 2022, the Company’s board of directors (the “Board”) authorized a stock repurchase program (the “Repurchase Program”) pursuant to which we may repurchase up to $1.0 million of outstanding shares of our common stock. The Board authorized us to purchase our common stock from time to time on a discretionary basis through open market or private transactions, through block trades, and pursuant to any trading plan that may be adopted in accordance with Rule 10b-18 of the Exchange Act, and other applicable legal requirements. On March 18, 2026, the Board authorized an expansion of the Repurchase Program, such that the maximum aggregate purchase price under the program will now be $1.5 million.
Previous report
Repurchases under the Repurchase Program will be made at management’s discretion at prices management considers to be attractive and in the best interests of both the Company and its stockholders, subject to the availability of stock, general market conditions, the trading price of the stock, alternative uses for capital, and our financial performance. The Repurchase Program may be suspended, terminated or modified at any time for any reason, including market conditions, the cost of repurchasing shares, the availability of alternative investment opportunities, liquidity, and other factors deemed appropriate. These factors may also affect the timing and amount of share repurchases. The Repurchase Program does not obligate us to purchase any particular number of shares. As of the date of this filing, the Company repurchased 2,674,709 shares of its Common Stock.
Previous report
Binding Term-sheet with Exaware
Previous report
In March 24, 2026, the Company entered into a binding term sheet to acquire 100% of the issued and outstanding shares of Exaware Routing Ltd. (“Exaware”), an Israel-based provider of high-throughput routing, switching, and open networking platforms, in an all-stock transaction (the “Acquisition”). Under the binding term sheet, the Company will acquire 100% of the equity of Exaware in an all-stock transaction. The agreed post-transaction value ratio reflects approximately 40% attributable to the Company and 60% to Exaware, subject to third-party valuation, receipt of a customary fairness opinion and adjustments, as well as definitive documentation. At closing, the Company expects to issue common stock equal to 19.9% of its then outstanding number of shares, with the remaining consideration to be issued as non-voting preferred shares, convertible into the Company’s common stock subject to compliance with applicable rules and regulations. The shares issued to Exaware in the transaction will be subject to lock-up for a period of six months from the date of conversion of preferred shares to common stock. The transaction is subject to the execution of a definitive agreement, board approvals, and the satisfaction of customary closing conditions. The binding term sheet provides for a 60-day non-solicitation and no-shop period, and includes the payment of a break-up fee under specified circumstances. The Company and Exaware remain engaged in ongoing discussions to advance the Acquisition towards definitive agreement and closing.
Previous report
Our cost of revenues for the three months ended March 31, 2026, amounted to $723,000 compared to approximately $470,000 for the three months ended March 31, 2025. The increase was primarily attributable to higher direct costs driven by delivery of an unusually low margin deal in the US of approximately $200,000 that is not representative of our normal profitability, and indirect costs increase associated with foreign exchange rate, inventory and warranty related costs which. The increase in direct costs was offset by higher revenue.
Previous report
Our sales and marketing expenses for the three months ended March 31, 2026 amounted to $675,000 compared to $666,000 for the three months ended March 31, 2025. The increase is related to increase in commission to salespersons in line with increase in revenues, as well as unfavorable foreign exchange movements, increasing expenses by approximately $30,000. The increase was partially offset by cost reduction measures implemented by management.
Previous report
Operating Loss
Previous report
Our net loss for the three months ended March 31, 2026 was approximately $2.5 million, compared to net loss of approximately $1.9 million for the three months ended March 31, 2025. This increase was primarily due to additional fees of $625,000 related to the Commitment Fee under the Common Stock Purchase Agreement payable in common shares issuance and foreign exchange rate differences, partially offset by income of $124,000 resulting from changes in the fair value of pre-funded warrants classified as a liability, revenue increase and cost reduction measures implemented by the Company.
Previous report
On September 18, 2024, we filed a shelf registration statement on Form S-3 (the “Registration Statement”). Pursuant to the Registration Statement, we may offer and sell securities having an aggregate public offering price of up to $50.0 million. In connection with the filing of the Registration Statement, on September 25, 2024, we entered into a sales agreement with H.C. Wainwright & Co. (the “Sales Agent”), pursuant to which we may issue and sell shares of our common stock for an aggregate offering price of up to $3.4 million under an at-the-market offering program (the “ATM”), which is included in the $50.0 million of securities that may be offered pursuant to the Registration Statement. Pursuant to the ATM, we will pay the Sales Agent a commission rate of up to 3.0% of the gross proceeds from the sale of any shares of our common stock. We are not obligated to make any sales of shares under the ATM.
Previous report
In March 2025, we increased the at-the-market equity program by an additional $1.3 million. In January 2026, we increased the at-the-market equity program by an additional $12 million. As of March 31, 2026, we have sold 18,429,137 shares of our common stock and received approximately $6.9 million in net proceeds under the ATM, and we had approximately $4.7 million available for future offerings under the prospectus filed with respect to the ATM. The Company is currently unable to utilize its ATM facility as a result of its delisting from Nasdaq until it will be able to relist.
Previous report
Under the Repurchase Program, during the quarter ended March 31, 2026, the Company purchased 2,674,709 shares of its common stock, for a total price of approximately $1 million.
Previous report
Net Cash used in operating activities (including the effect of exchange rate changes on cash and cash equivalents and restricted cash) amounted to $1,902,000 for the three months ended March 31, 2026, compared to approximately $2,175,000 for the three months ended March 31, 2025. The decrease was primarily due to an increase in our working capital.
Previous report
Net cash used in investing activities amounted to $41,000 for the three months ended March 31, 2026 compared to net cash provided by of $1,000 for the three months ended March 31, 2025. The increase in investing activities is mainly related to leasehold improvements and other purchases of fixed assets for our new facility.
Reworded paragraphs (15)
Previous wording
Three Months Ended March 31, 2026 Compared to Three Months Ended March 31, 2025
Current wording
Three and Six Months Ended June 30, 2026, Compared to Three and Six Months Ended June 30, 2025
Previous wording
Our revenues for the three months ended March 31, 2026 amounted to $958,000 compared to $721,000 for the three months ended March 31, 2025. The increase was primarily attributable to an expansion of the Company’s sales footprint, including delivery of large U.S. and Asia Pacific orders to carriers, federal and ITS customers, with revenue increases of 25% in North America, 27% in Europe, the Middle East and Africa, and substantially in the Asia-Pacific region.
Current wording
Our revenues for the three months ended June 30, 2026, amounted to $1.1 million, compared to approximately $0.9 million for the three months ended June 30, 2025. The increase was primarily attributable to an expansion of the Company’s sales footprint, including delivery of a renewal order to a large U.S. carrier for software and service as well as to other carriers in EMEA, with revenue increases of 33% in North America, 22% in Europe, the Middle East and Africa.
Previous wording
Our research and development expenses for the three months ended March 31, 2026 amounted to $689,000 compared to $681,000 for the three months ended March 31, 2025. The increase was primarily attributable to unfavorable foreign exchange movements, increasing expenses by approximately $66,000, and was partially offset by cost reduction measures implemented by management.
Current wording
Our research and development expenses for the three months ended June 30, 2026, amounted to $0.7 million, compared to $0.7 million for the three months ended June 30, 2025. The Company implemented cost reduction measures during the period; however the resulting savings were offset by the unfavorable impact of foreign exchange rate fluctuations.
Previous wording
Our general and administrative expenses for the three months ended March 31, 2026 amounted to $734,000 compared to $716,000 for the three months ended March 31, 2025. The increase was primarily attributable to unfavorable foreign exchange movements, increasing expenses by approximately $29,000. The increase was partially offset by cost reduction measures implemented by the Company.
Current wording
Our general and administrative expenses for the six months ended June 30, 2026, amounted to $1.5 million, compared to $1.4 million for the six months ended June 30, 2025. Similar to the three month period ended June 30, 2026, cost reduction measures implemented during the period with the help of AI and other operating measures were partially offset by unfavorable impact of public Company expenses and foreign exchange rate fluctuations.
Previous wording
Our operating loss for the three months ended March 31, 2026, was approximately $1.86 million compared to an operating loss of approximately $1.81 million for the three months ended March 31, 2025. The increase was primarily driven by an increase in the cost of goods and unfavorable foreign exchange movements, partially offset by revenue increase and cost reduction measures implemented by the Company.
Current wording
Our operating loss for the three months ended June 30, 2026, was $1.6 million, compared to an operating loss of approximately $1.8 million for the three months ended June 30, 2025. The decrease in loss was primarily attributable to increased revenues and resulting higher gross margin, coupled with cost reduction measures implemented during the period, partially offset by the investment in sales and marketing, and the unfavorable impact of foreign exchange rate fluctuations, amounting to approximately $150,000.
Previous wording
Other Financial expenses, net
Current wording
Other Financial Expenses, Net and Interest Expenses
Previous wording
Our financial expense, net for the three months ended March 31, 2026, was $593,000 compared to $48,000 for the three months ended March 31, 2025. Our financial expenses net, mainly consisted of interest expenses, exchange rate differences of certain currencies (including NIS against USD). During the three months ended in March 31, 2026 we recorded a financial expense of $625,000 as a result of the increase in the commitment fee under the common stock purchase agreement associated with our equity line of credit, payable in common shares issuance. This increase in expense was partially offset by income of $124,000 resulting from changes in the fair value of pre-funded warrants classified as a liability. Please see Note 6(b) to the condensed consolidated financial statements appearing elsewhere in this Quarterly Report on Form 10-Q for more information.
Current wording
Our financial expense, net for the six months ended June 30, 2026, was $404,000 (including $120,000 interest expenses) compared to financial expense, net of $176,000 (including $56,000 interest expenses) for the six months ended June 30, 2025. Our financial expenses net, mainly consisted of interest expenses, exchange rate differences of certain currencies (including NIS against USD). In 2026, we recorded a financial expense of $625,000 as a result of the increase in the commitment fee under the common stock purchase agreement associated with our equity line of credit, payable in common shares issuance. This increase in expense was partially offset by income of $530,000 resulting from changes in the fair value of pre-funded warrants classified as a liability.
Previous wording
Non-GAAP Adjusted EBITDA and Adjusted EBITDA margin are Non-GAAP financial measures. In addition to reporting financial results in accordance with GAAP, we provide Non-GAAP supplemental operating results adjusted for certain items, including: financial expenses, which are interest, financial instrument fair value adjustments, exchange rate differences of assets and liabilities, stock-based compensation expenses, depreciation and amortization expense, tax expense, and impact of development expenses ahead of product launch. We adjust for the items listed above and show non-GAAP financial measures in all periods presented, unless the impact is clearly immaterial to our financial statements. When we calculate the tax effect of the adjustments, we include all current and deferred income tax expense commensurate with the adjusted measure of pre-tax profitability.
Current wording
Non-GAAP Adjusted EBITDA and Adjusted EBITDA margin are Non-GAAP financial measures. In addition to reporting financial results in accordance with GAAP, we provide Non-GAAP supplemental operating results adjusted for certain items, including: financial expenses, which are interest, financial instrument fair value adjustments, exchange rate differences of assets and liabilities, Share based compensation expenses, depreciation and amortization expense, tax expense, and impact of development expenses ahead of product launch. We adjust for the items listed above and show non-GAAP financial measures in all periods presented, unless the impact is clearly immaterial to our financial statements. When we calculate the tax effect of the adjustments, we include all current and deferred income tax expense commensurate with the adjusted measure of pre-tax profitability.
Previous wording
Our future capital requirements will be affected by many factors, including our revenue growth, the timing and extent of investments to support such growth, the expansion of sales and marketing activities, increases in general and administrative costs, repayment of principal of our existing credit line, working capital to support securing raw material supply and many other factors as described under “Risk Factors.”
Current wording
Our future capital requirements will be affected by many factors, including our revenues and resulting gross margin growth, the timing and extent of investments to support such growth compared to our resulting increase in revenues and gross margin, the associated expansion of sales and marketing activities, increases or decreases in general and administrative costs, repayment of principal of our existing credit line, working capital to support securing raw material supply and other factors as described under “Risk Factors.” At the same time, our investments, including in sales and marketing, as well as the cost reduction measures we are taking, are aimed at the goal of reaching the break even point on our P&L and resulting cash flow.
Previous wording
To the extent additional funds are necessary to meet our long-term liquidity needs as we continue to execute our business strategy, we anticipate that they will be obtained through the incurrence of additional indebtedness, additional equity financings or a combination of these potential sources of funds; however, such financing may not be available on favorable terms, or at all. In particular, the war in Israel and the war between Russia and the Ukraine, has resulted in, and may continue to result in, significant disruption of global financial markets, reducing our ability to access capital.
Current wording
To the extent additional funds are necessary to meet our long-term liquidity needs as we continue to execute our business strategy, we anticipate that they will be obtained through the incurrence of additional indebtedness, additional equity financings or a combination of these potential sources of funds; however, such financing may not be available on favorable terms, or at all. In particular, our delisting from the Nasdaq Capital Market to the OTCQB limits our ability to raise equity, which will remain limited if we are unsuccessful in re-listing on Nasdaq. Additionally, the wars in the Middle East and the war between Russia and the Ukraine, have resulted in, and may continue to result in, significant disruption of global financial markets, reducing our ability to access capital.
Previous wording
As discussed in Note 1(b) to the condensed consolidated financial statements appearing elsewhere in this Quarterly report on Form 10-Q, we have incurred significant losses and negative cash flows from operations and incurred losses of approximately $2.5 million and approximately $1.86 million for the three months ended March 31, 2026 and 2025, respectively. During the three months ended March 31, 2026 and 2025, we had negative cash flows from operations of $1.9 million and $2.2 million, respectively.
Current wording
As discussed in Note 1(b) to the condensed consolidated financial statements appearing elsewhere in this Quarterly report on Form 10-Q, we have incurred significant losses and negative cash flows from operations and incurred losses of approximately $3.8 million for the six months ended June 30, 2026 and 2025. During the six months ended June 30, 2026 and 2025, we had negative cash flows from operations of $3.6 million and $3.2 million, respectively.
Previous wording
As of March 31, 2026, we had an accumulated deficit of $54.8 million, cash on hand (including short term deposits and restricted cash equivalents) of $7.5 million, and long-term restricted cash and cash equivalents and restricted bank deposits of $0.2 million. We monitor our cash flow projections on a current basis and take active measures to obtain the funding we require to continue our operations. However, these cash flow projections are subject to various uncertainties concerning their fulfillment, such as the ability to increase revenues due to lack of customers or decrease cost structure. Our transition to profitable operations is dependent on generating a level of revenue adequate to support our cost structure through growth of existing and new customers.
Current wording
As of June 30, 2026, we had an accumulated deficit of $56.2 million, cash on hand of approximately $5.7 million and long-term deposits and restricted bank deposits of $159 as of June 30, 2026. We monitor our cash flow projections on a current basis and take active measures to obtain the funding we require to continue our operations. However, these cash flow projections are subject to various uncertainties concerning their fulfillment, such as the ability to increase revenues due to lack of customers or decrease cost structure. Our transition to profitable operations is dependent on generating a level of revenue adequate to support our cost structure through growth of existing and new customers.
Previous wording
As of March 31, 2026, we had cash, cash equivalents, and restricted cash and cash equivalents of approximately $7.5 million compared to approximately $1.4 million of cash, cash equivalents and restricted cash as of March 31, 2025.
Current wording
As of June 30, 2026, we had cash, cash equivalents, and restricted cash and cash equivalents of approximately $5.7 million compared to approximately $0.7 million of cash, cash equivalents and restricted cash as of June 30, 2025.
Previous wording
Net cash received in financing activities was $5,127,000 for the three months ended March 31, 2026, compared to $1,331,000 for the three months ended March 31, 2025. The increase was primarily attributable to higher proceeds from the issuance of common stock under our at-the-market (ATM) program, which increased to approximately $6.9 million from approximately $1.6 million, partially offset by share repurchases of approximately $1.0 million** **
Current wording
Net cash provided by financing activities was $5 million for the six months ended June 30, 2026, compared to $1.6 million for the six months ended June 30, 2025. The increase was primarily attributable to higher proceeds from the issuance of common stock under our at-the-market (ATM) program, which increased to approximately $6.9 million from approximately $1.6 million, partially offset by share repurchases of approximately $1.0 million during the period.
Previous wording
Our management’s discussion and analysis of our financial condition and results of operations is based on our financial statements, which we have prepared in accordance with U.S. generally accepted accounting principles issued by the Financial Accounting Standards Board (“FASB”).
Current wording
Our management’s discussion and analysis of our financial condition and results of operations is based on our financial statements, which we have prepared in accordance with U.S. generally accepted accounting principles issued by the Financial Accounting Standards Board, or FASB.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
Amendment to Equity Line of Credit
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
Cautionary Note Regarding Forward-Looking Statements