CapsoVision, Inc

Previous wording

We were founded in 2005 and are headquartered in Saratoga, California. We sell our small bowel capsule system to our provider customers (i.e., primarily gastroenterologists practicing in clinics and/or hospitals) both internationally and in the U.S. through our global sales and marketing team. In the U.S., we sell to customers directly. Internationally we sell both directly and through qualified exclusive distributors in specified regions. Our largest international shipping destinations in thethree months ended March 31, 2026 include France, Germany, and Saudi Arabia. As of March 31, 2026, our CapsoCam Plus has been used in over 167,000 patients. We currently manufacture and intend to continue manufacturing our CapsoCam capsules included in our GI-tract capsule endoscopy solution (including CapsoCam Colon capsules). To assist us in manufacturing our GI-tract capsule endoscopy products, we rely on component suppliers and assembly manufacturers based in Asia (particularly Taiwan and Japan).

Current wording

We were founded in 2005 and are headquartered in Saratoga, California. We sell our small bowel capsule system to our provider customers (i.e., primarily gastroenterologists practicing in clinics and/or hospitals) both internationally and in the U.S. through our global sales and marketing team. In the U.S., we sell to customers directly. Internationally we sell both directly and through qualified exclusive distributors in specified regions. Our largest international shipping destinations in thesix months ended June 30, 2026 include France, Germany, and Saudi Arabia. As of June 30, 2026, our CapsoCam Plus has been used in over 176,000 patients. We currently manufacture and intend to continue manufacturing our CapsoCam capsules included in our GI-tract capsule endoscopy solution (including CapsoCam Colon capsules). To assist us in manufacturing our GI-tract capsule endoscopy products, we rely on component suppliers and assembly manufacturers based in Asia (particularly Taiwan and Japan).

Previous wording

In the second quarter of 2025 we filed our 510(k) submission to the U.S. Food and Drug Administration (the “FDA”) for our initial CapsoCam Colon capsule endoscopy solution (the “First-Generation Product”). We received responses from the FDA in September 2025. During our meeting with the FDA in December 2025, the FDA raised inquiries on topics including panoramic image processing methodology, and the proposed study design, sample size and primary endpoint for an extended study. Based on our communications with the FDA, we have decided not to further pursue the submission and approval for the First-Generation Product, and to prioritize our resources for the development of our second-generation of CapsoCam Colon capsule (the “Second-Generation Product”), which features improved imaging quality and increased field of review with use of AI and better lens. We also expanded a second arm pivotal study to enroll approximately 800 patients at up to 20 sites in the U.S. in preparation for submitting a new 510(k) application for the Second-Generation Product. As of the date of this

Current wording

In the second quarter of 2025 we filed our 510(k) submission to the U.S. Food and Drug Administration (the “FDA”) for our initial CapsoCam Colon capsule endoscopy solution (the “First-Generation Product”). We received responses from the FDA in September 2025. During our meeting with the FDA in December 2025, the FDA raised inquiries on topics including panoramic image processing methodology, and the proposed study design, sample size and primary endpoint for an extended study. Based on our communications with the FDA, we have decided not to further pursue the submission and approval for the First-Generation Product, and to prioritize our resources for the development of our second-generation of CapsoCam Colon capsule (the “Second-Generation Product”), which features improved imaging quality and increased field of review with use of AI and better lens. We also expanded a second arm pivotal study to enroll approximately 800 patients at up to 20 sites in the U.S. in preparation for submitting a new 510(k) application for the Second-Generation Product. As of the date of this Quarterly Report, we have completed the enrollment process of the second arm pivotal study with 801 patients enrolled. We currently expect to submit the 510(k) application for the Second-Generation Product in the fourth quarter of 2026, subject to any further requests from the FDA.

Previous wording

Since we continue to invest in AI to improve our existing products, we completed a clinical study to demonstrate the benefits of our incorporation of AI technology into CapsoCam Plus, our existing product for the small bowel. We submitted the related 510(k) application to the FDA in December 2025. We received feedback from the FDA in March 2026 and submitted our responses to the FDA in April 2026. We will continue engaging with the FDA and expect to obtain the FDA clearance by the middle of 2026. The commercialization is planned to begin shortly thereafter.

Current wording

Since we continue to invest in AI to improve our existing products, we completed a clinical study to demonstrate the benefits of our incorporation of AI technology into CapsoCam Plus, our existing product for the small bowel. We submitted the related 510(k) application to the FDA in December 2025. In response to the FDA’s feedback, we submitted a proposal to the FDA in April 2026. As further requested by the FDA, we will conduct further demographic analysis of the study data and expect to submit the analysis to the FDA by the end of August 2026. We anticipate obtaining FDA clearance by the end of the third quarter of 2026 with commercialization planned to begin in US shortly thereafter. We also made the initial EU submission in January 2026 and submitted the related technical documents in July 2026. By the time of this Quarterly Report we have commercialized in EU.

Previous wording

Longer term, we believe our CapsoCam family of products, incorporating our panoramic imaging solution, can be adapted to address new GI medical indications. Potential new medical indications include esophageal medical conditions (such as esophageal varices) and pancreatic cancer. In connection with our efforts to address pancreatic cancer, we submitted an FDA “Breakthrough Device Designation” application for our capsule endoscopy solution on November 6, 2025. A response from FDA in January 2026 determined that the CapsoCam UGI does allow for visualization of the papilla and its abnormalities, for both pre-cancerous and cancerous lesions. Due to the fact that the device does not specifically define diagnostic criteria, the application was not approved. Following the FDA’s response, we initiated a study for early pancreatic cancer detection using the CapsoCam UGI system in May 2026. This study will build on established scientific literature and engage leading opinion leaders, including leadership of leading societies in the pancreatobiliary field, to define malignancy diagnosis criteria with the device. This study is expected to enroll up to 140 patients using the CapsoCam UGI system. As of May 11, 2026, the first patient has been enrolled in this study. We expect to resubmit the Breakthrough Device Designation application following the study, when additional data is available. The breakthrough designation is a part of the on-going project, potentially supplementing the regulatory pathway and approval for early pancreas cancer detection. However, additional research and studies to collect data may delay our anticipated timeline for obtaining the regulatory clearance (including obtaining the Breakthrough Device Designation) and may increase our research and development costs.

Current wording

Longer term, we believe our CapsoCam family of products, incorporating our panoramic imaging solution, can be adapted to address new GI medical indications. Potential new medical indications include esophageal medical conditions (such as esophageal varices) and pancreatic cancer. In connection with our efforts to address pancreatic cancer, we submitted an FDA “Breakthrough Device Designation” application for our capsule endoscopy solution on November 6, 2025. A response from FDA in January 2026 determined that the CapsoCam UGI does allow for visualization of the papilla and its abnormalities, for both pre-cancerous and cancerous lesions. Due to the fact that the device does not specifically define diagnostic criteria, the application was not approved. Following the FDA’s response, we initiated a study for early pancreatic cancer detection using the CapsoCam UGI system in May 2026. This study will build on established scientific literature and engage leading opinion leaders, including leadership of leading societies in the pancreatobiliary field, to define malignancy diagnosis criteria with the device. This study is expected to enroll up to 140 patients using the CapsoCam UGI system. As of the date of this Quarterly Report three patients have been enrolled in this study. The study continues and we are working on expanding a number of clinical sites participating in the study. We expect to resubmit the Breakthrough Device Designation application following the study, when additional data is available. The breakthrough designation is a part of the on-going project, potentially supplementing the regulatory pathway and approval for early pancreas cancer detection. However, additional research and studies to collect data may delay our anticipated timeline for obtaining the regulatory clearance (including obtaining the Breakthrough Device Designation) and may increase our research and development costs.

Previous wording

As of March 31, 2026, we had an accumulated deficit of $162.7 million. To date, we have funded our operations primarily through proceeds from the sale of shares of our convertible preferred stock, IPO and Private Placement proceeds and cash generated from the sale of CapsoCam capsules and the use of CapsoCloud or CapsoView, CapsoCloud data access, and capsule video reading service.

Current wording

As of June 30, 2026, we had an accumulated deficit of $170.2 million. To date, we have funded our operations primarily through proceeds from the sale of shares of our convertible preferred stock, IPO and Private Placement proceeds and cash generated from the sale of CapsoCam capsules and the use of CapsoCloud or CapsoView, CapsoCloud data access, and capsule video reading service.

Previous wording

Success in further penetrating the small bowel capsule endoscopy market. Until commercialization of our CapsoCam Colon capsule (targeted for the middle of 2027), to grow our revenues (and, in turn, reduce our expected losses and negative cash flows), we intend to grow our small-bowel-related revenues by, among other things: (i) retaining and growing our customer base; (ii) cost-effectively increasing the size and effectiveness of our U.S. and international sales teams and our customer-support function; (iii) pursuing the pediatric market (with children comprising a significant portion of the Crohn’s disease patient population); (iv) introducing complementary products such as our (a) capsule delivery device with full commercialization expected in the fourth quarter of 2026, and (b) patency capsule (for verifying whether a capsule endoscope can pass through the bowel without retention prior to an exam) with tentative FDA 510(k) submission planned by the end of the second quarter of 2026; (v) facilitating increased telemedicine adoption following recent FDA clearance of remote ingestion of our

Current wording

Success in further penetrating the small bowel capsule endoscopy market. Until commercialization of our CapsoCam Colon capsule (targeted for within one quarter after FDA clearance is provided), to grow our revenues (and, in turn, reduce our expected losses and negative cash flows), we intend to grow our small-bowel-related revenues by, among other things: (i) retaining and growing our customer base; (ii) cost-effectively increasing the size and effectiveness of our U.S. and international sales teams and our customer-support function; (iii) pursuing the pediatric market (with children comprising a significant portion of the Crohn’s disease patient population); (iv)

Previous wording

Due to the potential increase in cost of revenue, expected as a result of U.S. trade policies changes, including increasing tariffs on imports, our gross profit/gross margin may be adversely impacted.

Current wording

Due to the potential increase in costs of revenue, expected as a result of U.S. trade policies changes, including increasing tariffs on imports, our gross profit/gross margin may be adversely impacted.

Previous wording

In the near term, we expect our clinical development expenses to vary as a percent of revenue as, among others, we (i) continued the second arm of our CapsoCam Colon pivotal study involving the second generation of that capsule (incorporating further advanced features designed to improve the accuracy of CapsoCam Colon) with the second arm expected to involve approximately 800 patients enrolled at up to 20 sites in the U.S. and plan to refine the study based on the FDA comments to the first arm pivotal study, (ii) continued clinical development of our updated small bowel CapsoCam Plus capsule incorporating our AI assisted pathology detection technology, and (iii) conducted additional research and studies to collect data for the development of CapsoCam UGI.

Current wording

In the near term, we expect our clinical development expenses to vary as a percent of revenue as, among others, we (i) continued the second arm of our CapsoCam Colon pivotal study involving the second generation of that capsule (incorporating further advanced features designed to improve the accuracy of CapsoCam Colon) with the second arm involving 801 patients enrolled, and (ii) conducted additional research and studies to collect data for the development of CapsoCam UGI.

Previous wording

In addition to clinical trials costs, our research and development costs also includes engineering for our AI technology, hardware development, and regulatory personnel.

Current wording

In addition to clinical trials costs, our research and development costs also include engineering for our AI technology, hardware development, and regulatory personnel.

Previous wording

Our revenue was flat when comparing the three months ended March 31, 2026 and 2025. The reason was a period-over-period decrease of 3% in the number of CapsoCam Plus capsules sold for the three months ended March 31, 2026 and 2025 offset by a period-over-period increase of approximately 1% in the average selling price for the three months ended March 31, 2026 and 2025.

Current wording

Our revenue for the three months ended June 30, 2026 and 2025 was $3.6 million and $3.3 million, respectively, representing a period-over-period growth of $0.3 million or approximately 10% (7% in the U.S. and 20% internationally). The primary driver for the revenue growth was a 13% increase in the number of CapsoCam Plus capsules sold offset by a period-over-period decrease of approximately 3% in the average selling price due to competitive pricing pressure. Our revenue for the six months ended June 30, 2026 and 2025 was $6.4 million and

Previous wording

For the three months ended March 31, 2026 and 2025, international sales accounted for 28% and 23% of total revenue.

Current wording

For the three months ended June 30, 2026 and 2025, international sales accounted for 25% and 23% of total revenue. For the six months ended June 30, 2026 and 2025, international sales accounted for 26% and 23% of total revenue.

Previous wording

As we continued to scale our business, costs of revenue increased $0.2 million, or 13%, for the three months ended March 31, 2026, compared to the three months ended March 31, 2025 from $1.3 million to $1.5 million. The increased costs of revenue was attributable to increased customs and tariffs due to the change in U.S. customs policy.

Current wording

As we continued to scale our business, costs of revenue increased $0.3 million, or 18%, for the three months ended June 30, 2026, compared to the three months ended June 30, 2025 from $1.5 million to $1.8 million. The increased costs of revenue was attributable to increased unit sales of CapsoCam Plus for the small-bowel. For the six months ended June 30, 2026, compared to the six months ended June 30, 2025 the cost of revenue was $3.2 million and $2.8 million, respectively, which represented an increase of $0.4 million, or 16% period-over-period. The increased costs of revenue was attributable to $0.3 million due to increased unit sales of CapsoCam Plus for the small-bowel and the related services and $0.1 million due to to increased customs and tariffs due to the change in U.S. customs policy.

Previous wording

Gross profit decreased $0.2 million, or 11%, for the three months ended March 31, 2026, compared to the three months ended March 31, 2025, from $1.5 million to $1.3 million. For the three months ended March 31, 2026 and 2025, the gross margin was 48% and 54%, respectively. The decrease in gross profit was a result of changes the U.S. government made to the trade policies and tariffs resulting in an increase in expenses for customs and tariffs.

Current wording

Gross profit increased $0.1 million, or 3%, for the three months ended June 30, 2026, compared to the three months ended June 30, 2025, from $1.8 million to $1.9 million. For the three months ended June 30, 2026 and 2025, the gross margin was 51% and 55%, respectively. Gross profit decreased $(0.1) million, or (3)%, for the six months ended June 30, 2026, compared to the six months ended June 30, 2025, from $3.3 million to $3.2 million. For the six months ended June 30, 2026 and 2025, the gross margin was 50% and 54%, respectively. The increase in gross profit was a result of increased CapsoCam Plus unit sales and the related software component, while the decline of the gross margin is due to a pressure on selling prices we have when operating in a highly competitive market and changes the U.S. government made to the trade policies and tariffs at the beginning of the year resulting in an increase in expenses for customs and tariffs.

Previous wording

The following tables provide a summary for our key operating expenses forthe three months ended March 31, 2026 and 2025.

Current wording

The following tables provide a summary for our key operating expenses forthe three and six months ended June 30, 2026 and 2025.

Previous wording

Selling and marketing expenses increased $0.1 million, or 7%, for the three months ended March 31, 2026, compared to the three months ended March 31, 2025, from $2.0 million to $2.1 million. The increase was due to a headcount increase of 4 employees in the sales and marketing organization, including insides sales, that resulted in an increase in compensation expenses, as well as an increase in insurance expenses.

Current wording

Selling and marketing expenses increased $0.2 million, or 6%, for the six months ended June 30, 2026 compared to the six months ended June 30, 2025, from $3.8 million to $4.0 million. The increase was due to a headcount increase of 4 employees in the sales and marketing organization, including inside sales, that resulted in a $0.1 million increase in compensation expenses, as well as an increase in insurance expenses, and an increase in stock-based compensation due to new stock-option grants.

Previous wording

Research and development expenses increased $1.3 million, or 43%, for the three months ended March 31, 2026, compared to the three months ended March 31, 2025, from $3.1 million to $4.4 million. The increase was primarily due to $0.9 million attributable to expenses associated with ongoing clinical trials and a $0.4 million net increase of non-recurring engineering services driven by the development of the new CMOS under the development agreement with Canon Inc.

Current wording

Research and development expenses increased $3.2 million, or 50%, for the six months ended June 30, 2026 compared to the six months ended June 30, 2025, from $6.5 million to $9.7 million. The increase was primarily due to a $2.3 million increase attributable to expenses associated with ongoing clinical trials, a $0.9 million increase in expenses for non-recurring engineering services driven by the development of the new CMOS image sensor under the development agreement with Canon Inc., and an increase in stock-based compensation expenses for $0.1 million due to new stock-option grants.

Previous wording

General and administrative expenses increased $0.1 million, or 5%, for the three months ended March 31, 2026 compared to the three months ended March 31, 2025, from $1.8 million to $1.9 million. The increase was due to expenses operating as a public company for $0.2 million (insurance expenses increased $0.1 million, Board of Directors cash compensation $0.1 million), increase in stock-based compensation expenses for $0.1 million, primarily due to stock-option grant per the consulting agreement with Mr. Wen-Hung Tsai, and expenses for software for $0.1 million (expenses for a new ERP implementation and software necessary for operating as a public company). This increase was partially offset by a decrease in expenses for audit (for $0.1 million) and consulting (for $0.2 million) that were higher in the first quarter of 2025 due to the preparation of the Company's financial statements in connection with the IPO.

Current wording

General and administrative expenses increased $1.1 million, or 35%, for the six months ended June 30, 2026 compared to the six months ended June 30, 2025, from $3.0 million to $4.1 million. The increase was due to expenses operating as a public company of $0.4 million (insurance expenses increased $0.3 million, Board of Directors cash compensation expense increased $0.1 million), an increase in stock-based compensation expenses of $0.4 million, primarily due to new stock-option grants, and software expenses of $0.2 million (expenses for a new ERP implementation and software necessary for operating as a public company). This increase was partially offset by a decrease in expenses for audit and consulting ($0.3 million) that were higher in the first half of 2025 due to the preparation of the Company's financial statements in connection with the IPO.

Previous wording

Our reported net loss attributable to CapsoVision common stockholders for the three months ended March 31, 2026 and 2025 totaled approximately $7.0 million and $5.4 million, respectively, representing a period-over-period increase of $1.7 million or 31%.

Current wording

Our reported net loss attributable to CapsoVision common stockholders for the three months ended June 30, 2026 and 2025 totaled approximately $7.5 million and $4.6 million, respectively, representing a period-over-period increase of $2.9 million or 62%. Our reported net loss attributable to CapsoVision common stockholders for the six months ended June 30, 2026 and 2025 totaled approximately $14.5 million and $10.0 million, respectively, representing a period-over-period increase of $4.5 million or 45%.

Previous wording

To date, we have financed our operations primarily through the net proceeds we have received from the sales of our convertible preferred stock, IPO and Private Placement as well as cash generated from sales of our CapsoCam Plus capsule endoscopy solution. We have generated losses from our operations as reflected in our accumulated deficit of $162.7 million as of March 31, 2026. Net cash used in operating activities was $6.1 million and $5.0 million for the three months ended March 31, 2026 and 2025, respectively.

Current wording

To date, we have financed our operations primarily through the net proceeds we have received from the sales of our convertible preferred stock, IPO and Private Placement as well as cash generated from sales of our CapsoCam Plus capsule endoscopy solution. We have generated losses from our operations as reflected in our accumulated deficit of $170.2 million as of June 30, 2026. Net cash used in operating activities was $14.5 million and $9.5 million for the six months ended June 30, 2026 and 2025, respectively.

Previous wording

Our interim (unaudited) financial statements for the three months ended March 31, 2026 included in this Quarterly Report on Form 10-Q note that there is substantial doubt about our ability to continue as a going concern within one year after the date of issuance of those financial statements (see Note 2. GOING CONCERN). This means that we have expressed substantial doubt about our ability to continue our operations without an additional infusion of capital from external sources. Our interim (unaudited) financial statements have been prepared on a going concern basis and do not include any adjustments to reflect the future effects on the recoverability and classification of assets or the amounts and classification of liabilities that may be necessary should we be unable to continue as a going concern. If we are unable to finance our operations, our business would be in jeopardy and we might not be able to continue operations and might have to liquidate our assets. In that case, investors might receive less than the value at which those assets are carried on our interim (unaudited) financial statements for the three months ended March 31, 2026, and it is likely that investors would lose all or a part of their investment. See “Risk Factors—Business and Industry Risks—Our Quarterly Report, our unaudited financial statements for the three months ended March 31, 2026 and our audited financial statements for the year ended December 31, 2025 include a footnote raising substantial doubt about our ability to continue as a ‘going concern’ and we will likely need to raise additional financing to fund our business and revenue growth plans."

Current wording

Our interim (unaudited) financial statements for the six months ended June 30, 2026 included in this Quarterly Report on Form 10-Q note that there is substantial doubt about our ability to continue as a going concern within one year after the date of issuance of those financial statements (see Note 2. GOING CONCERN). This means that we have expressed substantial doubt about our ability to continue our operations without an additional infusion of capital from external sources. Our interim (unaudited) financial statements have been prepared on a going concern basis and do not include any adjustments to reflect the future effects on the recoverability and classification of assets or the amounts and classification of liabilities that may be necessary should we be unable to continue as a going concern. If we are unable to finance our operations, our business would be in jeopardy and we might not be able to continue operations and might have to liquidate our assets. In that case, investors might receive less than the value at which those assets are carried on our interim (unaudited) financial statements for the six months ended June 30, 2026, and it is likely that investors would lose all or a part of their investment. See “Risk Factors—Business and Industry Risks—Our Quarterly Report, our unaudited financial statements for the six months ended June 30, 2026 and our audited financial statements for the year ended December 31, 2025 include a footnote raising substantial doubt about our ability to continue as a ‘going concern’ and we will likely need to raise additional financing to fund our business and revenue growth plans."

Previous wording

As of March 31, 2026, we had approximately $17.9 million in cash and cash equivalents. From our inception through March 31, 2026, we have received aggregate gross proceeds of $143.6 million from sales of our convertible preferred stock, which were automatically converted into shares of our common stock in connection with the completion of our IPO. To provide for additional liquidity prior to the completion of our IPO, on May 28, 2025 we received $1 million as a note payable from an existing investor. The note payable, together with interest thereon (at 1% per month) was repaid shortly after completion of our IPO. On July 3, 2025 we completed our IPO from which we received the net proceeds in the amount of $23.4 million. On March 16, 2026 we closed the Private Placement and received the gross proceeds in the amount of $14 million.

Current wording

As of June 30, 2026, we had approximately $9.1 million in cash and cash equivalents. From our inception through June 30, 2026, we have received aggregate gross proceeds of $143.6 million from sales of our convertible preferred stock, which were automatically converted into shares of our common stock in connection with the completion of our IPO. To provide for additional liquidity prior to the completion of our IPO, on May 28, 2025 we received $1 million as a note payable from an existing investor. The note payable, together with interest thereon (at 1% per month) was repaid shortly after completion of our IPO. On July 3, 2025 we completed our IPO from which we received the net proceeds in the amount of $23.4 million. On March 16, 2026 we closed the Private Placement and received the net proceeds in the amount of $13.4 million.

Previous wording

As of March 31, 2026, we had an accumulated deficit of $162.7 million and cash and cash equivalents of $17.9 million. On March 16, 2026, we completed the Private Placement with the gross proceeds to us of approximately $14 million. Based on our current operating plan, we believe that our existing cash balances will not be sufficient to fund our operations for at least the next 12 months after the date of issuance of these financial statements.

Current wording

As of June 30, 2026, we had an accumulated deficit of $170.2 million and cash and cash equivalents of $9.1 million. On March 16, 2026, we completed the Private Placement with the net proceeds to us of approximately $13.4 million. Based on our current operating plan, we believe that our existing cash balances will not be sufficient to fund our operations for at least the next 12 months after the date of issuance of these financial statements.

Previous wording

For the three months ended March 31, 2026, net cash used in operating activities totaled $6.1 million, primarily driven by the net loss of $7.0 million for the period. Additional contributing factors included a $0.4 million increase in accrued expenses and other current liabilities, and a $0.2 million increase in accounts payable, mainly due to research and development expenses and increased clinical trial expenses, as well as $0.3 million increase in stock-based compensation expenses due to new grants.

Current wording

For the six months ended June 30, 2026, net cash used in operating activities totaled $14.5 million, primarily driven by the net loss of $14.5 million for the period. Additional contributing factors included a $1.7 million increase in inventory to meet increased demand, a $1.4 million increase in accrued expenses and other current liabilities and a $0.7 million decrease in accounts payable, mainly due to research and development expenses and increased clinical trial expenses, as well as $0.9 million increase in stock-based compensation expenses due to new grants.

Previous wording

For the three months ended March 31, 2025, net cash used in operating activities was $5.0 million, primarily attributable to the net loss of $5.4 million. Cash outflows were further impacted by a $0.4 million increase in inventory to meet increased demand, and a $0.8 million increase in accrued expenses and other current liabilities, mainly due to research and development expenses, including on-going clinical trials.

Current wording

For the six months ended June 30, 2025, net cash used in operating activities was $9.5 million, primarily attributable to the net loss of $10.0 million. Cash outflows were further impacted by a $0.4 million increase in inventory to meet increased demand, and a $1.0 million increase in accrued expenses and other current liabilities, mainly due to research and development expenses and increased headcount related expenses.

Previous wording

Net cash used in investing activities during the three months ended March 31, 2026 and 2025 was immaterial and consisted of purchases of property and equipment.

Current wording

Net cash used in investing activities during the six months ended June 30, 2026 and 2025 was immaterial and consisted of purchases of property and equipment.

Previous wording

Net cash provided by financing activities during the three months ended March 31, 2026 consisted primarily of $14 million in gross proceeds from the Private Placement. For the three months ended March 31, 2025, net cash provided by financing activities was immaterial and consisted of the proceeds from exercise of stock options and warrants.

Current wording

Net cash provided by financing activities during the six months ended June 30, 2026 consisted primarily of $14.0 million in gross proceeds from the Private Placement, net of issuance costs of $0.6 million. For the six months ended June 30, 2025, net cash provided by financing activities consisted primarily of $1.0 million from note payable received from an existing investor and $0.2 million in proceeds from the exercise of options on common stock and warrants.

Previous wording

Our contractual obligations at March 31, 2026 include operating lease payments of $0.9 million due within 21 months and $2.2 million in outstanding purchase commitment for the development agreement with Canon Inc. due in 12 months. We expect to fund these obligations through our existing cash balances and cash flows from operations.

Current wording

Our contractual obligations at June 30, 2026 include operating lease payments of $0.7 million due within 18 months, purchase commitments to raw material suppliers of $1.0 million due within 21 months and $1.8 million in outstanding purchase commitment for the development agreement with Canon Inc. due in 9 months. We expect to fund these obligations through our existing cash balances and cash flows from operations.