BIOLARGO, INC.

Previous wording

This quarterly report on Form 10-Q contains forward-looking statements. These forward-looking statements involve risks and uncertainties, including statements regarding BioLargo’s capital needs, business plans and expectations. Such forward-looking statements involve risks and uncertainties regarding BioLargo’s ability to carry out its planned development and production of products. Forward-looking statements are made, without limitation, in relation to BioLargo’s operating plans, BioLargo’s liquidity and financial condition, availability of funds, operating and exploration costs and the market in which BioLargo competes. Any statements contained herein that are not statements of historical facts may be deemed to be forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as “may”, “will”, “should”, “expect”, “plan”, “intend”, “anticipate”, “believe”, “estimate”, “predict”, “potential” or “continue”, the negative of such terms or other comparable terminology. Actual events or results may differ materially. In evaluating these statements, you should consider various factors, including the risks outlined in our Form most recent annual report on Form 10-K, and, from time to time, in other reports BioLargo files with the SEC. These factors may cause BioLargo’s actual results to differ materially from any forward-looking statement. BioLargo disclaims any obligation to publicly update these statements, or disclose any difference between its actual results and those reflected in these statements. The information constitutes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Given these uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements.

Current wording

This Quarterly Report on Form 10-Q contains forward-looking statements. These statements relate to future events or our future financial performance and include statements regarding our capital needs, business plans, liquidity and financial condition, availability of funds, operating costs, and the markets in which we compete. In some cases, you can identify forward-looking statements by terminology such as "may," "will," "should," "expect," "plan," "intend," "anticipate," "believe," "estimate," "predict," "potential," or "continue," or the negative of these terms or other comparable terminology. Any statements contained in this report that are not statements of historical fact may be deemed to be forward-looking statements. Forward-looking statements involve known and unknown risks, uncertainties, and other factors that may cause our actual results, performance, or achievements to be materially different from any future results, performance, or achievements expressed or implied by the forward-looking statements. These factors include, among others, the risks described in our most recent Annual Report on Form 10-K and, from time to time, in our other filings with the Securities and Exchange Commission. Given these risks and uncertainties, you are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this report. Except as required by law, we undertake no obligation to update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise. All forward-looking statements are expressly qualified in their entirety by this cautionary statement.

Previous wording

When we refer in this report to “BioLargo,” the “Company,” “our Company,” “we,” “us” and “our,” we mean BioLargo, Inc., and our subsidiaries, including BioLargo Life Technologies, Inc., which holds our intellectual property; ONM Environmental, Inc., which manufactures, markets, sells and distributes our odor and volatile organic compound ("VOC") control products; BioLargo Energy Technologies, Inc. (“BETI”), formed to commercialize our proprietary battery technology; BioLargo Canada, Inc., our primary research and development team operating in Edmonton, Alberta Canada; BioLargo Engineering, Science & Technologies, LLC (“BLEST”), a professional engineering services division in Oak Ridge Tennessee; BioLargo Equipment Solutions & Technologies, Inc., which sells our water treatment products; BioLargo Development Corp., which employs and provides benefits to our employees; and Clyra Medical Technologies, Inc. (“Clyra Medical”), which commercializes our technologies in the medical and dental fields. All subsidiaries are wholly owned, except for BETI, BLEST and Clyra Medical.

Current wording

When we refer in this report to “BioLargo,” the “Company,” “our Company,” “we,” “us” and “our,” we mean BioLargo, Inc., and our subsidiaries, including BioLargo Life Technologies, Inc., which holds our intellectual property; ONM Environmental, Inc., which manufactures, markets, sells and distributes our odor and volatile organic compound ("VOC") control products; BioLargo Energy Technologies, Inc. (“BETI”), formed to commercialize our proprietary battery technology; BioLargo Canada, Inc., our primary research and development team operating in Edmonton, Alberta Canada; BioLargo Engineering, Science & Technologies, LLC (“BLEST”), a professional engineering services division in Oak Ridge Tennessee; BioLargo Equipment Solutions & Technologies, Inc., which sells our water treatment products; BioLargo CPG, LLC ("BCPG"), which was formed in May 2026 to commercialize household consumer products based on our technologies; BioLargo Development Corp., which employs and provides benefits to our employees; and Clyra Medical Technologies, Inc. (“Clyra Medical”), which commercializes our technologies in the medical and dental fields. All subsidiaries are wholly owned, except for BETI, BLEST, BCPG and Clyra Medical.

Previous wording

Why do we do this work? Every member of our team – including PhD scientists, engineers, and entrepreneurs – has a passion for seeking new, never-before-seen innovations that can make life better around the world. We care about safeguarding the environment and human health for future generations. We care about making technologies that are affordable and flexible enough to be accessed around the world. And we care about being the best at what we do – creating best-in-class technologies to solve meaningful cleantech challenges.

Current wording

Why do we do this work? Every member of our team – including PhD scientists, engineers, and entrepreneurs – has a passion for seeking new, never-before-seen innovations that can make life better around the world. We care about safeguarding the environment and human health for future generations. We care about making technologies that are affordable and flexible enough to be accessed around the world. And we care about doing the work well - developing technologies that solve meaningful cleantech challenges.

Previous wording

BLEST's board of directors includes Jeffrey Kightlinger, former CEO of the Metropolitan Water District of Southern California, Sally Gutierrez, retired career senior executive from the US Environmental Protection Agency (EPA), and Larry Dick, former Vice Chairman of the Metropolitan Water District of Southern California and board member of the Municipal Water District of Orange County. Each brings their significant and distinctive experience from decades in the water industry to BEST’s board to help the company create the necessary regulatory and industry connections that will be critical for its efforts to secure larger and more high-profile projects for its PFAS treatment and other water treatment technologies. These board members have been instrumental in efforts to raise awareness of our innovative treatment solutions within the water industry and EPA.

Current wording

BEST's board of directors includes Jeffrey Kightlinger, former CEO of the Metropolitan Water District of Southern California, Sally Gutierrez, retired career senior executive from the US Environmental Protection Agency (EPA), and Larry Dick, former Vice Chairman of the Metropolitan Water District of Southern California and board member of the Municipal Water District of Orange County. Each brings their significant and distinctive experience from decades in the water industry to BEST’s board to help the company create the necessary regulatory and industry connections that will be critical for its efforts to secure larger and more high-profile projects for its PFAS treatment and other water treatment technologies. These board members have been instrumental in efforts to raise awareness of our innovative treatment solutions within the water industry and EPA.

Previous wording

Securing sales in the water and wastewater industry is a very technically intensive process and can be long and arduous. The entirety of the sales cycle can be lengthy, in some cases even taking many months or, in the case of very large projects, multiple years. A typical sales timeline for a municipal drinking water or wastewater customer, from introduction to signing the contract for a full-scale install, usually requires feasibility studies, on-site pilot projects, budget approvals, State regulatory approvals, and more. Industrial clients may have a shorter sales cycles but are under pressure to ensure that the Return on Investment (ROI) fits into company standards, so their reviews can also be lengthy. For any water treatment project, the process is also very engineering-intensive, and therefore the staff required to secure contracts for water treatment projects need to be engineers, in most cases. In our company, BLEST’s engineers fill this role.

Current wording

Securing sales in the water and wastewater industry is a very technically intensive process and can be long and arduous. The entirety of the sales cycle can be lengthy, in some cases even taking many months or, in the case of very large projects, multiple years. A typical sales timeline for a municipal drinking water or wastewater customer, from introduction to signing the contract for a full-scale install, usually requires feasibility studies, on-site pilot projects, budget approvals, State regulatory approvals, and more. Industrial clients may have shorter sales cycles but are under pressure to ensure that the Return on Investment (ROI) fits into company standards, so their reviews can also be lengthy. For any water treatment project, the process is also very engineering-intensive, and therefore the staff required to secure contracts for water treatment projects need to be engineers, in most cases. In our company, BLEST’s engineers fill this role.

Previous wording

Our AEC unit has been installed and is up and running in Lake Stockholm, New Jersey, removing PFAS from drinking water for local residents. The AEC's performance is undergoing regular testing by both the U.S. EPA and the New Jersey Department of Environmental Protection. This project may represent a key milestone for the commercialization of the AEC, as we believe industry validation of the technology in a first municipal drinking water treatment project will play an important role in showcasing the AEC’s distinct advantages over incumbent technologies like carbon filtration and ion exchange. As we progress through the commercial rollout of our AEC technology, we continue to invest in innovation aimed at enhancing its commercial viability. These efforts are focused on improving system performance, reducing lifecycle costs, and strengthening the AEC’s competitive position within the PFAS treatment market. We remain committed to delivering scalable, cost-effective solutions that align with evolving regulatory requirements and market demand.

Current wording

Our AEC unit has been installed and is up and running in Lake Stockholm, New Jersey, and has been removing PFAS from drinking water for local residents for over six months. The AEC's performance is undergoing regular testing by both the U.S. EPA and the New Jersey Department of Environmental Protection to ensure it continues to meet their standards. We believe this project can validate for potential customers the AEC's use in municipal drinking water, and can showcase the AEC’s distinct advantages over incumbent technologies like carbon filtration and ion exchange, which include lower hazardous waste disposal costs.

Previous wording

We have successfully validated the AEC as an effective system to selectively extract and collect PFAS chemicals from contaminated water, including performance testing that shows “non-detect” levels of removal, which meets new EPA standards. We have demonstrated more than 10,000 hours of continuous operation showing no materially significant degradation of the AEC system’s components or performance over time, and believe the costs to operate our system will be far less than that of the two primary incumbent technologies.

Current wording

We have successfully validated the AEC as an effective system to selectively extract and collect PFAS chemicals from contaminated water, including performance testing that shows “non-detect” levels of removal, which meets both state and federal regulations. In addition to the use in Lake Stockholm New Jersey, we have demonstrated more than 10,000 hours of continuous operation showing no materially significant degradation of the AEC system’s components or performance over time, and believe the costs to operate our system will be far less than that of the two primary incumbent technologies.

Previous wording

We believe we are well-positioned in the PFAS-removal market for multiple reasons. We have successfully completed over a dozen pilot studies with prospective customers’ PFAS contaminated water from a variety of source waters including groundwater, wastewater and leachate; we have successfully maintained operation of our AEC PFAS treatment system for over 10,000 hours continuously, thus demonstrating its resilience to long-term use; we have submitted bids and proposals and have received indications of interest from a wide range of customer types; we have added several high-profile experts from the industry to our team who are assisting in opening doors to potential clients and collaborators; we have entered into discussions about partnership and opportunities for collaboration with industry-leading firms who have a gap in their PFAS treatment technology portfolio. While these opportunities do not convert into commercial sales overnight, but they represent strong avenues for accelerating adoption of our PFAS treatment solution.

Current wording

As we progress through the commercial rollout of our AEC technology, we continue to invest in innovation aimed at enhancing its commercial viability. These efforts are focused on improving system performance, reducing lifecycle costs, and strengthening the AEC’s competitive position within the PFAS treatment market. We remain committed to delivering scalable, cost-effective solutions that align with evolving regulatory requirements and market demand. We believe we are well-positioned in the PFAS-removal market for multiple reasons. We have successfully completed over a dozen pilot studies with prospective customers’ PFAS contaminated water from a variety of source waters including groundwater, wastewater and leachate; we have successfully maintained operation of our AEC PFAS treatment system for over 10,000 hours continuously, thus demonstrating its resilience to long-term use; we have submitted bids and proposals and have received indications of interest from a wide range of customer types; we have added several high-profile experts from the industry to our team who are assisting in opening doors to potential clients and collaborators; we have entered into discussions about partnership and opportunities for collaboration with industry-leading firms who have a gap in their PFAS treatment technology portfolio. While these opportunities do not convert into commercial sales overnight, they represent strong avenues for accelerating adoption of our PFAS treatment solution.

Previous wording

Our subsidiary BioLargo Energy Technologies, Inc. (“BETI”) was founded to commercialize a novel battery technology with the potential to help facilitate the ongoing shift toward renewable energy production by providing a safer, longer lasting, more eco-friendly, and more affordable alternative to lithium-ion batteries. Designed for long duration energy storage, also known as "battery energy storage solutions" (BESS), our battery, called Cellinity™, uses a novel “liquid sodium” chemistry that uses common domestically sourced materials, and which has significant advantages over other battery chemistries for use in stationary, long-duration energy storage.

Current wording

Our subsidiary BioLargo Energy Technologies, Inc. (“BETI”) was founded to commercialize a novel battery technology with the potential to help facilitate the ongoing shift toward renewable energy production by providing a safer, longer lasting, more eco-friendly, and more affordable alternative to lithium-ion batteries. Designed for long duration energy storage, also known as "battery energy storage systems" (BESS), our battery, called Cellinity™, uses a novel “liquid sodium” chemistry that uses common domestically sourced materials, and which has significant advantages over other battery chemistries for use in stationary, long-duration energy storage.

Previous wording

BETI operates out of a pilot-scale battery production facility in our Oak Ridge Tennessee engineering headquarters, and is currently manufacturing and testing prototype battery cells. A third party has confirmed many of the technology's exceptional performance claims that we believe will make it an attractive battery technology for long duration energy storage and other industrial uses such as artificial intelligence data centers, electric vehicle charging stations, and renewal energy, including the stability of the chemistry of the battery cell and the reliability of the component construction as a sealed, non-venting cell design with no self-discharging, and the battery's ability to quickly charge and discharge at a high voltage. It has also been proven that the battery can withstand catastrophic physical insults without causing fire or explosion, one of the battery’s key features. With this data confirmed by a third party, our engineers have begun work advancing Cellinity's development, including the design of a larger sized battery cell that would then be incorporated into battery packs, modules and batteries meant for industrial facilities. Simultaneously, our engineers are working to develop manufacturing processes that would allow scale production and a supply chain necessary to ensure costs of goods in line with market demand and conditions.

Current wording

BETI operates out of a pilot-scale battery production facility in our Oak Ridge Tennessee engineering headquarters, and is currently manufacturing and testing prototype battery cells. A third party has confirmed many of the technology's exceptional performance claims that we believe will make it an attractive battery technology for long duration energy storage and other industrial uses such as artificial intelligence data centers, electric vehicle charging stations, and renewable energy, including the stability of the chemistry of the battery cell and the reliability of the component construction as a sealed, non-venting cell design with no self-discharging, and the battery's ability to quickly charge and discharge at a high voltage. It has also been proven that the battery can withstand catastrophic physical insults without causing fire or explosion, one of the battery’s key features. With this data confirmed by a third party, our engineers have begun work advancing Cellinity's development, including the design of a larger sized battery cell that would then be incorporated into battery packs, modules and batteries meant for industrial facilities. Simultaneously, our engineers are working to develop manufacturing processes that would allow scale production and a supply chain necessary to ensure costs of goods in line with market demand and conditions.

Previous wording

Clyra has 12 full time employees, and has increased staff and raised capital to ready the company to launch additional products. Clyra’s management team includes Medical Director Dr. Jeffrey Marcus, who is Chief of Plastic, Maxillofacial, and Oral Surgery at Duke University, Nicholas Valeriani, chairman of the board of directors of Edwards Lifesciences and who had a 34-year career with Johnson and Johnson where he held numerous leadership positions in engineering, manufacturing, sales and marketing, and Linda Park of Edwards Lifesciences, where she serves as Corporate Secretary, Senior Vice President and Associate General Counsel, and as a board member of the Edwards Lifesciences Foundation.

Current wording

Clyra has 14 full time employees, and has increased staff and raised capital to ready the company to launch additional products. Clyra’s management team includes Medical Director Dr. Jeffrey Marcus, who is Chief of Plastic, Maxillofacial, and Oral Surgery at Duke University, Nicholas Valeriani, chairman of the board of directors of Edwards Lifesciences and who had a 34-year career with Johnson & Johnson where he held numerous leadership positions in engineering, manufacturing, sales and marketing, and Linda Park of Edwards Lifesciences, where she serves as Corporate Secretary, Senior Vice President and Associate General Counsel, and as a board member of the Edwards Lifesciences Foundation.

Previous wording

BLEST operates out of an engineering facility in Oak Ridge, Tennessee (a suburb of Knoxville), and employs a group of scientists and engineers, many of whom are owners of the entity (BioLargo owns 70% as of March 31, 2026 and December 31, 2025). The team is led by Randall Moore, who served as Manager of Operations for Consulting and Engineering for the Knoxville office of CB&I Environmental & Infrastructure and was formerly a leader at The Shaw Group, Inc., a Fortune 500 global engineering firm. Many of the other team members are also former employees of CB&I and Shaw, with the exception of more recent staff hires. The team is highly experienced across multiple industries and we believe they are considered experts in their respective fields, including: chemical engineering, wastewater treatment (including design, operations, data gathering and data evaluation), process safety, energy efficiency, air pollution, design and control, technology evaluation, technology integration, air quality management and testing, engineering management, permitting, industrial hygiene, applied research and development, air testing, environmental permitting, HAZOP review, chemical processing, thermal design, computational fluid dynamics, mechanical engineering, mechanical design, NEPDES permitting, RCRA/TSCA compliance and permitting, project management, storm water design and permitting, computer assisted design (CAD), bench chemistry, continuous emission monitoring system operator, data handling and evaluation and decommissioning and decontamination of radiological and chemical contaminated facilities. The team has decades of high-level experience in the energy industry. The engineering team has also developed an extended network of trusted engineering subcontractors that assist in serving specific client projects as needed.

Current wording

BLEST operates out of an engineering facility in Oak Ridge, Tennessee (a suburb of Knoxville), and employs a group of scientists and engineers, many of whom are owners of the entity (BioLargo owns 70%). The team is led by Randall Moore, who served as Manager of Operations for Consulting and Engineering for the Knoxville office of CB&I Environmental & Infrastructure and was formerly a leader at The Shaw Group, Inc., a Fortune 500 global engineering firm. Many of the other team members are also former employees of CB&I and Shaw, with the exception of more recent staff hires. The team is highly experienced across multiple industries and we believe they are considered experts in their respective fields, including: chemical engineering, wastewater treatment (including design, operations, data gathering and data evaluation), process safety, energy efficiency, air pollution, design and control, technology evaluation, technology integration, air quality management and testing, engineering management, permitting, industrial hygiene, applied research and development, air testing, environmental permitting, HAZOP review, chemical processing, thermal design, computational fluid dynamics, mechanical engineering, mechanical design, NEPDES permitting, RCRA/TSCA compliance and permitting, project management, storm water design and permitting, computer assisted design (CAD), bench chemistry, continuous emission monitoring system operator, data handling and evaluation and decommissioning and decontamination of radiological and chemical contaminated facilities. The team has decades of high-level experience in the energy industry. The engineering team has also developed an extended network of trusted engineering subcontractors that assist in serving specific client projects as needed.

Previous wording

BLEST engineers generate revenue through services to third party clients, as well as for internal BioLargo projects such as the AEC and battery (revenues from internal projects are eliminated in the consolidation of our financial statements and are designated “intersegment revenue”). Third party contracts include ongoing work at U.S. Air Force bases for air quality control which generate ongoing contract-based revenue of approximately $100,000 per month. Efforts to expand this work as well as with other clients are consistently ongoing. In April 2026 BLEST was engaged to design a pilot-scale minerals processing facility that will remediate and, utilizing a patented BioLargo process, will create a beneficial reuse of a legacy mineral waste deposit associated with a historically impacted site in the western United States. Work on the $1.2 million contract has begun and is expected conclude by the end of the year, and is expected to lead to the design and construction of a larger processing facility.

Current wording

BLEST engineers generate revenue through services to third party clients, as well as for internal BioLargo projects such as the AEC and battery (revenues from internal projects are eliminated in the consolidation of our financial statements and are designated “intersegment revenue”). Third party contracts include ongoing work at U.S. Air Force bases for air quality control which generate ongoing contract-based revenue of approximately $100,000 per month. Efforts to expand this work as well as with other clients are consistently ongoing. In April 2026 BLEST was engaged to design a pilot-scale minerals processing facility that will remediate and, utilizing a patented BioLargo process, will create a beneficial reuse of a legacy mineral waste deposit associated with a historically impacted site in the western United States. Work on the $1.2 million contract has begun and is expected to continue through second quarter of 2027, and is expected to lead to the design and construction of a larger processing facility.

Previous wording

Our revenues decreased 66% in the three months ended March 31, 2026, as compared with the same period in 2025, primarily due to a decreased volume of sales of our pet odor control product private labeled to a third party under the brand name “Pooph”. During the three months ended March 31, 2025, sales to Pooph had comprised 79% of our consolidated revenue; in August 2025 Pooph Inc. stopped purchasing Pooph-branded products from us, and thus revenues from sale of Pooph-branded products during the three months ended March 31, 2026 were zero. We are in litigation with Pooph Inc. and do not expect product sales to Pooph Inc. to resume. Our financial statements separate revenue based on products and services. Revenues from the sale of products for the three months ended March 31, 2026, decreased 79% (from $2,803,000 to $577,000) over the same period in 2025. Revenues from services for the three months ended March 31, 2026, increased 15% (from $466,000 to $538,000) over the same period in 2025.

Current wording

For the three and six months ended June 30, 2026, our revenues decreased 55% and 61% as compared with the same periods in 2025. The decrease is due to the cessation of sales of private-labeled pet odor control products sold to a third party under the brand name “Pooph” in August 2025. During the three and six months ended June 30, 2025, such sales had comprised 57% and 69% of our consolidated revenue. Our financial statements separate revenue based on products and services. Revenues from the sale of products totaled $421,000 and $999,000 for the three and six months ended June 30, 2026, a 79% decrease compared the same periods in 2025. Revenues from services totaled $827,000 and $1,364,000 for the three and six months ended June 30, 2026, an increase of 7% and 10% compared to the same periods in 2025.

Previous wording

ONM Environmental’s revenues decreased 85% in the three months ended March 31, 2026, compared with the same period in 2025. The decrease in revenues was due to a decrease in the volume of sales of our pet odor product private labeled to a third party under the brand name "Pooph", offset by an increase in sales of industrial odor control products (which increased 90% (from $223,000 to $423,000)).

Current wording

ONM Environmental’s revenues decreased 77% and 81% in the three and six months ended June 30, 2026, compared with the same periods in 2025. The decrease in revenues was due to a decrease in the volume of sales of our pet odor product private labeled to a third party under the brand name "Pooph", offset by sales of industrial odor control products.

Previous wording

ONM Environmental’s cost of goods sold includes costs of raw materials, contract manufacturing, and portions of depreciation, salaries and expenses related to the manufacturing and installation of its products. As a percentage of revenue, ONM Environmental’s costs of goods for the three months ended March 31, 2026, were 35%, a decrease of 19% compared to the same period in 2025. The decrease in cost of goods is due to the change in revenue concentration across product lines.

Current wording

ONM Environmental’s cost of goods sold includes costs of raw materials, contract manufacturing, and portions of depreciation, salaries and expenses related to the manufacturing and installation of its products. As a percentage of revenue, ONM Environmental’s costs of goods sold for the three and six months ended June 30, 2026, were 37% and 36% a decrease of 8% and 14% compared to the same periods in 2025. The decrease in cost of goods sold is due to the change in revenue concentration across product lines.

Previous wording

ONM Environmental’s selling, general and administrative expenses ("SG&A") totaled $371,000 and increased 24% during the three months ended March 31, 2026, as compared with the same period in 2025. The increase is due to increases in salaries, professional fees and insurance expense.

Current wording

ONM Environmental’s selling, general and administrative expenses ("SG&A") for the three and six months ended June 30, 2026 totaled $407,000 and $778,000, an increase of 47% and 27% compared with the same periods in 2025. The increase is due to increases in salaries, professional fees and insurance expense.

Previous wording

ONM Environmental generated an operating loss of $95,000 in the three months ended March 31, 2026, compared to operating income of $956,000 for the three months ended March 31, 2025. The operating loss is primarily due to the decrease in revenues.

Current wording

ONM Environmental generated an operating loss totaling $110,000 and $204,000 in the three and six months ended June 30, 2026, compared to operating income totaling $823,000 and $1,780,000 for the three and six months ended June 30, 2025. The operating loss is primarily due to the decrease in revenues.

Previous wording

BLEST generated $538,000 in third-party service revenues in the three months ended March 31, 2026, a 15% increase over the $466,000 in third-party service revenues in the same period in 2025. This increase was due to an increase in fixed fee contracts at U.S. Air Force bases.

Current wording

BLEST generated $777,000 and $1,314,000 in third-party service revenues in the three and six months ended June 30, 2026, an increase of 1% and 6% compared to the third-party service revenues in the same periods in 2025. This increase was due to an increase in fixed fee contracts at U.S. Air Force bases.

Previous wording

In addition to providing services to third party clients, BLEST provides services for internal BioLargo projects. These services are billed internally, are considered intersegment revenue, and are eliminated in the consolidation of our financial statements. In the three months ended March 31, 2026, intersegment revenue for BLEST totaled $259,000 and for the three months ended March 31, 2025, intersegment revenue for BLEST totaled $224,000.

Current wording

In addition to providing services to third party clients, BLEST provides services for internal BioLargo projects. These services are billed internally, are considered intersegment revenue, and are eliminated in the consolidation of our financial statements. In the three and six months ended June 30, 2026, intersegment revenue for BLEST totaled $313,000 and $574,000. In the three and six months ended June 30, 2025, intersegment revenue for BLEST totaled $169,000 and $393,000.

Previous wording

BLEST’s cost of revenues includes employee labor, subcontracted costs and material costs. In the three months ended March 31, 2026, costs were 56% of revenues, versus 39% in the same period in 2025. The increase is related to our fixed fee contracts, compared to product sales, which had more direct costs.

Current wording

BLEST’s cost of revenues includes employee labor, subcontracted costs and material costs. In the three and six months ended June 30, 2026, costs were 51% and 63% of revenues, versus 58% in the same periods in 2025. The fluctuation is related to our fixed fee contracts, compared to product sales, which had more direct costs.

Previous wording

BLEST’s SG&A expenses were $266,000 in the three months ended March 31, 2026, compared to $330,000 in the three months ended March 31, 2025. The decrease is due to the timing of expenses in the prior period and does not reflect a decrease in SG&A activity or employees.

Current wording

BLEST’s SG&A expenses were $168,000 and $434,000 in the three and six months ended June 30, 2026, compared to $224,000 and $556,000 in the three and six months ended June 30, 2025. The decrease is due to the timing of expenses in the prior period and does not reflect a decrease in SG&A activity or employees.

Previous wording

BLEST generated an operating loss of $380,000 in the three months ended March 31, 2026, compared to an operating loss of $378,000 in the three months ended March 31, 2025. The operating losses are reflective of the focus at BLEST on advancing internal BioLargo projects such as the Cellinity battery and AEC water treatment system.

Current wording

BLEST generated an operating loss of $45,000 and $426,000 in the three and six months ended June 30, 2026, compared to an operating income of $16,000 and an operating loss of $364,000 in the three and six months ended June 30, 2025. The operating losses are reflective of the focus at BLEST on advancing internal BioLargo projects such as the Cellinity battery and AEC water treatment system.

Previous wording

Clyra Medical generated revenues of $154,000 in the three months ended March 31, 2026 and margin of 57%, compared with no revenue in the same period in 2025. The increase in revenue is due to the sale of ViaCLYR® wound irrigation solution to a newly engaged distributor. In the three months ended March 31, 2026, Clyra incurred total costs of $1,712,000, which included $521,000 in research and development expenses. In the same period in 2025, total costs and expenses were $1,315,000, which included $335,000 in research and development expenses. The increases in costs and expenses are primarily related to an increased number of employees, increased product development work, and stock option expense.

Current wording

Clyra Medical did not generate revenue in the three months ended June 30, 2026, and generated revenues of $154,000 in the six months ended June 30, 2026. Clyra Medical did not generate revenue in 2025. The increase in revenue is due to the sale of ViaCLYR wound irrigation solution to a newly engaged distributor. In the three and six months ended June 30, 2026, Clyra incurred an operating loss of $2,105,000 and $3,826,000, which included $610,000 and $1,131,000 in research and development expenses. In the same periods in 2025, the operating loss totaled $1,263,000 and $2,580,000, which included $229,000 and $564,000 in research and development expenses. The increases in costs and expenses are primarily related to an increased number of employees, increased product development work, and stock option expense.

Previous wording

BioLargo Energy Technologies, Inc. (BETI) is developing our Cellinity battery, and has not generated generate revenue. For the three months ended March 31, 2026, it incurred total costs and expenses of $355,000, which included $142,000 in research and development expenses. In the same period in 2025, total costs and expenses were $96,000, which included $60,000 in research and development expenses. We are focused on recruiting business and financial partners to facilitate additional capital investment and move the product to commercialization.

Current wording

BioLargo Energy Technologies, Inc. (BETI) is developing our Cellinity battery, and has not generated revenue. For the three and six months ended June 30, 2026, it incurred total costs and expenses of $339,000 and $694,000, which included $156,000 and $298,000 in research and development expenses. In the same periods in 2025, total costs and expenses were $122,000 and $217,000, which included $54,000 and $113,000 in research and development expenses. We are focused on recruiting business and financial partners to facilitate additional capital investment and move the product to commercialization.

Previous wording

BioLargo Equipment, Sciences and Technologies, Inc. (BEST) was formed in fiscah year 2024 to commercialize BioLargo's proprietary water treatment equipment, including its PFAS removal device the AEC. As the first AEC sale occurred prior to the Company's formation, and the sales cycle for advanced water treatment systems is long, BEST has not yet generated revenues. We intend future water treatment projects to be contracted through BEST. During the three months ended March 31, 2026, it incurred $90,000 of total expenses. In the same period in 2025, it incurred $58,000 in total expenses primarily related to administrative activities.

Current wording

BioLargo Equipment Solutions & Technologies, Inc. (BEST) was formed in fiscal year 2024 to commercialize BioLargo's proprietary water treatment equipment, including its PFAS removal device the AEC. As the first AEC sale occurred prior to the Company's formation, and the sales cycle for advanced water treatment systems is long, BEST has not yet generated revenues. We intend future water treatment projects to be contracted through BEST. During the three and six months ended June 30, 2026, it incurred $75,000 and $165,000 of total expenses. In the same periods in 2025, it incurred $67,000 and $125,000 in total expenses primarily related to administrative activities.

Previous wording

Our SG&A expenses include both cash (for example, salaries to employees) and non-cash expenses (for example, stock option compensation expense). For the three months ended March 31, 2026 consolidated SG&A increased 9% (to $2,755,000) as compared with the three months ended March 31, 2025. The largest components of our SG&A expenses included (in thousands):

Current wording

Our SG&A expenses include both cash (for example, salaries to employees) and non-cash expenses (for example, stock option compensation expense). For the three and six months ended June 30, 2026 consolidated SG&A increased 23% and 16% as compared with the three and six months ended June 30, 2025. The largest components of our SG&A expenses included (in thousands):

Previous wording

In the three months ended March 31, 2026, our non-cash expenses from the issuance of stock and stock options increased to $699,000 compared to $615,000 for the three months ended March 31, 2025. The majority of this stock option expense is recorded in employee salaries and consulting expense. The reduction in salaries and payroll related expenses is due to an Employee Retention Tax Credit recognized in the first quarter ended March 31, 2026 offset by an increase related to an increased number of employees. Professional fees increased in the three months ended March 31, 2026, due to increased corporate activity related to new private securities offerings for BioLargo and Clyra, legal proceedings related to ONM Environmental, and other organizational needs that required professionals. Office expense increased due to an increase in insurance premiums.

Current wording

In the three and six months ended June 30, 2026, our non-cash expenses from the issuance of stock and stock options totaled $975,000 and $1,744,000 compared to $728,000 and $1,440,000 for the three and six months ended June 30, 2025. The majority of this stock option expense is recorded in employee salaries and consulting expense. The reduction in salaries and payroll related expenses is due to an Employee Retention Tax Credit recognized in the six months ended June 30, 2026, offset by an increased number of employees. Professional fees increased in the three and six months ended June 30, 2026, due to increased corporate activity related to new private securities offerings for BioLargo and Clyra, legal proceedings related to ONM Environmental, and other organizational needs that required professionals. Office expense increased due to an increase in insurance premiums.

Previous wording

In the three months ended March 31, 2026, we spent $907,000 in the research and development of our technologies and products. This was a increase of 15% as compared to the three months ended March 31, 2025. The increase is primarily due to the timing of project work and available working capital.

Current wording

In the three and six months ended June 30, 2026, we spent $1,088,000 and $1,995,000 in the research and development of our technologies and products. This was an increase of 103% and 51% as compared to the three and six months ended June 30, 2025. The increase is primarily due to the timing of project work and available working capital.

Previous wording

Our interest income for the three months ended March 31, 2026, was $72,000 compared to $28,000 in the three months ended March 31, 2025. Our interest expense for the three months ended March 31, 2026, was $188,000 compared to $93,000 in the three months ended March 31, 2025. The increase is related to the increase of Clyra Medical debt obligations.

Current wording

Our interest income for the three and six months ended June 30, 2026, was $13,000 and $85,000 compared to $35,000 and $63,000 in the three and six months ended June 30, 2025. Our interest expense for the three and six months ended June 30, 2026, was $285,000 and $474,000 compared to $115,000 and $208,000 in the three and six months ended June 30, 2025. The increase is related to the increase of Clyra Medical debt obligations.

Previous wording

For the three months ended March 31, 2026, we did not receive any grant income, compared to $6,000 of grant income for the same period in 2025. Grant income is primarily generated through our wholly owned Canadian subsidiary. The research grants received are considered reimbursement grants related to costs we incur and therefore are included as Other Income. Grant funds paid directly to third parties are not included as income in our condensed consolidated financial statements.

Current wording

For the three and six months ended June 30, 2026, we did not receive any grant income, compared to no grant income for the three months ended June 30, 2025, and $6,000 of grant income for the six months ended June 30, 2025. Grant income is primarily generated through our wholly owned Canadian subsidiary. The research grants received are considered reimbursement grants related to costs we incur and therefore are included as Other Income. Grant funds paid directly to third parties are not included as income in our condensed consolidated financial statements.

Previous wording

Net loss for the three months ended March 31, 2026, was $3,405,000 a loss of $ (0.01) per share, compared to a net loss for the three months ended March 31, 2025, of $1,921,000 a loss of $ (0.00) per share. Our net loss for the three months ended March 31, 2026, increased because of the decrease in revenue.

Current wording

Net loss for the three and six months ended June 30, 2026, was $4,000,000 and $7,405,000 a loss of $ (0.01) and $ (0.02) per share, compared to a net loss for the three and six months ended June 30, 2025, of $1,882,000 and $3,803,000 a loss of $ (0.004) and $ (0.008) per share. Our net loss for the three and six months ended June 30, 2026, increased because of the decrease in revenue.

Previous wording

For the three months ended March 31, 2026, we generated revenues of $1,115,000, had a net loss of $3,405,000, used $2,917,000 net cash in operating activities, and received $3,190,000 net cash from financing activities. As of March 31, 2026, we had current assets of $5,445,000, including $4,122,000 cash and cash equivalents. As of March 31, 2026, we had current liabilities of $4,932,000, and working capital of $513,000. We do not believe gross profits in the year ending December 31, 2026, will be sufficient to fund our current level of operations for the reminder of the year, and therefore expect we will continue to be limited in terms of our capital resources, and therefore expect to continue to need further investment capital to fund our business plans and investments in our new technologies. The foregoing factors raise substantial doubt about our ability to continue as a going concern, unless we are able to increase revenues, generate cash from operations, and/or generate cash from financing activities. If we are unable to raise additional cash through gross profits or financing activities, management may choose to curtail portions of our operations. The condensed consolidated financial statements do not include any adjustments that might be necessary if we are unable to continue as a going concern.

Current wording

For the six months ended June 30, 2026, we generated revenues of $2,363,000, had a net loss of $7,405,000, used $5,973,000 net cash in operating activities, and received $4,469,000 net cash from financing activities. As of June 30, 2026, we had current assets of $3,499,000, including $2,188,000 cash and cash equivalents. As of June 30, 2026, we had current liabilities of $4,765,000, and working capital deficit of $1,266,000. We do not believe gross profits in the year ending December 31, 2026, will be sufficient to fund our operational costs for the reminder of the year, and therefore expect we will continue need further investment capital to fund our business plans and investments in our technologies. The foregoing factors raise substantial doubt about our ability to continue as a going concern, unless we are able to increase revenues, generate cash from operations, and/or generate cash from financing activities. If we are unable to raise additional cash through gross profits or financing activities, management may choose to curtail portions of our operations. The condensed consolidated financial statements do not include any adjustments that might be necessary if we are unable to continue as a going concern.