SOBR Safe, Inc.
For the period ended Sep 30, 2025. Filed Nov 12, 2025.
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.
Sep 30, 2025 · Filed Nov 12, 2025
SOBR$0.20-48.0%Stored close · as of Sep 15, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-06-30; filed 2025-08-07.
0001477932-25-005544
ITEM 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-09-30; filed 2025-11-12.
0001477932-25-008092
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 94 previous paragraphs and 93 current paragraphs.
58 unchanged; 31 reworded; 4 added; 3 removed; 2 previous and 0 current paragraphs rearranged.
Tables are not compared: 8 previous and 9 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 (4)
Current report
We have begun executing a strategic initiative to expand beyond our core cloud-based alcohol monitoring and detection solutions to establish a broader presence within the health and wellness ecosystem. This evolution reflects SOBR’s commitment to supporting users not only in maintaining sobriety but also in achieving overall physical and mental well-being. Approximately 40% of Americans who experience AUD each year also experience depression, and around 35% live with anxiety. This overlap highlights a sizable total addressable market that spans behavioral health providers including sober living facilities, intensive outpatient programs, and residential treatment centers as well as retail consumers managing recovery for themselves or supporting a loved one. We believe this expansion will strengthen user engagement, diversify revenue streams, and position the Company as a comprehensive wellness technology provider in the future. Our ongoing focus will be placed on product innovation, providing data-driven user insights, and ensuring that new offerings remain consistent with our mission to promote a healthier, safer world free from the impacts of alcohol with balanced lifestyles.
Current report
The cost of goods and services for the three months ended September 30, 2025, was $71,026 resulting in a gross profit of $37,867 and a gross margin of 34.8%. The cost of goods and services for the three months ended September 30, 2024 was $15,992 resulting in a gross profit of $30,137 and a gross margin of 65.3%. The decrease in gross margin is primarily driven by two factors: (i) strategic price reductions to the SOBRsure devices and software subscriptions and (ii) an increase in cost of goods associated with product replacements. The pricing adjustments reflect a proactive approach to enhancing market competitiveness and expanding our customer base. The replacements were linked to specific product quality issues that have since been identified and addressed. The Company has implemented corrective actions, including enhanced quality assurance processes and supplier performance reviews, to mitigate similar issues going forward. We expect these efforts to support margin recovery in future periods while maintaining our focus on customer satisfaction and product integrity. While these actions contributed to a short-term decline in gross margin, they are expected to support revenue growth and improve margin performance over the longer term.
Current report
Interest expense increased by $3,053 from $5,908 for the three months ended September 30, 2024, to $8,961 for the three months ended September 30, 2025. This increase is due to an increase in the premium financing note payable balance at September 30, 2025.
Current report
Results of Operations for Nine Months Ended September 30, 2025, Compared to Nine Months Ended September 30, 2024
Removed paragraphs (3)
Previous report
➢ In July 2025, the Company remitted payments in the aggregate amount of $1,640,000 to remaining holders of the Series A Warrants issued on October 9, 2024 in conjunction with the 2024 PIPE Financing. The payments were made to satisfy the determined True-Up Payment obligation accrued as of June 30, 2025 and will not have an impact on the Company’s ability to continue as a going concern.
Previous report
➢ On July 17, 2025, the Company’s stockholders approved and ratified an amendment to increase the number of shares authorized under the 2019 Equity Incentive Plan to 350,000 shares.
Previous report
Results of Operations for Six Months Ended June 30, 2025, Compared to Six Months Ended June 30, 2024
Reworded paragraphs (31)
Previous wording
Pursuant to approval of an application with the Nasdaq Capital Market (“Nasdaq”) to uplist our common stock to their exchange under the ticker symbol “SOBR,” our common stock began trading and quoted on the Nasdaq on May 16, 2022. Prior to this uplist to the Nasdaq exchange, our common stock was quoted on the “OTCQB” tier of the OTC Markets under the ticker symbol “SOBR.”
Current wording
Pursuant to approval of an application with the Nasdaq Capital Market to uplist our common stock to their exchange under the ticker symbol “SOBR,” our common stock began trading and quoted on the Nasdaq on May 16, 2022. Prior to this uplist to the Nasdaq exchange, our common stock was quoted on the “OTCQB” tier of the OTC Markets under the ticker symbol “SOBR.”
Previous wording
Since inception we have generated significant losses from operations and anticipate that we will continue to generate significant losses for the foreseeable future. Our success is dependent on our ability to access additional capital. Additional capital will be required under the following circumstances: 1) to offset negative cash flows from operations, 2) to accelerate customer acquisition, thereby increasing capital outlay, 3) for advanced purchasing of materials, 4) for the acquisition of new technology, 5) for potential acquisition of a key asset, and 6) for sales expansion.
Current wording
Since inception we have generated significant losses from operations and anticipate that we will continue to generate significant losses for the foreseeable future. Our success is dependent on our ability to access additional capital. Additional capital will be required under the following circumstances: 1) to offset negative cash flows from operations, 2) to accelerate customer acquisition, thereby increasing capital outlay, 3) for advanced purchasing of materials, 4) for the development and acquisition of new technology, 5) for potential acquisition of a key asset, and 6) for sales expansion.
Previous wording
SOBR Safe is committed to addressing the increasing diagnosis of Alcohol Use Disorder (“AUD”) which is a medical condition characterized by an inability to control or stop the use of alcohol despite the adverse effects and consequences. Approximately 29 million individuals in the United States and 283 million globally suffer from this diagnosis where the problematic use of alcohol can result in both short- and long-term health issues including effects on behavioral wellness and overall physical health. According to the National Institute on Alcohol Abuse and Alcoholism, AUD increased by 38% during the COVID pandemic creating a surge in diagnoses and untreated cases.
Current wording
SOBR Safe is committed to addressing the increasing diagnosis of Alcohol Use Disorder (“AUD”) which is a medical condition characterized by an inability to control or stop the use of alcohol despite the adverse effects and consequences. According to the National Institute on Alcohol Abuse and Alcoholism (“NIAAA”) approximately 29 million individuals in the United States and 283 million globally suffer from this diagnosis where the problematic use of alcohol can result in both short- and long-term health issues including effects on behavioral wellness and overall physical health. The NIAA also notes AUD increased by 38% during the COVID pandemic creating a surge in diagnoses and untreated cases.
Previous wording
During the six-months ended June 30, 2025, the following developments occurred:
Current wording
During the nine months ended September 30, 2025, the following developments occurred:
Previous wording
Subsequent to the six-months ended June 30, 2025, the following developments occurred as detailed below:
Current wording
Subsequent to the nine months ended September 30, 2025, the following developments occurred as detailed below:
Previous wording
Revenues of $104,228 for the three-month period ended June 30, 2025, have increased by $50,037, or an increase of 92.3%, as compared to the prior year period of $54,191. This increase is primarily driven by increased sales of our SOBRsure device of $29,244, or 133.0%; an increase in sales of our SOBRsure software subscriptions of $25,177, or 342.7%; and an increase in our SOBRcheck software subscriptions of $5,009. These increases have been offset by decreased sales of our SOBRcheck device of $7,365 and an increase in sales discounts of $2,312. During the three months ended June 30, 2025, the Company sold 161 unique SOBRsure 2 nd generation devices after being launched in the fourth quarter of 2024. This represents an increase of 8.8% from the prior quarter unique sales of 148 SOBRsure 2 nd generation devices.
Current wording
Revenues of $108,893 for the three months ended September 30, 2025 have increased by $62,764, or an increase of 136.1%, as compared to the prior year period of $46,129. This increase is primarily driven by increased sales of our SOBRsure device of $25,059, or 336.0%, and an increase in sales of our SOBRsure software subscriptions of $41,915, or 312.5%. These increases have been offset by increases in sales returns and discounts of $7,130. During the three months ended September 30, 2025, the Company sold 277 unique SOBRsure 2 nd generation devices, representing an increase of 55.6% from 178 unique sales of SOBRsure 2 nd generation devices during the three months ended June 30, 2025.
Previous wording
General and administrative expenses increased by $827,002, or 29.4%, from $2,811,495 for the six-month period ended June 30, 2024, to $3,638,497 for the six-month period ended June 30, 2025. This increase is primarily attributable to an increase in professional services spend of $696,752 principally in marketing efforts, an increase in payroll costs of $261,095, offset by a decrease in business development expense of $75,509 and related travel spend of $11,545 which is delayed to the second half of 2025, and decrease in insurance spend of $32,229.
Current wording
General and administrative expenses increased by $618,345, from $1,499,296 for the three months ended September 30, 2024, to $2,117,641 for the three months ended September 30, 2025. This increase is primarily attributable to an increase in payroll costs of $286,965, an increase in business development costs of $156,002, an increase in professional services spend of $155,926 principally in marketing efforts, and an increase in travel costs of $19,571.
Previous wording
The Company had stock-based compensation expense of $115,252 for the three months ended June 30, 2025, compared to $185,910 for the three months ended June 30, 2024. The reduction in stock-based compensation expense is due to previously issued equity compensation awards becoming fully vested and no issuance of new awards in 2025.
Current wording
The Company had stock-based compensation expense of $115,250 for the three months ended September 30, 2025, compared to $184,243 for the three months ended September 30, 2024. The reduction in stock-based compensation expense is due to previously issued equity compensation awards becoming fully vested and no issuance of new awards in 2025.
Previous wording
Research and development expenses decreased by $109,752, or 35.6%, to $198,675 for the three months ended June 30, 2025, compared to $308,427 for the three months ended June 30, 2024. The decrease in research and development is due to the Company’s making improvements to its existing SOBRsafe software platform and enhancements to its mobile application, whereas the prior year spend was primarily driven by more expensive hardware development initiatives including the second generation of the SOBRsure device.
Current wording
Research and development expenses decreased by $164,364, or 84.5%, to $30,102 for the three months ended September 30, 2025, compared to $194,466 for the three months ended September 30, 2024. The decrease in research and development is driven by focusing on improvements to its existing SOBRsafe software platform and enhancements to its mobile application, whereas the prior year spend was primarily driven by more expensive hardware development initiatives including the development of the second generation of the SOBRsure device.
Previous wording
Other income, net increased by $62,556 from $13,157 for the three months ended June 30, 2024, to $75,713 for the three months ended June 30, 2025. Other income consists primarily of interest income earned on cash deposits. The increase is due to more cash on hand during 2025 when compared to the same period in 2024 as a result of cash proceeds from the 2024 PIPE Financing in October 2024, and the Series A Warrant exercises completed in the fourth quarter of 2024 and the first quarter of 2025.
Current wording
Other income, net increased by $34,893 from $12,566 for the three months ended September 30, 2024, to $47,459 for the three months ended September 30, 2025. Other income consists primarily of interest income earned on cash deposits. The increase in interest income is due to more cash on hand during 2025 when compared to the same period in 2024 as a result of cash proceeds from the 2024 PIPE Financing in October 2024, and the Series A Warrant exercises completed in the fourth quarter of 2024 and the first quarter of 2025.
Previous wording
Our operating loss increased by $191,836 from $1,877,235 for the three-month period ended June 30, 2024, compared to $2,069,071 for the three-month period ended June 30, 2025. The change in our operating loss for the three months ended June 30, 2024, compared to the same prior year period, is primarily a result in an increase in general and administrative expense as detailed above, offset by decreases in stock-based compensation and research and development expenses.
Current wording
Our operating loss increased by $377,258 from $1,847,868 for the three months ended September 30, 2024, compared to $2,225,126 for the three months ended September 30, 2025. The change in our operating loss for the three months ended September 30, 2024, compared to the same prior year period, is primarily a result in an increase in general and administrative expense (as detailed above), offset by decreases in stock-based compensation and research and development expenses.
Previous wording
Our net loss decreased by $81,890 from $2,077,374 for the three-month period ended June 30, 2024, to $1,995,480 for the three-month period ended June 30, 2025. The change in our net loss for the three months ended June 30, 2024, compared to the same prior year period, is primarily a result in an increase our operating loss as detailed above, offset by an increase in interest income and a decrease in interest expense.
Current wording
Our net loss increased by $345,418 from $1,841,210 for the three months ended September 30, 2024, to $2,186,628 for the three months ended September 30, 2025. The change in our net loss for the three months ended September 30, 2024, compared to the same prior year period, is primarily a result in an increase our operating loss as detailed above, offset by an increase in interest income.
Previous wording
Revenues of $190,845 for the six-month period ended June 30, 2025, have increased by $88,664, or 86.8%, as compared to the prior year period of $102,181. This increase from the prior year period is primarily driven by increased sales of our SOBRsure device of $53,045, or 150.5%; an increase in sales of our SOBRsure subscriptions of $47,534, or 468.8%; an increase in our SOBRcheck subscriptions of $7,035, or 17.8%. These increases are offset by decreased sales of our SOBRcheck device of $16,787 and an increase in discounts of $2,312. During the first six-months of 2025, the Company sold 309 unique SOBRsure 2 nd generation devices after being launched in the fourth quarter of 2024.
Current wording
Revenues of $299,738 for the nine months ended September 30, 2025, have increased by $151,428, or 102.1%, as compared to the prior year period of $148,310. This increase from the prior year period is primarily driven by increased sales of our SOBRsure device of $94,960, or 195.1%; an increase in sales of our SOBRsure subscriptions of $72,593, or 412.5%; an increase in our SOBRcheck subscriptions of $6,362, or 10.1%. These increases are offset by decreased sales of our SOBRcheck device of $14,888 and an increase in discounts and returns of $9,991. During the first nine months of 2025, the Company sold 603 unique SOBRsure 2 nd generation devices after being launched in the fourth quarter of 2024.
Previous wording
The cost of goods and services for the three months ended June 30, 2025, was $44,344 resulting in a gross profit of $59,884 and a gross margin of 57.5%. The cost of goods and services for the three months ended June 30, 2024 was $41,156 resulting in a gross profit of $13,035. The prior period cost of goods and services included an inventory cost adjustment of $17,434 for SOBRcheck inventory resulting in an adjusted gross margin of 53.7%.
Current wording
The cost of goods and services for the nine months ended September 30, 2025 was $151,023 resulting in a gross profit of $148,715 and a gross margin of 49.6%. The cost of goods and services for the nine months ended September 30, 2024 was $81,929 resulting in a gross profit of $66,381. The prior period cost of goods and services included an inventory cost adjustment of $23,410 resulting in an adjusted gross margin of 58.4%. The decrease in gross margin is primarily driven by an increase in cost of goods associated with product replacements during the third quarter of 2025. The replacements were linked to specific product quality issues that have since been identified and addressed. While this impacted gross margin in the short term, the Company has implemented corrective actions, including enhanced quality assurance processes and supplier performance reviews, to mitigate similar issues going forward. We expect these efforts to support margin recovery in future periods while maintaining our focus on customer satisfaction and product integrity. The gross margin adjusted for these replacements was 59.7%.
Previous wording
General and administrative expenses increased by $419,095, from $1,395,933 for the three-month period ended June 30, 2024, to $1,815,028 for the three-month period ended June 30, 2025. This increase is primarily attributable to an increase in professional services spend of $376,204, an increase in payroll costs of $130,938, offset by a decrease in business development expense of $60,380 and insurance spend of $23,244.
Current wording
General and administrative expenses increased by $1,445,347, or 33.5%, from $4,310,791 for the nine months ended September 30, 2024, to $5,756,138 for the nine months ended September 30, 2025. This increase is primarily attributable to an increase in professional services spend of $852,678 principally for the 2025 consumer and commercial marketing programs launched for the first time, an increase in payroll costs of $548,060, an increase in business development expense of $80,494 offset by a decrease in insurance spend of $28,748.
Previous wording
The Company had stock-based compensation expense of $254,930 for the six months ended June 30, 2025, compared to $400,308 for the six months ended June 30, 2024. The reduction in stock-based compensation expense is due to previously issued equity compensation awards becoming fully vested and no issuance of new awards in 2025.
Current wording
The Company had stock-based compensation expense of $370,180 for the nine months ended September 30, 2025, compared to $584,551 for the nine months ended September 30, 2024. The reduction in stock-based compensation expense is due to previously issued equity compensation awards becoming fully vested and no issuance of new awards in 2025.
Previous wording
Research and development expenses for the six months ended June 30, 2025, and 2024, decreased by $170,862, or 41.6%, from $410,461 for the six months ended June 30, 2024, to $239,599 for the six months ended June 30, 2025. The decrease in research and development is due to the Company’s making improvements to its existing SOBRsafe software platform and enhancements to its mobile application, whereas the prior year spend was primarily driven by more expensive hardware development initiatives including the second generation of the SOBRsure device.
Current wording
Research and development expenses for the nine months ended September 30, 2025, and 2024, decreased by $335,226, or 55.4%, from $604,927 for the nine months ended September 30, 2024, to $269,701 for the nine months ended September 30, 2025. The decrease in research and development is due to the Company making improvements to its existing SOBRsafe software platform and enhancements to its mobile application, whereas the prior year spend was primarily driven by more expensive hardware development initiatives including the second generation of the SOBRsure device.
Previous wording
Other income, net increased by $119,018 from $34,412 for the six months ended June 30, 2024 to $153,430 for the six months ended June 30, 2025. Other income consists primarily of interest income earned on cash deposits. The increase is due to more cash on hand during 2025 when compared to the same period in 2024 as a result of cash proceeds from the 2024 PIPE Financing in October 2024, and the Series A Warrant exercises completed in the fourth quarter of 2024 and the first quarter of 2025.
Current wording
Other income, net increased by $153,911 from $46,978 for the nine months ended September 30, 2024 to $200,889 for the nine months ended September 30, 2025. Other income consists primarily of interest income earned on cash deposits. The increase is due to more cash on hand during 2025 when compared to the same period in 2024 as a result of cash proceeds from the 2024 PIPE Financing in October 2024, and the Series A Warrant exercises completed in the fourth quarter of 2024 and the first quarter of 2025.
Previous wording
Interest expense decreased by $440,020 from $445,812 for the six months ended June 30, 2024, to $5,792 for the six months ended June 30, 2025. This decrease was due to make-whole interest related to outstanding convertible debt as the conversion of debt to common stock was completed in the prior year.
Current wording
Interest expense decreased by $436,967 from $451,720 for the nine months ended September 30, 2024, to $14,753 for the nine months ended September 30, 2025. This decrease was due to make-whole interest related to outstanding convertible debt as the conversion of debt to common stock was completed in the prior year.
Previous wording
Our operating loss increased by $436,158, from $3,586,020 for the six-month period ended June 30, 2024, compared to $4,022,178 for the six-month period ended June 30, 2025. The change in our operating loss for the three months ended June 30, 2025, compared to the same prior year period, is primarily a result in an increase in general and administrative expense as detailed above offset by decreases in stock-based compensation and research and development expenses.
Current wording
Our operating loss increased by $813,416, from $5,433,888 for the nine months ended September 30, 2024, compared to $6,247,304 for the nine months ended September 30, 2025. The change in our operating loss for the three months ended September 30, 2025, compared to the same prior year period, is primarily a result in an increase in general and administrative expense as detailed above, offset by decreases in stock-based compensation and research and development expenses.
Previous wording
Our net loss decreased by $708,755 from $4,583,295 for the six-month period ended June 30, 2024, compared to $3,874,540 for the six-month period ended June 30, 2025. The change in our net loss for the three months ended June 30, 2025, compared to the same prior year period, is primarily a result of notes payable conversion expense not experienced in 2025 and a decrease in interest expense for make-whole interest, and an increase in interest income. These decreases were offset by the increase in our operating loss as compared to the prior period detailed above.
Current wording
Our net loss decreased by $363,337 from $6,424,505 for the nine months ended September 30, 2024, compared to $6,061,168 for the nine months ended September 30, 2025. The change in our net loss for the nine months ended September 30, 2025, compared to the same prior year period, is primarily a result of notes payable conversion expense not experienced in 2025 and a decrease in interest expense for make-whole interest, and an increase in interest income. These decreases were offset by the increase in our operating loss as compared to the prior period detailed above.
Previous wording
Liquidity and Capital Resources for Six Months Ended June 30, 2025, Compared to December 31, 2024
Current wording
Liquidity and Capital Resources for Nine Months Ended September 30, 2025, Compared to December 31, 2024
Previous wording
During the six-months ended June 30, 2025, and 2024, the Company has incurred recurring losses from operations. Future capital requirements will depend on many factors including the Company’s ability to sell and develop products, generate cash flow from operations, and assess competing market developments. The Company will need additional capital in the near term. Our cash on hand as of June 30, 2025, was $8,466,322 and our current normalized operating cash flow burn rate is approximately $550,000 per month.
Current wording
During the nine months ended September 30, 2025, and 2024, the Company has incurred recurring losses from operations. Future capital requirements will depend on many factors including the Company’s ability to sell and develop products, generate cash flow from operations, and assess competing market developments. The Company will need additional capital in the near term. Our cash on hand as of September 30, 2025, was $4,711,664 and our current normalized operating cash flow burn rate is approximately $560,000 per month.
Previous wording
Management believes that cash balances and positive working capital at June 30, 2025 provide adequate operating capital for operating activities for the next twelve months after the date these financial statements are issued. Management anticipates additional revenue generation with the release of its second generation SOBRsure device and a comprehensive marketing plan. These plans are contingent upon the actions to be performed by the Company which have been implemented through the quarter and will continue into future periods, however, these conditions have not been met on or before June 30, 2025. The Company has acquired additional proceeds net of transactional costs from the exercise of outstanding warrants, net of transactional costs, of approximately $3,395,021 during the first quarter of 2025, increasing the Company’s cash balances. As such, Management believes despite limited revenue generation and positive operating cash flows being generated in the past, adequate cash balances and working capital are available to support ongoing operations for the next twelve months and the Company will continue as a going concern at June 30, 2026.
Current wording
Management believes that cash balances and positive working capital at September 30, 2025 do not provide adequate operating capital for operating activities for the next twelve months after the date these financial statements are issued. Management anticipates additional revenue generation with the release of its second-generation SOBRsure device and a comprehensive marketing plan. In addition, the Company’s plans and ability to access capital sources and implement expense reduction tactics to preserve working capital provide the opportunity for the Company to continue as a going concern. These plans are contingent upon the actions to be performed by the Company which have been implemented through the quarter and will continue into future periods, however, these conditions have not been met on or before November 12, 2025. As such, substantial doubt about the Company’s ability to continue as a going concern has not been alleviated at September 30, 2025.
Previous wording
Our total current assets and total assets decreased as of June 30, 2025, as compared to December 31, 2024, primarily due to a decrease in prepaid expenses of approximately $100,000, amortization of SOBRsafe Intellectual Technology and Right-of-Use assets of approximately $242,000, lower inventory on hand of approximately $35,000, and collection of receivables of approximately $19,000, offset by an increase in cash on hand of approximately $82,000.
Current wording
Our total current assets and total assets decreased as of September 30, 2025, as compared to December 31, 2024, primarily due to a decrease in cash of $3,672,378, amortization of SOBRsafe Intellectual Technology and Right-of-Use assets of approximately $364,000, and lower inventory on hand of approximately $82,600, offset by an increase in prepaid expenses of approximately $121,000 and accounts receivable of approximately $8,000.
Previous wording
Our total current liabilities and total liabilities increased as of June 30, 2025, as compared to December 31, 2024. The increase was primarily due to the accrual for the Series A Warrant True-up Payment obligation of $1,640,000 during the period, offset by the decrease in accounts payable and accrued expenses of approximately $54,000, and payment of the balance of the insurance premium note payable and operating lease liabilities of approximately $155,000.
Current wording
Our total current liabilities and total liabilities decreased as of September 30, 2025, as compared to December 31, 2024. The decrease was primarily due to a decrease in accounts payable of approximately $27,500, and accrued expenses of approximately $138,000. The decrease in accrued expenses during the period was primarily driven by the payment of approximately $82,600 for transactional costs related to the exercise of Series A Warrants in 2024. The decrease in current liabilities is offset by an increase in notes payable of approximately $83,000, deferred revenue of approximately $10,000, and operating lease liabilities of approximately $10,300.
Previous wording
We had net cash used in operating activities of $3,313,203 for the six-month period ended June 30, 2025, as compared to net cash used in operating activities of $3,049,161 for the six-month period ended June 30, 2024. For the period in 2025, the net cash used in operating activities consisted primarily of our net loss of $3,874,540, offset by non-cash expense items including amortization of $192,732, stock-based compensation expense of $254,930, non-cash lease expense of $49,298, and changes in our assets and liabilities for accounts receivable of ($22,524), inventory of $35,112, prepaid expenses of $115,082, other assets of $41,918, accounts payable of $63,738, accrued expenses of ($133,086), and operating lease liabilities of ($53,794).
Current wording
We had net cash used in operating activities of $5,330,526 for the nine months ended September 30, 2025, as compared to net cash used in operating activities of $4,911,028 for the nine months ended September 30, 2024. During the period in 2025, the net cash used in operating activities consisted primarily of our net loss of $6,061,168, offset by non-cash expense items including amortization of $291,006, stock-based compensation expense of $370,182, non-cash lease expense of $74,968, and changes in our assets and liabilities; accounts receivable of $17,414, inventory of $82,645, prepaid expenses of $152,161, other assets of $26,889, accounts payable and accrued expenses of $195,596, and deferred revenue of $10,092 and operating lease liabilities of $81,712.
Previous wording
For the period in 2024, the net cash used in operating activities of $3,049,161 consisted primarily of our net loss of $4,583,295, offset by non-cash expense items including amortization of $192,732, amortization of debt discounts of $237,250, stock-based compensation expense of $400,307, non-cash interest expense of $336,510, non-cash lease expense of $44,284, non-cash conversion expense of $585,875 and changes in our assets and liabilities for accounts receivable of ($9,708), inventory of $60,844, prepaid expenses of $81,051, accrued expenses of ($208,212), accrued interest payable of ($128,214), and operating lease liabilities of ($46,872).
Current wording
For the nine months ended September 30, 2024, the net cash used in operating activities of $4,911,028 consisted primarily of our net loss of $6,424,505, offset by non-cash expense items including amortization of $289,098, amortization of debt discounts of $237,250, stock-based compensation expense of $584,551, non-cash debt conversion expense of 585,875, non-cash interest expense of $336,510, non-cash lease expense of $67,315, and changes in our assets and liabilities; accounts receivable of $20,573, inventory of $72,798, and prepaid expenses of $86,566, accounts payable and accrued expenses of $507,296, accrued interest payable of 126,086 and operating lease liabilities of $71,199.
Previous wording
We had no cash provided by or used in investing activities during the six-month periods ended June 30, 2025, or June 30, 2024.
Current wording
For the nine months ended September 30, 2025 the net cash used in investing activities of $38,172 consisted of our purchase of office leasehold and furniture improvements. There was no cash provided by or used in investing activities during the nine months September 30, 2024.
Previous wording
Our net cash provided by financing activities for the six-months ended June 30, 2025, was $3,395,483. For the six-months ended June 30, 2025, our net cash from financing activities consisted of proceeds from the exercise of warrants of $3,680,411, offset by issuance costs of $184,021 and financing payments of $100,907 for annual insurance premiums.
Current wording
Our net cash provided by financing activities for the nine months ended September 30, 2025, was $1,696,320. Net cash from financing activities consisted of proceeds from the exercise of warrants of $3,680,411, offset by issuance costs of $184,021, financing payments of $160,070 for annual insurance premiums and the payment of $1,640,000 for the PIPE Warrant True-up Payment.
Previous wording
Our net cash provided by financing activities for the six-months ended June 30, 2024, was $2,425,418. During the six-month period ended June 30, 2024, we received gross proceeds from the exercise of warrants of $2,786,174 which was offset by transactional costs of $360,756.
Current wording
Our net cash provided by financing activities for the nine months ended September 30, 2024, was $2,425,418. During the nine months ended September 30, 2024, we received gross proceeds from the exercise of warrants for $2,786,174, which was offset by transactional costs of $360,756.
Rearranged previous paragraphs (2)
Previous report — wording carried elsewhere
Interest expense decreased by $211,169 from $213,296 for the three-month periods ended June 30, 2024, to $2,127 for the three months ended June 30, 2025. This decrease was due to make-whole interest related to outstanding convertible debt as the conversion of debt to common stock was completed in the prior year.
Previous report — wording carried elsewhere
The cost of goods and services for the six months ended June 30, 2025 was $79,997 resulting in a gross profit of $110,848 and a gross margin of 58.1%. The cost of goods and services for the six months ended June 30, 2024 was $65,937 resulting in a gross profit of $36,244. The prior period cost of goods and services included an inventory cost adjustment of $23,410 resulting in an adjusted gross margin of 58.4%.