NEPHROS INC
For the period ended Sep 30, 2025. Filed Nov 6, 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 6, 2025
NEPH$2.79-9.7%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-06-30; filed 2025-08-07.
0001641172-25-022596
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-09-30; filed 2025-11-06.
0001493152-25-021061
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 86 previous paragraphs and 82 current paragraphs.
43 unchanged; 20 reworded; 19 added; 21 removed; 2 previous and 0 current paragraphs rearranged.
Tables are not compared: 11 previous and 8 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 (19)
Current report
In medical markets, we manufacture both ultra- and microfilters using polysulfone hollow fiber membranes that retain microbiological contaminants through physical size exclusion. Our ultrafilters, with a 0.005-micron pore size, retain bacteria, viruses, and endotoxins, providing a unique alternative to charged membrane solutions and featuring one of the smallest pore sizes available. Our microfilters, with a 0.1-micron pore size, also retain bacteria, a critically important function given the prevalence ofLegionella in premise plumbing and the risks associated with Legionnaires’ disease. Across both filter types, Nephros filters are distinguished by exceptional membrane surface area and longer service life, particularly in comparison to our competitors, making Nephros filters well-suited to support improved water safety within the demands of clinical environments.
Current report
In commercial markets, we develop filters designed to improve water quality through the reduction of aesthetic and functional contaminants. This segment includes both carbon-based and carbon-free solutions to reduce a number of issues including taste, odor, scale buildup, fine particulate, lead, cysts, and Total PFAS (otherwise known as “forever chemicals”). Like our infection control segment, our commercial filters support a wide range of applications; they also play a key role in enhancing equipment performance and reducing maintenance needs.
Current report
Our commercial sales model combines both direct and indirect channels. Through our internal sales team, we sell directly to customers across a range of industries, including healthcare, where our commercial solutions are an effective complement to our medical-grade, infection control filters. We also partner with VARs, including one non-exclusive partner focused only on food service and hospitality sectors, such as quick-service restaurants (QSRs), convenience stores, and restaurants. In contrast to our channel partners who offer both medical and commercial products, this VAR expands our reach in high-volume, commercial food and beverage markets.
Current report
We currently serve the following primary and emerging markets through our portfolio of medical-grade and commercial water filtration products:
Current report
Hospitals and Other Healthcare Facilities. Nephros infection control filters are widely used by hospitals and healthcare facilities seeking to reduce exposure to waterborne pathogens and meet infection prevention and water management goals. Our products help mitigate microbiological risks in potable water systems, particularly in areas of patient vulnerability and during periods of elevated waterborne threat.
Current report
The U.S. Centers for Disease Control and Prevention (CDC) estimates that one in every 31 hospital patients acquire a healthcare-associated infection (HAI), totaling over one million patients in 2023. Many of these infections are caused by waterborne bacteria or viruses that proliferate in premise plumbing systems, particularly in aging infrastructure or where water is stagnant, warm, or aerosolized.
Current report
In response to risks posed byLegionella and other opportunistic pathogens, regulatory and accreditation bodies have emphasized the need for proactive water management. The Centers for Medicare and Medicaid Services (CMS) require hospitals and long-term care facilities to implement documented water management programs that align with ANSI/ASHRAE Standard 188 and CDC guidance. Similarly, The Joint Commission includes oversight of utility system safety, water quality, and building risk within its physical environment standards, formerly part of the Environment of Care (EC) chapter. Although TJC is reorganizing these standards under a new Physical Environment (PE) chapter, the underlying compliance obligations remain active and enforceable. In parallel, newly introduced standards, such as ANSI/ASHRAE Standard 514 and ANSI/AAMI ST108, signal a broader regulatory shift toward formalized water safety and medical device reprocessing quality, even when not yet codified as survey requirements.
Current report
Nephros filters are validated for physical retention of bacteria, viruses, and endotoxins through size exclusion. All models are FDA 510(k)-cleared and installed at the point of use, where they can support compliance goals, align with evolving standards, and provide additional protection for patients, staff, and visitors.
Current report
Dialysis Settings. Nephros ultrafiltration products are widely deployed in both acute and chronic dialysis environments to enhance water safety and support the production of ultrapure dialysate. Our filters provide retention of bacteria, viruses, and endotoxins in water and bicarbonate lines used to treat patients with kidney failure.
Current report
Hemodialysis requires the use of large volumes of purified water, often more than 100 liters per treatment. Clinics rely on reverse osmosis systems to generate this water and use ultrafilters downstream as a final barrier against microbial contaminants. Our filters are used in both fixed RO loops and portable systems and are validated for up to 12 months of service life in dialysis applications.
Current report
According to the American Journal of Kidney Diseases, approximately 7,100 dialysis clinics in the United States provide care for over 500,000 patients annually. Nephros is a recognized provider of ultrafiltration solutions to dialysis machine manufacturers, water system integrators, and clinical service providers. All Nephros dialysis filters are FDA 510(k)-cleared and meet current regulatory expectations for microbial retention in water and bicarbonate lines.
Current report
Commercial and Industrial Facilities. Our commercial product portfolio includes both carbon-based and carbon-free filtration solutions that address a variety of water-quality concerns common in foodservice and hospitality industries. These include but are not limited to: taste and odor compounds, scale-forming minerals, and various particulates, with several membrane-based models capable of retaining particles down to 0.005 micron. In addition, our newest offering supports the validated reduction of Total PFAS, expanding our reach to customers concerned with long-term exposure to “forever chemicals” in water-fed equipment.
Current report
Overall, net revenues increased by $1.2 million, or 35%, for the three months ended September 30, 2025, compared to the same period in 2024. This increase was primarily driven by higher programmatic revenue, reflecting strong reorder activity and the addition of several new active sites, and significant growth in our service revenue.
Current report
Gross margin was approximately 61% for the three months ended September 30, 2025, consistent with approximately 61% for the three months ended September 30, 2024. An increase in handling expenses including tariffs was mostly offset by a reduction in inventory reserve adjustments.
Current report
Depreciation and amortization expense were approximately $34,000 for the three months ended September 30, 2025 and 2024 respectively.
Current report
Interest income was approximately $41,000 for the three months ended September 30, 2025 compared to approximately $20,000 for the three months ended September 30, 2024.
Current report
Nine Months Ended September 30, 2025 Compared to the Nine Months Ended September 30, 2024
Current report
Research and development expense increased $290,000, or 44%, primarily due to due to higher accrual for employee bonuses and higher salary expense.
Current report
Interest income was approximately $85,000 for the nine months ended September 30, 2025, compared to approximately $66,000 for the nine months ended September 30, 2024.
Removed paragraphs (21)
Previous report
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
Previous report
In medical markets, our primary filtration mechanism is to pass liquids through the pores of polysulfone hollow fiber. Our filters’ pores are significantly smaller than those of competing products, resulting in highly effective elimination of waterborne pathogens, including legionella bacteria (the cause of Legionnaires disease) and viruses, which are not eliminated by most other microbiological filters on the market. Additionally, the fiber structure and pore density in our hollow fiber enables significantly higher flow rates than in other polysulfone hollow fiber.
Previous report
In commercial markets, we develop and sell our filters, for which carbon-based absorption is the primary filtration mechanism. These products allow us to improve water’s odor and taste, to reduce scale and heavy metals, and to reduce other water contaminants for customers who are primarily in the food service, convenience store, and hospitality industries. These commercial products are also sold into medical markets, as supplemental filtration to our medical filters.
Previous report
In commercial markets, our model combines both direct and indirect sales. Through our employee sales staff, we have sold products directly to a number of convenience stores, hotels, casinos, and restaurants. We have also engaged a non-exclusive distributor to resell certain of our water filters and related products to end customers in the commercial food and beverage markets.
Previous report
Our ultrafiltration products currently target the following markets:
Previous report
Hospitals and Other Healthcare Facilities. Nephros filters are a leading tool used to provide proactive protection to patients in high-risk areas (e.g., ice machines, surgical rooms, NICUs) and reactive protection to patients in broader areas during periods of water pathogen outbreaks. Our products are used in hundreds of medical facilities to aid in infection control, both proactively and reactively.
Previous report
As of 2023, according to the American Hospital Association, there are approximately 6,129 hospitals in the U.S., with approximately 920,000 beds. Over 34 million patients were admitted to these hospitals. The U.S. Centers for Disease Control and Prevention (“CDC”) estimates that healthcare associated infections (“HAI”) occur in approximately 1 out of every 31 hospital patients, which calculates to over one million patients in 2023. HAIs affect patients in hospitals or other healthcare facilities and are not present or incubating at the time of admission. They also include infections acquired by patients in the hospital or facility, but appearing after discharge, and occupational infections among staff. Many HAIs are caused by waterborne bacteria and viruses that can thrive in aging or complex plumbing systems often found in healthcare facilities.
Previous report
In January 2022, the Center for Clinical Standards and Quality at the Centers for Medicare and Medicaid Services (“CMS”) expanded its requirements – originally implemented in 2017 – for facilities to develop policies and procedures that inhibit the growth and spread of legionella and other opportunistic pathogens in building water systems. In this 2022 update, CMS requires teams to be assigned to the development of formal water management plans (“WMPs”), as well as detailed documentation regarding the development of the WMPs and their execution. CMS surveyors regularly review policies, procedures, and reports documenting water management implementation results to verify that facilities are compliant with these requirements. These policies must be in accordance with The American Society of Heating, Refrigerating, and Air-Conditioning Engineers (ASHRAE) Standard 188-2015 and the CDC toolkit. Facilities must regularly monitor water systems and take corrective actions when needed to ensure safe water for patients, residents and visitors. We believe that these CMS regulations may have a positive impact on the sale of our HAI-inhibiting ultrafilters.
Previous report
We currently have FDA 510(k) clearance on the following portfolio of medical device products for use in the hospital setting to aid in infection control:
Previous report
Our complete hospital infection control product line, including in-line, and point-of-use can be viewed on our website athttps://www.nephros.com/infection-control/. We are not including the information on our website as a part of, nor incorporating it by reference into, this Quarterly Report on Form 10-Q.
Previous report
Dialysis Centers - Water/Bicarbonate. In the dialysis water market, Nephros ultrafiltration products are among the highest performing products on the market. The DSU-D, SSU-D and the SSUmini have become the standard endotoxin filter in many portable reverse osmosis systems. The EndoPur®, our large-format ultrafilter targeted at dialysis clinic water systems, provides the smallest pore size available.
Previous report
To perform hemodialysis, all dialysis clinics have dedicated water purification systems to produce water and bicarbonate concentrate, two essential ingredients for making dialysate, the liquid that removes waste material from the blood. According to the American Journal of Kidney Diseases, there are approximately 7,100 dialysis clinics in the United States servicing approximately 500,000 patients annually. We estimate that there are over 100,000 hemodialysis machines in operation in the United States.
Previous report
We currently have FDA 510(k) clearance on the following portfolio of medical device products for use in the dialysis setting to aid in bacteria, virus, and endotoxin retention:
Previous report
Commercial and Industrial Facilities. Our commercial NanoGuard® product line accomplishes ultrafiltration via small pore size (0.005 micron) technology, filtering bacteria and viruses from water. In addition, our commercial filtration offerings include technologies that are primarily focused on improving odor and taste and on reducing scale and heavy metals from filtered water.
Previous report
We currently market the following portfolio of proprietary products for use in the commercial, industrial, and food service settings:
Previous report
Nephros commercial products combine effectively with NanoGuard ultrafiltration technologies to offer full-featured solutions to the commercial water market, including to existing users of Everpure filter manifolds.
Previous report
Interest income was approximately $31,000 for the three months ended June 30, 2025 compared to approximately $21,000 for the three months ended June 30, 2024.
Previous report
Six Months Ended June 30, 2025 Compared to the Six Months Ended June 30, 2024
Previous report
Research and development expenses increased $140,000 primarily due to an increase in headcount.
Previous report
Depreciation and amortization expenses were approximately $74,000 and $67,000, respectively, for the six months ended June 30, 2025, and 2024.
Previous report
Interest income was approximately $44,000 for the six months ended June 30, 2025 compared to approximately $46,000 for the six months ended June 30, 2024.
Reworded paragraphs (20)
Previous wording
Nephros is a commercial-stage company that develops and markets high-performance water filtration solutions, with a core focus on medical-grade water filtration. Our portfolio includes two primary product lines: infection control and dialysis water. The infection control segment features both microfilters (0.1 micron) and ultrafilters (0.005 micron), used to help prevent infections from waterborne pathogens such as Legionella and Pseudomonas. The dialysis segment consists exclusively of ultrafilters designed to remove biological contaminants, particularly endotoxins, from water and bicarbonate concentrate used in dialysis treatment. All of our medical-grade filters are FDA 510(k)-cleared as Class II medical devices—a distinguishing feature that affirms their validated safety and performance in critical-use environments. While these filters are widely used in healthcare settings, they have also been adopted across a range of other industries—including manufacturing, laboratories, aviation, and federal facilities—where water quality is essential to operational safety and compliance.
Current wording
Nephros is a commercial-stage company that develops and markets high-performance water filtration solutions for points of use, with a core focus on medical-grade water filtration. Our portfolio includes two primary product lines: infection control and dialysis water. The infection control segment features both microfilters (0.1 micron) and ultrafilters (0.005 micron), used to help prevent infections from waterborne pathogens such asLegionella andPseudomonas. The dialysis segment consists exclusively of ultrafilters designed to remove biological contaminants, particularly endotoxins, from water and bicarbonate concentrate used in dialysis treatment. All of our medical-grade filters are FDA 510(k)-cleared as Class II medical devices—a distinguishing feature that affirms their validated safety and performance in critical-use environments. While these filters are widely used in healthcare settings, they have also been adopted across a range of other industries—including manufacturing, laboratories, aviation, and federal facilities—where water purity is essential to operational safety and compliance.
Previous wording
In addition, we offer a line of commercial water filters that improve taste and odor, reduce biofilm formation and scale buildup, and remove cysts, particulates, and soluble lead from water systems. These products are broadly applicable across industries and are especially valuable when used in tandem with our medical-grade filters to deliver comprehensive water-quality protection. Whether in clinical care, industrial operations, or public infrastructure, Nephros solutions support the universal need for safe, high-quality water.
Current wording
In addition, we offer a line of commercial water filters that improve taste and odor, reduce biofilm formation and scale buildup, and remove cysts, particulates, and lead from water systems. With the recent release of our newest solution, validated for the reduction of Total PFAS (a mixture of seven PFAS compounds including PFOA, PFOS, PFHxS, PFNA, PFHpA, PFBS, and PFDA), further enhancing our portfolio of products and their ability to address a broad spectrum of emerging and persistent waterborne contaminants. These products are broadly applicable across industries and are especially valuable when used in tandem with our medical-grade filters to deliver comprehensive water-quality protection. Whether in clinical care, industrial operations, or public infrastructure, Nephros solutions support the universal need for safe, high-quality water.
Previous wording
Our commercial market focus is on the hotel, restaurant, and convenience store markets. In March 2022, we entered into an agreement with Donastar LLC to provide water filtration systems to an organization that services approximately 3,000 Quick Service Restaurants (“QSR”). Effective January 1, 2023, we entered into a new supply agreement with Donastar, which superseded the March 2022 agreement. Under the January 2023 agreement, we engaged Donastar to be our exclusive distributor to the food, beverage and hospitality industries. Effective September 2024, we ended our exclusive relationship with Donastar. Although Donastar continues to distribute our products on a non-exclusive basis, we are expanding our distribution in the commercial market in order to pursue other national accounts, which, over time, may result in step-change increases in commercial market revenue.
Current wording
Our commercial market focus is on food service and hospitality industries, including hotels, restaurants, and convenience stores. In March 2022, we entered into an agreement with Donastar LLC to provide water filtration systems to an organization that services approximately 3,000 Quick Service Restaurants (“QSR”). Effective January 1, 2023, we entered into a new supply agreement with Donastar, which superseded the March 2022 agreement. Under the January 2023 agreement, we engaged Donastar to be our exclusive distributor to the food service and hospitality sectors. Effective September 2024, we ended our exclusivity arrangement with Donastar though Donastar continues to distribute our products on a non-exclusive basis and expand our reach within their target markets.
Previous wording
For the six-month period ended June 30, 2025, there were no significant changes to our critical accounting policies as identified in our Annual Report on Form 10-K for the year ended December 31, 2024.
Current wording
For the nine-month period ended September 30, 2025, there were no significant changes to our critical accounting policies as identified in our Annual Report on Form 10-K for the year ended December 31, 2024.
Previous wording
Service revenue is recognized at a point in time. the Company is not entitled to payment until the point at which the service is completed.
Current wording
Service revenue is recognized at a point in time when service is completed. The Company is not entitled to payment until the point at which the service is completed.
Previous wording
We are subject to recently issued accounting standards, accounting guidance and disclosure requirements. For a description of these new accounting standards, see Note 2, “Basis of Presentation and Liquidity,” of the Notes to our Unaudited Interim Financial Statements contained in Item 1 of Part I of this Quarterly Report on Form 10-Q, which is incorporated herein by reference.
Current wording
We are subject to recently issued accounting standards, accounting guidance and disclosure requirements. For a description of these new accounting standards, see Note 2, “Basis of Presentation and Liquidity,” of the Notes to our Unaudited Condensed Interim Financial Statements contained in Item 1 of Part I of this Quarterly Report on Form 10-Q, which is incorporated herein by reference.
Previous wording
Selling, general and administrative expense increased by approximately $260,000, or 13%, for the three months ended June 30, 2025, compared to the same period in the prior year. The increase was primarily driven by higher sales commissions, higher accrual for employee bonuses, and increased stock-based compensation expense.
Current wording
Selling, general and administrative expense increased by approximately $508,000, or 30%, for the three months ended September 30, 2025, compared to the same period in the prior year. The increase was primarily driven by higher sales commissions and higher accrual for employee bonuses.
Previous wording
Research and development expenses increased approximately $57,000 due to higher salary expense, and higher accrual for employee bonuses.
Current wording
Research and development expense increased approximately $150,000, or 80%, due to higher accrual for employee bonuses and higher salary expense.
Previous wording
Other expense of approximately $32,000 for the three months ended June 30, 2025 is primarily a result of losses on foreign currency transactions. Other income of approximately $7,000 for the three months ended June 30, 2024, is primarily a result of a sale of a fully depreciated asset.
Current wording
Other expense of approximately $15,000 for the three months ended September 30, 2025 is primarily a result of losses on foreign currency transactions. Other expense of approximately $43,000 for the three months ended September 30, 2024 was also primarily a result of losses on foreign currency transactions.
Previous wording
The following table sets forth our summarized results of operations for the six months ended June 30, 2025 and 2024 (in thousands, except percentages):
Current wording
The following table sets forth our summarized, results of operations for the nine months ended September 30, 2025 and 2024 (in thousands, except percentages):
Previous wording
Overall, net revenues increased by $2.5 million, or 37% for the six months ended June 30, 2025, compared to the same period in 2024. This increase was primarily driven by increased revenue in both programmatic and emergency response. The growth in programmatic revenue reflects strong reorders, and a number of new active sites. The growth in emergency response sales reflects more opportunities in the first half of 2025 compared to limited opportunities in the prior year period.
Current wording
Overall, net revenues increased by $3.8 million or 37% for the nine months ended September 30, 2025 compared to the same period in 2024. This increase was primarily driven by increased revenue in both programmatic and emergency response. The growth in programmatic revenue reflects strong reorders and a number of new active sites. The growth in emergency response sales reflects more opportunities in the first half of 2025 compared to limited opportunities in the prior year period. Service revenue also showed significant growth.
Previous wording
Gross margin was approximately 64% for the six months ended June 30, 2025, compared to approximately 61% for the same period in 2024. The increase of approximately 3 percentage points was primarily driven by lower product costs resulting from a more favorable product mix and a reduction in inventory reserve adjustments, both of which contributed to lower cost of goods sold.
Current wording
Gross margin was approximately 63% for the nine months ended September 30, 2025 compared to approximately 61% for the nine months ended September 30, 2024. The increase of approximately 2 percentage points was primarily driven by a reduction in inventory reserve adjustments and lower product costs resulting from a more favorable product mix, both of which contributed to lower cost of goods sold.
Previous wording
Selling, general and administrative expenses increased $372,000, or 9%, for the six months ended June 30, 2025, compared to the same period in the prior year. The increase was primarily driven by higher sales commission expense, increase employee bonus accruals, and higher stock-based compensation expense.
Current wording
Selling, general and administrative expense increased $880,000, or 15%, for the nine months ended September 30, 2025 compared to the same period in the prior year. The increase was primarily driven by higher sales commissions, increased employee bonus accruals, and higher stock-based compensation.
Previous wording
Depreciation and amortization expenses were approximately $35,000 and $34,000, respectively, for the three months ended June 30, 2025, and 2024.
Current wording
Depreciation and amortization expenses were approximately $108,000 and $101,000, respectively, for the nine months ended September 30, 2025 and 2024.
Previous wording
Other expense was approximately $53,000 for the six months ended June 30, 2025, and is primarily a result of losses on foreign currency transactions. Other income was approximately $14,000 for the six months ended June 30, 2024, and is primarily a result of gains on foreign currency transactions and a sale of a fully depreciated asset.
Current wording
Other expense was approximately $68,000 and $29,000 respectively for the nine months ended September 30, 2025 and September 30, 2024, primarily a result of losses on foreign currency transactions.
Previous wording
As of June 30, 2025, we had an accumulated deficit of $143.5 million. Although we were profitable in the quarter ended June 30, 2025, the six months ended June 30, 2025, and the full year ended December 31, 2024, we may incur future operating losses if we are unable to maintain or increase our revenue.
Current wording
At September 30, 2025, we had an accumulated deficit of $143.2 million. Although we were profitable in the quarter ended September 30, 2025, the nine months ended September 30, 2025, and the full year ended December 31, 2024, we may incur future operating losses if we are unable to maintain or increase our revenue.
Previous wording
Based on cash that is available for our operations and projections of our future operations, we believe that our cash balances will be sufficient to fund our current operating plan through at least the next 12 months from the date of issuance of the financial statements in this Quarterly Report on Form 10-Q. Additionally, our operating plans are designed to help control operating costs and to increase revenue so we can continue to generate sufficient cash flows to fund operations. If there were a decrease in the demand for our products due to either economic or competitive conditions, or if we are otherwise unable to achieve our plan or achieve our anticipated operating results, there could be a significant reduction in liquidity due to our possible inability to cut costs sufficiently. In such event, the Company may need to take further actions to reduce its discretionary expenditures, including further reducing headcount, reducing spending on R&D projects, and reducing other variable costs.
Current wording
Based on cash that is available for our operations and projections of our future operations, we believe that our cash balances will be sufficient to fund our current operating plan through at least the next 12 months from the date of issuance of the condensed financial statements in this Quarterly Report on Form 10-Q. Additionally, our operating plans are designed to help control operating costs and to increase revenue so we can continue to generate sufficient cash flows to fund operations. If there were a decrease in the demand for our products due to either economic or competitive conditions, or if we are otherwise unable to achieve our plan or achieve our anticipated operating results, there could be a significant reduction in liquidity due to our possible inability to cut costs sufficiently. In such event, the Company may need to take further actions to reduce its discretionary expenditures, including further reducing headcount, reducing spending on R&D projects, and reducing other variable costs.
Previous wording
Net cash provided by operating activities was $1.3 million for the six months ended June 30, 2025, compared to net cash used by operating activities of approximately $1.2 million for the six months ended June 30, 2024. Net cash provided by operating activities in 2025 was primarily due to the net income of approximately $0.8 million, a decrease in inventory of approximately $0.3 million, offset by an increase in accounts receivable of approximately $0.3 million. Net cash used in operating activities in 2024 was primarily due to the net loss of approximately $0.5 million, an increase in inventory of approximately $0.5 million, an increase in accounts receivable of approximately $0.4 million and a decrease in accrued expenses of approximately $0.4 million, offset by an increase in accounts payable of approximately $0.3 million, and an increase in inventory impairments and write offs of approximately $0.2 million.
Current wording
Net cash provided by operating activities was $1.4 million for the nine months ended September 30, 2025, compared to net cash used in operating activities of approximately $1.8 million for the nine months ended September 30, 2024. Net cash provided by operating activities in 2025 was primarily due to net income of approximately $1.1 million and an increase in accrued expenses of approximately $0.7 million, offset by an increase in accounts receivable of approximately $0.9 million. Net cash used in operating activities in 2024 was primarily due to an increase in inventory of approximately $0.8 million, a decrease in accounts payable and accrued expenses of approximately $0.5 million each, and a net loss of approximately $0.3 million, offset by an increase in inventory impairments and write-offs of approximately $0.2 million.
Previous wording
We had no investing activities for the six months ended June 30, 2025. Net cash used in investing activities was approximately $50,000 in the six months ended June 30, 2024, due to purchases of property and equipment.
Current wording
We had no investing activities for the nine months ended September 30, 2025. Net cash used in investing activities was approximately $50,000 in the nine months ended September 30, 2024 due primarily to purchases of property and equipment.
Previous wording
Net cash used in financing activities was approximately $2,000 and $4,000 for the six months ended June 30, 2025 and June 30, 2024, respectively, primarily due to payments on finance lease
Current wording
Net cash used in financing activities was approximately $4,000 for the nine months ended September 30, 2025 and September 30, 2024, respectively, primarily due to payments on finance leases.
Rearranged previous paragraphs (2)
Previous report — wording carried elsewhere
Net revenue increased by $1.2 million, or 36%, in the second quarter of 2025 compared to the same period in 2024. This increase was primarily driven by increased revenue in both programmatic and emergency response. The growth in programmatic revenue reflects strong reorders, and a number of new active sites. The growth in emergency response sales reflects increased opportunities in 2025 compared to limited opportunities in the prior-year period.
Previous report — wording carried elsewhere
Gross profit margin was approximately 63% for the three months ended June 30, 2025, compared to approximately 59% for the same period in 2024. The increase of approximately 4 percentage points was primarily driven by a reduction in shipping costs, and inventory reserve adjustments, both of which contributed to lower cost of goods sold.