ACORN ENERGY, INC.

Previous wording

The following tables show, for the periods indicated, the financial results (dollar amounts in thousands) attributable to each of our consolidated companies.

Current wording

The following table shows, for the periods indicated, the financial results (dollar amounts in thousands) attributable to each of our consolidated companies.

Previous wording

As of March 31, 2026, OmniMetrix had a backlog of $3,269,000, comprised of deferred revenue, of which $2,934,000 is expected to be recognized as revenue in the next twelve months. This compares to a backlog of $3,955,000 at March 31, 2025.

Current wording

As of June 30, 2026, OmniMetrix had a backlog of $3,236,000, primarily comprised of deferred revenue, of which $2,806,000 is expected to be recognized as revenue in the next twelve months. This compares to a backlog of $3,669,000 at June 30, 2025.

Previous wording

OmniMetrix is a Georgia limited liability company based in Buford, Georgia that develops and markets wireless remote monitoring and control systems and services for multiple markets in the IoT ecosystem: critical assets (including stand-by power generators, pumps, pumpjacks, light towers, turbines, compressors, and other industrial equipment) as well as cathodic protection for the pipeline industry (gas utilities and pipeline companies). Acorn owns 99% of OmniMetrix with 1% owned by the former CEO of OmniMetrix.

Current wording

OmniMetrix is a Georgia limited liability company based in Buford, Georgia that develops and markets wireless remote monitoring and control systems and services for multiple markets in the IoT ecosystem: critical assets (including stand-by power generators, pumps, pumpjacks, light towers, turbines, compressors, and other industrial equipment) as well as cathodic protection for the pipeline industry (gas utilities and pipeline companies). OmniMetrix now also markets an infrastructure solutions product line that provides smart infrastructure monitoring hardware, software and solutions for telecommunications, energy and data center infrastructure asset management in the North American market as described above.

Previous wording

In preparing the financial statements, management is required to make estimates and assumptions that have an impact on the asset, liability, revenue and expense amounts reported. These estimates can also affect our supplemental information disclosures, including information about contingencies, risk and financial condition. We believe, given current facts and circumstances, that our estimates and assumptions are reasonable, adhere to U.S. GAAP, and are consistently applied. Inherent in the nature of an estimate or assumption is the fact that actual results may differ from estimates and estimates may vary as new facts and circumstances arise. We make routine estimates and judgments in determining net realizable value of accounts receivable, inventories, property and equipment, prepaid expenses, product warranties and other reserves as well as the amortization period for deferred commissions payable. Management believes our most critical accounting estimates and assumptions are in the area of valuation allowance.

Current wording

In preparing the financial statements, management is required to make estimates and assumptions that have an impact on the asset, liability, revenue and expense amounts reported. These estimates can also affect our supplemental information disclosures, including information about contingencies, risk and financial condition. We believe, given current facts and circumstances, that our estimates and assumptions are reasonable, adhere to U.S. GAAP, and are consistently applied. Inherent in the nature of an estimate or assumption is the fact that actual results may differ from estimates and estimates may vary as new facts and circumstances arise. We make routine estimates and judgments in determining net realizable value of accounts receivable, inventories, property and equipment, prepaid expenses, product warranties and other reserves as well as the amortization period for deferred commissions payable. Management believes our most critical accounting estimates and assumptions are in the area of the valuation allowance.

Previous wording

The following table sets forth certain information with respect to the unaudited condensed consolidated results of operations of the Company for the three-month periods ended March 31, 2026 and March 31, 2025, including the percentage of total revenues during each period attributable to selected components of the operations statement data and for the period-to-period percentage changes in such components. For segment data, see Notes 11 and 12 to the unaudited condensed consolidated financial statements included in this quarterly report.

Current wording

The following tables set forth certain information with respect to the unaudited condensed consolidated results of operations of the Company for the six- and three-month periods ended June 30, 2026 and 2025, including the percentage of total revenues during each period attributable to selected components of the operations statements data and for the period-to-period percentage changes in such components. For segment data, see Notes 11 and 12 to the unaudited condensed consolidated financial statements included in this quarterly report.

Previous wording

PG hardware revenue decreased $956,000, or 56.9% during the first three-month period ended March 31, 2026 to $725,000, as compared to $1,681,000 during the first three-month period ended March 31, 2025. The decrease in PG revenue was primarily due to the sales under our material contract in the prior year period and the decrease in revenue recognized from amortization of deferred hardware, as we near the final recognition of the remaining balance of revenue that was previously deferred. PG monitoring revenue increased $152,000, or 12.6%, due to an increase in the number of connections being monitored and growth in our customer base.

Current wording

As discussed above, OmniMetrix has three reportable segments, PG, CP and IS. Of the $4,716,000 in revenue recognized in the six-month period ended June 30, 2026, $4,450,000 was generated by PG activities and $266,000 was generated by CP activities. This represents a decrease in revenue from PG activities of $1,797,000, or 28.8%, from $6,247,000 in the six-month period ended June 30, 2025, and a decrease in revenue from CP activities of $110,000, or 29.3%, from $376,000 in the six-month period ended June 30, 2025. The IS segment remained in a pre-revenue stage and generated no revenue in either period. The decrease in PG revenue was primarily due to the sales under our Material Contract in the prior year period and the decrease in revenue recognized from amortization of deferred hardware, as we near the final recognition of the remaining balance of revenue that was previously deferred. The decrease in CP revenue was due to fewer CP hardware sales in the current-year period as compared to the prior-year period.

Previous wording

Hardware revenue during the three-month periods ended March 31, 2026 and 2025 is further detailed in the table below (in thousands):

Current wording

Hardware revenue during the six- and three-month periods ended June 30, 2026 and 2025 is further detailed in the table below (in thousands):

Previous wording

R&D expense. During the three-month periods ended March 31, 2026 and 2025, R&D expense was $255,000 and $291,000, respectively. The decrease in R&D expense in the three-month period ended March 31, 2026 of approximately $36,000 is related to a decrease in expenses and materials paid to third-party consultants offset by salary increases granted to our engineering personnel effective January 1, 2026.

Current wording

R&D expense. During the six-month periods ended June 30, 2026 and 2025, R&D expense was $494,000 and $556,000, respectively. During the three-month period ended June 30, 2026, OmniMetrix recorded $239,000 of R&D expense as compared to $265,000 in the three-month period ended June 30, 2025. The decrease in R&D expense in the six-month period ended June 30, 2026 of approximately $62,000 is related to a decrease in expenses and materials paid to third-party consultants offset by salary increases granted to our engineering personnel effective January 1, 2026.

Previous wording

*Selling, general and administrative expense.*SG&A expense of the consolidated entities in the first three months of 2026 reflected an increase of $228,000, or 15.9%, as compared to the first three months of 2025. OmniMetrix’s SG&A expense increased $111,000, or 10.8%, from $1,024,000 in the first three months of 2025 to $1,135,000 in the first three months of 2026. This increase was primarily due to an increase of (i) $25,000 in personnel expenses due to compensation increases and staff additions, (ii) $43,000 in technology expenses, primarily consulting fees for staff augmentation and special projects, (iii) $27,000 in travel and trade show expenses, (iv) $26,000 in facility expenses, and an increase of (iv) $6,000 in other expenses in the aggregate offset by a decrease of (v) $16,000 in commission expenses. Corporate SG&A expense increased $117,000, or 28.7%, from $407,000 in the first three months of 2025 to $524,000 in the first three months of 2026. This increase was due to an increase of $136,000 in stock compensation expense due to a higher number of options being issued to our officers and directors in January 2026 than in historical periods and the higher stock price and related volatility offset by a net decrease of $19,000 in other public company expenses in the aggregate.

Current wording

Selling, general and administrative expense. SG&A expense of the consolidated entities in the six-month period ended June 30, 2026 reflected an increase of $237,000, or 8.3%, as compared to the six-month period ended June 30, 2025. OmniMetrix’s SG&A expense increased $51,000, or 2.3%, from $2,173,000 in the six-month period ended June 30, 2025 to $2,224,000 in the six-month period ended June 30, 2026. This increase was primarily due to an increase of (i) $126,000 increase in personnel expenses due to compensation increases and staff additions, (ii) $47,000 in facility expenses due to the rate increase in our office space lease which was amended June 20, 2025, (iii) $25,000 in technology expenses, primarily consulting fees for special projects, (iv) $24,000 in travel and trade show expenses, (v) $13,000 in other expenses in the aggregate offset by a decrease of (vi) $184,000 in commission expenses as the prior year period was significantly higher due to the commissions earned related to the Material Contract. Corporate SG&A expense increased $186,000, or 27.2%, from $685,000 in the six-month period ended June 30, 2025 to $871,000 in the six-month period ended June 30, 2026. This increase was due to an increase of $202,000 in stock compensation expense due to a higher number of options being issued to our officers and directors in January 2026 than in historical periods and the higher stock price and related volatility offset by a net decrease of $16,000 in other public company expenses.

Previous wording

Net (loss) income attributable to Acorn Energy. We recognized a net loss attributable to Acorn stockholders of $77,000 in the first three months of 2026 compared to net income attributable to Acorn stockholders of $464,000 in the first three months of 2025. Our net income during the three-month period ended March 31, 2026 is comprised of pre-tax net income at OmniMetrix of $426,000 plus a tax benefit of $25,000, corporate expenses, net of interest income, of $524,000, and $4,000 representing the non-controlling interest share of our income from OmniMetrix. Our net income during the three-month period ended March 31, 2025 is comprised of pre-tax net income at OmniMetrix of $1,034,000 less federal and state taxes of $154,000, in the aggregate, corporate expenses, net of interest income, of $406,000, and $10,000 representing the non-controlling interest share of our income from OmniMetrix.

Current wording

Net income attributable to Acorn Energy. We recognized net income attributable to Acorn stockholders of $217,000 in the six-month period ended June 30, 2026, compared to net income attributable to Acorn stockholders of $1,184,000 in the six-month period ended June 30, 2025. Our net income during the six-month period ended June 30, 2026 is comprised of pre-tax net income at OmniMetrix of $1,179,000 less federal income taxes of $64,000 and state income taxes of $16,000 offset by corporate expenses, net of interest income, of $870,000, and the non-controlling interest share of our income from OmniMetrix of $12,000. Our net income during the six-month period ended June 30, 2025 is comprised of pre-tax net income at OmniMetrix of $2,285,000 less federal income taxes of $337,000 and state income taxes of $59,000 offset by corporate expenses, net of interest income, of $681,000, and the non-controlling interest share of our income from OmniMetrix of $22,000.

Previous wording

At March 31, 2026, we had working capital of $3,115,000. Our working capital includes $4,257,000 of cash and deferred revenue of $2,934,000. Such deferred revenue does not require a significant cash outlay for the revenue to be recognized.

Current wording

At June 30, 2026, we had working capital of $3,688,000. Our working capital includes $4,478,000 of cash and deferred revenue of $2,722,000. Such deferred revenue does not require a significant cash outlay for the revenue to be recognized.

Previous wording

The Company expects that its existing cash as of March 31, 2026 of $4,257,000 will be sufficient to fund our planned operating expenses and capital expenditure requirements for at least the next 12 months from the issuance date of these financial statements.

Current wording

The Company expects that its existing cash as of June 30, 2026 of $4,478,000 will be sufficient to fund our planned operating expenses and capital expenditure requirements for at least the next 12 months from the issuance date of these financial statements.

Previous wording

*Reflects the gross amount of the operating lease liabilities. Imputed interest is $150,000 resulting in $163,000 included in current liabilities. Does not include rent amounts to be received under the sublease.

Current wording

*Reflects the gross amount of the payments to be made under the operating lease liabilities. Does not include rent amounts to be received under the sublease.