AQUABOUNTY TECHNOLOGIES INC

Previous wording

AquaBounty has historically pursued a growth strategy that included the construction of large-scale recirculating aquaculture system (“RAS”) farms for producing our genetically engineered Atlantic salmon (“GE Atlantic salmon”). We had commenced construction of a 10,000 metric ton farm in Pioneer, Ohio (the “Ohio Farm Project”), but paused the construction in June 2023, as the cost estimate to complete the farm continued to substantially increase due to inflation and other factors. Further, these cost increases impaired our ability to pursue municipal bond financing, which was a necessary component of our funding strategy. We subsequently engaged an investment bank to pursue a range of funding and strategic alternatives, and to assist management in the prioritization of our core assets. These efforts resulted in the sale of our grow-out farm in Indiana (“Indiana Farm”) in July 2024, recurring sales throughout the remainder of 2024 and the first half of 2025 of selected equipment originally intended for the Ohio Farm Project (the “Ohio Equipment Assets”), and the sale of our Canadian subsidiary, including the broodstock farms owned by the Canadian subsidiary in Prince Edward Island, Canada (“Canadian Farms”), and our intellectual property for the GE Atlantic salmon, along with trademarks and patents (“Corporate IP”) in March 2025. After completion of these transactions, our primary remaining asset is our investment in the Ohio Farm Project, consisting of the remaining Ohio Equipment Assets and the land and construction in process (the “Ohio Farm Site”). We continue to work with our investment bank to identify the optimal path forward for realizing the potential of this asset, either through new investment, partnership or other strategic options.

Current wording

AquaBounty has historically pursued a growth strategy that included the construction of large-scale RAS farms for producing our GE Atlantic salmon. We had commenced construction of our 10,000 metric ton Ohio Farm Project, but paused the construction in June 2023, as the cost estimate to complete the farm continued to substantially increase due to inflation and other factors. Further, these cost increases impaired our ability to pursue municipal bond financing, which was a necessary component of our funding strategy. We subsequently engaged an investment bank to pursue a range of funding and strategic alternatives and to assist management in the prioritization of our core assets. These efforts resulted in the sale of our Indiana Farm in July 2024, recurring sales throughout 2024 and 2025 of selected Ohio Equipment Assets originally intended for the Ohio Farm Project, and the sale of our Canadian Farms, and our Corporate IP in March 2025. After completion of these transactions, our primary remaining asset is our investment in the Ohio Farm Project, consisting of the remaining Ohio Equipment Assets and the Ohio Farm Site. We continue to work with an investment bank to identify the optimal path forward for realizing the potential of this asset, including its possible sale.

Previous wording

As noted above, we sold our Indiana Farm in July 2024 and our Canadian Farms in March 2025. These farms have been designated as discontinued operations in our condensed consolidated financial statements for the three and nine months ended September 30, 2025 and 2024 in this Form 10-Q (see Note 5 to our condensed consolidated financial statements for additional information).

Current wording

As noted above, we sold our Indiana Farm in July 2024, our Canadian Farms in March 2025, and in 2024 and 2025 we sold Ohio Equipment Assets to generate liquidity. In conjunction with the work that our investment bank has done to help us realize the value of our Ohio Farm Project, we received a non-binding Letter of Interest to purchase our Ohio subsidiary. Though this offer is currently being considered by the Company, we determined the actions in 2025 that contributed to receiving the non-binding Letter of Interest to be a triggering event for revaluing these assets and we designated the Ohio Farm Project as a discontinued operation, along with the Indiana Farm and the Canadian Farms in ourcondensed consolidated financial statements for the periods included in this Form 10-Q (see Note 5 to our condensed consolidated financial statements for additional information).

Previous wording

With the winding down of our fish rearing operations, we have significantly reduced our headcount and on-going operating costs. We maintain a small core group of corporate individuals to oversee our strategic options, our asset sale transactions and our books and records. As of September 30, 2025, we had an accumulated deficit of $374 million and $951 thousand in cash and cash equivalents on our interim condensed consolidated balance sheet. We require new funding to provide liquidity for working capital in order to realize the potential value of our assets. Consequently, our ability to continue as a going concern is dependent upon our ability to raise additional capital, and there can be no assurance that such capital will be available in sufficient amounts, on a timely basis, on acceptable terms, or at all.

Current wording

With the exit from our fish rearing operations, we have significantly reduced our headcount and on-going operating costs. We maintain a small core group of corporate individuals to oversee our strategic options, our asset sale transactions and our books and records. As of March 31, 2026, we had an accumulated deficit of $389 million and $441 thousand in cash on our condensed consolidated balance sheet. We require new funding to provide liquidity for working capital and to fund our evolving strategic plan. Consequently, our ability to continue as a going concern is dependent upon our ability to raise additional capital, and there can be no assurance that such capital will be available in sufficient amounts, on a timely basis, on acceptable terms, or at all.

Previous wording

Our sales and marketing expenses have historically included agency fees for investor-related activities. With the sale of our Canadian Farms in March 2025, we no longer have sales and marketing expenses.

Current wording

Our sales and marketing expenses have historically included agency fees for investor-related activities. With the sale of our Canadian Farms and the corresponding cessation of our salmon rearing activities in March 2025, we no longer have sales and marketing expenses.

Previous wording

General and administrative expenses consist primarily of salaries and related costs for employees in executive, corporate, and finance functions. Other significant general and administrative expenses include corporate governance and public company costs, regulatory affairs, rent and utilities, insurance, and legal services. We expect our general and administrative expenses to decrease as a result of our reduced operations.

Current wording

General and administrative expenses consist primarily of salaries and related costs for employees in executive, corporate, and finance functions. Other significant general and administrative expenses include corporate governance and public company costs, rent and utilities, insurance, and legal services. We expect our general and administrative expenses to remain stable until a new strategic direction of the Company is selected.

Previous wording

Interest expense includes the interest on our loans and accounts payable for our continuing operations. Loan forgiveness relates to the termination of an outstanding loan. Other expense, net includes bank charges, fees, and interest income.

Current wording

Interest expense includes the interest on our loans for our continuing operations. Loan forgiveness relates to the termination of an outstanding loan. Other expense, net includes bank charges, fees, and interest income.

Previous wording

General and administrative expenses for the nine months ended September 30, 2025 were down from the corresponding period in 2024 due to reductions in personnel costs, legal fees, state excise tax liabilities, share-based compensation costs, professional fees, audit fees, and travel, partly offset by a legal settlement expense.

Current wording

General and administrative expenses for the three months ended March 31, 2026 were down from the corresponding period in 2025, primarily due to reductions in personnel costs, audit fees, legal fees, insurance fees, state excise tax liabilities, share-based compensation costs, and Board compensation fees.

Previous wording

Other income for the nine months ended September 30, 2025, is comprised of the forgiveness of an outstanding loan and interest income, less interest expense and bank charges. Other expense for the nine months ended September 30, 2024 is comprised of interest expense and bank charges, less interest income.

Current wording

Other expense for the three months ended March 31, 2026 is comprised of interest expense and bank charges. Other income for the three months ended March 31, 2025 is comprised of the forgiveness of an outstanding loan and interest income, less interest expense and bank charges.

Previous wording

The income from discontinued operations for the three months ended September 30, 2025 was primarily due to a gain on the settlement of an outstanding payable balance for the Indiana Farm. For the three months ended September 30, 2024, the loss was comprised of all operating costs for our Indiana Farm and our Canadian Farms, including fish and egg production costs, sales and marketing, research and development, general and administrative expenses, non-cash long-lived asset impairment charges, interest expense and banking fees.

Current wording

The loss from discontinued operations for the three months ended March 31, 2026 was comprised of general administrative expenses and interest expense. The loss from discontinued operations for the three months ended March 31, 2025 was comprised of all remaining operating costs for our Indiana Farm and our Canadian Farms, primarily fish and egg husbandry costs, general and administrative expenses and interest expense and banking fees.

Previous wording

Net cash used in operating activities during the nine months ended September 30, 2025, was primarily comprised of our $4.4 million net loss, which included $2.1 million in non-cash gains, and working capital uses of $452 thousand, partially offset by non-cash share-based compensation charges of $64 thousand and an asset impairment charge of $1.3 million. Net cash used in operating activities during the nine months ended September 30, 2024, was primarily comprised of our $65.1 million net loss, partially offset by non-cash depreciation and share-based compensation charges of $1.1 million, long-lived asset impairment charges of $48.7 million, and working capital sources of $2.5 million.

Current wording

Net cash used in operating activities during the three months ended March 31, 2026, was primarily comprised of our $1.2 million net loss, which included $300 thousand in non-cash interest and amortized loan costs, non-cash share-based compensation charges of $5 thousand and working capital uses of $125 thousand. Net cash used in operating activities during the three months ended March 31, 2025, was primarily comprised of our $401 thousand net income, which included a $2.0 million non-cash gain on the forgiveness of an outstanding loan, non-cash share-based compensation charges of $40 thousand, and working capital uses of $795 thousand.

Previous wording

Spending on operations decreased in the current period due to reductions in personnel, farm operating costs, depreciation charges, and share-based compensation. Uses of cash from changes in working capital were due to decreases in accounts payable and accrued expenses, partially offset by increases in prepaid expenses and other assets.

Current wording

Spending decreased in the current period due to reductions in personnel and other general administrative costs, such as, audit fees, legal fees, insurance fees, state excise tax liabilities, share-based compensation costs, and Board compensation fees. Uses of cash from changes in working capital were due to decreases in accounts payable and accrued expenses, partly offset by a decrease in prepaid expenses and other assets.

Previous wording

During the nine months ended September 30, 2025, we made $832 thousand in debt repayments. During the nine months ended September 30, 2024, we received $6.8 million from new debt and made $9.5 million in term debt repayments.

Current wording

During the three months ended March 31, 2026, we received $960 thousand in proceeds from the issuance of common stock and warrants. During the three months ended March 31, 2025, we made $232 thousand in debt repayments.

Previous wording

Since inception, we have incurred cumulative net losses and negative cash flows from operating activities, and we expect this to continue for the foreseeable future. As of September 30, 2025, we had $951 thousand of cash and cash equivalents. Our ability to continue as a going concern is dependent upon our ability to raise additional capital, and there can be no assurance that such capital will be available in sufficient amounts, on a timely basis, on terms acceptable to us, or at all. This raises substantial doubt about our ability to continue as a going concern within one year after the date that the accompanying condensed consolidated financial statements are issued.

Current wording

Since inception, we have incurred cumulative net losses and negative cash flows from operating activities, and we expect this to continue for the foreseeable future. As of March 31, 2026, we had $441 thousand in cash balances. Our ability to continue as a going concern is dependent upon our ability to raise additional capital, and there can be no assurance that such capital will be available in sufficient amounts, on a timely basis, on terms acceptable to us, or at all. This raises substantial doubt about our ability to continue as a going concern within one year after the date that the accompanying consolidated financial statements are issued.

Previous wording

Until such time, if ever, as we can generate positive cash flows from operating activities, we may finance our cash needs through a combination of sales of non-core assets, equity offerings, debt financings, government or other third-party funding, and strategic alliances. To the extent that we raise additional capital through the sale of equity or convertible debt securities, the ownership interests of holders of our common stock will be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect the rights of holders of our common stock. Debt financing, if available, may involve agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making capital expenditures, or declaring dividends. If we raise additional funds through government or other third-party funding, marketing and distribution arrangements, or other collaborations, or strategic alliances, we may have to relinquish future revenue streams, research programs, or product candidates or to grant licenses on terms that may not be favorable to us.

Current wording

Until such time, if ever, as we can generate positive cash flows from operating activities, we may finance our cash needs through a combination of sales of non-core assets, equity offerings, debt financings, government or other third-party funding, strategic alliances, and licensing arrangements. To the extent that we raise additional capital through the sale of equity or convertible debt securities, the ownership interests of holders of our common stock will be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect the rights of holders of our common stock. Debt financing, if available, may involve agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making capital expenditures, or declaring dividends. If we raise additional funds through government or other third-party funding, marketing and distribution arrangements, or other collaborations, strategic alliances, or licensing arrangements with third parties, we may have to relinquish valuable rights to our technologies, future revenue streams, research programs, or product candidates or to grant licenses on terms that may not be favorable to us.

Previous wording

There have been no material changes to these estimates, or the policies related to them, during the nine months ended September 30, 2025. For a full discussion of these estimates and policies, see “Critical Accounting Policies and Estimates” within “Management’s Discussion and Analysis of Financial Results of Operations” in our 2024 Annual Report on Form 10-K.

Current wording

There have been no material changes to these estimates, or the policies related to them, during the three months ended March 31, 2026. For a full discussion of these estimates and policies, see “Critical Accounting Policies and Estimates” within “Management’s Discussion and Analysis of Financial Results of Operations” in our 2025 Annual Report on Form 10-K.