Atomera Inc

Previous wording

Our principal business objective is to enter into commercial license agreements that enable our customers to manufacture and sell MST-enabled products, generating license revenues and ongoing royalties. We also license our MSTcad® software to customers, enabling them to simulate the effects of MST on their products using Synopsys, Inc.’s technology computer-aided design, or TCAD, software. In addition, we offer fee-based integration engineering services to customers to evaluate the effects of MST as integrated into their manufacturing flow. Typically, we offer these services through paid evaluation arrangement, joint development agreements (“JDAs”) or integration license agreements.

Current wording

Our principal business objective is to enter into commercial license agreements that enable our customers to manufacture and sell MST-enabled products, generating license revenues and ongoing royalties. We also license our MSTcad® software to customers, enabling them to simulate the effects of MST on their products using Synopsys, Inc.’s technology computer-aided design, or TCAD, software. In addition, we offer fee-based integration engineering services to customers to evaluate the effects of MST as integrated into their manufacturing flow. Typically, we offer these services through paid evaluation arrangements, joint development agreements (“JDAs”) or integration license agreements.

Previous wording

On May 27, 2025, we entered into an Equity Distribution Agreement Craig-Hallum as agent, under which we may offer and sell, from time to time at our sole discretion, shares of our common stock in an “at-the-market” offering, (the “2025 ATM”) to or through the agent, having aggregate offering proceeds of up to $50.0 million. During the three months ended March 31, 2026, we sold approximately 1.3 million shares pursuant to the 2025 ATM at an average price per share of approximately $2.47 resulting in approximately $3.1 million of net proceeds to us after deducting commissions and other offering expenses.

Current wording

On May 27, 2025, we entered into an Equity Distribution Agreement Craig-Hallum as agent, under which we may offer and sell, from time to time at our sole discretion, shares of our common stock in an “at-the-market” offering, (the “2025 ATM”) to or through the agent, having aggregate offering proceeds of up to $50.0 million. During the three months ended June 30, 2026, no shares were sold pursuant to the 2025 ATM. During the six months ended June 30, 2026, approximately 1.3 million shares were sold pursuant to the 2025 ATM at an average price per share of approximately $2.47 resulting in approximately $3.1 million of net proceeds to us after deducting commissions and other offering expenses.

Previous wording

Revenue for the three months ended March 31, 2026 and 2025 was approximately $11,000 and $4,000, respectively. Our revenue for the period ended March 31, 2026, consisted of engineering services revenue from the delivery of MST wafers. Revenue for the period ended March 31, 2025 consisted of MSTcad licensing and related consulting services revenue.

Current wording

Revenue for the three and six months ended June 30, 2026 was approximately $158,000 and $169,000, respectively. Revenue consisted of engineering services revenue from the delivery of MST wafers. Revenue for the three and six months ended June 30, 2025 consisted of approximately $0 and $4,000 and consisted of MSTcad licensing and related consulting services revenue.

Previous wording

Cost of revenue. Cost of revenue consists of costs of materials, as well as direct compensation and expenses incurred to deliver wafers and perform services, and consulting services provided for our MSTcad licenses. Cost of revenue for the three months ended March 31, 2026 was approximately $126,000. No cost of revenue was recorded for the three months ended March 31, 2025. We anticipate that our cost of revenue will vary substantially depending on the mix of license and engineering services revenues we receive and the nature of products and/or services delivered in each customer engagement. Cost of revenue is expensed when incurred and may not correspond with revenue earned in the same period. Our cost of revenue in the three months ended March 31, 2026 is an example of this timing mismatch because our labor, wafer processing and metrology costs were incurred in advance of anticipated wafer shipments that will result in recognizing engineering services revenue in future periods.

Current wording

Cost of revenue. Cost of revenue consists of costs of materials, as well as direct compensation and expenses incurred to deliver wafers and perform services, and consulting services provided for our MSTcad licenses. Cost of revenue for the three and six months ended June 30, 2026 was approximately $26,000 and $152,000, respectively. Cost of revenue for the three and six months ended June 30, 2025 was approximately $62,000 and $62,000, respectively. We anticipate that our cost of revenue will vary substantially depending on the mix of license and engineering services revenues we receive and the nature of products and/or services delivered in each customer’s engagement. Cost of revenue is expensed when incurred and may not correspond with revenue earned in the same period.

Previous wording

Operating expenses. Operating expenses consist of research and development, general and administrative, and selling and marketing expenses. For the three months ended March 31, 2026 and 2025, our operating expenses totaled approximately $6.2 million and $5.5 million, respectively.

Current wording

Operating expenses. Operating expenses consist of research and development, general and administrative, and selling and marketing expenses. For the three months ended June 30, 2026 and 2025, our operating expenses totaled approximately $6.9 million and $5.2 million, respectively. For the six months ended June 30, 2026 and 2025, our operating expenses totaled approximately $13.1 million and $10.7 million, respectively.

Previous wording

For the three months ended March 31, 2026 and 2025, we incurred approximately $3.5 million and $3.3 million, respectively, of research and development expenses, an increase of approximately $202,000, or 6%. This increase was primarily due to increases in payroll and benefits costs of approximately $79,000 and stock-based compensation expenses of approximately $75,000.

Current wording

For the three months ended June 30, 2026 and 2025, we incurred approximately $3.3 million and $3.0 million, respectively, of research and development expenses, an increase of approximately $283,000, or 9%. This increase was primarily due to increases in bonus accrual of approximately $146,000, stock-based compensation cost of approximately $96,000 and tool lease costs of approximately $40,000.

Previous wording

General and administrative expense. General and administrative expenses consist primarily of payroll and benefit costs for administrative personnel, office-related costs and professional fees. General and administrative costs were approximately $2.3 million and $2.1 million for the three months ended March 31, 2026 and 2025, respectively, representing an increase of approximately $245,000, or 12%. The increase is primarily related to increases of approximately $229,000 in stock-based compensation expenses and payroll and benefits costs of approximately $168,000 offset by a decrease of approximately $121,000 in intellectual property related expenses.

Current wording

General and administrative expense. General and administrative expenses consist primarily of payroll and benefit costs for administrative personnel, office-related costs and professional fees. General and administrative costs were approximately $3.2 million and $2.0 million for the three months ended June 30, 2026 and 2025, respectively, representing an increase of approximately $1.1 million, or 55%. The increase is primarily related to increases of approximately $541,000 in bonus accrual, stock-based compensation expenses of approximately $298,000 and an increase in legal costs and filing fees related to our patent portfolio of approximately $296,000.

Previous wording

Selling and marketing expense. Selling and marketing expenses consist primarily of salary and benefits for our sales and marketing personnel and business development consulting services. Selling and marketing expenses for the three months ended March 31, 2026 and 2025 were approximately $419,000 and $124,000, respectively, representing an increase of approximately $295,000, or 238%. The increase is primarily related to a $136,000 increase in employee related expenses, approximately $92,000 increase in stock based compensation and recruiting fees all related to an increase in headcount over the prior year.

Current wording

Selling and marketing expense. Selling and marketing expenses consist primarily of salary and benefits for our sales and marketing personnel and business development consulting services. Selling and marketing expenses for the three months ended June 30, 2026 and 2025 were approximately $437,000 and $141,000, respectively, representing an increase of approximately $296,000, or 210%. The increase is primarily related to a $273,000 increase in employee-related expenses and approximately $70,000 increase in stock-based compensation, all related to an increase in headcount over the prior year.

Previous wording

Interest income. Interest income for the three months ended March 31, 2026 and 2025 was approximately $197,000 and $270,000, respectively. Interest income reflects interest earned on our cash, cash equivalents and short-term investments and are impacted by current interest rates and average balances over the periods presented.

Current wording

Interest income. Interest income for the three months ended June 30, 2026 and 2025 was approximately $172,000 and $234,000, respectively. Interest income for the six months ended June 30, 2026 and 2025 was approximately $369,000 and $504,000, respectively. Interest income reflects interest earned on our cash, cash equivalents and short-term investments and are impacted by current interest rates and average balances over the periods presented.

Previous wording

Accretion income. Accretion income for the three months ended March 31, 206 and 2025 was approximately $57,000 and $6,000, respectively. Accretion income relates to the increase in value of our available-for-sale securities from the purchase date through the maturity date.

Current wording

Accretion income. Accretion income for the three and six months ended June 30, 2026 was approximately $178,000 and $235,000, respectively. Accretion income for the three and six months ended June 30, 2025 was approximately $0 and $6,000, respectively. Accretion income relates to the increase in value of our available-for-sale securities from the purchase date through the maturity date.

Previous wording

Interest expense. Interest expense for the three months ended March 31, 2026 and 2025, was approximately $4,000 and $21,000, respectively. Interest expense is related to the tool financing lease entered into in August 2021.

Current wording

Interest expense. Interest expenses for the three months ended June 30, 2026 and 2025 were approximately $1,000 and $18,000, respectively. Interest expenses for the six months ended June 30, 2026 and 2025 were approximately $5,000 and $39,000, respectively. Interest expense is related to the tool financing lease entered into in August 2021.** **

Previous wording

Other income (expense), net. Other income for the three months ended March 31, 2026 and 2025 was approximately $1,000 and ($1,000), respectively.

Current wording

Other income (expense), net. Other income for the three months ended June 30, 2026 and 2025 was approximately $74,000 and $72,000

Previous wording

Net cash used in operating activities of approximately $4.6 million for the three months ended March 31, 2026 resulted primarily from our net loss of approximately $6.1 million offset by approximately $1.4 million of stock-based compensation.

Current wording

Net cash used in operating activities of approximately $8.5 million for the six months ended June 30, 2026 resulted primarily from our net loss of approximately $12.4 million offset by approximately $3.2 million of stock-based compensation, amortization of our operating right-of-use assets of approximately $422,000 and an increase of approximately $468,000 in accrued payroll which primarily consists of our annual bonus accrual.

Previous wording

Net cash used in operating activities of approximately $4.8 million for the three months ended March 31, 2025 resulted primarily from our net loss of approximately $5.2 million and a decrease in our accrued payroll expenses of approximately $926,000, offset by approximately $1.0 million of stock-based compensation and an increase of approximately $269,000 in accounts payable.

Current wording

Net cash used in operating activities of approximately $8.3 million for the six months ended June 30, 2025 resulted primarily from our net loss of approximately $10.2 million and a decrease in our accrued payroll expenses of approximately $979,000, offset by approximately $2.3 million of stock-based compensation.

Previous wording

Net cash used in investing activities of approximately $27.0 million for the three months ended March 31, 2026 consisted of the purchase of short-term available-for-sale investments.

Current wording

Net cash used in investing activities of approximately $23.1 million for the six months ended June 30, 2026 consisted primarily of the purchase of short-term available-for-sale investments offset by the maturity of short-term investments.

Previous wording

Net cash provided by investing activities of approximately $996,000 for the three months ended March 31, 2025 consisted primarily of the maturity of short-term available-for-sale investments.

Current wording

Net cash provided by investing activities of approximately $986,000 for the six months ended June 30, 2025 consisted primarily of the maturity of short-term available-for-sale investments.

Previous wording

Net cash provided by financing activities of approximately $26.5 million for the three months ended March 31, 2026 primarily related to the net proceeds from sales under our registered direct offering of common stock, sales under the 2025 ATM and stock option exercises, offset by the principal payments on our financing lease.

Current wording

Net cash provided by financing activities of approximately $27.6 million for the six months ended June 30, 2026 primarily related to the net proceeds from sales under our registered direct offering of common stock, sales under the 2025 ATM and stock option exercises, offset by the principal payments on our financing lease.

Previous wording

Net cash provided by financing activities of approximately $2.1 million for the three months ended March 31, 2025 primarily related to the net proceeds from sales under our 2022 ATM, offset by the principal payments on our financing lease.

Current wording

Net cash provided by financing activities of approximately $3.5 million for the six months ended June 30, 2025 primarily related to the net proceeds from sales under our ATM and stock option exercises, offset by the principal payments on our financing lease.

Previous wording

As of March 31, 2026, we had cash, cash equivalents and short-term investments of approximately $41.1 million and working capital of approximately $39.9 million. For the three months ended March 31, 2026 we had a net loss of approximately $6.1 million and used approximately $4.6 million of cash and cash equivalents in operations. Since inception, we have incurred recurring operating losses.

Current wording

As of June 30, 2026, we had cash, cash equivalents and short-term investments of approximately $38.4 million and working capital of approximately $36.7 million. For the six months ended June 30, 2026 we had a net loss of approximately $12.4 million and used approximately $8.5 million of cash and cash equivalents in operations. Since inception, we have incurred recurring operating losses.

Previous wording

During the three months ended March 31, 2026, we sold approximately 1.3 million shares of commons stock pursuant to the 2025 ATM at an average price per share of approximately $2.47, resulting in approximately $3.1 million of net proceeds to the Company after deducting commissions and other offering expenses.

Current wording

During the six months ended June 30, 2026, we sold approximately 1.3 million shares of common stock pursuant to 2025 ATM at an average price per share of approximately $2.47 resulting in approximately $3.1 million in net proceeds after deducting commissions and other offering expenses. No shares were sold under the 2025 ATM in the three months ended June 30, 2026.

Previous wording

During the three months ended March 31, 2026, we sold five million shares of common stock in a registered direct offering, at a purchase price of $5.00 per share. As compensation for such placement agent services, the Company paid Craig-Hallum an aggregate cash fee equal to 5.0% of the gross proceeds received by the Company from the Offering and agreed to reimburse up to $75,000 of legal and other expenses as actually incurred. Net proceeds to the Company after deducting the placement agent fee and expenses were approximately $23.6 million.

Current wording

On February 24, 2026, we sold five million shares of common stock in a registered direct offering, at a purchase price of $5.00 per share. As compensation for such placement agent services, the Company paid Craig-Hallum an aggregate cash fee equal to 5.0% of the gross proceeds received by the Company from the Offering and agreed to reimburse up to $75,000 of legal and other expenses as actually incurred. Net proceeds to the Company after deducting the placement agent fee and expenses were approximately $23.6 million.

Previous wording

We believe that our available working capital is sufficient to fund our presently forecasted working capital requirements for, at least, the next 24 months following the date of the filing of this report. However, our future capital requirements and the adequacy of our available funds will depend on many factors, including our ability to successfully commercialize our MST technology, competing technological and market developments, and the need to enter into collaborations with other companies or acquire technologies to enhance or complement our current offerings. If we are not able to generate sufficient revenue from license fees and royalties in a timeframe that satisfies our cash needs, we will need to raise more capital. In the event we require additional capital, we will endeavor to acquire additional funds through various financing sources, including our ATM, follow-on equity offerings, debt financing and joint ventures with industry partners. In addition, we will consider alternatives to our current business plan that may enable us to achieve revenue-producing operations and meaningful commercial success with a smaller amount of capital. If we are unable to secure additional capital, we may be required to curtail our research and development initiatives and take additional measures to reduce costs in order to conserve cash.

Current wording

We believe that our available working capital is sufficient to fund our presently forecasted working capital requirements for, at least, the next 12 months following the date of the filing of this report. However, our future capital requirements and the adequacy of our available funds will depend on many factors, including our ability to successfully commercialize our MST technology, competing technological and market developments, and the need to enter into collaborations with other companies or acquire technologies to enhance or complement our current offerings. If we are not able to generate sufficient revenue from license fees and royalties in a timeframe that satisfies our cash needs, we will need to raise more capital. In the event we require additional capital, we will endeavor to acquire additional funds through various financing sources, including our ATM, follow-on equity offerings, debt financing and joint ventures with industry partners. In addition, we will consider alternatives to our current business plan that may enable us to achieve revenue-producing operations and meaningful commercial success with a smaller amount of capital. If we are unable to secure additional capital, we may be required to curtail our research and development initiatives and take additional measures to reduce costs in order to conserve cash.