Revenue and Profitability - Revenue from logistics operations increased by 16.5% to $3,215,881 for the quarter ended October 31, 2025, compared to the same period in 2024[2] - The cost of revenue for logistics operations rose by 18.9%, leading to a decrease in gross profit margin from 6.12% to 4.17%[2] - The company recorded a net loss of $268,874 for the quarter, representing a 192% increase in net loss compared to the previous year[4] - Initial mineral sales generated $505,465 in revenue with a gross profit margin of 32.51%[3] - Total operating revenues for the quarter reached $3,818,227, a 28% increase quarter-to-quarter[8] Expenses and Cash Flow - Cash balance decreased by $727,403 to $1,677,949, primarily due to $582,912 spent on expanding mineral ore inventory[5] - General and administrative expenses surged by 134% to $608,648, up from $260,393 in the same quarter of 2024[8] Strategic Focus - The company aims to shift focus towards long-distance shipping lines to improve profit margins[3] - The company plans to utilize optimized bulk vessel and container shipping for its new mineral trade operations[7] Working Capital - Working capital as of October 31, 2025, was $2,636,809[5]

Financial Performance - Revenues for the three months ended October 31, 2025, increased to $17,127 thousand, up 8.2% from $15,820 thousand in the same period last year[14] - Net income for the three months ended October 31, 2025, was $1,801 thousand, down 32.2% from $2,654 thousand in the prior year[14] - Total operating income for the three months ended October 31, 2025, was $1.7 million, down from $2.6 million in the same period of 2024, a decline of 34.6%[42] - Operating income for the three months ended October 31, 2025, was $1,714,000, a decrease of 34.5% from $2,618,000 in the prior year[77] - The effective tax rate for the three months ended October 31, 2025, was an income tax benefit of 1.73% on pretax income of $1.8 million, compared to an income tax provision of 4.96% on pretax income of $2.8 million in the prior year[84] Assets and Liabilities - Total current assets decreased to $50,919 thousand as of October 31, 2025, from $53,106 thousand as of April 30, 2025, reflecting a decline of 4.1%[12] - Total liabilities decreased to $33,800 thousand as of October 31, 2025, down 11.8% from $38,117 thousand as of April 30, 2025[12] - Total identifiable assets as of October 31, 2025, were $92.3 million, slightly down from $93.7 million as of April 30, 2025[45] - The total lease liabilities as of October 31, 2025, amounted to $8.4 million, a decrease from $8.8 million as of April 30, 2025[34] Cash Flow - The company reported a net cash provided by operating activities of $638 thousand for the six months ended October 31, 2025, compared to $2,352 thousand in the prior year, a decline of 72.9%[17] - Net cash provided by operating activities decreased to approximately $0.6 million for the six months ended October 31, 2025, down from $2.4 million in the prior year, primarily due to timing of billings and cash collections[87] - Net cash used in investing activities increased to approximately $1.4 million for the six months ended October 31, 2025, compared to $0.8 million in the prior year, all related to capital expenditures[88] Research and Development - Research and development expenses for the six months ended October 31, 2025, were $2,332 thousand, down 24.8% from $3,101 thousand in the same period last year[14] - Research and development (R&D) expenses for the three months ended October 31, 2025, were $1,199,000, a decrease of 25.7% from $1,613,000 in the prior year[76] - The company plans to continue investing in R&D to maintain competitiveness in time and frequency technology[76] - The company plans to continue investing in R&D for products related to space applications and communication systems, anticipating additional customer funding for these activities[93] Stockholder Equity and Dividends - Total stockholders' equity increased to $58,455 thousand as of October 31, 2025, up from $55,620 thousand as of April 30, 2025, reflecting a growth of 3.3%[12] - The company did not pay any dividends during the six months ended October 31, 2025, compared to $9,567 thousand in the same period last year[17] - The company declared a special cash dividend of $1.00 per share, totaling approximately $9.6 million, paid on August 29, 2024[25] Inventory and Expenses - Inventory as of October 31, 2025, totaled $24,682,000, an increase from $23,487,000 as of April 30, 2025[31] - Selling, general, and administrative (SG&A) expenses for the three months ended October 31, 2025, were $3,623,000, an increase of 6.9% from $3,388,000 in the prior year, representing approximately 21% of consolidated revenues[75] - SG&A expenses are expected to continue increasing through the remainder of fiscal year 2026 due to payroll-related expenses and investments in growth initiatives[75] Backlog and Future Outlook - The consolidated funded backlog was approximately $82 million as of October 31, 2025, compared to $70 million at April 30, 2025, with about 69% expected to be realized in the next twelve months[94] - The company believes its liquidity is adequate to meet short-term operating and investment needs through at least December 12, 2026[95] Other Financial Information - The company recognized $3.3 million and $7.4 million of contract liabilities as revenue during the three and six months ended October 31, 2025, respectively[26] - The company incurred warranty costs of $130,000 for the three months ended October 31, 2025, with an ending balance of warranty reserves at $557,000[61] - There were no changes in the company's internal control over financial reporting that materially affected its financial reporting during the fiscal quarter ended October 31, 2025[100] - The company does not have any off-balance sheet arrangements that could materially affect its financial condition or results[96]

Financial Performance - The company reported total revenues of $225.3 million for the three months ended June 30, 2025, a significant increase of $130.4 million or 137.4% compared to $94.9 million in the same period of 2024[380]. - Operating income for the period was $10.8 million, a turnaround from an operating loss of $232.6 million in the same quarter of 2024[377]. - Net income attributable to B. Riley Financial, Inc. was $139.5 million, compared to a net loss of $433.6 million in the prior year, marking a significant recovery[377]. - Total revenues for the six months ended June 30, 2025, were $411.4 million, an increase of 4.8% compared to $392.5 million for the same period in 2024[419]. - The company generated net income of $129.5 million for the six months ended June 30, 2025, compared to a net loss of $482.8 million in the same period of 2024[457]. Revenue Breakdown - Services and fees revenue decreased by $57.1 million or 28.2% to $145.8 million, primarily due to declines in the Capital Markets, Wealth Management, and Communications segments[377]. - Wealth Management segment total revenues decreased to $38.6 million in Q2 2025 from $50.9 million in Q2 2024, a decline of 24%[383]. - Revenues from the Communications segment fell to $60.7 million in Q2 2025 from $77.7 million in Q2 2024, a decrease of 22%[384]. - The Capital Markets segment saw a revenue decrease of $46.3 million to $64.3 million, primarily due to declines in corporate finance and investment banking fees[424]. - Communications segment revenues fell by $34.9 million to $123.9 million, largely due to a $34.3 million decrease in subscription revenue following the divestiture of the Lingo wholesale carrier business[426]. Investment and Securities - As of June 30, 2025, the total securities and other investments owned amounted to $242.4 million, down from $282.3 million as of December 31, 2024, representing a decrease of approximately 14.1%[363][364]. - The carrying value of equity securities was $186.9 million as of June 30, 2025, compared to $232.5 million as of December 31, 2024, indicating a decline of about 19.6%[364]. - Public equity securities decreased from $124.9 million as of December 31, 2024, to $88.9 million as of June 30, 2025, a reduction of approximately 29%[364]. - The carrying value of Babcock & Wilcox Enterprises, Inc. common stock decreased from $45.0 million as of December 31, 2024, to $26.4 million as of June 30, 2025, reflecting a decline of approximately 41.1%[365]. - The carrying value of Double Down Interactive Co., Ltd common stock fell from $43.7 million as of December 31, 2024, to $34.5 million as of June 30, 2025, a decrease of about 21.1%[366]. Expenses and Cost Management - Selling, general and administrative expenses decreased by $35.6 million to $142.4 million in Q2 2025 from $178.0 million in Q2 2024, a reduction of 20%[397]. - Total selling, general and administrative expenses decreased by $47.2 million to $309.8 million during the six months ended June 30, 2025, from $356.9 million in the same period of 2024, a reduction of 13.2%[439]. - The Capital Markets segment saw a decrease in expenses of $18.1 million to $86.5 million, primarily due to a $21.7 million reduction in employee compensation and benefits[440]. - Wealth Management segment expenses decreased by $13.8 million to $85.5 million, mainly due to a $16.6 million drop in employee compensation and benefits[441]. - Direct cost of services decreased by $42.4 million to $75.9 million, primarily due to reductions in the Communications segment and the sale of a regional environmental services business[437]. Cash Flow and Liquidity - As of June 30, 2025, the company had $267.4 million of unrestricted cash and cash equivalents and $1.5 billion of borrowings outstanding[458]. - Cash used in operating activities was $25.4 million for the six months ended June 30, 2025, a decrease of $272.2 million compared to the same period in 2024[469]. - Cash provided by investing activities increased to $289.2 million for the six months ended June 30, 2025, compared to $6.7 million in 2024[471]. - Cash used in financing activities was $252.4 million for the six months ended June 30, 2025, compared to $243.5 million in 2024, primarily due to increased debt-related payments[472]. - The Company expects current cash, cash equivalents, and available credit facilities to meet working capital and capital expenditure requirements for at least the next 12 months[464]. Debt and Borrowings - Total borrowings outstanding as of June 30, 2025, amounted to $1.5 billion, including $1.3 billion from senior notes with interest rates ranging from 5.00% to 8.00%[463]. - The company utilizes borrowings under senior notes payable and credit facilities to fund acquisitions and operations[475]. - Interest expense decreased by $56.0 million to $2.7 million during the six months ended June 30, 2025, from $58.7 million in the same period of 2024, due to a reduction in securities loaned and loan participations sold[447]. - Approximately 90% of the company's debt obligations bore interest at fixed rates, mitigating exposure to interest rate fluctuations[475]. - Management actively monitors debt obligations and interest income sensitivity to changes in interest rates[476]. Impairments and Adjustments - The company recognized an impairment charge of $1.5 million for the Targus tradename due to potential impairment indicators[374]. - Non-cash impairment charges of $1.5 million were recognized during the three months ended June 30, 2025, compared to $27.7 million in the same period of 2024, which included $26.7 million of goodwill impairment[404]. - Fair value adjustments on loans increased by $176.4 million, contributing significantly to revenue growth, with $150.3 million attributed to a loan to Vintage Capital Management[380]. - Fair value adjustments on loans receivable improved to $0.8 million in Q2 2025 from a loss of $175.6 million in Q2 2024, a favorable variance of $176.4 million[390]. - Other income included a gain of $10.2 million from realized and unrealized investments during the three months ended June 30, 2025, compared to a loss of $155.2 million in the same period of 2024, resulting in a favorable variance of $165.5 million[407]. Strategic Changes - The company is changing its name to BRC Group Holdings, Inc. effective January 1, 2026, reflecting its diversified portfolio and strategic direction[350]. - The Company completed the sale of Atlantic Coast Recycling for approximately $68.6 million, part of the Wealth Management business for $26.0 million, and the financial consulting business for $117.8 million[461]. - Targus entered into a $30.0 million revolving credit agreement with FGI Worldwide LLC, maturing on August 20, 2028, to refinance existing obligations[370]. - The Company anticipates variability in the sale of additional investments over the next twelve months based on economic value realization and liquidity needs[461]. - The company plans to change its name to BRC Group Holdings, Inc., effective January 1, 2026[372].

Financial Performance - The company reported total revenues of $225.3 million for the three months ended June 30, 2025, a 137.4% increase from $94.9 million in the same period of 2024[380]. - Operating income for the three months ended June 30, 2025, was $10.8 million, a significant turnaround from an operating loss of $232.6 million in the same period of 2024[377]. - Net income attributable to B. Riley Financial, Inc. was $139.5 million for the three months ended June 30, 2025, compared to a loss of $433.6 million in the prior year[377]. - Total revenues for the six months ended June 30, 2025, were $411.4 million, an increase of 4.8% compared to $392.5 million for the same period in 2024[419]. - The company generated net income of $129.5 million for the six months ended June 30, 2025, compared to a net loss of $482.8 million in the same period of 2024[457]. Revenue Breakdown - Wealth Management segment total revenues decreased to $38.6 million in Q2 2025 from $50.9 million in Q2 2024, a decline of 24%[383]. - The Capital Markets segment saw a revenue decrease of $46.3 million to $64.3 million, a decline of 41.9% from $110.6 million in the prior year[424]. - Communications segment revenues decreased by $34.9 million to $123.9 million, a decline of 22.0% from $158.8 million in the prior year[426]. - E-Commerce segment revenues increased by 27.0% to $3.5 million, up from $2.7 million in the previous year[422]. - Revenues from services and fees in the Communications segment decreased to $60.7 million in Q2 2025 from $77.7 million in Q2 2024, a decline of 22%[384]. Investment and Securities - As of June 30, 2025, the total securities and other investments owned amounted to $242.4 million, down from $282.3 million as of December 31, 2024, representing a decrease of approximately 14.1%[363][364]. - The carrying value of public equity securities was $88.9 million as of June 30, 2025, compared to $124.9 million as of December 31, 2024, indicating a decline of about 29%[364]. - The carrying value of private equity securities decreased to $97.9 million as of June 30, 2025, from $107.6 million as of December 31, 2024, reflecting a reduction of approximately 9.5%[364][368]. - The carrying value of Babcock & Wilcox Enterprises, Inc. common stock decreased from $45.0 million as of December 31, 2024, to $26.4 million as of June 30, 2025, a decline of approximately 41.1%[365]. - The carrying value of Double Down Interactive Co., Ltd common stock fell from $43.7 million as of December 31, 2024, to $34.5 million as of June 30, 2025, representing a decrease of about 21.1%[366]. Cash Flow and Financing - Cash used in operating activities was $25.4 million for the six months ended June 30, 2025, a decrease of $272.2 million compared to $246.8 million provided in the same period of 2024[469]. - Cash provided by investing activities was $289.2 million for the six months ended June 30, 2025, compared to $6.7 million in the same period of 2024, primarily due to proceeds from business sales[471]. - Cash used in financing activities was $252.4 million for the six months ended June 30, 2025, compared to $243.5 million in the same period of 2024, primarily due to increased debt-related payments[472]. - The Company had borrowings outstanding of $1.5 billion as of June 30, 2025, including $1.3 billion from senior notes with interest rates ranging from 5.00% to 8.00%[463]. - The company expects to utilize existing cash balances and cash generated from operations to fund debt service obligations over the next twelve months[459]. Expenses and Cost Management - Selling, general and administrative expenses decreased by $35.6 million to $142.4 million in Q2 2025 from $178.0 million in Q2 2024, a reduction of 20%[397]. - Total selling, general and administrative expenses decreased by $47.2 million to $309.8 million during the six months ended June 30, 2025, from $356.9 million in the same period of 2024, a reduction of 13.2%[439]. - Direct cost of services decreased by $42.4 million to $75.9 million, primarily due to a $32.9 million decrease in the Communications segment[437]. - Interest expense decreased by $56.0 million to $2.7 million during the six months ended June 30, 2025, from $58.7 million in the same period of 2024, due to a decrease in securities loaned and loan participations sold[447]. - The impairment charge for the Targus tradename was $1.5 million as of June 30, 2025, reflecting a decline in fair value due to market conditions[374]. Future Outlook and Strategic Initiatives - The Company plans to change its name to BRC Group Holdings, Inc., effective January 1, 2026[372]. - The Company anticipates variability in the sale of additional investments over the next twelve months based on economic value realization and liquidity needs[461]. - The company actively monitors interest rate risk and may consider entering into interest rate hedges to mitigate potential risks[476]. - The company maintains a portfolio of cash equivalents and short-term investments, including common stocks and loans receivable, to maximize income while preserving capital[477]. - The Company completed private exchange transactions on July 11, 2025, exchanging Exchanged Notes for approximately $24.6 million aggregate principal amount of New Notes[462].

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2025 Or o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number 001-37503 B. RILEY FINANCIAL, INC. (Exact Name of Registrant as Specified in Its Charter) | | | (State or Other Jur ...

Financial Performance - HeartSciences Inc. reported financial results for the quarter ended October 31, 2025, with a focus on operational performance and business updates[7]. - The press release detailing the financial results is included as Exhibit 99.1 in the Current Report[9]. Company Classification - The company is classified as an emerging growth company under the Securities Act of 1933[6].

Revenue Performance - Net revenue for the three months ended September 30, 2025, was $1,694,174, representing an increase of approximately 21% compared to $1,395,913 for the same period in 2024 [202]. - Net revenue for the nine months ended September 30, 2025, was $5,116,963, reflecting a 5% increase from $4,886,359 in the prior year [203]. Profitability Metrics - Gross profit margin for the three months ended September 30, 2025, improved to 57.7%, up from 54.7% in the same period of 2024 [206]. - Operating loss for the three months ended September 30, 2025, decreased to $(78,288), a 64% improvement from $(218,771) in the prior year [201]. Interest and Other Income - Interest expense for the three months ended September 30, 2025, increased by approximately 123% to $155,310, compared to $69,638 in the same period of 2024 [212]. - Other income for the three months ended September 30, 2025, surged to $492,599, primarily due to an Employee Retention Tax Credit reimbursement of $491,801 [214]. Cash Flow and Financing Activities - Net cash provided by operating activities for the nine months ended September 30, 2025, was $1,478,358, a significant increase of approximately 2,829% from $(54,178) in the prior year [218]. - Cash used in financing activities for the nine months ended September 30, 2025, was $676,164, representing an increase of approximately 891% from $68,206 in the same period of 2024 [220]. Debt and Obligations - The company owes $2,227,366 for the Kirkman acquisition as of September 30, 2025, with a forbearance agreement executed to postpone principal payments [216]. - On November 4, 2025, the company completed a private placement for gross proceeds of $8,000,000, netting approximately $7,360,000 after commissions [221]. - The Company executed a loan agreement for $150,000 with a 12.5% OID, totaling $171,500, and issued 37,500 warrants [223]. - A related party loan agreement was executed for $130,000 with a 20% annual interest rate, due March 11, 2031 [224]. - The Company entered a line of credit agreement for $300,000 with a 27% interest rate, settled in full on January 22, 2024 [224]. - An additional line of credit agreement was established for $100,000 with a 5% interest rate, settled in full on July 7, 2024 [225]. - A short-term debt facility was entered into for $247,634, which is non-interest-bearing and remains outstanding as of September 30, 2025 [226]. Inventory and Asset Management - As of September 30, 2025, the allowance for inventory obsolescence increased by $12,895, resulting in a reserve of $77,722 [228]. - The Company did not recognize impairment losses for long-lived assets during the nine months ended September 30, 2025, and 2024 [229]. Regulatory and Reporting Status - The Company adopted ASU 2023-07 effective December 31, 2024, requiring additional segment reporting disclosures [235]. - The Company is classified as an "emerging growth company" and a "smaller reporting company," with annual revenue less than $100 million [240][244]. - The Company may continue to rely on exemptions from certain disclosure requirements as a smaller reporting company [245].

Financial Performance - Total revenue for Q3 2025 was approximately $109.1 million, with adjusted net revenue of approximately $75.7 million[3] - Net income for the quarter was approximately $41.8 million, while adjusted net income totaled approximately $18.9 million[3] - Investment banking revenue was $53.9 million, while institutional brokerage revenue was $51.6 million for the quarter[14] Capital Management - The company raised approximately $10.5 billion in capital for clients through equity and debt financings during the quarter[2] - Cash and securities as of September 30, 2025, totaled $145.9 million, with no outstanding debt[6] - The company continues to evaluate future returns of capital to shareholders based on available excess capital and business growth prospects[10] Shareholder Returns - The board approved a dividend of $0.40 per common share, amounting to approximately $7.4 million in total distribution[10] Strategic Initiatives - The company maintained a disciplined approach to recruiting, strategically expanding its team to enhance its platform[2] - The upcoming Convergence Conference will focus on the impact of AI and blockchain on the energy sector, reflecting the company's commitment to relevant engagement[2] Revenue Clarity - Adjusted net revenue excludes trading gains and losses, providing a clearer view of the firm's operating performance[4]

Financial Performance - For Q3 2025, B. Riley Securities reported total revenue of approximately $109.1 million and adjusted net revenue of approximately $75.7 million[3]. - Net income for the quarter was approximately $41.8 million, with adjusted net income totaling approximately $18.9 million[3]. - Investment banking revenue was $53.9 million, while institutional brokerage revenue was $51.6 million for the quarter[14]. - Adjusted net revenue excludes trading gains and losses, providing a clearer view of the firm's operating performance[4]. Capital Management - The company raised approximately $10.5 billion in capital for clients through equity and debt financings during the quarter[2]. - B. Riley Securities has a debt-free balance sheet, with cash and securities totaling $145.9 million as of September 30, 2025[10]. - The company plans to evaluate future returns of capital to shareholders based on available excess capital and business growth prospects[10]. Shareholder Returns - The Board approved a dividend of $0.40 per common share, amounting to approximately $7.4 million in total distribution[10]. Strategic Initiatives - The company emphasized a disciplined approach to risk management and recruiting new talent to strengthen its platform[2]. - Upcoming conferences, including the Convergence Conference focusing on AI and blockchain, reflect the company's commitment to high-quality engagement[2].

Financial Performance - Total revenue for the second quarter of fiscal 2026 was $15.0 million, an increase of 11.5% compared to $13.5 million in the same period last year[5] - Net income for the second quarter was $237,000, compared to $728,000 in the same quarter of the previous year[6] - Total revenue for the first half of fiscal 2026 was $29.0 million, a 5.4% increase from $27.6 million in the prior year[11] - Oncology revenue for the three months ended October 31, 2025, was $15.035 million, an increase from $13.489 million in the same period of 2024, representing a growth of 11.5%[27] - Net income attributable to the company's common shares for the three months ended October 31, 2025, was $268,000, compared to $728,000 in the same period of 2024, a decrease of 63.2%[27] Profitability Metrics - Oncology services profit was $7.8 million with a margin of 52%, up from 45% in the same quarter of the previous year[7] - Adjusted EPS - diluted, Non-GAAP for the three months ended October 31, 2025, was $0.06, compared to $0.08 in the same period of 2024, reflecting a decrease of 25%[26] - Oncology services margin for the first half of fiscal 2026 was 47%, consistent with the prior year[13] - The oncology services margin - Non-GAAP for the three months ended October 31, 2025, was 52%, compared to 45% in the same period of 2024[26] Expenses - Adjusted EBITDA for the second quarter was $843,000, down from $1.1 million in the same quarter of fiscal 2025[6] - Research and development expenses for the second quarter increased by 54.9% to $2.6 million, reflecting greater investment in the data licensing platform[8] - Operating expenses for the second quarter rose by 16.4% to $14.9 million, driven by targeted investments in growth areas[5] - Income from operations for the six months ended October 31, 2025, was a loss of $342,000, compared to a profit of $2.061 million in the same period of 2024[27] - Research and development expenses for the six months ended October 31, 2025, were $4.698 million, up from $3.143 million in the same period of 2024, indicating a 49.4% increase[27] Cash and Assets - The company ended the quarter with approximately $8.5 million in cash and no debt[10] - Cash and cash equivalents as of October 31, 2025, were $8.516 million, a decrease from $9.785 million at the end of the previous reporting period[28] - Total assets as of October 31, 2025, were $30.162 million, down from $32.344 million as of April 30, 2025[28] - Total liabilities as of October 31, 2025, were $25.931 million, down from $28.572 million as of April 30, 2025[28] Market Outlook - The company remains optimistic about the strengthening pharma and biotech funding environment, which is expected to support improved bookings[2] - Net cash used in operating activities for the six months ended October 31, 2025, was $(1.135) million, compared to $28,000 in the same period of 2024[29]