Financial Position - As of September 30, 2025, the company reported approximately $1.9 million in cash and cash equivalents, with an accumulated deficit of approximately $86.3 million[283]. - The company has substantial doubt about its ability to continue as a going concern without additional funding for R&D activities[288]. - As of September 30, 2025, the company had approximately $1.9 million in cash and cash equivalents, which is expected to be insufficient to fund operations for the next 12 months[324]. Capital Raising Activities - The company raised approximately $4.4 million in net proceeds from its equity line of credit and an additional $4.2 million from a public offering that closed on February 7, 2025[296]. - The company entered into a Fourth Securities Purchase Agreement to issue and sell up to 10,000 shares of Series D Preferred Stock for an aggregate purchase price of up to $8 million[285]. - The company issued 6,250 shares of Series D Preferred Stock in exchange for 1,000,279 shares of Series D Preferred Stock of Stella Diagnostics, valued at $500,000[286]. - The company sold an additional 938 shares of Series D Preferred Stock for gross cash proceeds of $750,400 in June 2025[287]. - The company entered into a Fifth Securities Purchase Agreement to issue and sell up to 9,750 shares of Series E Preferred Stock for an aggregate purchase price of up to $7 million[294]. - The company has arranged two equity lines of credit, one for the sale of up to 25,000,000 shares of common stock and another for the purchase of up to $17.5 million of common stock[324]. - On October 14, 2025, the company entered into an agreement to issue and sell up to 9,750 shares of Series E Preferred Stock for an aggregate purchase price of up to $7 million[325]. Revenue and Expenses - The company has not recognized any revenue from product sales and does not expect to generate revenue in the foreseeable future[301]. - Research and development (R&D) expenses for Q3 2025 were $2,386,244, an increase of 34.5% from $1,774,210 in Q3 2024[309]. - General and administrative expenses decreased by 24.8% to $1,976,335 in Q3 2025 from $2,628,028 in Q3 2024[309]. - The total operating expenses for Q3 2025 were $4,362,579, a slight decrease of 0.9% compared to $4,402,238 in Q3 2024[309]. - The net loss for Q3 2025 was $4,856,395, representing a 14.9% increase from a net loss of $4,227,967 in Q3 2024[314]. - Net loss attributable to common stockholders for Q3 2025 was $11,506,223, a significant increase of 172.1% from $4,227,967 in Q3 2024[309]. - The company anticipates a significant increase in R&D expenses in the future due to expanded clinical development efforts[311]. - Other expenses for Q3 2025 were $(494,000), a negative change of $668,000 compared to other income of $174,000 in Q3 2024[313]. - The company recorded deemed dividends of $6,649,828 related to Series D Preferred Stock during Q3 2025[314]. - Research and development expenses increased to $8,048,000 for the nine months ended September 30, 2025, up from $6,157,000 in the same period of 2024, reflecting a 30.7% increase[316]. - General and administrative expenses decreased to $5,989,000 for the nine months ended September 30, 2025, down from $7,946,000 in the same period of 2024, representing a 24.6% decrease[319]. - Net loss for the nine months ended September 30, 2025, was $15,380,000, compared to a net loss of $8,976,000 for the same period in 2024, indicating a 71.3% increase in net loss[321]. - Net loss attributable to common stockholders amounted to $47,078,000 for the nine months ended September 30, 2025, compared to $8,976,000 in the same period of 2024, reflecting a 424.5% increase[321]. - Other expenses, net, were $(1,343,000) for the nine months ended September 30, 2025, compared to other income of $5,126,000 for the same period in 2024, showing a negative change of $6,469,000[320]. - The company anticipates significant increases in R&D expenses in the future due to expanded headcount and contracted services for clinical development[318]. Cash Flow - Net cash used in operating activities for the nine months ended September 30, 2025 was $(12,273,817), compared to $(11,375,873) for the same period in 2024, reflecting a difference of $(897,944)[329]. - The net loss for the nine months ended September 30, 2025 was $15,380,000, adjusted for non-cash items including depreciation expense of $215,000 and stock-based compensation of $836,000[330]. - Net cash provided by investing activities for the nine months ended September 30, 2025 amounted to $500,000, compared to $0 for the same period in 2024, due to the sale of equity securities[332]. - Net cash provided by financing activities for the nine months ended September 30, 2025 was $10,469,000, down from $12,241,000 in 2024[333]. - The financing activities in 2025 included net proceeds of $3,704,000 from the sale of common stock under the ELOC and $2,561,000 from the sale of Series D Preferred Stock[334]. - The net cash decrease in cash, restricted cash, and cash equivalents for the nine months ended September 30, 2025 was $(1,304,988), compared to an increase of $864,809 in 2024, resulting in a difference of $(2,169,797)[329]. Other Financial Information - The company recognized an earnout liability of $4.9 million as a result of the merger in February 2024, with a gain from the change in fair value of $4,870,000 recorded for the nine months ended September 30, 2024[337]. - Stock-based compensation for the nine months ended September 30, 2025 included expenses related to stock options and restricted stock awards, with the fair value estimated using the Black-Scholes model[338]. - The company recorded a gain of $5,190,000 on the revaluation of earnout liability and preferred stock warrant liability for the nine months ended September 30, 2024[331]. - The company’s investment in equity securities consists of Series D Preferred Stock of Stella Diagnostics, Inc., measured at cost or fair value based on observable price changes[336].

Sales Performance - Jack in the Box same-store sales decreased by 7.4% in Q4 2025 and 4.2% for FY 2025, while Del Taco same-store sales decreased by 3.9% in Q4 2025 and 3.7% for FY 2025[1][8] - Company restaurant sales for the 12 weeks ended September 28, 2025, were $142,515, a decrease of 5.9% from $151,417 for the same period in 2024[30] - Company-operated restaurant sales for the 12 weeks ended September 28, 2025, were $93,753,000, a decrease from $95,718,000 for the same period in 2024, representing a decline of 2.0%[41] - Franchised restaurant sales for the 12 weeks ended September 28, 2025, were $830,560,000, down from $899,882,000 in 2024, indicating a decrease of 7.7%[41] - Systemwide sales for the 12 weeks ended September 28, 2025, totaled $924,313,000, compared to $995,600,000 in 2024, reflecting a decline of 7.2%[41] Financial Performance - Diluted earnings per share for Q4 2025 was $0.30, down from $1.12 in the prior year quarter, and operating EPS was also $0.30 compared to $1.16 in the prior year[16] - Adjusted EBITDA for Q4 2025 was $45.6 million, down from $65.5 million in the prior year quarter[16] - Net earnings for the 52 weeks ended September 28, 2025, were a loss of $80,719 compared to a loss of $36,695 for the same period in 2024[30] - The company reported a basic net loss per share of $4.24 for the 52 weeks ended September 28, 2025, compared to a loss of $1.87 in 2024[30] - The net earnings (loss) for the 52 weeks ended September 28, 2025, was $(80,719), a significant decline from $(36,695) in 2024, indicating a worsening financial position[59] Margins - Restaurant-Level Margin for Jack in the Box was 16.1% in Q4 2025, down from 18.5% in the prior year, influenced by market entry inefficiencies and inflationary commodity costs[3][4] - Franchise-Level Margin for Jack in the Box was 38.9% in Q4 2025, a decrease from 40.4% a year ago, primarily due to lower franchise same-store sales[5] - Del Taco's Restaurant-Level Margin was 6.8% in Q4 2025, down from 9.3% in the prior year, driven by transaction declines and inflationary commodity increases[9] - The Restaurant-Level Margin for Jack in the Box was 16.1% for the 12 weeks ended September 28, 2025, down from 18.5% in the same period of 2024[64][65] - The Franchise-Level Margin for Jack in the Box was 38.9% for the 12 weeks ended September 28, 2025, compared to 40.4% in the same period of 2024, indicating a decline in profitability[68] Assets and Liabilities - Total current assets increased to $220,372 as of September 28, 2025, from $181,277 as of September 29, 2024, representing a growth of 21.6%[32] - Cash and restricted cash at the end of the year increased to $81,813 from $54,167, marking a rise of 50.9%[34] - Total liabilities decreased to $3,531,692 as of September 28, 2025, from $3,587,427 as of September 29, 2024, a reduction of 1.6%[32] Impairment and Expenses - The company incurred impairment charges of $213,997 for the 52 weeks ended September 28, 2025, compared to $171,415 in 2024[34] - The company reported an impairment of goodwill and intangible assets of 14.3% for the 52 weeks ended September 28, 2025, up from 10.3% in 2024[51] - The impairment of goodwill and intangible assets for the 52 weeks ended September 28, 2025, was $209,556, compared to $162,624 in 2024, indicating increased financial strain[59][60] - Operating costs and expenses for the 52 weeks ended September 28, 2025, totaled $1,483,384, slightly down from $1,488,770 in 2024[30] - The company reported interest expense of $78,941 for the 52 weeks ended September 28, 2025, slightly down from $80,016 in 2024[59] Future Outlook - For FY 2026, Jack in the Box expects same-store sales to range from -1% to +1% compared to FY 2025, with first-quarter results anticipated to remain pressured[22] - The company plans to maintain a restaurant count of 2,050 to 2,100, including approximately 20 new openings and 50 to 100 closures, mostly in franchises[21]

Financial Performance - Fourth quarter net revenue was $177.6 million, a decrease of 2.1% from $181.3 million in Q4 2024[2][3]. - GAAP net income for the fourth quarter was $6.4 million, resulting in an EPS of $0.12, compared to $12.1 million and $0.22 EPS in Q4 2024[2][3][6]. - Non-GAAP net income for Q4 was $14.9 million, with a non-GAAP EPS of $0.28, down from $0.34 in the same quarter last year[2][3][6]. - Net revenue for the three months ended October 4, 2025, was $177.6 million, a decrease from $181.3 million in the previous quarter[22]. - U.S. GAAP net income for the twelve months ended October 4, 2025, was $213, compared to a net loss of $3.3 million for the three months ended September 28, 2024[23]. - Non-GAAP net income for the twelve months ended October 4, 2025, was $10.99 million, with a non-GAAP net margin of 1.7%[23]. Cash and Investments - Cash, cash equivalents, and short-term investments totaled $510.7 million as of October 4, 2025[6]. - Cash and cash equivalents at the end of the period were $215.7 million, down from $366.9 million at the beginning of the period[20]. - Total cash, cash equivalents, and short-term investments at the end of the period were $510.7 million[20]. Future Projections - The company expects first quarter fiscal 2026 net revenue to be approximately $190 million, with GAAP diluted EPS around $0.18[7]. - The company expects net revenue for the first quarter of fiscal 2026 to be approximately $190 million, with a potential variance of +/- $10 million[28]. - Operating expenses for the first quarter of fiscal 2026 are projected to be $79.8 million, with adjustments leading to a non-GAAP outlook of $71.0 million[28]. - The diluted EPS for the first quarter of fiscal 2026 is expected to be $0.18 under GAAP and $0.33 under non-GAAP[28]. Shareholder Actions - The company repurchased 0.5 million shares of common stock at a cost of $16.7 million during the fourth quarter[6]. Assets and Liabilities - Total assets decreased to $1.1 billion from $1.24 billion as of September 28, 2024[18]. - Total liabilities were $282.9 million, down from $296.2 million in the previous year[18]. Margins and Cash Flow - Gross margin for Q4 was 45.7%, compared to 42.5% for the full fiscal year 2025[6][3]. - The company reported adjusted free cash flow of $4.4 million for the fourth quarter[6]. - Non-GAAP adjusted free cash flow for the twelve months ended October 4, 2025, was $96.6 million[26]. - The company reported a U.S. GAAP operating margin of 0.5% for the three months ended October 4, 2025[22].

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Table of Contents For the quarterly period ended September 30, 2025 or ☐ 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: 001-41346 NUTEX HEALTH INC. (Exact name of registrant as specified in its charter) | Delaware | 11-3363609 | ...

Revenue Generation and Financial Performance - The company has not generated any revenue from aircraft sales as it is still in the design and development phase of the xVTOL airplane, specifically the TriFan 600[230]. - The Company has not generated revenue from the Commercial Aviation segment as it continues to design and develop the TriFan 600 airplane[270]. - Revenues for Q3 2025 were $2.5 million, a 171% increase from $0.9 million in Q3 2024, primarily driven by a $1.3 million increase in hardware revenue due to improved supply chain conditions[284]. - For the nine months ended September 30, 2025, revenues were $3.6 million, a 64% increase from $2.2 million in the same period of 2024, with hardware revenue contributing $0.9 million and recurring software revenue increasing by $0.4 million[292]. - The company reported a net loss of approximately $47.2 million for the nine months ended September 30, 2025, with cash used in operating activities amounting to approximately $30.4 million[309][318]. - Net loss for Q3 2025 was $13.4 million, a 203% increase from a net loss of $4.4 million in Q3 2024[284]. - Other expense for the nine months ended September 30, 2025 was a loss of $10.8 million, compared to a gain of $5.3 million in the same period of 2024, primarily due to financing costs and changes in fair value of warrant liabilities[297]. Strategic Acquisitions and Investments - The company acquired Drone Nerds and Anzu Robotics for a total consideration of approximately $41.6 million, which includes $20 million in cash and $11.9 million in promissory notes[239]. - The Company made a strategic investment of $2 million in Valkyrie Sciences Holdings LLC through a convertible promissory note, with an interest rate of 10% per annum[252]. - The company acquired 100% of Drone Nerds and Anzu Robotics for a total purchase consideration of $40.0 million, which included $20.0 million in cash and $11.9 million in promissory notes[310]. Research and Development - Research and development expenses are expected to increase significantly as the Company builds aircraft prototypes and develops technologies for the TriFan 600[273]. - The TriFan 600 program made notable progress in engineering development, completing initial flight operations for subscale prototypes during Q3 2025, with a full-scale demonstrator expected to be completed in 2027[258]. - The company is focused on developing a family of versatile aircraft and solutions within the Vertical Economy, which includes various aircraft types and supporting technologies[237]. Operational and Administrative Expenses - Operating expenses for Q3 2025 increased to $15.9 million from $4.7 million in Q3 2024, reflecting a 235% rise attributed to increased headcount and operational growth[288]. - Operating expenses for the nine months ended September 30, 2025 were $38.2 million, up 35% from $28.3 million in the prior year, driven by increases in research and development, sales and marketing, and general and administrative expenses[296]. - General and administrative expenses are anticipated to rise substantially as the Company increases headcount to support research and development and commercialization efforts[277]. Financing Activities and Cash Flow - The company raised $25 million through a private placement of Series 10 Convertible Preferred Stock, receiving net proceeds of approximately $23.1 million after expenses[242]. - The September Offering closed on September 15, 2025, resulting in net proceeds of approximately $18.5 million after deducting placement agent fees and expenses of about $1.5 million[254]. - Net cash flows provided by financing activities for the nine months ended September 30, 2025, were approximately $58.6 million, significantly higher than the $11.9 million reported for the same period in 2024[323][324]. - Cash and cash equivalents increased by approximately $28.1 million from December 31, 2024, primarily due to net proceeds from public offerings[305]. - Cash and cash equivalents as of September 30, 2025, were approximately $32.2 million, with working capital adjusted to $29.3 million excluding derivative warrant liabilities[309]. Future Plans and Certifications - The company aims to achieve FAA certification for the TriFan 600, which is critical for future revenue generation and operational success[235]. - The company expects to commence deliveries of the TriFan 600 no earlier than 2030 and plans to fund operations primarily through equity and/or debt financings until then[313]. - The company plans to hold a shareholder meeting by January 31, 2026, to obtain approval for the removal of conversion limitations on the Series 10 Preferred Stock[245]. Compliance and Regulatory Engagement - The Company maintains active engagement with the FAA to ensure compliance with regulatory requirements during the development of the TriFan 600[259]. - The company does not have any off-balance sheet guarantees or trading activities involving non-exchange traded contracts[325].

Aircraft Development - The company is developing the TriFan 600, a VTOL airplane designed for over 1,000 miles of travel, aiming to achieve speeds twice that of competing helicopters and cruise at altitudes up to 25,000 feet [228]. - The company plans to secure FAA certification for the TriFan 600, which is critical for future revenue generation and operational success [235]. - The TriFan 600 program achieved initial flight operations for subscale prototypes, validating key design elements, with a full-scale demonstrator expected to be completed in 2027 [258]. - The company expects to commence deliveries of the TriFan 600 no earlier than 2030 and plans to fund operations primarily through equity and/or debt financings until then [313]. Financial Performance - Revenues for Q3 2025 were $2.5 million, a 171% increase from $0.9 million in Q3 2024, primarily driven by a $1.3 million increase in hardware revenue due to improved supply chain conditions [284]. - Gross profit for Q3 2025 was $1.1 million, up 107% from $0.5 million in Q3 2024, with a gross margin of 43.4%, down from 56.6% in the prior year due to a shift towards lower margin hardware products [287]. - Operating expenses for Q3 2025 increased to $15.9 million from $4.7 million in Q3 2024, reflecting a 235% rise attributed to increased headcount and operational growth [288]. - Net loss for Q3 2025 was $13.4 million, a 203% increase from a net loss of $4.4 million in Q3 2024 [284]. - For the nine months ended September 30, 2025, revenues were $3.6 million, a 64% increase from $2.2 million in the same period of 2024, with hardware revenue up by $0.9 million and recurring software revenue up by $0.4 million [292]. - Operating expenses for the nine months ended September 30, 2025 were $38.2 million, a 35% increase from $28.3 million in the same period of 2024, driven by higher research and development, sales and marketing, and general administrative expenses [296]. - The company reported a net loss of approximately $47.2 million for the nine months ended September 30, 2025, with cash used in operating activities amounting to approximately $30.4 million [309][318]. Capital and Funding - The company raised $25 million through a private placement of Series 10 Convertible Preferred Stock, receiving net proceeds of approximately $23.1 million after expenses [242]. - The Series 10 Preferred Stock has a stated value of $1,000 per share and offers a cumulative dividend of 12% annually, payable quarterly [247]. - The company closed a PIPE Offering on November 12, 2025, issuing 25,000 shares of Series 10 Convertible Preferred Stock for gross proceeds of $25.0 million [311]. - For the nine months ended September 30, 2025, net cash provided by financing activities was approximately $58.6 million, significantly higher than the $11.9 million reported for the same period in 2024 [323][324]. Strategic Acquisitions and Investments - The company acquired Drone Nerds and Anzu Robotics for a total consideration of approximately $41.6 million, including $20 million in cash and $11.9 million in promissory notes [239]. - The company incurred approximately $1.2 million in advisory fees related to the acquisitions of Drone Nerds and Anzu Robotics [241]. - The Company made a strategic investment of $2 million in Valkyrie Sciences Holdings LLC through a convertible promissory note, with an interest rate of 10% per annum [252]. Operational Changes and Future Outlook - The company has not generated any revenue from aircraft sales as it is still in the design and development phase of the TriFan 600, and will need to raise capital for future operations [230]. - The company reported two segments: Commercial Aviation (pre-revenue) and Industrial IoT, with a strategic shift towards software sales in the Industrial IoT segment [233]. - The company is exploring strategic options to wind down or sell the hardware portions of its Industrial IoT business to focus on software products [233]. - Research and development expenses are expected to increase significantly as the Company builds aircraft prototypes and explores new technologies [273]. - General and administrative expenses are anticipated to rise substantially as the Company increases headcount to support research and development and commercialization efforts [277]. - The company has incurred net losses and negative operating cash flows since the XTI Merger completed on March 12, 2024, and expects to continue this trend until sustainable commercial operations commence [312]. Cash and Working Capital - Cash and cash equivalents increased by approximately $28.1 million from December 31, 2024, primarily due to net proceeds from public offerings [305]. - As of September 30, 2025, the company had no interest-bearing debt outstanding, following the repayment of secured promissory notes and other obligations [305]. - Working capital improved to approximately $1.1 million as of September 30, 2025, compared to a deficit of $8.8 million at the end of 2024 [302]. - Cash and cash equivalents as of September 30, 2025, were approximately $32.2 million, with working capital adjusted to $29.3 million when excluding derivative warrant liabilities [309]. - As of September 30, 2025, the company received approximately $1.4 million in cash from customer deposits related to aircraft pre-orders, which will not be recognized as revenue until delivery [307].

Financial Performance - Q4 revenue reached $60.6 million, exceeding the high end of guidance, with FY25 revenue totaling $251.8 million[3] - Adjusted EBITDA for Q4 was $8.3 million, while FY25 adjusted EBITDA was $48.1 million[5] - Free cash flow for Q4 was $9.7 million, contributing to a total of $46.8 million for FY25, nearly three times the previous year[3] - The company projects FY26 revenue guidance of $300 million to $320 million, reflecting a 23% year-over-year increase at the midpoint[3] - The company anticipates first fiscal quarter revenue between $110 million and $120 million, including a $49.5 million patent license payment[8] - GAAP revenue for Q4 2025 was $60.639 million, up from $54.805 million in Q4 2024, representing a growth of 3.1%[51] - The company reported GAAP net cash provided by operating activities of $12.752 million for Q4 2025, compared to $6.115 million in Q4 2024[51] Profitability Metrics - Gross margin for Q4 was 72.6%, compared to 63.7% in Q4 FY24[5] - GAAP gross profit increased to $43.995 million in Q4 2025, compared to $34.895 million in Q4 2024, resulting in a gross margin of 72.6%[51] - Adjusted EBITDA for the twelve months ended September 30, 2025, was $48.064 million, down from $80.616 million in the previous year[51] - The net loss for the twelve months ended September 30, 2025, was $18.714 million, a significant improvement from a net loss of $588.078 million in 2024[49] - The company anticipates GAAP net income for FY2026 to range from a loss of $8.117 million to a profit of $11.883 million[53] Cash Flow and Assets - Net cash provided by operating activities for FY25 was $61.2 million, significantly up from $17.2 million in FY24[5] - Cash and cash equivalents at the end of the period were $84.017 million, down from $121.485 million at the end of September 30, 2024[46] - Total current assets decreased to $190.757 million as of September 30, 2025, from $265.509 million in 2024, reflecting a decline of about 28.2%[46] - Free cash flow for FY2026 is expected to be between $55.5 million and $65.5 million[53] Operational Metrics - The core technology business is expected to grow by 8% in FY26, excluding professional services[2] - The percentage of worldwide auto production utilizing Cerence technology reached 52% over the trailing twelve months[7] - The number of Cerence connected cars shipped increased by 14% year-over-year[7] - The number of Cerence enabled cars shipped on a TTM basis was over 525 million, showcasing the company's strong market presence[37] - Research and development expenses for the three months ended September 30, 2025, were $26.403 million, slightly up from $25.227 million in the same period of 2024[41] Liabilities and Shareholder Equity - The total liabilities decreased to $479.915 million as of September 30, 2025, compared to $561.261 million in 2024, indicating a reduction of approximately 14.5%[46] - The weighted-average common shares outstanding for the three months ended September 30, 2025, were 43.339 million, compared to 41.866 million in the same period of 2024[41] - Capital expenditures for FY2026 are projected to be between $(5.5) million and $(1.5) million[53]

Revenue Performance - Revenue for Q3 2025 was $1.34 billion, an increase of 31.0% year-over-year[6] - Year-to-date revenue for 2025 reached $3.93 billion, reflecting a 36.4% increase compared to the prior year period[6] - Full-year 2024 revenue was $4.09 billion, up 31.4% from full year 2023[6] - Total revenue for Q3 2025 reached $1,344,567, a 31.1% increase from $1,026,305 in Q3 2024[24] - Patient and resident service revenue increased to $1,344,302 in Q3 2025, up 31.3% from $1,024,276 in Q3 2024[24] - Skilled nursing services revenue for the nine months ended September 30, 2025, was $3,843,153, a 34.9% increase from $2,849,806 in 2024[30] Net Income and Profitability - Net income for Q3 2025 was $52.3 million, with year-to-date net income of $131.7 million[6] - Net income attributable to PACS Group, Inc. for the nine months ended September 30, 2025, was $131,841, compared to $18,559 for the same period in 2024, representing a 610.5% increase[24] - Operating income for the nine months ended September 30, 2025, was $214,908, compared to $51,094 in 2024, reflecting a 320.5% increase[24] - Net income for the three months ended September 30, 2025, was $52,330,000, a significant increase from $16,210,000 in the same period of 2024, representing a year-over-year growth of 223%[40] Adjusted EBITDA - Adjusted EBITDA for Q3 2025 was $131.5 million, while year-to-date adjusted EBITDA was $363.0 million[6] - Adjusted EBITDA for the three months ended September 30, 2025, reached $131,515,000, compared to $49,082,000 in the same period of 2024, indicating a growth of 168%[40] - Adjusted EBITDAR for the nine months ended September 30, 2025, was $646,216,000, up from $200,954,000 in the same period of 2024, reflecting a substantial increase of 221%[40] - Adjusted EBITDA for full-year 2025 is projected to be between $480 million and $490 million[14] Cash and Liquidity - As of September 30, 2025, cash and cash equivalents totaled $355.7 million, up from $157.7 million as of December 31, 2024[6] - Net cash at the end of the period was $359,056, significantly up from $62,012 at the end of September 2024[25] - Cash provided by operating activities for the nine months ended September 30, 2025, was $407,614, compared to $302,751 in 2024[25] Occupancy and Facilities - Mature facilities occupancy was 94.8%, significantly higher than the industry average of 79%[6] - The occupancy rate for skilled nursing services was 88.9% for the nine months ended September 30, 2025, down from 90.8% in 2024[30] - The occupancy rate for skilled nursing services decreased to 86.2% in 2025 from 94.4% in 2024, reflecting an 8.2% decline[31] - The number of facilities at period end increased to 290 in Q3 2025, up 16.5% from 249 in Q3 2024[28] - The number of operational beds at period end increased to 32,677 in Q3 2025, a 19.0% increase from 27,467 in Q3 2024[30] - The total number of facilities at period end increased by 3 to 79 in new facilities, representing a 3.9% growth[31] - The number of facilities decreased by 31 to 62 in ramping facilities, a decline of 33.3% compared to 93 in 2024[31] Costs and Expenses - The company reported a total rent-cost of services of $95,107,000 for the three months ended September 30, 2025, compared to $72,632,000 in the same period of 2024, which is an increase of 31%[40] - Interest expense for the three months ended September 30, 2025, was $8,529,000, slightly down from $9,029,000 in the same period of 2024, showing a decrease of 6%[40] - Provision for income taxes for the three months ended September 30, 2025, was $23,966,000, compared to $17,446,000 in the same period of 2024, marking an increase of 37%[40] - Depreciation and amortization expenses for the three months ended September 30, 2025, totaled $14,401,000, up from $10,523,000 in the same period of 2024, which is an increase of 37%[40] - The company incurred acquisition-related costs of $101,000 for the three months ended September 30, 2025, compared to $845,000 in the same period of 2024, indicating a decrease of 88%[40] - Stock-based compensation expense for the three months ended September 30, 2025, was $12,516,000, slightly up from $12,304,000 in the same period of 2024, reflecting an increase of 2%[40] - Legal and other costs for the three months ended September 30, 2025, amounted to $19,596,000, with no comparable costs reported in the same period of 2024, indicating new expenditures in this area[40] Patient Acuity and Rates - The average daily rate for Medicare patients increased to $988.41 in mature facilities for the three months ended September 30, 2025, compared to $947.82 in 2024[35] - The skilled mix by revenue for mature facilities increased to 56.4% in 2025 from 55.0% in 2024, indicating a shift towards higher acuity patients[34] - The average daily rate for total skilled patient payors increased to $824.34 in 2025 from $805.90 in 2024[35] - The skilled mix by nursing patient days for new facilities increased to 24.7% in 2025 from 22.3% in 2024, indicating improved patient acuity[34] - Skilled nursing services revenue for new facilities increased by $143,808 or 19.3% to $887,886 in 2025 from $744,078 in 2024[31]

Revenue Performance - Total revenue for Q3 2025 was $6,783,000, a 76% increase from $3,860,000 in Q3 2024[18] - Product revenue increased to $2,195,000 in Q3 2025, up 12% from $1,958,000 in Q3 2024[18] - Service revenue surged to $4,588,000 in Q3 2025, compared to $1,902,000 in Q3 2024, representing a 142% increase[18] - For the three months ended September 30, 2025, the company incurred a net loss of $5.4 million, compared to a net loss of $2.6 million for the same period in 2024[149] - Pro forma net revenue for the three months ended September 30, 2025, was $6.8 million, compared to $5.8 million for the same period in 2024[88] Financial Losses - Operating loss for Q3 2025 was $(4,734,000), compared to $(2,645,000) in Q3 2024, indicating a worsening of 79%[18] - Net loss for Q3 2025 was $(5,400,000), compared to $(2,616,000) in Q3 2024, representing a 106% increase in losses[18] - For the nine months ended September 30, 2025, the net loss was $14.276 million, compared to a net loss of $8.309 million for the same period in 2024, representing a 72% increase in losses[24] Assets and Liabilities - Total assets as of September 30, 2025, were $25,644,000, significantly up from $15,284,000 as of December 31, 2024[15] - Total liabilities increased to $23,112,000 as of September 30, 2025, compared to $7,330,000 at the end of 2024[15] - Stockholders' equity decreased to $2,532,000 as of September 30, 2025, down from $7,954,000 as of December 31, 2024[15] Cash Flow and Financing - Net cash used in operating activities was $11.451 million for the nine months ended September 30, 2025, compared to $9.751 million for the same period in 2024, indicating a 17% increase in cash outflow[24] - The company reported net cash provided by financing activities of $14.223 million for the nine months ended September 30, 2025, compared to $14.822 million for the same period in 2024, showing a slight decrease of 4%[24] - Cash and cash equivalents at the end of the year were $3.087 million, down from $6.311 million at the end of the previous year, reflecting a decrease of 51%[24] Strategic Acquisitions and Business Model - The company acquired all operating assets of The Sleep Center of Nevada for a total consideration of $6.0 million in cash and $1.5 million in common stock, marking a strategic expansion into sleep disorder treatment[29] - The company is exploring additional acquisitions and collaborations with medical sleep practices to expand its business model and revenue streams[37] - The company has shifted its focus to direct patient services, including home sleep screenings and telemedicine, under its new business strategy[32] Revenue Recognition and Customer Contracts - Revenue recognition follows ASC Topic 606, with legacy VIP enrollment revenue expected to continue through 2026[44] - Estimated customer life for VIP contracts ranges from 14 to 27 months, impacting revenue recognition timing[48] - Revenue from appliance sales is recognized upon transfer of control to the VIP, with the company acting as the principal in the transaction[59] Market and Operational Challenges - The Federal Reserve's elevated interest rates pose a risk to the company's revenue, earnings, and access to capital[207] - Changes in U.S. trade policy and tariffs may materially impact the company's sourcing strategy and competitiveness of contract manufacturers[205] - Ongoing geopolitical tensions, including the war in Ukraine and Middle East hostilities, could adversely affect demand for the company's products and capital market stability[209] Compliance and Regulatory Matters - The company received a notice from Nasdaq regarding non-compliance with the $2,500,000 minimum stockholders' equity requirement as of March 31, 2024[211] - Following a $7.5 million equity private placement, the company reported compliance with the equity requirement and received continued listing approval from Nasdaq[211] - The company is exploring additional equity capital financings to maintain compliance with Nasdaq's equity requirement[212]

Financial Performance - For the three months ended September 30, 2025, net revenue was $0.9 million, a decrease of 35.7% from $1.4 million for the same period in 2024[272]. - Gross margin for the three months ended September 30, 2025 was (13.9)%, compared to 15.2% for the same period in 2024, reflecting a decrease of 29.1 percentage points[274]. - General and administration expenses for the three months ended September 30, 2025 were $4.6 million, down 30.3% from $6.6 million in the same period of 2024[275]. - Research and development costs for the three months ended September 30, 2025 were $6,000, a significant decrease of 95.1% from $122,000 for the same period in 2024[276]. - Net loss from continuing operations for the three months ended September 30, 2025 was $6.8 million, or $(0.16) per share, compared to a net loss of $5.0 million, or $(0.26) per share, for the same period in 2024[278][279]. - For the nine months ended September 30, 2025, net revenue was $3.6 million, a decrease of 32.1% from $5.3 million for the same period in 2024[280]. - Gross margin profit for the nine months ended September 30, 2025 was $1.1 million, compared to a gross margin loss of zero for the same period in 2024[282]. - General and administration expenses for the nine months ended September 30, 2025 were $13.4 million, down 36.1% from $20.8 million in the same period of 2024[283]. - Interest expense for the nine months ended September 30, 2025 was $2.7 million, an increase of 35.9% from $2.0 million for the same period in 2024[285]. - As of September 30, 2025, the company's working capital deficit was $47.5 million, compared to $1.5 million as of December 31, 2024[293]. - The company estimates it will have enough cash and liquidity to finance its operating requirements for at least 12 months from the date of filing the financial statements[294]. - The company anticipates continuing to incur losses and will need additional capital to fund operations, which may be raised through public or private equity or debt financings[298]. Business Developments - ProPhase Labs, Inc. ceased providing COVID-19 diagnostic testing in May 2025 due to insurance carriers stopping payment for claims, leading to a Chapter 11 reorganization filing on September 22, 2025[244]. - The BE-Smart™ Esophageal Pre-Cancer Diagnostic Screening Test achieved a technical success rate greater than 95% in a validation study completed on June 17, 2025, with commercialization planned for Q1 2026 and broader insurance-backed commercialization targeted for Q3 2026[251]. - The U.S. District Court vacated the FDA's Final Rule expanding oversight of Laboratory Developed Tests (LDTs), allowing for faster market entry for the BE-Smart™ test[252]. - ProPhase acquired Nebula Genomics, Inc. in August 2021, focusing on genomics sequencing technologies and exploring the potential sale of Nebula while growing its genomics business[245]. - DNA Complete, formed in September 2024, offers whole genome sequencing products with plans to expand into retail stores and provide testing for universities[246]. - DNA Complete provides three tiers of DNA testing (Essential, Pro, Elite) with varying levels of analysis and personalized health reports, including over 350 reports for the Elite tier[260]. - Nebula Genomics offers affordable whole genome sequencing and over 300 personalized reports, with a subscription model for ongoing updates[258]. - The BE-Smart™ test is supported by a full intellectual property portfolio, with protection expected until 2040, enhancing commercialization efforts[256]. - ProPhase owns dietary supplements under the TK Supplements® brand, including products like Legendz XL® and Triple Edge XL®[249]. Bankruptcy and Legal Matters - The bankruptcy filing aims to streamline recovery of potentially tens of millions in unpaid insurance claims related to COVID-19 testing[244]. - The company has not generated diagnostic services revenue for the three months ended September 30, 2025, due to the expiration of the federal Public Health Emergency related to COVID-19[315]. Market and Economic Conditions - The company is subject to inflationary trends, which may impact costs related to retail operations and diagnostic services[320]. - Current economic conditions may lead to a decline in business and consumer spending, adversely affecting financial performance[326]. - There have been no material changes to market risk exposures since December 31, 2024[327]. - The company does not expect material losses in its investment portfolio or excessive exposure to market risks associated with interest rates[325]. Financing Activities - The company entered into a Sales Agreement with WestPark Capital, Inc. to offer and sell shares of its common stock with an aggregate offering price of up to $100 million[316]. - In April 2024, the company sold 1,033,500 shares of common stock, receiving cash proceeds of $4.6 million, net of offering costs[318]. - On November 12, 2024, the company closed on a public offering, selling 4,795,000 shares at a price of $0.72 per share, resulting in net cash proceeds of $3 million[319]. Contractual Obligations - The company has contractual obligations to pay Global BioLife a royalty of 5.5% on sales of Equivir products after the first commercial sale[308]. - Under the Linebacker License Agreement, the company must pay $900,000 upon achieving a first Phase 3 study and an additional $1 million upon receiving regulatory approval for the first product[309]. - The company purchased assets from Stella Diagnostics for $3.5 million in cash and 100,000 shares of common stock, with additional royalties of 5% of Adjusted Gross Margin for seven years post-commercialization[310][312].