Cardio Diagnostics (CDIO) - 2025 Q1 - Quarterly Report

Part I — Financial Information Financial Statements (unaudited) The company's unaudited Q1 2025 financial statements show a net loss of $1.64 million, a significant reduction from $4.16 million in Q1 2024, with cash and assets increasing after a reverse stock split Condensed Consolidated Balance Sheets (unaudited) | | March 31, 2025 ($) | December 31, 2024 ($) | | :--- | :--- | :--- | | Total current assets | $10.54 million | $8.79 million | | Total assets | $12.28 million | $10.62 million | | Total current liabilities | $0.54 million | $0.63 million | | Total liabilities | $0.90 million | $1.06 million | | Total stockholders' equity | $11.38 million | $9.56 million | Condensed Consolidated Statements of Operations (unaudited) | | Three Months Ended March 31, 2025 ($) | Three Months Ended March 31, 2024 ($) | | :--- | :--- | :--- | | Revenue | $940 | $15.93 thousand | | Total operating expenses | $1.63 million | $4.17 million | | Loss from operations | ($1.63 million) | ($4.16 million) | | Net loss | ($1.64 million) | ($4.16 million) | | Net loss per common share | ($0.97) | ($5.93) | Condensed Consolidated Statements of Cash Flows (unaudited) | | Three Months Ended March 31, 2025 ($) | Three Months Ended March 31, 2024 ($) | | :--- | :--- | :--- | | Net cash used in operating activities | ($1.40 million) | ($1.23 million) | | Net cash used in investing activities | ($47.42 thousand) | ($69.94 thousand) | | Net cash provided by financing activities | $3.31 million | $1.58 million | | Net increase in cash | $1.86 million | $279.62 thousand | | Cash - End of period | $9.69 million | $1.56 million | - On May 12, 2025, the company executed a 1-for-30 reverse stock split to regain compliance with Nasdaq's minimum bid price requirement. All share and per-share amounts in the financial statements have been retroactively adjusted[35][37][111] Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses the significant reduction in Q1 2025 net loss to $1.64 million, driven by lower stock-based compensation, and highlights the company's focus on commercializing AI-driven cardiovascular tests and securing $14.68 million in ATM financing - The company's primary business is developing and commercializing AI-driven, epigenetics-based clinical tests for cardiovascular diseases like coronary heart disease (CHD), stroke, and heart failure[118][119] - The significant decrease in net loss for Q1 2025 compared to Q1 2024 was primarily driven by a $2.58 million reduction in General and Administrative expenses, largely due to lower stock compensation expense ($30.61 thousand in Q1 2025 vs. $2.52 million in Q1 2024)[131][136] - As of May 15, 2025, the company has raised $14.68 million in net proceeds from its At-the-Market (ATM) sales agreement, which serves as a primary source of liquidity[126][144] - Management anticipates that existing funds will be sufficient to fund activities for the next 12 months, but acknowledges the need to raise additional capital through equity or debt to support operations beyond that period[151] Quantitative and Qualitative Disclosures About Market Risk As a "smaller reporting company," the company is not required to provide quantitative and qualitative disclosures about market risk - Pursuant to Item 305(e) of Regulation S-K, the Company is not required to provide market risk disclosures as it qualifies as a "smaller reporting company"[176] Controls and Procedures Management concluded that disclosure controls and procedures were ineffective as of March 31, 2025, due to a material weakness in internal control over financial reporting, with remediation plans in progress - Management identified a material weakness in internal control over financial reporting: inadequate segregation of duties within the financial reporting process due to limited staff resources[179] - Remediation plans are in progress and include developing a formalized approval matrix for significant financial transactions and exploring the automation of key accounting processes[180][183] Part II — Other Information Legal Proceedings As of March 31, 2025, the company is not a party to any litigation deemed material to its ongoing operations - The Company reports that it is not a party to any material litigation as of the period ended March 31, 2025[185] Risk Factors No material changes to the risk factors previously disclosed in the company's 2024 Annual Report on Form 10-K have been reported - No material changes to the risk factors from the company's 2024 Annual Report on Form 10-K have been reported[186] Unregistered Sales of Equity Securities and Use of Proceeds The company reported no unregistered sales of equity securities or use of proceeds during the quarter - None reported for the period[187] Other Information No directors or officers adopted, modified, or terminated a Rule 10b-5 trading arrangement during the fiscal quarter ended March 31, 2025 - No directors or officers adopted, modified, or terminated a Rule 10b-5 trading arrangement during the quarter[190] Exhibits This section lists all exhibits filed as part of the Quarterly Report on Form 10-Q, including required officer certifications - The report includes a list of filed exhibits, such as the Agreement and Plan of Merger, Certificate of Incorporation, and various officer certifications required by the Sarbanes-Oxley Act[191][192][193]