Aeluma Inc(ALMU) - 2025 Q3 - Quarterly Report

PART I - FINANCIAL INFORMATION This section presents Aeluma, Inc.'s unaudited consolidated financial statements and management's analysis of financial condition and operations Item 1. Financial Statements This section presents Aeluma, Inc.'s unaudited consolidated financial statements, including balance sheets, statements of operations, stockholders' equity, cash flows, and detailed notes on business, accounting policies, and financial activities Consolidated Balance Sheets This section provides a snapshot of Aeluma, Inc.'s financial position at specific dates, detailing assets, liabilities, and stockholders' equity Consolidated Balance Sheet Highlights (March 31, 2025 vs. June 30, 2024) | Metric | March 31, 2025 | June 30, 2024 | | :--- | :--- | :--- | | Total Assets | $19,361,740 | $3,844,047 | | Total Liabilities | $1,364,645 | $1,567,886 | | Total Stockholders' Equity | $17,997,095 | $2,276,161 | | Cash and cash equivalents | $3,865,659 | $1,291,072 | | Certificate of deposit | $12,000,000 | $ - | | Accounts receivable | $1,143,417 | $60,004 | Consolidated Statements of Operations This section reports Aeluma, Inc.'s financial performance over specific periods, detailing revenues, expenses, and net income or loss Consolidated Statements of Operations Highlights (Three Months Ended March 31) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Revenue | $1,254,966 | $343,894 | | Loss from operations | $(831,470) | $(962,768) | | Net income (loss) | $1,460,893 | $(962,651) | | Basic Net income (loss) per share | $0.12 | $(0.08) | Consolidated Statements of Operations Highlights (Nine Months Ended March 31) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Revenue | $3,348,220 | $639,286 | | Loss from operations | $(1,173,252) | $(3,574,278) | | Net loss | $(2,163,550) | $(3,573,480) | | Basic Net loss per share | $(0.18) | $(0.29) | - The significant net income for the three months ended March 31, 2025, was primarily driven by a $2,577,103 change in the fair value of derivative liabilities[12] Consolidated Statements of Stockholders' Equity This section details changes in Aeluma, Inc.'s equity accounts over specific periods, including stock issuances, conversions, compensation, and net income/loss Changes in Stockholders' Equity (Nine Months Ended March 31, 2025) | Item | Amount | | :--- | :--- | | Balance, July 1, 2024 | $2,276,161 | | Issuance of common stock, net of offering costs | $12,587,439 | | Conversion of convertible notes | $1,666,899 | | Conversion of derivative liabilities | $2,171,071 | | Stock-based compensation | $1,148,986 | | Net loss | $(2,163,550) | | Balance, March 31, 2025 | $17,997,095 | Changes in Stockholders' Equity (Nine Months Ended March 31, 2024) | Item | Amount | | :--- | :--- | | Balance, July 1, 2023 | $6,110,290 | | Repurchase of common stock | $(4,001) | | Stock-based compensation | $568,340 | | Net loss | $(3,573,480) | | Balance, March 31, 2024 | $3,101,149 | Consolidated Statements of Cash Flows This section reports Aeluma, Inc.'s cash inflows and outflows from operating, investing, and financing activities over specific periods Consolidated Statements of Cash Flows Highlights (Nine Months Ended March 31) | Activity | 2025 | 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(1,082,677) | $(2,876,190) | | Net cash used in investing activities | $(85,175) | $(316,934) | | Net cash provided by (used in) financing activities | $15,742,439 | $(4,001) | | Net change in cash and cash equivalent, and certificate of deposit | $14,574,587 | $(3,197,125) | | Cash and cash equivalent, and certificate of deposit, end of period | $15,865,659 | $1,874,565 | - Net cash provided by financing activities in 2025 included $3,145,000 from convertible notes issuance and $12,587,439 from a public offering[17] - Non-cash disclosures for 2025 include $1,666,988 from conversion of convertible notes to stockholders' equity and $2,471,071 from conversion of derivative liabilities to stockholders' equity[17] Notes to Consolidated Financial Statements This section provides detailed explanations and additional information supporting the consolidated financial statements, clarifying accounting policies and specific transactions Note 1 – The Company Aeluma, Inc. develops novel optoelectronic and electronic devices using proprietary techniques for cost-effective mass-market semiconductor manufacturing across diverse applications - Aeluma develops novel optoelectronic and electronic devices for sensing, communication, and computing applications[19] - The company's technology enables cost-effective manufacturing of high-performance photodetectors and arrays for imaging applications in mobile devices and other sectors[19] - Aeluma's technology is broadly applicable across mobile, automotive, AI, defense & aerospace, communication, AR/VR, high-performance computing, and quantum computing[19] Note 2 – Summary of Significant Accounting Policies This note details Aeluma's significant accounting policies, covering GAAP presentation, estimates, cash, convertible debt, fair value, assets, revenue recognition, income per share, stock compensation, and income taxes Basis of Presentation Consolidated financial statements are unaudited, GAAP-compliant, include recurring adjustments, and should be read with the Annual Report on Form 10-K Use of Estimates and Assumptions Financial statement preparation involves management estimates and assumptions, which may lead to actual results differing materially Reclassification of Prior Year Presentation Certain prior year amounts have been reclassified for consistency with the current year presentation, with no effect on the reported consolidated financial statements Cash and Cash Equivalents, and Certificate of Deposit Cash and cash equivalents include highly liquid debt instruments with original maturities of three months or less, with excess cash invested in certificates of deposit, including a $12,000,000 certificate as of March 31, 2025 - As of March 31, 2025, the Company held a certificate of deposit with a carrying value of $12,000,000 and an accrued interest receivable of $2,459[23] - The certificate of deposit has a seven-month maturity period and bears interest at a rate of 3.74%[23] Concentration of Risk The company maintains cash in bank deposit accounts that may exceed federally insured limits but has not experienced any losses Convertible Debt Instruments Convertible debt instruments are evaluated for derivative financial instruments, with bifurcated embedded features recorded at fair value and changes recognized in earnings Fair Value of Financial Instruments Fair value is determined using market or income approaches, prioritizing observable inputs, with Level 3 embedded derivatives valued using Black-Scholes, all of which were converted by March 31, 2025 - Embedded derivatives are classified in Level 3 and valued using the Black-Scholes option-pricing model due to significant unobservable inputs[29] - During the three months ended March 31, 2025, convertible notes were converted into common stock, and the fair value of embedded derivative liabilities was remeasured at $6.25 per share prior to conversion[30] - As of March 31, 2025, all derivative liabilities were exercised, and the Company had no remaining outstanding derivative liabilities[31] Fair Value of Embedded Derivatives (July 1, 2024 to March 31, 2025) | Metric | Amount | | :--- | :--- | | Beginning balance at July 1, 2024 | $ - | | New derivative liabilities | $2,193,129 | | Change in fair value of derivative liabilities | $277,942 | | Conversion of derivative liabilities | $(2,471,071) | | Ending balance at March 31, 2025 | $ - | Property and Equipment Property, equipment, and leasehold improvements are reported at historical cost, net of accumulated depreciation and amortization, computed using the straight-line method Intangible Assets Intangible assets, primarily the Aeluma.com domain name, are amortized on a straight-line basis over 10 years Revenue Recognition The company follows a five-step approach for revenue recognition, primarily from commercial product/service and government contracts, including $11,866,384 in new government contracts for the nine months ended March 31, 2025 - Revenue is currently generated from commercial product and service contracts (R&D services, small-volume orders) and government contracts (cost reimbursement or fixed firm price terms)[35] - For the nine months ended March 31, 2025, the Company was awarded two government contracts totaling $11,866,384, with revenue recognized over an expected performance period of 36 months[36] Revenue Breakdown (Nine Months Ended March 31) | Source | 2025 | 2024 | | :--- | :--- | :--- | | Total Revenue | $3,348,220 | $639,286 | | Government Contracts | $3,147,225 | $606,886 | | Product Sales | $200,995 | $32,400 | - As of March 31, 2025, total remaining performance obligations under obligated government contracts amounted to $9,409,984[38] Income (Loss) Per Share Basic income (loss) per share is calculated by dividing net income (loss) by weighted average common shares outstanding, with diluted income (loss) per share including potential dilutive shares unless anti-dilutive - For the three months ended March 31, 2025, 734,858 shares (comprising 452,364 stock options and 282,494 stock warrants) were considered dilutive and included in the calculation of diluted earnings per share[39] - For the three months ended March 31, 2025, 405,521 stock options were excluded from the calculation of diluted income per share as their inclusion would have been anti-dilutive[39] Stock-Based Compensation The company recognizes compensation expense for all share-based payment awards to employees, consultants, and directors based on estimated fair values using the Black-Scholes model Income Taxes The company expects to use net operating loss carryforwards to offset future taxable income, with deferred tax assets offset by a valuation allowance due to realization uncertainty Recent Accounting Pronouncements The company has evaluated all issued but not yet effective accounting pronouncements and determined they are either immaterial or not relevant Note 3 – Convertible Notes Between August 5 and August 27, 2024, Aeluma issued $3,145,000 in convertible promissory notes, which were converted into 898,573 shares of common stock on March 25, 2025, at $3.50 per share, settling all obligations - The Company issued convertible promissory notes totaling $3,145,000 to 10 accredited investors between August 5, 2024, and August 27, 2024[46] - On March 25, 2025, a Conversion Event occurred, resulting in the issuance of 898,573 shares of Common Stock in exchange for $3,145,000 in outstanding principal under the Notes, at a Ceiling Price of $3.50 per share[49] - Following the conversion, the Company has no further obligations under the converted Notes[49] Convertible Notes Summary (As of March 31, 2025) | Item | Amount | | :--- | :--- | | Principal amounts of convertible notes | $3,145,000 | | Less: unamortized debt discount | $(1,478,012) | | Convertible notes, net of discount | $1,666,988 | | Conversion of convertible notes | $(1,666,988) | | Principal amounts of convertible notes (ending) | $ - | Note 4 – Stockholders' Equity This note details Aeluma's authorized and issued shares, including the full vesting of CEO shares, satisfaction of registration rights, and the $12,587,439 net proceeds from the March 26, 2025 public offering Authorized Shares The Company's Articles of Incorporation authorize 50,000,000 shares of common stock and 10,000,000 shares of preferred stock, with no preferred shares issued as of March 31, 2025 Issued and Vested Shares to Officers Jonathan Klamkin, CEO, was issued 1,623,920 shares of common stock on October 27, 2020, which fully vested by March 31, 2025 Registration Rights Agreement The company satisfied its obligations under the registration rights agreement by filing Form S-1, declared effective on March 26, 2025, thus avoiding liquidated damages - The Company filed the Registration Statement on Form S-1 with the SEC, which was declared effective on March 26, 2025[55] - As a result, the Company has satisfied its obligations under the Registration Rights Agreement and does not expect to pay any damages[55] Public Offering of Common Stock On March 26, 2025, Aeluma completed a public offering of 2,285,714 shares at $5.25 per share, generating $12,587,439 in net proceeds for business development, manufacturing, and general corporate purposes - On March 26, 2025, the Company entered into an Underwriting Agreement for a public offering of 2,285,714 shares of its common stock at a price of $5.25 per share[57] - The Underwriter's 30-day option to purchase up to an additional 342,857 shares to cover over-allotments was exercised in full on March 27, 2025[57] Public Offering Proceeds | Metric | Amount | | :--- | :--- | | Total gross proceeds | $13,799,998 | | Net proceeds (after underwriting discounts and offering expenses) | $12,587,439 | - The Company intends to use the proceeds for business development, scaling manufacturing operations, and general corporate purposes[59] - Directors and officers agreed to a 90-day lock-up period restricting sales or transfers of Company securities[60] Note 5 – Stock-Based Compensation This note details Aeluma's stock-based compensation, including restricted stock awards and common stock options, with fair values estimated using the Black-Scholes model and significant expense increases in 2025 Restricted Stock Awards The company issues common stock for future services under consulting agreements with time-based vesting, recognizing deferred compensation as consulting expense, with $17,047 amortized for the nine months ended March 31, 2025 Consulting Expense Amortized from Restricted Stock Awards | Period | 2025 | 2024 | | :--- | :--- | :--- | | Three Months Ended March 31 | $3,085 | $6,981 | | Nine Months Ended March 31 | $17,047 | $25,919 | - At March 31, 2025, $3,086 of deferred compensation is expected to be recognized as an expense within the next three months[62] Common Stock Options Aeluma grants stock options to consultants, employees, and directors with varying terms, fair value estimated using Black-Scholes, and stock-based compensation expenses significantly increased to $1,148,987 for the nine months ended March 31, 2025 - During the three months ended March 31, 2025, the Company granted 451,354 stock options to employees and directors, with exercise prices ranging from $5.93 to $8.86 and vesting schedules from one month to 48 months[68] Stock Option Valuation Assumptions (Nine Months Ended March 31) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Weighted-average fair value | $5.66 | $2.52 | | Expected volatility | 113.9% - 138.3% | 104.9% - 113.9% | | Expected term | 0.9 years - 6.0 years | 5.0 years - 6.2 years | | Risk-free interest rate | 3.87% - 4.60% | 3.94% - 4.92% | Stock-Based Compensation Expenses for Options Granted | Period | 2025 | 2024 | | :--- | :--- | :--- | | Three Months Ended March 31 | $832,793 | $191,844 | | Nine Months Ended March 31 | $1,148,987 | $568,340 | - Unrecognized stock-based compensation expense was $2,562,963, with an average expected recognition period of 1.0 years as of March 31, 2025[69] Note 6 – Facility Operating Lease On April 1, 2021, the company commenced a 5-year operating lease, with an extension option considered certain on July 1, 2023, leading to a remeasurement of the ROU asset and lease liability to $1,189,606 - The Company commenced a 5-year operating lease for a facility on April 1, 2021[72] - On July 1, 2023, an option to extend the lease was considered reasonably certain, leading to a remeasurement of the ROU asset and lease liability to $1,189,606[72] Operating Lease Liabilities (Undiscounted, As of March 31, 2025) | For the years ending June 30, | Amount | | :--- | :--- | | Remainder of 2025 | $43,094 | | 2026 | $173,454 | | 2027 | $177,791 | | 2028 | $182,235 | | 2029 | $186,791 | | Thereafter | $337,732 | | Total | $1,101,097 | | Less imputed interest | $(126,441) | | Total lease liability | $974,656 | | Less: lease liability, current portion | $135,854 | | Lease liability, long term portion | $838,802 | - Total lease expenses were $131,231 for the nine months ended March 31, 2025, compared to $125,656 for the same period in 2024[73] Note 7 – Warrants to Purchase Common Stock In connection with the March 26, 2025 public offering, the company issued warrants to the underwriter to purchase up to 131,427 shares at $6.04 per share, with 550,305 warrants outstanding as of March 31, 2025 - In connection with the public offering on March 26, 2025, the Company issued warrants to the underwriter to purchase up to 131,427 shares[74] - The warrants are exercisable at a price of $6.04 per share (115% of the public offering price) and expire on March 26, 2030[74] Outstanding Warrants to Purchase Common Stock (As of March 31, 2025) | Number of Shares | Exercise Price | Expiration Date | | :--- | :--- | :--- | | 286,672 | $2.00 | June 22, 2026 | | 37,433 | $2.00 | June 28, 2026 | | 11,500 | $2.00 | July 1, 2026 | | 27,032 | $3.00 | December 22, 2027 | | 4,588 | $3.00 | January 10, 2028 | | 6,720 | $3.00 | March 31, 2028 | | 44,933 | $3.00 | May 10, 2028 | | 131,427 | $6.04 | March 26, 2030 | | Total: 550,305 | | | Note 8 – Concentration of Credit Risk and Significant Customers The company manages credit risk for accounts receivable, with several government agencies representing significant portions of revenue and accounts receivable, notably Customer E accounting for 70.4% of revenues and 95.0% of accounts receivable in 2025 - The Company manages its credit risk associated with exposure to its direct customers on outstanding accounts receivable through credit approvals and monitoring procedures[76] Significant Customers by Revenue Percentage (Nine Months Ended March 31) | Customer | 2025 | 2024 | | :--- | :--- | :--- | | Customer E | 70.4% | * | | Customer A | * | 34.6% | | Customer B | * | 37.2% | | Customer C | * | 23.1% | Significant Customers by Accounts Receivable Percentage (As of March 31) | Customer | 2025 | 2024 | | :--- | :--- | :--- | | Customer E | 95.0% | * | | Customer C | * | 18.3% | | Customer D | * | 27.7% | | Customer F | * | 53.9% | - Customers A, B, C, D, and E are government agencies[79] Note 9 – Subsequent Event The company has evaluated subsequent events through the filing date and is not aware of any material items requiring disclosure or recognition as of March 31, 2025 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations This section provides management's perspective on Aeluma's financial condition and operational results, highlighting core business, recent government contracts, and significant capital-raising activities that alleviated prior going concern doubts Overview Aeluma develops novel optoelectronic and electronic devices for sensing, communication, and computing, leveraging proprietary techniques for cost-effective, high-performance semiconductor manufacturing across diverse mass-market applications - Aeluma develops novel optoelectronic and electronic devices for sensing, communication, and computing applications[83] - The company's technology enables cost-effective manufacturing of high-performance photodetectors and arrays for imaging applications in mobile devices and other applications[83] - Aeluma's technology is broadly applicable across mobile, automotive, AI, defense & aerospace, communication, AR/VR, high-performance computing, and quantum computing[84] Recent Government Contracts Aeluma secured an $11.717 million DARPA contract on September 6, 2024, for nano-scale semiconductors and a U.S. Department of Energy contract on April 24, 2025, to develop low-cost shortwave infrared photodetectors - On September 6, 2024, Aeluma won an $11.717 million DARPA contract for nano-scale semiconductors to develop heterogeneous integration technology compatible with leading edge and future advanced-node semiconductors[86] - The DARPA contract is structured with $5.974 million provided over 18 months, and the $5.743 million balance provided over the following 18 months as Aeluma meets certain milestones[86] - On April 24, 2025, the Company received a contract from the U.S. Department of Energy to develop commercially viable, low-cost shortwave infrared (SWIR) photodetectors[87] Private Placements and Conversion of Notes Between August 5 and August 27, 2024, Aeluma issued $3,145,000 in convertible promissory notes, which were converted into 898,573 shares of common stock on March 25, 2025, at $3.50 per share, eliminating all outstanding principal obligations - Between August 5, 2024, and August 27, 2024, the Company issued convertible promissory notes in the aggregate principal amount of $3,145,000 to 10 accredited investors[88] - On March 25, 2025, a Conversion Event occurred, resulting in the issuance of an aggregate of 898,573 shares of Common Stock in exchange for $3,145,000 in outstanding principal under the Notes, at the applicable Ceiling Price of $3.50 per share[90] - Following the conversion, the Company has no further obligations under the converted Notes[90] Public Offering of Common Stock On March 26, 2025, Aeluma completed a public offering of 2,285,714 shares at $5.25 per share, generating $12,587,439 in net proceeds for business development, manufacturing, and general corporate purposes - On March 26, 2025, the Company entered into an Underwriting Agreement for a public offering of 2,285,714 shares of its common stock at a price of $5.25 per share[91] - The Underwriter's 30-day option to purchase up to an additional 342,857 shares to cover over-allotments was exercised in full on March 27, 2025[91] Public Offering Proceeds | Metric | Amount | | :--- | :--- | | Total gross proceeds | $13,799,998 | | Net proceeds (after underwriting discounts and offering expenses) | $12,587,439 | - The Company intends to use the proceeds for business development, scaling manufacturing operations, and general corporate purposes[93] - Directors and officers agreed to a 90-day lock-up period restricting sales or transfers of Company securities[94] Executive Officer Announcements As of March 18, 2025, Mr. James Seo was appointed as Aeluma's interim Chief Financial Officer/Principal Accounting Officer, having served as the Company's Controller since May 2023 - Mr. James Seo agreed to serve as Aeluma's interim Chief Financial Officer/Principal Accounting Officer as of March 18, 2025[95] - Mr. Seo has been serving as the Company's Controller since May 2023[95] Plan of Operations Aeluma's operational plan focuses on developing novel materials and devices, manufacturing high-performance semiconductor technologies for mass markets, maturing processes, and expanding business development and commercialization - The Company's primary focus is to manufacture high-performance semiconductor technologies that scale for mass markets[97] - Aeluma operates R&D/manufacturing facilities and partners with volume fabrication foundries and packaging companies to scale production capacity[97] - The Company will continue to perform on customer and government contracts, expand business development, and pursue volume production and commercialization[97] Limited Operating History Aeluma has a limited operating history with inherent uncertainties, but a successful public offering raising $13.8 million alleviated going concern doubts for at least the next twelve months - The Company has a limited operating history and its future success is subject to numerous uncertainties and risks inherent in the development of a new business[98] - The successful public offering on March 26, 2025, raising gross proceeds of $13,800,000, has alleviated the previously reported substantial doubt about the Company's ability to continue as a going concern for at least the next twelve months[98][99] Components of Results of Operations This section defines Aeluma's key financial components: revenue from commercial and government contracts, operating expenses (cost of revenue, R&D, G&A), other income/expense, and income tax expense Revenue Aeluma's revenue currently consists of commercial product sales and government contracts Operating Expenses Operating expenses comprise cost of revenue (materials, direct compensation), research and development, and general and administrative costs Other Income (Expense) Other income (expense) includes interest income, non-cash interest expense from convertible note discount amortization, and valuation changes in derivative liabilities Income Tax Expense Income tax expense primarily consists of income taxes in certain state jurisdictions where the company conducts business Results of Operations For the nine months ended March 31, 2025, Aeluma's revenue significantly increased by $2.7 million to $3.3 million, while net loss decreased by 39.5% to $(2.16) million, influenced by other income/expense items Results of Operations (Nine Months Ended March 31) | Metric | 2025 | 2024 | $ Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Revenue | $3,348,220 | $639,286 | $2,708,934 | n/m | | Operating expenses | $(4,521,472) | $(4,213,564) | $(307,908) | 7.3% | | Other income (expense) | $(990,298) | $798 | $(991,096) | n/m | | Loss before income tax expense | $(2,163,550) | $(3,573,480) | $1,409,930 | -39.5% | | Net loss | $(2,163,550) | $(3,573,480) | $1,409,930 | -39.5% | - Revenue increased by $2,708,934 to $3,348,220 for the nine months ended March 31, 2025, with $3,147,225 derived from government contracts and $200,995 from commercial product and service contracts[106] - Operating expenses increased $307,908 or 7.3%, to $4,521,472, primarily driven by higher salaries and employee benefits, partially offset by a reduction in research and development activities[107] - Other income (expense) for the nine months ended March 31, 2025, included amortization of discount on convertible notes ($715,117), changes in fair value of derivative liabilities ($277,942), and interest income ($2,761)[108] Liquidity and Capital Resources As of March 31, 2025, Aeluma's cash, cash equivalents, and certificate of deposit totaled $15,865,659, a substantial increase due to $12,587,439 net proceeds from a public offering, alleviating prior going concern doubts - As of March 31, 2025, cash, cash equivalents, and a certificate of deposit totaled $15,865,659, compared to $1,291,072 as of June 30, 2024[110] - The increase in cash was primarily attributable to the net proceeds from the public offering completed on March 26, 2025, which generated $12,587,439[110] - The successful completion of the offering alleviated substantial doubt about the Company's ability to continue as a going concern for at least the next twelve months[111] - As of March 31, 2025, working capital was $16,700,152, a significant increase from $766,160 as of June 30, 2024[114] Summary of Cash Flows (Nine Months Ended March 31) | Activity | 2025 | 2024 | $ Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Net cash provided by (used in) Operating activities | $(1,082,677) | $(2,876,190) | $1,793,513 | -62.4% | | Investing activities | $(85,175) | $(316,934) | $231,759 | -73.1% | | Financing activities | $15,742,439 | $(4,001) | $15,746,440 | n/m | | Increase (decrease) in cash | $14,574,587 | $(3,197,125) | $17,771,712 | n/m | Critical Accounting Policies There were no significant changes in Aeluma's critical accounting policies during the three and nine months ended March 31, 2025 Item 3. Quantitative and Qualitative Disclosures about Market Risk This item is marked as 'Not applicable' for Aeluma, Inc Item 4. Controls and Procedures Management concluded that Aeluma's disclosure controls and procedures were not effective as of March 31, 2025, due to insufficient finance staffing, with no material changes in internal control over financial reporting Inherent Limitations on Effectiveness of Controls Management acknowledges that control systems provide only reasonable assurance due to resource constraints and inherent limitations, meaning not all errors or fraud may be prevented or detected Evaluation of Disclosure Controls and Procedures As of March 31, 2025, management concluded that the company's disclosure controls and procedures were not effective due to insufficient finance department staffing, impacting review control precision, evidence, or timeliness - As of March 31, 2025, management concluded that the Company's disclosure controls and procedures were not effective[122] - The ineffectiveness is primarily due to insufficient staffing resources in the finance department, leading to an inadequate level of precision, evidence, or timeliness in the performance of review controls[122] Changes in Internal Control over Financial Reporting There were no material changes in Aeluma's internal control over financial reporting during the nine months ended March 31, 2025 PART II - OTHER INFORMATION This section provides additional information beyond the financial statements, including legal proceedings, risk factors, equity sales, defaults, and exhibits Item 1. Legal Proceedings Aeluma is not currently involved in any legal proceedings reasonably expected to have a material adverse effect on its business, prospects, financial condition, or results of operations Item 1A. Risk Factors As a smaller reporting company, Aeluma is not required to provide the information under this item Item 2. Unregistered Sales of Equity Securities and Use of Proceeds Aeluma did not sell any unregistered equity securities during the quarter ended March 31, 2025, that were not previously disclosed in its Current Reports on Form 8-K Item 3. Defaults Upon Senior Securities There were no defaults upon senior securities during the reporting period Item 4. Mine Safety Disclosures This item is marked as 'Not applicable' for Aeluma, Inc Item 5. Other Information During the three months ended March 31, 2025, none of Aeluma's directors or officers adopted or terminated a 'Rule 10b5-1 trading arrangement' or 'non-Rule 10b5-1 trading arrangement' Item 6. Exhibits This section lists all exhibits filed with the Form 10-Q, including various agreements, certificates, plans, and certifications, many incorporated by reference from previous SEC filings - The exhibits include various agreements (e.g., Merger and Reorganization, Underwriting, Registration Rights), certificates (e.g., Merger, Amended and Restated Certificate of Incorporation), and certifications (e.g., CEO and Principal Financial Officer certifications pursuant to Sarbanes-Oxley Act)[131][132] SIGNATURES The report is duly signed on behalf of Aeluma, Inc. by Jonathan Klamkin (President, Chief Executive Officer and Director) and James Seo (Interim Chief Financial Officer) on May 9, 2025 - The report was signed by Jonathan Klamkin, President, Chief Executive Officer and Director, and James Seo, Interim Chief Financial Officer, on May 9, 2025[137]