[PART I. FINANCIAL INFORMATION](index=4&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [Item 1. Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) The company presents its unaudited consolidated financial statements, detailing significant changes in assets, liabilities, equity, and cash flows [Consolidated Balance Sheets](index=4&type=section&id=Consolidated%20Balance%20Sheets%20as%20of%20June%2030%2C%202025%20(unaudited)%20and%20December%2031%2C%202024) **Consolidated Balance Sheet Highlights (in thousands):** | Metric | June 30, 2025 | December 31, 2024 | Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Cash and cash equivalents | $183,105 | $36,926 | $146,179 | 396% | | Short-term investments | $— | $94,965 | $(94,965) | (100)% | | Total current assets | $188,422 | $137,254 | $51,168 | 37% | | Total assets | $190,350 | $139,306 | $51,044 | 37% | | Total current liabilities | $9,220 | $10,468 | $(1,248) | (12)% | | Term loan, noncurrent | $14,332 | $— | $14,332 | N/A | | Total liabilities | $28,983 | $15,798 | $13,185 | 83% | | Total stockholders' equity | $161,367 | $123,508 | $37,859 | 31% | [Consolidated Statements of Operations and Comprehensive Loss](index=5&type=section&id=Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Loss%20for%20the%20three%20and%20six%20months%20ended%20June%2030%2C%202025%20and%202024%20(unaudited)) **Consolidated Statements of Operations and Comprehensive Loss Highlights (in thousands):** | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Revenues | $5 | $5 | $10 | $10 | | Research and development expenses | $17,236 | $21,155 | $33,063 | $42,642 | | General and administrative expenses | $5,691 | $5,595 | $11,684 | $10,907 | | Loss from operations | $(22,922) | $(26,745) | $(44,737) | $(53,539) | | Total other income (expense), net | $776 | $2,105 | $2,335 | $4,505 | | Net loss | $(22,146) | $(24,640) | $(41,721) | $(49,034) | | Net loss per share, basic and diluted | $(0.27) | $(0.35) | $(0.53) | $(0.69) | - Net loss **decreased by 10%** for the three months ended June 30, 2025, and by **15%** for the six months ended June 30, 2025, compared to the respective prior-year periods[10](index=10&type=chunk) - Research and development expenses **decreased by 19%** for the three months and **22%** for the six months ended June 30, 2025, primarily due to reduced MASH trial enrollment and manufacturing costs[10](index=10&type=chunk) [Consolidated Statements of Changes in Stockholders' Equity](index=6&type=section&id=Consolidated%20Statements%20of%20Changes%20in%20Stockholders'%20Equity%20for%20the%20three%20and%20six%20months%20ended%20June%2030%2C%202025%20and%202024%20(unaudited)) **Changes in Stockholders' Equity (in thousands) for Six Months Ended June 30, 2025:** | Item | Amount | | :--- | :--- | | Balance at December 31, 2024 | $123,508 | | Stock-based compensation | $7,581 | | Issuance of common stock in at-the-market offerings, net | $72,571 | | Net loss | $(41,721) | | **Balance at June 30, 2025** | **$161,367** | - Total stockholders' equity **increased from $123.5 million** at December 31, 2024, to **$161.4 million** at June 30, 2025, primarily driven by proceeds from at-the-market offerings and stock-based compensation, partially offset by net loss[12](index=12&type=chunk) [Consolidated Statements of Cash Flows](index=8&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows%20for%20the%20six%20months%20ended%20June%2030%2C%202025%20and%202024%20(unaudited)) **Consolidated Statements of Cash Flows Highlights (in thousands) for Six Months Ended June 30:** | Activity | 2025 | 2024 | Change | | :--- | :--- | :--- | :--- | | Net cash used in operating activities | $(36,190) | $(34,465) | $(1,725) | | Net cash provided by (used in) investing activities | $96,006 | $(43,217) | $139,223 | | Net cash provided by (used in) financing activities | $86,363 | $(307) | $86,670 | | Net increase (decrease) in cash and cash equivalents and restricted cash | $146,179 | $(77,989) | $224,168 | | Cash, cash equivalents and restricted cash at end of period | $183,147 | $57,169 | $125,978 | - Significant shift in investing activities from cash usage to provision, primarily due to proceeds from sales and maturities of short-term investments (**$143.6 million in 2025** vs $33.5 million in 2024)[17](index=17&type=chunk) - Financing activities provided substantial cash in 2025 (**$86.4 million**) due to at-the-market offerings (**$72.6 million**) and a new term loan (**$15.0 million**)[17](index=17&type=chunk) [1. Nature of Business and Basis of Presentation](index=9&type=section&id=1.%20Nature%20of%20Business%20and%20Basis%20of%20Presentation) - Altimmune, Inc. is a late clinical-stage biopharmaceutical company focused on developing novel peptide-based therapeutics for liver and cardiometabolic diseases[18](index=18&type=chunk)[19](index=19&type=chunk) - The company's lead program is pemvidutide, a GLP-1/glucagon dual receptor agonist, for the treatment of MASH, Alcohol Use Disorder (AUD), Alcohol-Associated Liver Disease (ALD), and obesity[19](index=19&type=chunk) - Altimmune has not generated any revenues from product sales to date and finances operations through equity, debt, and research grants[19](index=19&type=chunk) [2. Summary of Significant Accounting Policies](index=9&type=section&id=2.%20Summary%20of%20Significant%20Accounting%20Policies) - No significant changes to the company's accounting policies during the six months ended June 30, 2025, compared to the Annual Report on Form 10-K for December 31, 2024[23](index=23&type=chunk) - A discrete tax benefit of approximately **$0.7 million** was recorded during the six months ended June 30, 2025, related to Maryland carryback claims[25](index=25&type=chunk) - The recently enacted One Big Beautiful Bill Act (OBBBA) is being assessed but is not expected to materially impact the estimated annual effective tax rate in 2025[26](index=26&type=chunk) [3. Fair Value Measurements](index=11&type=section&id=3.%20Fair%20Value%20Measurements) - As of June 30, 2025, the company had **no assets and liabilities measured at fair value** on a recurring basis, a change from December 31, 2024[28](index=28&type=chunk) - Recognized approximately **$0.1 million realized net loss** from sales of available-for-sale debt securities during the six months ended June 30, 2025[28](index=28&type=chunk) **Fair Value Measurement at December 31, 2024 (in thousands):** | Category | Total | Level 1 | Level 2 | Level 3 | | :--- | :--- | :--- | :--- | :--- | | Cash equivalents - money market funds | $27,279 | $27,279 | $— | $— | | Short-term investments | $94,965 | $— | $94,965 | $— | | **Total** | **$122,244** | **$27,279** | **$94,965** | **$—** | [4. Accrued Expenses](index=13&type=section&id=4.%20Accrued%20Expenses) **Accrued Expenses and Other Current Liabilities (in thousands):** | Category | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Accrued professional services | $695 | $401 | | Accrued payroll and employee benefits | $1,828 | $3,079 | | Accrued research and development | $5,424 | $6,443 | | Lease obligation, current portion | $239 | $279 | | Accrued interest and other | $183 | $55 | | **Total** | **$8,369** | **$10,257** | - Total accrued expenses and other current liabilities **decreased by $1.9 million, or 18%**, from December 31, 2024, to June 30, 2025, primarily due to decreases in accrued payroll and R&D[35](index=35&type=chunk) [5. Term Loan](index=13&type=section&id=5.%20Term%20Loan) - On May 13, 2025, the company entered into a Loan and Security Agreement with Hercules Capital, Inc. for up to **$100.0 million** in term loans[36](index=36&type=chunk) - The first tranche of **$15.0 million** was drawn on the closing date; additional tranches are subject to milestones and lender approval[37](index=37&type=chunk)[39](index=39&type=chunk) - The Term Loan matures on January 1, 2029, bears interest at a rate based on prime plus 2.45% (or a floor of 9.95% until Dec 31, 2025, then 9.45%), and has an **effective interest rate of 14.4%**[40](index=40&type=chunk)[44](index=44&type=chunk) **Term Loan Details (in thousands) as of June 30, 2025:** | Item | Amount | | :--- | :--- | | Term loan principal amount | $15,000 | | End of term charge | $937 | | Unamortized discount and issuance costs | $(1,605) | | **Total term loan, net of current portion** | **$14,332** | [6. Other Noncurrent Liabilities](index=17&type=section&id=6.%20Other%20Noncurrent%20Liabilities) **Other Noncurrent Liabilities (in thousands):** | Category | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Research and development incentive credit | $3,981 | $3,746 | | Lease obligation, long-term portion | $1,278 | $1,402 | | Conditional economic incentive grants | $160 | $160 | | Other | $12 | $22 | | **Total** | **$5,431** | **$5,330** | - Total other noncurrent liabilities **increased slightly by $0.1 million, or 2%**, from December 31, 2024, to June 30, 2025, primarily due to an increase in research and development incentive credit[47](index=47&type=chunk) [7. Stockholders' Equity](index=17&type=section&id=7.%20Stockholders'%20Equity) - As of June 30, 2025, the company had **85,076,300 shares of common stock issued and outstanding**, out of 200,000,000 authorized shares[48](index=48&type=chunk) - During the six months ended June 30, 2025, the company sold 8,052,064 shares under the 2025 at-the-market (ATM) offering, generating approximately **$42.4 million in net proceeds**[50](index=50&type=chunk) - An additional **$106.2 million remained available** to be sold under the 2025 ATM Agreement as of June 30, 2025[50](index=50&type=chunk) - The 2023 ATM Agreement was terminated in February 2025, having sold 4,467,866 shares for approximately **$30.2 million in net proceeds** during the six months ended June 30, 2025[51](index=51&type=chunk) [8. Stock-Based Compensation](index=19&type=section&id=8.%20Stock-Based%20Compensation) - On January 1, 2025, the Omnibus Incentive Plan **increased by 3,193,659 shares** of common stock[52](index=52&type=chunk) - During the six months ended June 30, 2025, the company granted **1,954,950 stock options** and **481,700 Restricted Stock Units (RSUs)**[53](index=53&type=chunk)[55](index=55&type=chunk) **Stock-based Compensation Expense (in thousands) for Six Months Ended June 30:** | Category | 2025 | 2024 | | :--- | :--- | :--- | | Research and development | $3,329 | $3,249 | | General and administrative | $4,252 | $4,712 | | **Total** | **$7,581** | **$7,961** | [9. Net Loss Per Share](index=21&type=section&id=9.%20Net%20Loss%20Per%20Share) - Basic and diluted net loss per share are the same for the three and six months ended June 30, 2025 and 2024, due to the company reporting a net loss[58](index=58&type=chunk) - All unvested RSUs and stock options are excluded from the computation of diluted weighted-average shares outstanding as they are anti-dilutive[59](index=59&type=chunk) **Anti-Dilutive Potential Common Shares (Six Months Ended June 30):** | Security Type | 2025 | 2024 | | :--- | :--- | :--- | | Common stock options | 8,128,505 | 6,328,463 | | Restricted stock units | 1,039,950 | 786,102 | [10. Commitments and Contingencies](index=21&type=section&id=10.%20Commitments%20and%20Contingencies) - The company has contingent payment obligations of up to **$80.0 million** related to the Spitfire acquisition upon achievement of specified worldwide net sales milestones[61](index=61&type=chunk) - A shareholder derivative complaint filed in June 2024 was **dismissed without prejudice** on February 3, 2025[63](index=63&type=chunk) - A new class action complaint was filed on August 5, 2025, alleging securities law violations related to pemvidutide and the IMPACT Phase 2b trial, which the company intends to vigorously defend[64](index=64&type=chunk) [11. Segment Information](index=22&type=section&id=11.%20Segment%20Information) - The company operates as a **single segment**, a late clinical-stage biopharmaceutical company focused on developing novel peptide-based therapeutics[66](index=66&type=chunk) - The chief operating decision maker assesses performance and allocates resources based solely on consolidated net loss[67](index=67&type=chunk) [12. Subsequent Events](index=24&type=section&id=12.%20Subsequent%20Events) - During July 2025 and through the issuance date of the financial statements, the company raised an additional **$12.8 million in net proceeds** by issuing 3,141,233 shares of common stock through its 2025 at-the-market offering[68](index=68&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=25&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses financial performance, liquidity, capital resources, and recent business updates including positive MASH trial results [Overview](index=25&type=section&id=Overview) - Altimmune, Inc. is a late clinical-stage biopharmaceutical company focused on developing novel peptide-based therapeutics for liver and cardiometabolic diseases[73](index=73&type=chunk) - The lead program, pemvidutide, is a GLP-1/glucagon dual receptor agonist for MASH, Alcohol Use Disorder (AUD), Alcohol-Associated Liver Disease (ALD), and obesity[73](index=73&type=chunk) [Recent Business Update](index=25&type=section&id=Recent%20Business%20Update) [MASH](index=25&type=section&id=MASH) - On June 26, 2025, topline results from the IMPACT Phase 2b trial in MASH were released, showing **statistically significant MASH resolution** without worsening of fibrosis[74](index=74&type=chunk)[75](index=75&type=chunk) **MASH Resolution without Worsening Fibrosis (24 weeks, ITT analysis):** | Pemvidutide Dose | MASH Resolution Rate | Placebo Rate | p-value | | :--- | :--- | :--- | :--- | | 1.2 mg | 59.1% | 19.1% | < 0.0001 | | 1.8 mg | 52.1% | 19.1% | < 0.0001 | - An AI-based analysis demonstrated statistically significant reductions in fibrosis, with **30.6% of subjects** on pemvidutide 1.8 mg achieving a 60% or more reduction compared to 8.2% on placebo (p<0.001)[76](index=76&type=chunk) **Mean Weight Loss (24 weeks):** | Pemvidutide Dose | Mean Weight Loss | Placebo Weight Loss | p-value | | :--- | :--- | :--- | :--- | | 1.2 mg | 5.0% | 1.0% | < 0.001 | | 1.8 mg | 6.2% | 1.0% | < 0.001 | - Pemvidutide demonstrated favorable safety and tolerability with **low overall treatment discontinuation rates** (0.0% for 1.2 mg and 1.2% for 1.8 mg due to adverse events, versus 2.4% for placebo)[78](index=78&type=chunk) [AUD and ALD](index=27&type=section&id=AUD%20and%20ALD) - The company is pursuing two additional indications for pemvidutide: Alcohol Use Disorder (AUD) and Alcohol-Associated Liver Disease (ALD)[79](index=79&type=chunk) - The RECLAIM Phase 2 trial for AUD enrolled its first subject on May 19, 2025, targeting 100 subjects to evaluate changes in alcohol consumption[80](index=80&type=chunk) - The RESTORE Phase 2 trial for ALD enrolled its first patient on July 9, 2025, targeting 100 patients to evaluate changes in liver stiffness[81](index=81&type=chunk) [Recent Global Events](index=27&type=section&id=Recent%20Global%20Events) - Global tariffs and counter-tariffs are causing uncertainties in global markets, potentially leading to inflationary pressures, supply chain disruptions, and volatility in capital markets, foreign exchange rates, and interest rates[82](index=82&type=chunk) [Results of Operations](index=28&type=section&id=Results%20of%20Operations) [Comparison of the three months ended June 30, 2025 and 2024](index=28&type=section&id=Comparison%20of%20the%20three%20months%20ended%20June%2030%2C%202025%20and%202024) **Results of Operations (Three Months Ended June 30, in thousands):** | Metric | 2025 | 2024 | Increase (Decrease) | % Change | | :--- | :--- | :--- | :--- | :--- | | Revenues | $5 | $5 | $— | 0% | | Research and development | $17,236 | $21,155 | $(3,919) | (19)% | | General and administrative | $5,691 | $5,595 | $96 | 2% | | Loss from operations | $(22,922) | $(26,745) | $(3,823) | (14)% | | Total other income (expense), net | $776 | $2,105 | $(1,329) | (63)% | | Net loss | $(22,146) | $(24,640) | $(2,494) | (10)% | - The decrease in R&D expenses was primarily due to ongoing enrollment for the IMPACT Phase 2b trial in MASH during the first half of 2024 and a **$1.6 million decrease in manufacturing expenses**, partially offset by new AUD and ALD trials[85](index=85&type=chunk) - Total other income (expense), net **decreased by $1.3 million**, primarily due to a $1.0 million decrease in interest income and a $0.3 million increase in interest expense related to the Term Loan[88](index=88&type=chunk) [Comparison of the six months ended June 30, 2025 and 2024](index=30&type=section&id=Comparison%20of%20the%20six%20months%20ended%20June%2030%2C%202025%20and%202024) **Results of Operations (Six Months Ended June 30, in thousands):** | Metric | 2025 | 2024 | Increase (Decrease) | % Change | | :--- | :--- | :--- | :--- | :--- | | Revenues | $10 | $10 | $— | 0% | | Research and development | $33,063 | $42,642 | $(9,579) | (22)% | | General and administrative | $11,684 | $10,907 | $777 | 7% | | Loss from operations | $(44,737) | $(53,539) | $(8,802) | (16)% | | Total other income (expense), net | $2,335 | $4,505 | $(2,170) | (48)% | | Net loss | $(41,721) | $(49,034) | $(7,313) | (15)% | - The **$9.6 million decrease in R&D expenses** was primarily due to reduced MASH trial enrollment costs ($6.1 million), a $3.3 million decrease in manufacturing expenses, and the termination of the HepTcell program ($2.0 million), partially offset by increased expenses for AUD and ALD trials ($3.0 million)[92](index=92&type=chunk)[93](index=93&type=chunk) - General and administrative expenses **increased by $0.8 million, or 7%**, primarily due to higher professional services[94](index=94&type=chunk) - Total other income (expense), net **decreased by $2.2 million**, primarily due to a $1.9 million decrease in interest income and a $0.3 million increase in interest expense from the Term Loan[95](index=95&type=chunk) [Liquidity and Capital Resources](index=33&type=section&id=Liquidity%20and%20Capital%20Resources) [Overview](index=33&type=section&id=Overview) - As of June 30, 2025, cash, cash equivalents, and restricted cash totaled **$183.1 million**[97](index=97&type=chunk) - Management believes current cash on hand is **sufficient to fund operations for at least a twelve-month period** from the issuance date of the financial statements[98](index=98&type=chunk) - The company has an **accumulated deficit of $603.1 million** as of June 30, 2025, and will require additional equity or debt financing or partnerships for long-term capital needs[99](index=99&type=chunk) [Sources of Liquidity](index=33&type=section&id=Sources%20of%20Liquidity) - Secured a new term loan facility of up to **$100.0 million** with Hercules Capital, Inc., with **$15.0 million drawn** on May 13, 2025[100](index=100&type=chunk) - Filed a shelf registration statement on Form S-3 on February 27, 2025, allowing the company to offer and sell up to **$400.0 million** in various securities[101](index=101&type=chunk) - Raised approximately **$42.4 million in net proceeds** from the 2025 at-the-market (ATM) offering during the six months ended June 30, 2025, with **$106.2 million remaining available**[103](index=103&type=chunk) - Raised approximately **$30.2 million in net proceeds** from the 2023 ATM offering during the six months ended June 30, 2025, before its termination in February 2025[105](index=105&type=chunk) [Cash Flows](index=35&type=section&id=Cash%20Flows) **Cash Flow Summary (Six Months Ended June 30, in thousands):** | Activity | 2025 | 2024 | Increase (Decrease) | | :--- | :--- | :--- | :--- | | Net cash used in operating activities | $(36,190) | $(34,465) | $1,725 | | Net cash provided by (used in) investing activities | $96,006 | $(43,217) | $139,223 | | Net cash provided by (used in) financing activities | $86,363 | $(307) | $86,670 | | **Net increase (decrease) in cash** | **$146,179** | **$(77,989)** | **$224,168** | - Net cash provided by investing activities **significantly increased to $96.0 million** in 2025 from $43.2 million used in 2024, primarily due to proceeds from sales and maturities of short-term investments[108](index=108&type=chunk) - Net cash provided by financing activities **increased to $86.4 million** in 2025 from $0.3 million used in 2024, driven by ATM offerings and the new term loan[109](index=109&type=chunk) [Current Resources](index=37&type=section&id=Current%20Resources) - As of June 30, 2025, the company had **$183.1 million in cash, cash equivalents, and restricted cash**, deemed sufficient for operations for at least the next twelve months[110](index=110&type=chunk) - Long-term capital needs for planned clinical trials will require additional equity or debt financing, or monetization through partnerships[110](index=110&type=chunk) [Critical Accounting Estimates](index=37&type=section&id=Critical%20Accounting%20Estimates) - No material changes to critical accounting policies and significant judgments and estimates were reported compared to the Annual Report on Form 10-K for the year ended December 31, 2024[112](index=112&type=chunk) [Item 3. Quantitative and Qualitative Disclosures about Market Risk](index=37&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) As a "smaller reporting company," Altimmune, Inc. is not required to provide these disclosures - The company is exempt from providing market risk disclosures as a "smaller reporting company" under Item 10 of Regulation S-K[113](index=113&type=chunk) [Item 4. Controls and Procedures](index=37&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective, with no material changes in internal control over financial reporting - Management, including the principal executive and financial officers, concluded that **disclosure controls and procedures were effective** as of June 30, 2025[114](index=114&type=chunk)[115](index=115&type=chunk) - There were **no changes in internal control over financial reporting** during the quarter ended June 30, 2025, that materially affected or are reasonably likely to materially affect internal control over financial reporting[116](index=116&type=chunk) [PART II. OTHER INFORMATION](index=38&type=section&id=PART%20II.%20OTHER%20INFORMATION) [Item 1. Legal Proceedings](index=38&type=section&id=Item%201.%20Legal%20Proceedings) A new class action complaint was filed on August 5, 2025, alleging securities law violations, which the company will vigorously defend - A shareholder derivative complaint (In re Altimmune, Inc. Stockholder Derivative Litigation) was **dismissed without prejudice** on February 3, 2025[117](index=117&type=chunk) - A new class action complaint (Collier v. Altimmune, Inc., et al.) was filed on August 5, 2025, alleging violations of the Securities Exchange Act of 1934 related to pemvidutide and the IMPACT Phase 2b trial[118](index=118&type=chunk) - The company intends to **vigorously defend** against the Collier Class Action litigation[118](index=118&type=chunk) [Item 1A. Risk Factors](index=38&type=section&id=Item%201A.%20Risk%20Factors) There have been no material changes to the risk factors previously disclosed in the company's Annual and Quarterly Reports - **No material changes** from the risk factors disclosed in the Annual Report on Form 10-K filed on February 27, 2025, and the latest Quarterly Report on Form 10-Q filed on May 13, 2025[120](index=120&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=38&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company reported no unregistered sales of equity securities or use of proceeds for the period - No unregistered sales of equity securities and use of proceeds to report[121](index=121&type=chunk) [Item 3. Defaults Upon Senior Securities](index=38&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) The company reported no defaults upon senior securities for the period - No defaults upon senior securities to report[122](index=122&type=chunk) [Item 4. Mine Safety Disclosures](index=38&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to Altimmune, Inc.'s operations - Not applicable to the company[123](index=123&type=chunk) [Item 5. Other Information](index=40&type=section&id=Item%205.%20Other%20Information) No officers or directors adopted, modified, or terminated Rule 10b5-1 or non-Rule 10b5-1 trading arrangements during the quarter - No officers or directors adopted, modified, or terminated a "Rule 10b5-1 trading arrangement" or "non-Rule 10b5-1 trading arrangement" during the three months ended June 30, 2025[124](index=124&type=chunk) [Item 6. Exhibits](index=41&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed with the Form 10-Q, including corporate governance and financing agreement documents - Includes Amended and Restated Certificate of Incorporation, Loan and Security Agreement, and certifications of principal executive and financial officers[126](index=126&type=chunk) [Signatures](index=42&type=section&id=Signatures) The report was duly signed on August 12, 2025, by the President and Chief Executive Officer and the Chief Financial Officer - Report signed by Vipin K. Garg, President and Chief Executive Officer, and Gregory Weaver, Chief Financial Officer, on August 12, 2025[131](index=131&type=chunk)

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 6-K REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16 UNDER THE SECURITIES EXCHANGE ACT OF 1934 Date of Report: August 12, 2025 Commission File Number: 001-40377 Valneva SE (Exact name of Registrant as specified in its charter and translation of Registrant's name into English) France (Jurisdiction of incorporation or organization) 6 rue Alain Bombard 44800 Saint-Herblain, France (Address of principal executive offi ...

PART I [Unaudited Condensed Consolidated Financial Statements](index=5&type=section&id=Item%201.%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) The company's H1 2025 financials show significant asset and liability growth from increased USDC circulation, a $583 million IPO, and a $417.3 million net loss due to $423.8 million in stock-based compensation [Condensed Consolidated Balance Sheets](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets increased to $64.2 billion and liabilities to $61.8 billion by June 30, 2025, driven by a $17.4 billion rise in stablecoin-related cash and deposits, while equity grew to $2.37 billion from the IPO and preferred stock conversion | (in thousands) | June 30, 2025 (unaudited) | December 31, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $1,118,119 | $750,981 | | Cash and cash equivalents segregated for the benefit of stablecoin holders | $61,365,920 | $43,918,572 | | Goodwill | $266,384 | $169,544 | | Intangible assets, net | $396,969 | $331,394 | | **Total Assets** | **$64,153,508** | **$45,834,409** | | **Liabilities & Equity** | | | | Deposits from stablecoin holders | $61,101,523 | $43,727,363 | | **Total Liabilities** | **$61,782,677** | **$44,124,115** | | Redeemable convertible preferred stock | $— | $1,139,765 | | Additional paid-in capital | $3,998,827 | $1,792,969 | | Accumulated deficit | ($1,640,510) | ($1,223,213) | | **Total Stockholders' Equity** | **$2,370,831** | **$570,529** | [Condensed Consolidated Statements Of Operations](index=8&type=section&id=Condensed%20Consolidated%20Statements%20Of%20Operations) The company reported a net loss of $482.1 million for Q2 2025 and $417.3 million for H1 2025, primarily due to a surge in compensation expenses from IPO-related stock-based compensation, despite revenue growth to $658.1 million and $1.24 billion respectively | (in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Total revenue and reserve income | $658,078 | $430,030 | $1,236,651 | $795,124 | | Compensation expenses | $503,392 | $67,604 | $579,012 | $128,753 | | Operating income (loss) | ($325,582) | $50,246 | ($232,642) | $102,565 | | Net income (loss) | ($482,100) | $32,923 | ($417,309) | $81,562 | | Earnings (loss) per share, basic | ($4.48) | $0.00 | ($5.04) | $0.00 | [Condensed Consolidated Statements Of Cash Flows](index=11&type=section&id=Condensed%20Consolidated%20Statements%20Of%20Cash%20Flows) Net cash from operations was $303.7 million, investing used $46.1 million, and financing provided $17.8 billion, primarily from stablecoin deposits and IPO proceeds, leading to an $18.1 billion increase in total cash and equivalents by June 30, 2025 | (in thousands) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $303,716 | $124,955 | | Net cash (used in) provided by investing activities | ($46,108) | $52,221 | | Net cash provided by financing activities | $17,797,061 | $7,632,000 | | Net increase in cash and cash equivalents | $18,107,916 | $7,806,941 | [Notes To Condensed Consolidated Financial Statements](index=13&type=section&id=Notes%20To%20Condensed%20Consolidated%20Financial%20Statements) Notes detail the June 2025 IPO's $583 million net proceeds and $423.8 million stock-based compensation, the $100.1 million Hashnote acquisition, primary revenue from reserve income, and an unquantifiable legal dispute with FT Partners - In June 2025, the company completed its IPO, raising net proceeds of **$583.0 million**. This event triggered the conversion of all redeemable convertible preferred stock into **139.8 million** shares of Class A common stock[30](index=30&type=chunk)[31](index=31&type=chunk) - The IPO caused the vesting of certain performance-based RSUs, resulting in the recognition of **$423.8 million** of stock-based compensation expense[32](index=32&type=chunk)[120](index=120&type=chunk) - In January 2025, the company acquired Hashnote for approximately **$100.1 million**, consisting of **$10.2 million** in cash and **2.9 million** shares of Class A common stock. The acquisition resulted in **$96.8 million** of goodwill[50](index=50&type=chunk)[54](index=54&type=chunk) - The company is in a legal dispute with a former financial advisor, FT Partners, regarding advisory fees. The company disputes the claim, and the outcome cannot be reasonably quantified at this time[132](index=132&type=chunk) [Management's Discussion And Analysis Of Financial Condition And Results Of Operations](index=33&type=section&id=Item%202.%20Management%27s%20Discussion%20And%20Analysis%20Of%20Financial%20Condition%20And%20Results%20Of%20Operations) Management attributes performance to USDC growth, with reserve income rising to $1.19 billion despite a net loss of $417.3 million due to a one-time $423.8 million stock compensation expense, emphasizing regulatory approach and strategic partnerships Key Operating and Financial Indicators (Six Months Ended June 30) | (in millions, except percentages) | 2025 | 2024 | | :--- | :--- | :--- | | Average USDC in circulation | $57,574 | $30,405 | | Reserve return rate | 4.2% | 5.2% | | Total revenue and reserve income | $1,237 | $795 | | Net income (loss) from continuing operations | ($417) | $82 | | Adjusted EBITDA (Non-GAAP) | $248 | $159 | - The increase in reserve income for H1 2025 was driven by an **89%** increase in average daily USDC circulation, which was partially offset by a **100 basis point** decline in average yields[217](index=217&type=chunk) - Compensation expenses for H1 2025 increased by **$450.3 million** year-over-year, primarily due to **$423.8 million** in stock-based compensation expense recognized upon the IPO[221](index=221&type=chunk) Composition of USDC Reserves (as of June 30, 2025) | Asset Class | Fair Value (in millions) | Average Yield (Q2 2025) | | :--- | :--- | :--- | | Cash | $8,233 | 3.45% | | Circle Reserve Fund | $53,165 | 4.24% | [Quantitative And Qualitative Disclosures About Market Risk](index=56&type=section&id=Item%203.%20Quantitative%20And%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's primary market risk is interest rate sensitivity, with a 100 bps rate increase potentially boosting annual reserve income by $618 million, while foreign currency risk is deemed immaterial Hypothetical 12-Month Impact of Interest Rate Changes | Change in interest rates | Estimated change in reserve income (in millions) | Estimated change in distribution and transaction costs (in millions) | | :--- | :--- | :--- | | +200 bps | $1,235 | $631 | | +100 bps | $618 | $315 | | -100 bps | ($618) | ($315) | | -200 bps | ($1,235) | ($631) | - The company acknowledges that predicting the impact of interest rate changes on overall reserve income is difficult because the effect on USDC in circulation is uncertain and unproven[279](index=279&type=chunk) [Controls And Procedures](index=56&type=section&id=Item%204.%20Controls%20And%20Procedures) Management concluded that disclosure controls and procedures were effective as of June 30, 2025, with no material changes to internal control over financial reporting during the quarter - Management, including the principal executive officer and principal financial officer, concluded that as of June 30, 2025, the company's disclosure controls and procedures were effective at the reasonable assurance level[282](index=282&type=chunk) - No changes occurred during the most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, the company's internal control over financial reporting[283](index=283&type=chunk) PART II [Legal Proceedings](index=58&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in various legal proceedings arising from ordinary business, with details on specific matters, including a financial advisor dispute, referenced in Note 22 and Risk Factors - The company is involved in various legal proceedings and claims arising from its business activities. For a summary of these proceedings, the report refers to Note 22 of the condensed consolidated financial statements[288](index=288&type=chunk) [Risk Factors](index=58&type=section&id=Item%201a.%20Risk%20Factors) The company faces intense competition, regulatory uncertainty from the GENIUS Act, heavy reliance on third parties like BlackRock for USDC reserves, operational risks including stablecoin 'runs', financial risks from interest rate volatility, and a significant legal dispute with FT Partners - The company faces intense competition from other stablecoins, banks, and new yield-bearing digital assets like TMMFs, which could reduce demand and circulation of Circle stablecoins[290](index=290&type=chunk)[292](index=292&type=chunk)[297](index=297&type=chunk) - The recently enacted GENIUS Act will create a new federal regulatory regime for payment stablecoins. While it provides a path to regulatory clarity, its implementation is uncertain and could impose additional costs, limit reserve asset flexibility, and encourage new competitors[310](index=310&type=chunk)[311](index=311&type=chunk)[312](index=312&type=chunk) - As of June 30, 2025, approximately **87%** of USDC reserves are held in the Circle Reserve Fund, managed by BlackRock. The business is subject to risks associated with BlackRock's management and the fund's availability[318](index=318&type=chunk) - The company is in a legal dispute with financial advisor FT Partners over fees for several transactions, including the IPO. An adverse outcome could require substantial payments and affect future capital raises[370](index=370&type=chunk) [Unregistered Sales Of Equity Securities And Use Of Proceeds](index=94&type=section&id=Item%202.%20Unregistered%20Sales%20Of%20Equity%20Securities%20And%20Use%20Of%20Proceeds) The June 2025 IPO generated **$583.0 million** in net proceeds from selling **19.9 million** Class A shares at **$31.00** each, with funds used for RSU tax withholding and general corporate purposes - The company's June 2025 IPO generated net proceeds of **$583.0 million** from the sale of **19.9 million** Class A shares at **$31.00** per share[479](index=479&type=chunk) - Proceeds were used to satisfy tax withholding on vested RSUs and for general corporate purposes. The company did not receive any proceeds from the **19.2 million** shares sold by selling stockholders[479](index=479&type=chunk)[481](index=481&type=chunk) [Other Information](index=94&type=section&id=Item%205.%20Other%20Information) Several executive officers, including the CEO and CFO, adopted Rule 10b5-1 trading plans in June 2025 for future stock sales, established during an open trading window with required cooling-off periods - In June 2025, CEO Jeremy Allaire, CFO Jeremy Fox-Geen, and other key executives adopted Rule 10b5-1 trading plans to sell portions of their Class A common stock over specified periods through 2026[482](index=482&type=chunk)[484](index=484&type=chunk)[485](index=485&type=chunk) [Exhibits](index=95&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with Form 10-Q, including corporate governance documents, incentive plans, CEO/CFO certifications, and XBRL data files

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 6-K REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13A-16 OR 15D-16 OF THE SECURITIES EXCHANGE ACT OF 1934 For the month of August 2025 Commission File Number: 001-38502 EURODRY LTD. Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. EURODRY LTD. (Translation of registrant's name into English) 4 ...

Table of Contents 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 For the quarter ended June 30, 2025 ☐ 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: 001-42383 OAKTREE ACQUISITION CORP. III LIFE SCIENCES (Exact Name of Registrant as Specified in Its Charter) Cayman Islands 98 ...

Table of Contents 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 For the quarter ended June 30, 2025 ☐ 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: 001-42383 OAKTREE ACQUISITION CORP. III LIFE SCIENCES UNITED STATES SECURITIES AND EXCHANGE COMMISSION (Exact Name of Registrant as Specified in Its Charter) Cayman Islands 98 ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2025 ☐ 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: 001-41778 LQR House Inc. (Exact name of registrant as specified in its charter) Nevada 86-1604197 (State or other jurisd ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☒ 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 ☐ 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 001-38308 Greenpro Capital Corp. (Exact name of registrant issuer as specified in its charter) Nevada 98-1146821 (State or o ...

Table of Contents 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 For the quarterly period ended June 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: 001-38410 BioXcel Therapeutics, Inc. (Exact name of registrant as specified in its charter) Delaware 82-1386754 (S ...

PART I – FINANCIAL INFORMATION [Item 1. Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements.) This section presents Lifeway Foods, Inc.'s unaudited consolidated financial statements and related notes for the periods ended June 30, 2025, and December 31, 2024 [Consolidated Balance Sheets](index=4&type=section&id=Consolidated%20Balance%20Sheets) | Metric | June 30, 2025 (Unaudited) (in thousands) | December 31, 2024 (in thousands) | | :----------------------------------- | :------------------------ | :------------------ | | **Assets** | | | | Total current assets | $49,331 | $43,605 | | Property, plant and equipment, net | $30,731 | $26,862 | | Total assets | $98,267 | $90,547 | | **Liabilities** | | | | Total current liabilities | $16,289 | $15,504 | | Total liabilities | $19,571 | $18,636 | | **Stockholders' Equity** | | | | Total stockholders' equity | $78,696 | $71,911 | - Total assets increased by **$7,720 thousand (8.5%)** from December 31, 2024, to June 30, 2025, primarily driven by increases in cash and cash equivalents, inventories, and property, plant, and equipment[10](index=10&type=chunk) - Total stockholders' equity increased by **$6,785 thousand (9.4%)** from December 31, 2024, to June 30, 2025[10](index=10&type=chunk) [Consolidated Statements of Operations](index=5&type=section&id=Consolidated%20Statements%20of%20Operations) | Metric | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :------------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net sales | $53,901 | $49,157 | $99,992 | $93,791 | | Gross profit | $15,400 | $13,275 | $26,435 | $24,810 | | Income from operations | $5,795 | $5,386 | $7,369 | $8,950 | | Net income | $4,249 | $3,783 | $7,789 | $6,209 | | Basic EPS | $0.28 | $0.26 | $0.51 | $0.42 | | Diluted EPS | $0.28 | $0.25 | $0.51 | $0.41 | - Net sales increased by **9.7%** for the three months ended June 30, 2025, and by **6.6%** for the six months ended June 30, 2025, compared to the respective prior-year periods[12](index=12&type=chunk) - Net income increased by **12.3%** for the three months ended June 30, 2025, and by **25.4%** for the six months ended June 30, 2025, compared to the respective prior-year periods[12](index=12&type=chunk) [Consolidated Statements of Stockholders' Equity](index=6&type=section&id=Consolidated%20Statements%20of%20Stockholders'%20Equity) - Total stockholders' equity increased from **$71,911 thousand** at January 1, 2025, to **$78,696 thousand** at June 30, 2025, primarily due to net income of **$7,789 thousand** and stock-based compensation[16](index=16&type=chunk) - Net income contributed **$3,540 thousand** in Q1 2025 and **$4,249 thousand** in Q2 2025 to retained earnings[16](index=16&type=chunk) - Stock-based compensation expense recognized was **$326 thousand** in Q1 2025 and **$601 thousand** in Q2 2025[16](index=16&type=chunk) [Consolidated Statements of Cash Flows](index=8&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) | Cash Flow Activity | Six months ended June 30, 2025 (in thousands) | Six months ended June 30, 2024 (in thousands) | | :-------------------------------- | :----------------------------- | :----------------------------- | | Net cash provided by operating activities | $3,762 | $8,090 | | Net cash provided by (used in) investing activities | $795 | $(3,905) | | Net cash used in financing activities | $(65) | $(2,750) | | Net increase in cash and cash equivalents | $4,492 | $1,435 | | Cash and cash equivalents at end of period | $21,220 | $14,633 | - Net cash provided by operating activities decreased to **$3,762 thousand** in the first six months of 2025 from **$8,090 thousand** in the same period of 2024, primarily due to lower cash earnings and changes in working capital[18](index=18&type=chunk)[107](index=107&type=chunk) - Net cash provided by investing activities significantly improved to **$795 thousand** in the first six months of 2025, compared to net cash used of **$3,905 thousand** in 2024, driven by **$5,206 thousand** in proceeds from the sale of investments[18](index=18&type=chunk)[108](index=108&type=chunk) [Note 1 – Basis of Presentation](index=9&type=section&id=Note%201%20%E2%80%93%20Basis%20of%20Presentation) - The unaudited consolidated financial statements are prepared in accordance with U.S. GAAP for interim financial information and include all adjustments necessary for fair presentation[20](index=20&type=chunk) - The consolidated financial statements include Lifeway Foods, Inc. and all its wholly-owned subsidiaries, with all significant intercompany accounts and transactions eliminated[21](index=21&type=chunk) [Note 2 – Summary of Significant Accounting Policies](index=9&type=section&id=Note%202%20%E2%80%93%20Summary%20of%20Significant%20Accounting%20Policies) - Significant accounting policies have not materially changed from the Annual Report on Form 10-K for fiscal year ended December 31, 2024[22](index=22&type=chunk) - Key estimates include promotional allowances, goodwill and intangible asset valuation, stock-based compensation, and deferred income taxes[23](index=23&type=chunk) - Advertising costs are expensed as incurred and reported in Selling expense, with total advertising expense at **$4,418 thousand** for the six months ended June 30, 2025, up from **$2,531 thousand** in 2024[26](index=26&type=chunk) - The Company operates as a single reportable segment, focusing on cultured dairy products sold in the United States[28](index=28&type=chunk) - New accounting standards ASU 2024-03 (Expense Disaggregation Disclosures) and ASU 2023-09 (Income Tax Disclosures) are effective for future periods and will primarily impact financial statement notes, not recognition or measurement[29](index=29&type=chunk)[30](index=30&type=chunk) [Note 3 – Inventories, net](index=10&type=section&id=Note%203%20%E2%80%93%20Inventories%2C%20net) | Inventory Category | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | | :-------------------------------- | :------------ | :---------------- | | Ingredients | $3,053 | $2,519 | | Packaging | $2,872 | $2,855 | | Finished goods | $4,299 | $3,304 | | Total inventories, net | $10,224 | $8,678 | - Total inventories, net, increased by **$1,546 thousand (17.8%)** from December 31, 2024, to June 30, 2025, primarily due to increases in ingredients and finished goods[31](index=31&type=chunk) [Note 4 – Property, Plant and Equipment, net](index=11&type=section&id=Note%204%20%E2%80%93%20Property%2C%20Plant%20and%20Equipment%2C%20net) | Category | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | | :---------------------- | :------------ | :---------------- | | Buildings and improvements | $24,141 | $23,520 | | Machinery and equipment | $38,997 | $38,181 | | Construction in process | $5,459 | $2,163 | | Total property, plant and equipment, net | $30,731 | $26,862 | - Net property, plant and equipment increased by **$3,869 thousand (14.4%)** from December 31, 2024, to June 30, 2025, largely due to an increase in construction in process[32](index=32&type=chunk) [Note 5 – Goodwill and Intangible Assets](index=11&type=section&id=Note%205%20%E2%80%93%20Goodwill%20and%20Intangible%20Assets) - Goodwill remained constant at **$11,704 thousand** as of June 30, 2025, with no changes from December 31, 2024[32](index=32&type=chunk) Intangible Assets, Net | Intangible Asset | Net Carrying Amount (June 30, 2025) (in thousands) | Net Carrying Amount (December 31, 2024) (in thousands) | | :------------------------------ | :---------------------------------- | :------------------------------------ | | Customer relationships | $1,773 | $1,853 | | Brand names | $4,315 | $4,505 | | Total intangible assets, net | $6,088 | $6,358 | - Total intangible assets, net, decreased by **$270 thousand** from December 31, 2024, to June 30, 2025, primarily due to amortization[33](index=33&type=chunk) - Estimated amortization expense for intangible assets is **$270 thousand** for the six months ended December 31, 2025, and **$540 thousand** annually from 2026 to 2029[33](index=33&type=chunk) [Note 6 – Accrued Expenses](index=12&type=section&id=Note%206%20%E2%80%93%20Accrued%20Expenses) | Accrued Expense Category | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | | :-------------------------------------- | :------------ | :---------------- | | Payroll and incentive compensation | $3,364 | $4,188 | | Real estate taxes | $507 | $468 | | Utilities | $189 | $193 | | Current portion of operating lease liabilities | $58 | $47 | | Other | $291 | $207 | | Total accrued expenses | $4,409 | $5,103 | - Total accrued expenses decreased by **$694 thousand (13.6%)** from December 31, 2024, to June 30, 2025, mainly due to a decrease in payroll and incentive compensation[34](index=34&type=chunk) [Note 7 – Debt](index=13&type=section&id=Note%207%20%E2%80%93%20Debt) - On February 5, 2025, the Company entered into the Fifth Modification to its Revolving Credit Facility, increasing the commitment from **$5,000 thousand** to **$25,000 thousand** and extending the termination date to February 5, 2028[35](index=35&type=chunk) - The Fifth Modification replaced the quarterly minimum working capital covenant with a maximum cash flow leverage ratio of no greater than **2.00 to 1.00**[35](index=35&type=chunk) - As of June 30, 2025, the Company had no outstanding borrowings and **$25,000 thousand** available under the Revolving Credit Facility, and was in compliance with all covenants[36](index=36&type=chunk)[37](index=37&type=chunk) [Note 8 – Leases](index=13&type=section&id=Note%208%20%E2%80%93%20Leases) - The Company leases machinery and equipment with remaining lease terms ranging from less than one year to six years[38](index=38&type=chunk) - Total lease expense (including short-term leases) was **$95 thousand** for the six months ended June 30, 2025, compared to **$77 thousand** for the same period in 2024[41](index=41&type=chunk) Operating Leases | Year | Operating Leases (in thousands) | | :--- | :------------------------------ | | Six months ended December 31, 2025 | $45 | | 2026 | $82 | | 2027 | $74 | | 2028 | $67 | | 2029 | $60 | | Thereafter | $41 | | Total lease payments | $369 | | Less: Interest | $(91) | | Present value of lease liabilities | $278 | - The weighted-average remaining lease term for operating leases was **4.8 years**, and the weighted average discount rate was **12.27%** as of June 30, 2025[42](index=42&type=chunk) [Note 9 – Commitments and contingencies](index=14&type=section&id=Note%209%20%E2%80%93%20Commitments%20and%20contingencies) - Lifeway is involved in various legal proceedings, claims, and disputes in the ordinary course of business[43](index=43&type=chunk) - Provisions for legal matters are recorded when a loss is probable and reasonably estimable; currently, no accruals are material individually or in aggregate[44](index=44&type=chunk) [Note 10 – Income taxes](index=14&type=section&id=Note%2010%20%E2%80%93%20Income%20taxes) | Period | Effective Tax Rate | | :----- | :----------------- | | Six months ended June 30, 2025 | 28.4% | | Six months ended June 30, 2024 | 30.0% | | Three months ended June 30, 2025 | 28.1% | | Three months ended June 30, 2024 | 29.4% | - The change in the effective tax rate is primarily due to changes in non-deductible officer compensation and stock-based compensation expense[45](index=45&type=chunk) - The provision for income taxes during interim periods is calculated by applying an estimate of the annual effective tax rate to income before taxes, excluding discrete items[46](index=46&type=chunk) [Note 11 – Stock-based and Other Compensation](index=15&type=section&id=Note%2011%20%E2%80%93%20Stock-based%20and%20Other%20Compensation) - The Lifeway Foods, Inc. 2022 Omnibus Incentive Plan has **2.57 million shares** remaining available for awards as of June 30, 2025[48](index=48&type=chunk) - The 2022 Non-Employee Director Equity and Deferred Compensation Plan has **390 thousand shares** remaining available for awards as of June 30, 2025[49](index=49&type=chunk) Compensation Expense and Tax Benefit | Metric | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :-------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Compensation expense related to stock-based payments | $601 | $623 | $927 | $1,296 | | Related income tax benefit | $168 | $66 | $259 | $131 | - Unrecognized compensation expense for nonvested restricted stock units was **$687 thousand** as of June 30, 2025, to be recognized over a weighted average period of **1.2 years**[53](index=53&type=chunk) - Unrecognized compensation expense for nonvested performance units is estimated at **$1,775 thousand** as of June 30, 2025, to be recognized over a weighted average period of **1.16 years**[58](index=58&type=chunk) - Total contribution expense for the defined contribution plan was **$413 thousand** for the six months ended June 30, 2025, compared to **$362 thousand** for the same period in 2024[59](index=59&type=chunk) [Note 12 - Earnings Per Share](index=17&type=section&id=Note%2012%20-%20Earnings%20Per%20Share) | Metric | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :-------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Weighted average common shares outstanding | 15,206 | 14,727 | 15,170 | 14,709 | | Assumed exercise/vesting of equity awards | 184 | 470 | 189 | 467 | | Weighted average diluted common shares outstanding | 15,390 | 15,197 | 15,359 | 15,176 | [Note 13 – Disaggregation of Revenue and Significant Customers](index=17&type=section&id=Note%2013%20%E2%80%93%20Disaggregation%20of%20Revenue%20and%20Significant%20Customers) - Lifeway operates as one reportable segment, manufacturing and distributing cultured dairy products primarily in North America[61](index=61&type=chunk)[62](index=62&type=chunk) - The primary product is drinkable kefir, sold under Lifeway, Fresh Made, GlenOaks Farms, and private labels[63](index=63&type=chunk) Net Sales by Product Category | Product Category | Six Months Ended June 30, 2025 (in thousands) | % of Total (2025) | Six Months Ended June 30, 2024 (in thousands) | % of Total (2024) | | :--------------- | :----------------------------- | :---------------- | :----------------------------- | :---------------- | | Drinkable Kefir other than ProBugs | $84,039 | 84% | $77,543 | 83% | | Cheese | $7,811 | 8% | $6,892 | 7% | | Cream and other | $4,825 | 5% | $3,987 | 4% | | ProBugs Kefir | $1,515 | 1% | $1,750 | 2% | | Drinkable Yogurt | $1,083 | 1% | $2,918 | 3% | | Other dairy | $719 | 1% | $701 | 1% | | **Net Sales** | **$99,992** | **100%** | **$93,791** | **100%** | | Product Category | Three Months Ended June 30, 2025 (in thousands) | % of Total (2025) | Three Months Ended June 30, 2024 (in thousands) | % of Total (2024) | | :--------------- | :------------------------------- | :---------------- | :------------------------------- | :---------------- | | Drinkable Kefir other than ProBugs | $45,989 | 85% | $41,010 | 83% | | Cheese | $3,999 | 8% | $3,377 | 7% | | Cream and other | $2,366 | 4% | $2,171 | 4% | | ProBugs Kefir | $769 | 1% | $884 | 2% | | Drinkable Yogurt | $449 | 1% | $1,382 | 3% | | Other dairy | $329 | 1% | $333 | 1% | | **Net Sales** | **$53,901** | **100%** | **$49,157** | **100%** | - Drinkable Kefir (excluding ProBugs) remains the largest product category, accounting for **84%** of net sales for the six months ended June 30, 2025[64](index=64&type=chunk) - Two significant customers accounted for approximately **25%** of net sales for the six months ended June 30, 2025, and **26%** for the same period in 2024[65](index=65&type=chunk) [Note 14 – Shareholder Rights Plan](index=19&type=section&id=Note%2014%20%E2%80%93%20Shareholder%20Rights%20Plan) - The Company adopted a Shareholder Rights Agreement on November 4, 2024, issuing one preferred share purchase right for each outstanding common stock share[68](index=68&type=chunk) - Each Right entitles its holder to purchase one one-thousandth of one share of Series A Junior Participating Preferred Stock at an exercise price of **$130.00**[68](index=68&type=chunk) - The Right expires at the end of November 4, 2025, or earlier if exercised[68](index=68&type=chunk) [Note 15 – Subsequent Events](index=19&type=section&id=Note%2015%20%E2%80%93%20Subsequent%20Events) - The One Big Beautiful Bill Act (OBBBA) was enacted on July 4, 2025, but is not expected to have a material impact on the Company's estimated annual effective tax rate or cash flows in the current fiscal year[69](index=69&type=chunk) - To increase organic milk supply, Lifeway purchased **224 mature dairy cows** for **$694 thousand** in July 2025 and entered into a 39-month agreement with a third-party dairy facility to manage the herd and sell milk to a COOP[70](index=70&type=chunk)[71](index=71&type=chunk)[72](index=72&type=chunk) - The Company is currently assessing the appropriate accounting treatment for the herd purchase and related agreement[73](index=73&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=20&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations.) Management discusses the company's financial condition, operational results, liquidity, and capital resources for the reported periods [Business Overview](index=21&type=section&id=Business%20Overview) - Lifeway Foods, Inc. was founded in 1986 and is the largest producer and marketer of kefir in the U.S., focusing on probiotic-based and 'better for you' foods[78](index=78&type=chunk) - The primary product is drinkable kefir, a cultured dairy product, marketed under Lifeway, Fresh Made, GlenOaks Farms, and private labels[79](index=79&type=chunk) - Product categories include: Drinkable Kefir, European-style soft cheeses, Cream and other, Drinkable Yogurt, ProBugs (kefir for children), and Other Dairy (butter and sour cream)[84](index=84&type=chunk) - The Company is primarily a United States-based manufacturer, sourcing most inputs domestically and selling all domestically produced products to U.S. customers[83](index=83&type=chunk) [Recent Developments and Trends](index=21&type=section&id=Recent%20Developments%20and%20Trends) - Lifeway is increasing its organic milk supply by purchasing mature dairy cows and entering into agreements with a third-party dairy facility and a COOP[79](index=79&type=chunk)[81](index=81&type=chunk) - The Company purchased **224 mature dairy cows** in July 2025 for **$694 thousand** and is evaluating further purchases[80](index=80&type=chunk) - The Company is assessing the accounting treatment for the herd purchase and the 39-month Herd Agreement[82](index=82&type=chunk) [Current Macroeconomic Environment](index=21&type=section&id=Current%20Macroeconomic%20Environment) - The Company monitors macroeconomic conditions, including inflation, tariffs, and trade policies, but does not currently expect a material adverse impact on operations or financial results[83](index=83&type=chunk) - An accelerating consumer focus on health and wellness is expected to drive increased demand for Lifeway's products[83](index=83&type=chunk) [Results of Operations](index=22&type=section&id=Results%20of%20Operations) Three Months Ended June 30, 2025 vs. 2024 | Metric | 2025 ($ in thousands) | 2025 (%) | 2024 ($ in thousands) | 2024 (%) | Change ($ in thousands) | Change (%) | | :-------------------------------- | :------- | :------- | :------- | :------- | :--------- | :--------- | | Net sales | 53,901 | 100.0% | 49,157 | 100.0% | 4,744 | 9.7% | | Gross profit | 15,400 | 28.6% | 13,275 | 27.0% | 2,125 | 16.0% | | Selling expenses | 4,718 | 8.8% | 3,577 | 7.3% | 1,141 | 31.9% | | General & administrative expense | 4,752 | 8.8% | 4,177 | 8.5% | 575 | 13.8% | | Income from operations | 5,795 | 10.7% | 5,386 | 10.9% | 409 | 7.6% | | Net income | 4,249 | 7.9% | 3,783 | 7.6% | 466 | 12.3% | Six Months Ended June 30, 2025 vs. 2024 | Metric | 2025 ($ in thousands) | 2025 (%) | 2024 ($ in thousands) | 2024 (%) | Change ($ in thousands) | Change (%) | | :-------------------------------- | :------- | :------- | :------- | :------- | :--------- | :--------- | | Net sales | 99,992 | 100.0% | 93,791 | 100.0% | 6,201 | 6.6% | | Gross profit | 26,435 | 26.5% | 24,810 | 26.4% | 1,625 | 6.5% | | Selling expense | 9,416 | 9.4% | 7,277 | 7.8% | 2,139 | 29.4% | | General & administrative expense | 9,380 | 9.4% | 8,313 | 8.9% | 1,067 | 12.8% | | Income from operations | 7,369 | 7.4% | 8,950 | 9.4% | (1,581) | (17.7%) | | Net income | 7,789 | 7.9% | 6,209 | 6.5% | 1,580 | 25.4% | - Net sales for Q2 2025 increased by **9.7%** to **$53,901 thousand**, primarily due to higher volumes of branded drinkable kefir, with a comparable increase of approximately **18%** when adjusting for exited customer relationships and distributor shifts[86](index=86&type=chunk) - Gross profit margin for Q2 2025 increased to **28.6%** from **27.0%** in Q2 2024, driven by higher branded product volumes and favorable conventional milk pricing, partially offset by unfavorable organic milk pricing and trade promotion investments[87](index=87&type=chunk) - Selling expenses for Q2 2025 increased by **$1,141 thousand (31.9%)** to **$4,718 thousand**, mainly due to increased marketing activities to boost brand awareness and sales volumes[88](index=88&type=chunk) - General and administrative expenses for Q2 2025 rose by **$575 thousand (13.8%)** to **$4,752 thousand**, primarily due to professional fees related to non-routine stockholder action and the Danone unsolicited purchase proposal[89](index=89&type=chunk) - The effective income tax rate for the six months ended June 30, 2025, was **28.4%**, down from **30.0%** in the prior year, mainly due to changes in non-deductible officer compensation and stock-based compensation[99](index=99&type=chunk) [Liquidity and Capital Resources](index=25&type=section&id=Liquidity%20and%20Capital%20Resources) - Lifeway maintains a strong financial position, expecting sufficient liquidity from operations, its revolving credit facility, and cash equivalents to fund working capital, capital requirements, and growth initiatives[102](index=102&type=chunk) - As of June 30, 2025, **$25,000 thousand** was available under the Revolving Credit Facility, with no outstanding borrowings[103](index=103&type=chunk)[110](index=110&type=chunk) - The Company is in compliance with all financial covenants of its Credit Agreement, including a fixed charge coverage ratio of no less than **1.25 to 1.00** and a maximum cash flow leverage ratio of no greater than **2.00 to 1.00**[111](index=111&type=chunk)[112](index=112&type=chunk) - Short-term cash requirements include funding operations (raw materials, labor, marketing, taxes) and capital expenditures; long-term needs relate to debt repayments and deferred income taxes[104](index=104&type=chunk) [Cash Flow](index=26&type=section&id=Cash%20Flow) | Cash Flow Activity | Six months Ended June 30, 2025 (in thousands) | Six months Ended June 30, 2024 (in thousands) | | :-------------------------------- | :----------------------------- | :----------------------------- | | Operating activities | $3,762 | $8,090 | | Investing activities | $795 | $(3,905) | | Financing activities | $(65) | $(2,750) | - Net cash from operating activities decreased to **$3,762 thousand** in H1 2025 from **$8,090 thousand** in H1 2024, primarily due to lower cash earnings and changes in working capital[107](index=107&type=chunk) - Net cash from investing activities turned positive at **$795 thousand** in H1 2025, compared to a net use of **$3,905 thousand** in H1 2024, mainly due to **$5,206 thousand** in proceeds from the sale of the Simple Mills investment[108](index=108&type=chunk)[27](index=27&type=chunk) - Net cash used in financing activities decreased significantly to **$65 thousand** in H1 2025 from **$2,750 thousand** in H1 2024, as the 2024 figure included principal payments on a term loan that was fully repaid[109](index=109&type=chunk) [Recent Accounting Pronouncements](index=27&type=section&id=Recent%20Accounting%20Pronouncements) - Information on recent accounting pronouncements is detailed in Note 2 – Summary of Significant Accounting Policies[113](index=113&type=chunk) [Critical Accounting Policies and Estimates](index=27&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) - There were no material changes to the Company's critical accounting policies and estimates during the six months ended June 30, 2025, as disclosed in the Annual Report on Form 10-K for the year ended December 31, 2024[114](index=114&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=27&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk.) The Company has no applicable quantitative and qualitative disclosures about market risk - The Company has no applicable quantitative and qualitative disclosures about market risk[115](index=115&type=chunk) [Item 4. Controls and Procedures](index=27&type=section&id=Item%204.%20Controls%20and%20Procedures.) This section details the evaluation of the Company's disclosure controls and procedures and reports on any changes in internal control over financial reporting [Evaluation of Disclosure Controls and Procedures](index=27&type=section&id=Evaluation%20of%20Disclosure%20Controls%20and%20Procedures) - As of June 30, 2025, the CEO and CFO concluded that the Company's disclosure controls and procedures were effective[116](index=116&type=chunk) [Changes in Internal Control over Financial Reporting](index=27&type=section&id=Changes%20in%20Internal%20Control%20over%20Financial%20Reporting) - There were no changes in the Company's internal control over financial reporting during the quarter ended June 30, 2025, that materially affected or are reasonably likely to materially affect, its internal control over financial reporting[117](index=117&type=chunk) PART II – OTHER INFORMATION [Item 1. Legal Proceedings](index=28&type=section&id=Item%201.%20Legal%20Proceedings.) This section refers to Note 9 for information regarding legal proceedings, indicating no new material information beyond what is already disclosed in the financial notes - Information regarding legal proceedings is available in Note 9, Commitment and Contingencies[119](index=119&type=chunk) [Item 1A. Risk Factors](index=28&type=section&id=Item%201A.Risk%20Factors.) This section states that there have been no material changes to the risk factors previously disclosed in the Company's Annual Report on Form 10-K - There have been no material changes from the risk factors disclosed in Part I, Item 1A of the Company's Annual Report on Form 10-K for the year ended December 31, 2024[120](index=120&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=28&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds.) This section indicates that there were no unregistered sales of equity securities or use of proceeds to report - There were no unregistered sales of equity securities and use of proceeds to report[121](index=121&type=chunk) [Item 3. Defaults Upon Senior Securities](index=28&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities.) This section reports that there were no defaults upon senior securities - There were no defaults upon senior securities[122](index=122&type=chunk) [Item 5. Other Information](index=28&type=section&id=Item%205.%20Other%20Information.) This section confirms that no director or officer adopted or terminated Rule 10b5-1 trading arrangements during the quarter - No director or officer of the Company adopted or terminated a "Rule 10b5-1 trading arrangement" or "non-Rule 10b5-1 trading arrangement" during the quarter ended June 30, 2025[123](index=123&type=chunk) [Item 6. Exhibits](index=29&type=section&id=Item%206.%20Exhibits.) This section lists all exhibits filed or furnished with the Form 10-Q, including certifications, press releases, and XBRL documents - Certifications (Rule 13a-14(a)/15d-14(a) and Section 1350) from Julie Smolyansky (CEO) and Eric Hanson (CFO) are included[125](index=125&type=chunk) - A press release dated August 12, 2025, reporting financial results for the three months ended June 30, 2025, is furnished[125](index=125&type=chunk) - Inline XBRL documents (Instance, Schema, Calculation, Definition, Label, Presentation Linkbase Documents) and Cover Page Interactive Data File are included[125](index=125&type=chunk) [Signatures](index=30&type=section&id=Signatures.) This section contains the required signatures from the Company's Chief Executive Officer, President, and Director, Julie Smolyansky, and Chief Financial & Accounting Officer, Eric Hanson, certifying the filing of the report - The report is signed by Julie Smolyansky, Chief Executive Officer, President, and Director (Principal Executive Officer), and Eric Hanson, Chief Financial & Accounting Officer (Principal Financial and Accounting Officer), both dated August 12, 2025[129](index=129&type=chunk)