Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 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 (514) 336-0444 ☐ 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: 001-38899 Milestone Pharmaceuticals Inc. (Exact Name of Registrant as Specified in its Charter) (Stat ...

FOR IMMEDIATE RELEASE Exhibit 99.1 Cardinal Health Reports Fourth Quarter and Fiscal Year 2025 Results and Raises Fiscal Year 2026 Guidance DUBLIN, Ohio, August 12, 2025 – Cardinal Health (NYSE: CAH) today reported fourth quarter fiscal year 2025 revenues of $60.2 billion, relatively flat to the fourth quarter of fiscal year 2024. Fourth quarter revenue increased 21% excluding the impact of a previously communicated customer contract expiration. GAAP operating earnings were $428 million and GAAP diluted ear ...

[PART I - FINANCIAL INFORMATION](index=3&type=section&id=PART%20I) This section presents NeurAxis, Inc.'s unaudited condensed financial statements and management's discussion for H1 2025 [ITEM 1: FINANCIAL STATEMENTS](index=3&type=section&id=ITEM%201%3A%20FINANCIAL%20STATEMENTS) This section presents the unaudited condensed financial statements of NeurAxis, Inc. and related notes for H1 2025 and FY 2024 [Condensed Balance Sheets](index=3&type=section&id=Condensed%20Balance%20Sheets%20as%20of%20June%2030%2C%202025%20%28Unaudited%29%20and%20December%2031%2C%202024) This section details the company's financial position, including assets, liabilities, and equity, for H1 2025 and FY 2024 Condensed Balance Sheet Highlights | Metric | June 30, 2025 (USD) | December 31, 2024 (USD) | Change (USD) | % Change | | :-------------------------- | :-------------- | :---------------- | :----- | :------- | | Total Assets | $7,087,999 | $4,757,572 | $2,330,427 | 49.0% | | Total Liabilities | $2,834,705 | $2,689,824 | $144,881 | 5.4% | | Total Stockholders' Equity | $4,253,294 | $2,067,748 | $2,185,546 | 105.7% | | Cash and cash equivalents | $5,988,456 | $3,696,870 | $2,291,586 | 62.0% | [Condensed Statements of Operations](index=4&type=section&id=Condensed%20Statements%20of%20Operations%20for%20the%20Three%20and%20Six%20Months%20Ended%20June%2030%2C%202025%20and%202024%20%28Unaudited%29) This section outlines the company's financial performance, including net sales, gross profit, and net loss for Q2 and H1 2025 and 2024 Statements of Operations Highlights (Three Months Ended June 30) | Metric | 2025 (USD) | 2024 (USD) | Change (USD) | % Change | | :-------------------------- | :------------ | :------------ | :------------ | :------- | | Net Sales | $894,086 | $611,500 | $282,586 | 46.2% | | Gross Profit | $747,443 | $538,042 | $209,401 | 38.9% | | Operating Loss | $(1,717,858) | $(2,206,832) | $488,974 | -22.2% | | Net Loss | $(1,690,418) | $(2,917,710) | $1,227,292 | -42.1% | | Basic and diluted loss per share | $(0.22) | $(0.42) | $0.20 | -47.6% | Statements of Operations Highlights (Six Months Ended June 30) | Metric | 2025 (USD) | 2024 (USD) | Change (USD) | % Change | | :-------------------------- | :------------ | :------------ | :------------ | :------- | | Net Sales | $1,789,741 | $1,258,135 | $531,606 | 42.3% | | Gross Profit | $1,503,623 | $1,109,596 | $394,027 | 35.5% | | Operating Loss | $(4,012,955) | $(4,038,952) | $25,997 | -0.6% | | Net Loss | $(3,969,102) | $(5,038,361) | $1,069,259 | -21.2% | | Basic and diluted loss per share | $(0.56) | $(0.73) | $0.17 | -23.3% | [Condensed Statements of Stockholders' Equity (Deficit)](index=5&type=section&id=Condensed%20Statements%20of%20Stockholders'%20Equity%20(Deficit)%20for%20the%20Three%20and%20Six%20Months%20Ended%20June%2030%2C%202025%20and%202024%20%28Unaudited%29) This section details changes in stockholders' equity, including common stock issuances, warrant exercises, and net loss for H1 2025 and 2024 Stockholders' Equity (Deficit) Changes (Six Months Ended June 30, 2025) | Item | Amount (USD) | | :------------------------------------------------ | :------------- | | Balances at January 1, 2025 | $2,067,748 | | Warrants exercised | $1,002,991 | | Common stock issued from agreements | $112,493 | | Vesting of restricted stock awards | $529,964 | | Issuance of common stock pursuant to shelf registration statement | $4,999,999 | | Offering costs | $(490,799) | | Net loss | $(3,969,102) | | Balances at June 30, 2025 | $4,253,294 | - The number of common shares outstanding increased significantly from **6,990,227** as of December 31, 2024, to **9,858,716** as of June 30, 2025, primarily due to the issuance of common stock through a shelf registration statement and warrant exercises[7](index=7&type=chunk)[12](index=12&type=chunk) [Condensed Statements of Cash Flows](index=7&type=section&id=Condensed%20Statements%20of%20Cash%20Flows%20for%20the%20Six%20Months%20Ended%20June%2030%2C%202025%20and%202024%20%28Unaudited%29) This section summarizes cash flows from operating, investing, and financing activities for the six months ended June 30, 2025 and 2024 Cash Flow Summary (Six Months Ended June 30) | Activity | 2025 (USD) | 2024 (USD) | Change (USD) | % Change | | :-------------------------- | :------------ | :------------ | :------------ | :------- | | Net cash used in operating activities | $(3,071,145) | $(2,947,295) | $(123,850) | 4.2% | | Net cash used in investing activities | $(25,288) | $(23,408) | $(1,880) | 8.0% | | Net cash provided by financing activities | $5,388,019 | $4,657,417 | $730,602 | 15.7% | | Net Increase in Cash and Cash Equivalents | $2,291,586 | $1,686,714 | $604,872 | 35.9% | | Cash and Cash Equivalents at End of Period | $5,988,456 | $1,765,274 | $4,223,182 | 239.2% | - The increase in cash from financing activities in 2025 was primarily driven by proceeds from the issuance of common stock (**$4,999,999**) and exercised warrants (**$1,002,991**), contrasting with 2024's primary source being convertible notes[13](index=13&type=chunk)[151](index=151&type=chunk) [Notes to Condensed Financial Statements](index=8&type=section&id=Notes%20to%20Condensed%20Financial%20Statements%20%28Unaudited%29) This section provides detailed explanations and disclosures supporting the condensed financial statements [1. Basis of Presentation, Organization and Other Matters](index=10&type=section&id=1.%20Basis%20of%20Presentation%2C%20Organization%20and%20Other%20Matters) This note describes the company's business, medical devices, and the basis for preparing interim financial statements - NeurAxis, Inc. specializes in medical neuromodulation devices, with four FDA-cleared products: IB-STIM, Rectal Expulsion Device (RED), NSS-2 Bridge (license terminated July 1, 2025), and the original 510(K) Electroacupuncture Device (NeuroStim, now for research only)[15](index=15&type=chunk)[17](index=17&type=chunk)[116](index=116&type=chunk) - The company's financial statements are prepared in accordance with U.S. GAAP for interim reporting, and the unaudited interim results are not necessarily indicative of future performance[16](index=16&type=chunk) [2. Summary of Significant Accounting Policies](index=11&type=section&id=2.%20Summary%20of%20Significant%20Accounting%20Policies) This note outlines key accounting principles, estimates, and judgments, including revenue recognition and going concern - Management makes estimates for revenue recognition, credit losses, stock-based compensation, income tax, inventory reserves, and impairment, which are subject to change[18](index=18&type=chunk)[21](index=21&type=chunk) Allowance for Credit Losses and Inventory Reserves | Metric | June 30, 2025 (USD) | December 31, 2024 (USD) | | :-------------------------- | :-------------- | :---------------- | | Allowance for credit losses | $5,000 | $5,000 | | Inventory reserves | $17,195 | $4,454 | - The company's Level 3 financial instruments, warrant liabilities, are valued using model-based techniques with unobservable inputs, reflecting management's estimates and judgment[29](index=29&type=chunk) - Revenue is recognized when customers obtain control of goods, typically at the point of receipt, with provisions for patient assistance programs and provider rebates/credits[37](index=37&type=chunk)[38](index=38&type=chunk)[39](index=39&type=chunk)[41](index=41&type=chunk) - Substantial doubt exists about the Company's ability to continue as a going concern due to accumulated losses and negative cash flows, with future viability dependent on generating sufficient revenue and raising additional funds[48](index=48&type=chunk)[51](index=51&type=chunk) - Recently issued accounting pronouncements (ASU 2024-03 and ASU 2023-09) are not expected to have a material impact on the Company's financial statements, though they require enhanced disclosures[53](index=53&type=chunk)[54](index=54&type=chunk) [3. Related Party Transactions](index=17&type=section&id=3.%20Related%20Party%20Transactions) This note discloses transactions with related parties, including demand notes, licensing, and services - The Company has two demand notes receivable from shareholders totaling **$1,012,800** in principal, with an allowance for the entire balance due to repayment uncertainty[55](index=55&type=chunk) - An exclusive, royalty-free license for auricular patent portions is held from an LLC co-owned by the CEO and Chief Regulatory Officer, with license costs of **$1,317** incurred in H1 2025[55](index=55&type=chunk) - Sales of IB-STIM devices to a Board member for R&D totaled **$6,351** for the six months ended June 30, 2025[56](index=56&type=chunk) - Accounting and tax services from a firm previously managed by the former CFO amounted to **$31,679** for H1 2025, a decrease from **$91,168** in H1 2024[57](index=57&type=chunk) [4. Prepaids and Other Current Assets](index=18&type=section&id=4.%20Prepaids%20and%20Other%20Current%20Assets) This note details the composition of prepaid expenses and other current assets Prepaids and Other Current Assets | Item | June 30, 2025 (USD) | December 31, 2024 (USD) | | :-------------------------- | :-------------- | :---------------- | | Prepaid insurance | $44,985 | $186,028 | | Prepaid software subscriptions | $176,940 | $39,834 | | Other | $148,400 | $54,505 | | Total | $370,325 | $280,367 | [5. Accrued Expenses](index=19&type=section&id=5.%20Accrued%20Expenses) This note itemizes accrued liabilities, such as compensation, litigation settlements, and legal fees Accrued Expenses | Item | June 30, 2025 (USD) | December 31, 2024 (USD) | | :-------------------------- | :-------------- | :---------------- | | Compensation and benefits | $1,040,099 | $1,261,317 | | Settled litigation | $375,000 | - | | Legal fees | $107,045 | $43,891 | | Interest | $66,648 | $66,648 | | Advisory fees | - | $176,750 | | Other | $63,996 | $29,174 | | Total | $1,652,788 | $1,577,780 | [6. Notes Payable](index=19&type=section&id=6.%20Notes%20Payable) This note describes outstanding promissory notes and the conversion of convertible notes into Series B Preferred Shares - The Company had outstanding promissory notes of **$121,433** as of June 30, 2025, down from **$154,152** at December 31, 2024, including a new note for software subscription fees[60](index=60&type=chunk) - In 2024, the Company issued convertible promissory notes totaling **$4,935,000**, which mandatorily converted into **2,073,524 Series B Preferred Shares** on August 15, 2024, at a conversion price of **$2.38 per share**[61](index=61&type=chunk)[62](index=62&type=chunk)[64](index=64&type=chunk)[66](index=66&type=chunk) Interest Expense | Period | 2025 (USD) | 2024 (USD) | | :-------------------------- | :------------ | :------------ | | Three Months Ended June 30 | $(13,434) | $(80,697) | | Six Months Ended June 30 | $(15,672) | $(107,257) | [7. Leases](index=20&type=section&id=7.%20Leases) This note details the company's operating lease arrangements for office space - The Company holds operating leases for office space in Indiana, with a new lease in Carmel commencing January 1, 2024, and the Versailles lease terminated effective July 31, 2025, due to relocation[68](index=68&type=chunk)[69](index=69&type=chunk)[70](index=70&type=chunk) Operating Lease Liabilities | Item | June 30, 2025 | December 31, 2024 | | :-------------------------- | :-------------- | :---------------- | | Operating lease right-of-use assets | $256,656 | $284,656 | | Operating lease liabilities | $219,880 | $256,499 | | Weighted-average remaining lease term | 3.66 years | 2.75 years | [8. Common Stock and Warrants](index=21&type=section&id=8.%20Common%20Stock%20and%20Warrants) This note provides information on changes in common stock outstanding and warrant activity - Common stock outstanding increased from **6,990,227 shares** at December 31, 2024, to **9,858,716 shares** at June 30, 2025[72](index=72&type=chunk) - Key issuances in H1 2025 include **1,538,461 shares** for **$4,999,999** via a shelf registration statement, **720,359 shares** from warrant exercises, and **426,048 shares** from Series B Preferred Stock conversions[73](index=73&type=chunk)[74](index=74&type=chunk)[75](index=75&type=chunk) Warrant Activity Summary | Metric | Outstanding as of Jan 1, 2024 | Outstanding as of Dec 31, 2024 | Outstanding as of June 30, 2025 | | :-------------------------- | :---------------------------- | :----------------------------- | :------------------------------ | | Number of Warrants for Common Stock | 1,822,358 | 2,642,530 | 1,419,524 | | Weighted-Avg. Exercise Price | $4.69 | $2.41 | $2.44 | [9. Preferred Stock](index=24&type=section&id=9.%20Preferred%20Stock) This note describes Series B Preferred Stock, including its authorization, outstanding shares, and dividend rights - As of June 30, 2025, **3,896,907 shares of Series B Preferred Stock** were issued and outstanding, authorized with **5,000,000 shares**, carrying an **8.5% cumulative dividend** and **1:1 convertibility** to common stock[81](index=81&type=chunk)[84](index=84&type=chunk) - Series B Preferred Stock maintains priority preference over other capital stock classes upon liquidation, dissolution, or winding up of the Company[86](index=86&type=chunk) Undeclared Cumulative Series B Preferred Stock Dividends | Period | Amount (USD) | Per Share (USD) | | :-------------------------- | :----------- | :-------------- | | Three Months Ended June 30, 2025 | $207,465 | $0.02 | | Six Months Ended June 30, 2025 | $421,008 | $0.05 | [10. Stock-Based Compensation](index=25&type=section&id=10.%20Stock-Based%20Compensation) This note details stock-based compensation arrangements, including RSUs and stock options - The Company granted **852,214 Restricted Stock Units (RSUs)** in H1 2025, subject to a three-year cliff-vesting period, with total stock-based compensation expense related to RSUs amounting to **$278,854** for the six months ended June 30, 2025[88](index=88&type=chunk)[89](index=89&type=chunk) - As of June 30, 2025, **1,319,394 stock options** were outstanding and fully vested/exercisable, with a weighted-average exercise price of **$6.94**, and no related compensation expense recorded in H1 2025[90](index=90&type=chunk) [11. Warrant Liabilities](index=26&type=section&id=11.%20Warrant%20Liabilities) This note explains the valuation and changes in warrant liabilities using a Black-Scholes model - Warrant liabilities decreased from **$9,166** at December 31, 2024, to **$7,454** at June 30, 2025, primarily due to changes in fair value[93](index=93&type=chunk) - The fair value of warrant liabilities is computed using a Black-Scholes option-pricing model, with inputs including an exercise price of **$8.76**, expected remaining term, estimated volatility (**75.0% to 89.9%**), and risk-free interest rates (**3.80% to 4.38%**)[92](index=92&type=chunk) [12. Segment Information](index=26&type=section&id=12.%20Segment%20Information) This note clarifies the company operates as a single reportable segment, IB-STIM, and its performance evaluation - The Company operates as a single reportable segment, IB-STIM, focusing on a PENFS device for functional abdominal pain associated with irritable bowel syndrome in patients aged 8-21[94](index=94&type=chunk) - The CEO, as the Chief Operating Decision Maker (CODM), evaluates segment performance based on net sales and operating loss to allocate resources and monitor cost structure[94](index=94&type=chunk) Segment Operating Loss (Six Months Ended June 30) | Metric | 2025 (USD) | 2024 (USD) | Change (USD) | % Change | | :-------------------------- | :------------ | :------------ | :------------ | :------- | | Net Revenue | $1,789,741 | $1,258,135 | $531,606 | 42.3% | | Gross Profit | $1,503,623 | $1,109,596 | $394,027 | 35.5% | | Segment Operating Loss | $(4,012,955) | $(4,038,952) | $25,997 | -0.6% | [13. Settled Litigation](index=27&type=section&id=13.%20Settled%20Litigation) This note provides details on a settled lawsuit, including the settlement amount and financial impact - A lawsuit initiated in 2019 by Ritu Bhambhani, M.D., against the Company was dismissed by the Court in 2022, and the plaintiff's appeal was denied by the Fourth Circuit in June 2024[98](index=98&type=chunk)[99](index=99&type=chunk)[100](index=100&type=chunk) - A related 2022 lawsuit by business entities owned by the same plaintiffs, alleging RICO Act violations and misrepresentation regarding NeuroStim device billing, resulted in a tentative **$750,000 settlement** executed on May 15, 2025, payable in 12 monthly installments starting January 2026[101](index=101&type=chunk)[102](index=102&type=chunk)[103](index=103&type=chunk) - The Company recorded a charge of **$630,568** for the six months ended June 30, 2025, related to the settlement, with **$375,000** accrued as current expenses and **$267,540** as non-current liabilities[103](index=103&type=chunk) [14. Commitments and Contingencies](index=28&type=section&id=14.%20Commitments%20and%20Contingencies) This note outlines the company's various contractual commitments and potential litigation - The Company has a manufacturing services agreement for its IB-STIM device, which automatically renews annually[104](index=104&type=chunk) - An advisory agreement for debt, equity, and public securities market services was terminated on December 31, 2024, with a payment of **$180,000** for services rendered in Q1 2025[105](index=105&type=chunk) - Settlement agreements in 2024 included resolving a convertible note dispute for **$230,824** (paid in common shares) and settling claims with pre-IPO Series A Preferred Stock shareholders for **$286,458** (paid in common shares) and an additional **$290,171** accrued[106](index=106&type=chunk)[107](index=107&type=chunk) - Executive employment agreements include provisions for special bonuses contingent on stock option exercise and a successful IPO, totaling **$14,821,830**, to be recorded when paid[109](index=109&type=chunk)[110](index=110&type=chunk)[112](index=112&type=chunk) - The Company is involved in threatened litigation regarding a patent interest claim valued at **$2,000,000**, which it intends to vigorously defend[115](index=115&type=chunk) [15. Subsequent Events](index=30&type=section&id=15.%20Subsequent%20Events) This note discloses significant events occurring after the reporting period, such as license terminations and an ESPP - On July 1, 2025, the NSS-2 Bridge license with Masimo was terminated, allowing NeurAxis to recapture trademark and patent application rights in exchange for **$200,000** payable in two installments[116](index=116&type=chunk) - The NeurAxis, Inc. 2025 Employee Stock Purchase Plan (ESPP) was adopted on July 1, 2025, offering eligible employees a **15% discount** on common stock purchases via payroll deductions, subject to shareholder approval[117](index=117&type=chunk) [ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION](index=31&type=section&id=ITEM%202%3A%20MANAGEMENT'S%20DISCUSSION%20AND%20ANALYSIS%20OF%20FINANCIAL%20CONDITION%20AND%20RESULTS%20OF%20OPERATION) This section analyzes NeurAxis's financial performance, liquidity, and capital resources for H1 2025 compared to 2024 [Overview](index=31&type=section&id=Overview) This section introduces NeurAxis as a growth-stage neuromodulation therapy company, highlighting its financial performance and outlook - NeurAxis is a growth-stage company developing neuromodulation therapies for chronic conditions in children, with FDA-cleared IB-Stim (for IBS in children) and RED (for chronic constipation in adults) devices[120](index=120&type=chunk) - The Company incurred net losses of **$1.69 million** (Q2 2025) and **$3.97 million** (H1 2025), and expects continued losses as it pursues widespread insurance coverage for IB-Stim and FDA clearance for new indications[121](index=121&type=chunk) [Factors Affecting our Business and Results of Operations](index=31&type=section&id=Factors%20Affecting%20our%20Business%20and%20Results%20of%20Operations) This section discusses key drivers influencing revenue, gross margin, and operating expenses - Revenue is primarily from IB-Stim device sales to healthcare providers, with sales generally non-seasonal and mildly correlated with economic cycles, and the IB-Stim device sells for **$1,195**, with **3-4 devices** used per patient[122](index=122&type=chunk) - Gross margin is influenced by average selling prices, production volume, customer mix, third-party manufacturing costs, and cost-reduction strategies, with expected increases in gross profit driven by broader insurer acceptance and new product approvals[125](index=125&type=chunk) - Expenses include cost of goods sold (contract manufacturing, shipping, expired inventory), selling expenses (commissions), research and development (clinical trials for new indications), and general and administrative (wages, professional fees, facility costs)[126](index=126&type=chunk)[127](index=127&type=chunk)[128](index=128&type=chunk)[129](index=129&type=chunk) [Results of Operations](index=32&type=section&id=Results%20of%20Operations) This section provides a detailed comparative analysis of net sales, gross profit, and expenses for Q2 and H1 2025 and 2024 Net Sales Performance | Period | 2025 (USD) | 2024 (USD) | Change (USD) | % Change | | :-------------------------- | :------------ | :------------ | :------------ | :------- | | Three Months Ended June 30 | $894,086 | $611,500 | $282,586 | 46.2% | | Six Months Ended June 30 | $1,789,741 | $1,258,135 | $531,606 | 42.3% | - Net sales increases were driven by volume growth from fully insured customers, financial assistance programs, and sales from the RED product launch in 2025[131](index=131&type=chunk) Gross Profit and Gross Margin Performance | Period | Gross Profit 2025 (USD) | Gross Profit 2024 (USD) | % Change Gross Profit | Gross Margin 2025 (%) | Gross Margin 2024 (%) | Change in Margin (pp) | | :-------------------------- | :---------------- | :---------------- | :-------------------- | :---------------- | :---------------- | :--------------- | | Three Months Ended June 30 | $747,443 | $538,042 | 38.9% | 83.6% | 88.0% | -4.4 pp | | Six Months Ended June 30 | $1,503,623 | $1,109,596 | 35.5% | 84.0% | 88.2% | -4.2 pp | - Gross margin decreased due to higher discounting in financial assistance programs and expired RED inventory, despite increased sales volume[132](index=132&type=chunk)[133](index=133&type=chunk) Expense Performance (Three Months Ended June 30) | Expense Category | 2025 (USD) | 2024 (USD) | Change (USD) | % Change | | :-------------------------- | :------------ | :------------ | :------------ | :------- | | Selling Expenses | $142,253 | $62,274 | $79,979 | 128.4% | | Research and Development | $58,319 | $54,312 | $4,007 | 7.4% | | General and Administrative | $2,264,729 | $2,628,288 | $(363,559) | -13.8% | Expense Performance (Six Months Ended June 30) | Expense Category | 2025 (USD) | 2024 (USD) | Change (USD) | % Change | | :-------------------------- | :------------ | :------------ | :------------ | :------- | | Selling Expenses | $276,206 | $142,304 | $133,902 | 94.1% | | Research and Development | $108,012 | $59,882 | $48,130 | 80.4% | | General and Administrative | $5,132,360 | $4,946,362 | $185,998 | 3.8% | - Selling expenses increased due to higher sales volume and a temporary commission structure[134](index=134&type=chunk) - R&D expenses rose due to medical research and RED device development[135](index=135&type=chunk) - G&A expenses decreased in Q2 2025 due to the absence of one-time costs in 2024 but increased in H1 2025 due to a lawsuit settlement and internal control enhancements[136](index=136&type=chunk)[137](index=137&type=chunk) Operating Loss and Net Loss Performance | Period | Operating Loss 2025 (USD) | Operating Loss 2024 (USD) | % Change Operating Loss | Net Loss 2025 (USD) | Net Loss 2024 (USD) | % Change Net Loss | | :-------------------------- | :------------------ | :------------------ | :---------------------- | :------------ | :------------ | :---------------- | | Three Months Ended June 30 | $(1,717,858) | $(2,206,832) | -22.2% | $(1,690,418) | $(2,917,710) | -42.1% | | Six Months Ended June 30 | $(4,012,955) | $(4,038,952) | -0.6% | $(3,969,102) | $(5,038,361) | -21.2% | - Operating loss decreased in both periods due to higher sales volume and lower G&A (Q2 2025), partially offset by lower gross margin and higher selling/R&D costs (H1 2025)[138](index=138&type=chunk)[139](index=139&type=chunk) - Net loss decreased significantly due to higher sales and the absence of one-time 2024 settlements[142](index=142&type=chunk)[143](index=143&type=chunk) [Liquidity and Capital Resources](index=35&type=section&id=Liquidity%20and%20Capital%20Resources) This section assesses the company's ability to meet financial obligations, focusing on cash, working capital, and future capital needs Liquidity and Working Capital | Metric | June 30, 2025 (USD) | December 31, 2024 (USD) | | :-------------------------- | :-------------- | :---------------- | | Cash on hand | $5,988,456 | $3,696,870 | | Working capital surplus | $4,271,446 | $1,832,858 | - The increase in working capital was primarily due to proceeds from common stock issuance and warrant exercises in H1 2025[145](index=145&type=chunk) - Future capital requirements depend on technology development, manufacturing, marketing, patent enforcement, collaborative arrangements, and achieving widespread insurance coverage for IB-Stim[147](index=147&type=chunk) Cash Flow Activities (Six Months Ended June 30) | Activity | 2025 (USD) | 2024 (USD) | Change (USD) | % Change | | :-------------------------- | :------------ | :------------ | :------------ | :------- | | Net cash used in operating activities | $(3,071,145) | $(2,947,295) | $(123,850) | 4.2% | | Net cash used in investing activities | $(25,288) | $(23,408) | $(1,880) | 8.0% | | Net cash provided by financing activities | $5,388,019 | $4,657,417 | $730,602 | 15.7% | - Operating cash outflow increased due to higher inventory purchases and 2024 incentive program payments, partially offset by increased cash collections[149](index=149&type=chunk)[150](index=150&type=chunk) - Investing cash outflow increased due to capital expenditures for the RED device[149](index=149&type=chunk) - Financing cash inflow increased significantly from common stock issuance and warrant exercises[151](index=151&type=chunk) [ITEM 3: QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK](index=26&type=section&id=ITEM%203%3A%20QUANTITATIVE%20AND%20QUALITATIVE%20DISCLOSURE%20ABOUT%20MARKET%20RISK) This section states that no quantitative and qualitative disclosures about market risk are applicable to the Company - The Company has no applicable quantitative and qualitative disclosures about market risk[152](index=152&type=chunk) [ITEM 4: CONTROLS AND PROCEDURES](index=27&type=section&id=ITEM%204%3A%20CONTROLS%20AND%20PROCEDURES) This section details management's evaluation of internal control effectiveness, material weaknesses, and remediation efforts [Evaluation of Internal Control Over Financial Reporting](index=36&type=section&id=Evaluation%20Of%20Internal%20Control%20Over%20Financial%20Reporting) This section discusses management's assessment of internal controls, highlighting identified material weaknesses and remediation - Management identified material weaknesses in internal control over financial reporting as of June 30, 2025, including ineffective approval processes, inadequate contract management, misapplication of U.S. GAAP, and ineffective disclosure controls[155](index=155&type=chunk)[158](index=158&type=chunk) - Remediation efforts are underway, including hiring accounting personnel, implementing a documented internal control framework, documenting business policies, completing a formal monthly close process, and engaging a third-party firm for segregation of duties[155](index=155&type=chunk) - Remediation efforts are expected to continue through fiscal year 2025, with management committed to maintaining a strong internal control program[155](index=155&type=chunk)[156](index=156&type=chunk) [Changes in Internal Control Over Financial Reporting](index=36&type=section&id=Changes%20In%20Internal%20Control%20Over%20Financial%20Reporting) This section reports on any material changes in internal controls over financial reporting during the quarter - Other than the described remediation efforts, there were no material changes in internal controls over financial reporting during the quarter ended June 30, 2025[157](index=157&type=chunk) [PART II - OTHER INFORMATION](index=28&type=section&id=PART%20II) This section provides additional information including legal proceedings, risk factors, equity sales, and other disclosures [ITEM 1: LEGAL PROCEEDINGS](index=28&type=section&id=ITEM%201%3A%20LEGAL%20PROCEEDINGS) This section updates on legal proceedings, including a dismissed lawsuit, a settled lawsuit, and threatened patent litigation - A lawsuit initiated by Ritu Bhambhani, M.D., against the Company was dismissed by the Court in 2022, and the plaintiff's appeal was denied by the Fourth Circuit in June 2024[160](index=160&type=chunk)[161](index=161&type=chunk)[162](index=162&type=chunk) - A related 2022 lawsuit by business entities, alleging RICO Act violations and misrepresentation, was tentatively settled for **$750,000** on May 15, 2025, payable in 12 equal monthly installments starting January 2026[163](index=163&type=chunk)[164](index=164&type=chunk)[165](index=165&type=chunk) - Dr. Arturo Taca asserted a **$2,000,000** interest in the Company's U.S. Patent No. 10,413,719 in January 2024, which the Company denies and intends to vigorously defend[166](index=166&type=chunk) [ITEM 1A: RISK FACTORS](index=28&type=section&id=ITEM%201A%3A%20RISK%20FACTORS) This section refers to previously disclosed risk factors, noting no material changes since December 31, 2024 - There have been no material changes to the risk factors previously disclosed in the Form 10-K for the period ended December 31, 2024[167](index=167&type=chunk) [ITEM 2: UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS](index=29&type=section&id=ITEM%202%3A%20UNREGISTERED%20SALES%20OF%20EQUITY%20SECURITIES%20AND%20USE%20OF%20PROCEEDS) This section details unregistered equity sales during Q2 2025, including warrant exercises and Series B conversions - On June 30, 2025, **289,779 common shares** were issued upon warrant exercise for **$29**[168](index=168&type=chunk) - On June 9, 2025, **42,016 common shares** were issued upon conversion of Series B Preferred Stock[168](index=168&type=chunk) - On May 21, 2025, **430,580 common shares** were issued upon warrant exercise for **$1,002,963**[169](index=169&type=chunk) - On May 20, 2025, **342,016 common shares** were issued upon conversion of Series B Preferred Stock[169](index=169&type=chunk) - On May 15, 2025, **10,000 restricted stock units (RSUs)** were issued to an employee at a fair value of **$2.36 per RSU**, subject to three-year pro rata annual vesting[170](index=170&type=chunk) - These issuances were made in reliance upon exemptions provided by Section 4(a)(2) of the Securities Act, Regulation D, or Securities Act Rule 701[171](index=171&type=chunk) [ITEM 3: DEFAULTS UPON SENIOR SECURITIES](index=29&type=section&id=ITEM%203%3A%20DEFAULTS%20UPON%20SENIOR%20SECURITIES) This section states that there were no defaults upon senior securities during the reporting period - There were no defaults upon senior securities[172](index=172&type=chunk) [ITEM 5: OTHER INFORMATION](index=29&type=section&id=ITEM%205%3A%20OTHER%20INFORMATION) This section confirms no director or officer adopted or terminated Rule 10b5-1 trading arrangements in Q2 2025 - No director or officer adopted or terminated any Rule 10b5-1 or non-Rule 10b5-1 trading arrangements during the quarter ended June 30, 2025[174](index=174&type=chunk) [ITEM 6: EXHIBITS](index=30&type=section&id=ITEM%206%3A%20EXHIBITS) This section lists all exhibits filed with the Form 10-Q, including various agreements and certifications - Exhibits include the Settlement Agreement and Mutual Release (May 15, 2025), Form of Securities Purchase Agreement (May 22, 2025), Termination Agreement with Masimo Corporation (July 1, 2025), and the Neuraxis, Inc. 2025 Employee Stock Purchase Plan[175](index=175&type=chunk) - Certifications pursuant to Sections 302 and 906 of the Sarbanes-Oxley Act of 2002 from the Chief Executive Officer and Chief Financial Officer are filed/furnished[175](index=175&type=chunk) [SIGNATURES](index=31&type=section&id=SIGNATURES) This section contains the required signatures for the Form 10-Q by authorized officers - The report is signed by Brian Carrico, Chief Executive Officer, and Timothy Henrichs, Chief Financial Officer, on August 12, 2025[178](index=178&type=chunk)

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 fiscal quarter 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: 001-39724 LIQUIDIA CORPORATION (Exact Name of Registrant as Specified in Its Charter) | Delaware | 85-1710962 | | -- ...

[Second Quarter 2025 Financial Results Overview](index=1&type=section&id=Second%20Quarter%202025%20Financial%20Results%20Overview) The company reported a 10% increase in total revenue to $7.3 million, driven by service and product growth, with gross margin improving to 4% and a new $45 million term loan facility secured [CEO Commentary and Business Highlights](index=1&type=section&id=CEO%20Commentary) CEO Robert Spignesi highlighted 10% total revenue growth, driven by service and product segments, and announced a new $45 million term loan facility - **Total revenue increased 10%**, driven by an **18% increase in Service revenue**. Product revenue increased by **6%**, led by mid-teens growth in consumables[3](index=3&type=chunk) - Announced a new five-year, **$45 million term loan facility**, with **$20 million funded upfront** with highly favorable terms, significantly strengthening the financial position[3](index=3&type=chunk) - Strategic priorities remain unchanged: delivering significant **long-term revenue growth**, **gross margin expansion**, and **shareholder value**[3](index=3&type=chunk) [Q2 2025 Key Financial Highlights](index=1&type=section&id=Q2%202025%20Key%20Financial%20Highlights) Total revenue grew 10% to $7.3 million, recurring revenue increased 15%, gross margin improved to 4%, and full-year guidance was reaffirmed Q2 2025 Key Financial Highlights | Metric | Q2 2025 (Millions) | Q2 2024 (Millions) | Change (%) | | :----- | :------ | :------ | :--------- | | Total Revenue | $7.3 | $6.6 | +10% | | Recurring Revenue | $4.4 | $3.8 | +15% | | Gross Margin | 4% | -3% | +7 ppts | - Enters into five-year, **$45 million term loan facility** with **$20 million funded at close**[9](index=9&type=chunk) - Reaffirms full-year 2025 total revenue guidance of **at least $32.0 million**[9](index=9&type=chunk) [Detailed Second Quarter 2025 Financial Performance](index=1&type=section&id=Detailed%20Second%20Quarter%202025%20Financial%20Performance) Q2 2025 saw total revenue increase 10% to $7.3 million, gross margin improve to 4%, operating expenses decrease 6%, and net loss narrow to $11.9 million [Revenue Breakdown](index=1&type=section&id=Revenue%20Breakdown) Total revenue increased 10% to $7.3 million, driven by 18% service revenue growth and 6% product revenue growth, with recurring revenue up 15% Q2 2025 Revenue Breakdown | Revenue Type | Q2 2025 (Millions) | Q2 2024 (Millions) | YoY Change (%) | | :----------- | :----------------- | :----------------- | :------------- | | Total Revenue | $7.3 | $6.6 | +10% | | Product Revenue | $4.8 | $4.5 | +6% | | Service Revenue | $2.5 | $2.1 | +18% | | Recurring Revenue | $4.4 | $3.8 | +15% | - The company placed **four new Growth Direct® systems** and completed **two customer system validations**, a decrease from the prior year[4](index=4&type=chunk) [Cost of Revenue and Gross Margin](index=1&type=section&id=Cost%20of%20Revenue%20and%20Gross%20Margin) Total cost of revenue increased 3% to $7.0 million, while gross margin significantly improved by 7 percentage points to positive 4% Q2 2025 Cost of Revenue and Gross Margin | Metric | Q2 2025 (Millions) | Q2 2024 (Millions) | YoY Change (%) | | :----- | :----------------- | :----------------- | :------------- | | Total Cost of Revenue | $7.0 | $6.8 | +3% | | Gross Margin | 4% ($0.3) | -3% (-$0.2) | +7 ppts | [Operating Expenses](index=1&type=section&id=Operating%20Expenses) Total operating expenses decreased 6% to $12.4 million, driven by reductions in R&D and sales and marketing, despite a rise in G&A Q2 2025 Operating Expenses Changes | Expense Type | Q2 2025 (Millions) | Q2 2024 (Millions) | YoY Change (%) | | :----------- | :----------------- | :----------------- | :------------- | | Total Operating Expenses | $12.4 | $13.2 | -6% | | General and Administrative | $6.079 | $5.818 | +4% | | Research and Development | $3.230 | $3.744 | -14% | | Sales and Marketing | $3.114 | $3.627 | -14% | [Net Loss and Cash Position](index=1&type=section&id=Net%20Loss%20and%20Cash%20Position) Net loss improved to $11.9 million, with loss per share at $0.27, and cash position stood at approximately $32 million Q2 2025 Net Loss Performance | Metric | Q2 2025 (Millions) | Q2 2024 (Millions) | | :----- | :------ | :------ | | Net Loss | -$11.9 | -$12.6 | | Net Loss per Share | -$0.27 | -$0.29 | - Cash, cash equivalents, short-term investments, and restricted cash totaled approximately **$32 million** as of June 30, 2025[7](index=7&type=chunk) [2025 Financial Outlook](index=1&type=section&id=2025%20Financial%20Outlook) The company reaffirmed its full-year 2025 total revenue guidance of at least $32.0 million [Full-Year Guidance](index=1&type=section&id=Full-Year%20Guidance) Rapid Micro Biosystems reaffirmed its full-year 2025 total revenue guidance of at least $32.0 million - The company is reaffirming its full-year 2025 total revenue guidance of **at least $32.0 million**[8](index=8&type=chunk) [Strategic Financial Initiatives](index=3&type=section&id=Strategic%20Financial%20Initiatives) The company secured a new five-year, $45 million term loan facility, with $20 million funded upfront and additional tranches contingent on milestones [New Term Loan Facility](index=3&type=section&id=New%20Term%20Loan%20Facility) A new five-year, $45 million term loan facility was secured, with $20 million funded at close and additional tranches tied to milestones - Entered into a five-year, **$45 million term loan facility** with Trinity Capital Inc[10](index=10&type=chunk) - Received **$20 million at close** through the first tranche, with access to **two additional tranches totaling $20 million** contingent on commercial and operational milestones[10](index=10&type=chunk) - A fourth tranche of **$5 million** is available at the lender's discretion[10](index=10&type=chunk) [Company Profile](index=3&type=section&id=Company%20Profile) Rapid Micro Biosystems is an innovative life sciences technology company providing automated microbial quality control solutions for healthcare product manufacturing [About Rapid Micro Biosystems](index=3&type=section&id=About%20Rapid%20Micro%20Biosystems) Rapid Micro Biosystems is an innovative life sciences technology company offering automated microbial quality control solutions for healthcare product manufacturing - Innovative life sciences technology company providing mission-critical automation solutions for efficient manufacturing and safe release of healthcare products[13](index=13&type=chunk) - The flagship **Growth Direct system** automates and modernizes manual microbial quality control (MQC) testing workflows[13](index=13&type=chunk) - Headquartered in Lexington, Massachusetts, with U.S. manufacturing in Lowell, Massachusetts, and global locations in Switzerland, Germany, and the Netherlands[13](index=13&type=chunk) [Unaudited Condensed Consolidated Financial Statements](index=5&type=section&id=Unaudited%20Condensed%20Consolidated%20Financial%20Statements) The unaudited financial statements detail Q2 2025 operations, balance sheet, and cash position, showing improved net loss and changes in assets and liabilities [Unaudited Condensed Consolidated Statements of Operations](index=5&type=section&id=Unaudited%20Condensed%20Consolidated%20Statements%20of%20Operations) The statements show an improved net loss of $11.9 million for Q2 2025, with total revenue increasing to $7.3 million due to revenue growth Unaudited Condensed Consolidated Statements of Operations (in thousands) | Metric | Three Months Ended June 30, 2025 (Thousands) | Three Months Ended June 30, 2024 (Thousands) | Six Months Ended June 30, 2025 (Thousands) | Six Months Ended June 30, 2024 (Thousands) | | :-------------------- | :------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | | Product revenue | $4,802 | $4,537 | $8,903 | $8,250 | | Service revenue | $2,460 | $2,081 | $5,564 | $3,979 | | Total revenue | $7,262 | $6,618 | $14,467 | $12,229 | | Total costs and operating expenses | $19,410 | $19,996 | $38,276 | $39,880 | | Net loss | $(11,858) | $(12,578) | $(23,121) | $(25,900) | | Net loss per share | $(0.27) | $(0.29) | $(0.52) | $(0.60) | [Unaudited Condensed Consolidated Balance Sheets](index=6&type=section&id=Unaudited%20Condensed%20Consolidated%20Balance%20Sheets) Total assets decreased to $75.6 million, total liabilities to $21.0 million, and stockholders' equity to $54.5 million as of June 30, 2025 Unaudited Condensed Consolidated Balance Sheets (in thousands) | Metric | June 30, 2025 (Thousands) | December 31, 2024 (Thousands) | | :-------------------- | :------------ | :---------------- | | Total current assets | $60,146 | $80,917 | | Total assets | $75,586 | $98,169 | | Total current liabilities | $16,403 | $17,565 | | Total liabilities | $21,041 | $22,817 | | Total stockholders' equity | $54,545 | $75,352 | [Unaudited Cash, Cash Equivalents and Investments](index=6&type=section&id=Unaudited%20Cash%2C%20Cash%20Equivalents%20and%20Investments) Cash, cash equivalents, and investments decreased to $31.3 million as of June 30, 2025, primarily due to reduced short-term investments Unaudited Cash, Cash Equivalents and Investments (in thousands) | Metric | June 30, 2025 (Thousands) | December 31, 2024 (Thousands) | | :-------------------- | :------------ | :---------------- | | Cash and cash equivalents | $18,333 | $16,911 | | Short-term investments | $12,922 | $33,821 | | Cash, cash equivalents and investments | $31,255 | $50,732 | [Other Information](index=3&type=section&id=Other%20Information) This section provides details on the Q2 2025 webcast, investor relations disclosure, forward-looking statements, and company contacts [Webcast Details](index=3&type=section&id=Webcast%20Details) A conference call was held on August 12, 2025, to discuss Q2 2025 financial results, with webcast access and replay available - The company hosted a conference call on **August 12, 2025, at 8:30 a.m. ET** to discuss its second quarter 2025 financial results[12](index=12&type=chunk) - The live call is accessible on the company's investor relations website and will be archived for **one year**[12](index=12&type=chunk) [Investor Relations Disclosure](index=3&type=section&id=Investor%20Relations%20Disclosure) The company uses its Investor Relations page for disclosing material nonpublic information and fulfilling Regulation FD obligations - Rapid Micro Biosystems intends to use its Investor Relations page for disclosing material nonpublic information and complying with Regulation FD obligations[14](index=14&type=chunk) [Forward-Looking Statements](index=3&type=section&id=Forward-Looking%20Statements) This section outlines forward-looking statements regarding future performance, including revenue guidance and cash flow, and details associated risks and uncertainties - Includes forward-looking statements on **full-year 2025 total revenue guidance**, Growth Direct placements, **cash flow breakeven**, debt facility impact, cost reduction, and product innovation[15](index=15&type=chunk) - Forward-looking statements involve inherent risks and uncertainties, including achieving **positive cash flow**, meeting business objectives, managing **significant losses**, debt obligations, market competition, technological changes, supply chain disruptions, and macroeconomic factors[16](index=16&type=chunk)[17](index=17&type=chunk) [Contacts](index=4&type=section&id=Contacts) Contact information is provided for investor relations and media inquiries - Investor Contact: **Michael Beaulieu, CFA**, Vice President, Investor Relations and Corporate Communications, investors@rapidmicrobio.com[18](index=18&type=chunk) - Media Contact: media@rapidmicrobio.com[18](index=18&type=chunk)

[Corporate Overview and Highlights](index=1&type=section&id=Corporate%20Overview%20and%20Highlights) The company achieved significant milestones in Q2 2025, including FDA approval and successful commercial launch of YUTREPIA, securing financing, and positive clinical data, positioning for growth [CEO Statement & Key Achievements](index=1&type=section&id=CEO%20Statement%20%26%20Key%20Achievements) The CEO highlighted Q2 as a defining period, marked by successful FDA approval and rapid commercial launch of YUTREPIA™ for PAH and PH-ILD, with initial market uptake exceeding expectations and positive interim data from the ASCENT study reinforcing its profile - YUTREPIA™ achieved over **900** unique patient prescriptions and **550** patient starts within the first 11 weeks of its commercial launch[3](index=3&type=chunk)[6](index=6&type=chunk) - The initial launch success was achieved with broad demand from both cardiologists and pulmonologists, even ahead of securing full payor coverage, indicating strong underlying clinical demand[4](index=4&type=chunk) - Interim data from the ASCENT study in PH-ILD patients showed a median improvement in six-minute walk distance (6MWD) of **31.5 meters** at Week 16, with a favorable tolerability profile and no discontinuations due to drug-related adverse events like cough[5](index=5&type=chunk)[6](index=6&type=chunk) - The company is well-capitalized to scale YUTREPIA access and expand clinical programs following recent funding under its financing agreement with Healthcare Royalty (HCRx)[6](index=6&type=chunk) [Second Quarter and Recent Corporate Highlights](index=2&type=section&id=Second%20Quarter%20and%20Recent%20Corporate%20Highlights) This section details key corporate events in Q2 2025, including the FDA approval of YUTREPIA, its commercial launch, securing $50 million in financing, leasing a new 70,000 sq ft manufacturing facility, and positive interim data from the ASCENT trial - On May 23, 2025, the FDA approved YUTREPIA™ for treating PAH and PH-ILD, with the commercial launch and first shipments initiated in the first week of June 2025[10](index=10&type=chunk) - The company secured **$50.0 million** on June 23, 2025, under its financing agreement with HCRx following the first commercial sale of YUTREPIA[10](index=10&type=chunk) - To support future growth, Liquidia signed a lease on June 16, 2025, for an additional **70,000 square feet** of manufacturing space, targeted for occupancy in 2026[10](index=10&type=chunk) - The ASCENT open-label study was fully enrolled with **54** PH-ILD patients, and interim data showed good tolerability, with only **2 of 26** patients reporting a moderate cough and no change in mean cough scores through Week 16[10](index=10&type=chunk) [Q2 2025 Financial Performance](index=2&type=section&id=Q2%202025%20Financial%20Performance) Liquidia's Q2 2025 financial performance reflects initial YUTREPIA sales, increased net loss due to commercialization expenses, and a strong cash position [Financial Results Summary](index=2&type=section&id=Financial%20Results%20Summary) For Q2 2025, Liquidia reported total revenue of $8.8 million, primarily from YUTREPIA product sales, with a net loss increasing to $41.6 million due to a 95% rise in SG&A expenses for commercialization and a 36% decrease in R&D spending Q2 2025 vs Q2 2024 Financial Performance (in millions, except per share data) | Metric | Q2 2025 | Q2 2024 | Change | | :--- | :--- | :--- | :--- | | **Product Revenue, net** | $6.5 | $0.0 | +$6.5 | | **Service Revenue, net** | $2.3 | $3.7 | -$1.4 | | **Total Revenue** | $8.8 | $3.7 | +$5.1 | | **R&D Expenses** | $6.0 | $9.4 | -36% | | **SG&A Expenses** | $38.8 | $19.9 | +95% | | **Net Loss** | ($41.6) | ($28.7) | +$12.9 | | **Net Loss Per Share** | ($0.49) | ($0.38) | +$0.11 | - Cash and cash equivalents stood at **$173.4 million** as of June 30, 2025, a slight decrease from **$176.5 million** at the end of 2024[8](index=8&type=chunk) - The **95%** increase in SG&A expenses was primarily driven by higher headcount for commercialization activities (**$8.8 million**), increased legal fees for ongoing litigation (**$5.8 million**), and commercial/consulting expenses (**$2.3 million**)[13](index=13&type=chunk) - The **36%** decrease in R&D expenses was mainly due to a shift in personnel from R&D to commercial activities and lower expenses for YUTREPIA development, partially offset by increased clinical expenses for the L606 program[12](index=12&type=chunk) [Condensed Financial Statements](index=7&type=section&id=Condensed%20Financial%20Statements) The unaudited condensed financial statements provide a detailed view of Liquidia's financial position and operational results, with the balance sheet showing total assets of $257.4 million and total liabilities of $242.2 million as of June 30, 2025, and a net loss of $41.6 million for the quarter Condensed Consolidated Balance Sheet Data (unaudited, in thousands) | | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $173,422 | $176,479 | | Total assets | $257,410 | $230,313 | | Total liabilities | $242,221 | $150,935 | | Total stockholders' equity | $15,189 | $79,378 | Condensed Consolidated Statements of Operations (unaudited, in thousands) | | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :--- | :--- | :--- | | Total revenue | $8,837 | $3,659 | | Total costs and expenses | $46,342 | $30,856 | | Loss from operations | ($37,505) | ($27,197) | | Total other expense, net | ($4,074) | ($1,471) | | Net loss and comprehensive loss | ($41,579) | ($28,668) | [Product Portfolio and Pipeline](index=3&type=section&id=Product%20Portfolio%20and%20Pipeline) Liquidia's portfolio includes the recently approved YUTREPIA, the investigational L606, and a generic treprostinil injection, leveraging proprietary technology for pulmonary hypertension treatments [YUTREPIA™ (treprostinil) Inhalation Powder](index=3&type=section&id=YUTREPIA%E2%84%A2%20(treprostinil)%20Inhalation%20Powder) YUTREPIA is an FDA-approved inhaled dry-powder formulation of treprostinil for treating PAH and PH-ILD, developed using Liquidia's proprietary PRINT® technology for enhanced lung deposition via a convenient, low-effort device - Indicated for the treatment of PAH and PH-ILD to improve exercise ability[16](index=16&type=chunk) - Utilizes PRINT® technology to create precise and uniform drug particles for enhanced delivery to the lung[16](index=16&type=chunk) [L606 (liposomal treprostinil) Inhalation Suspension](index=4&type=section&id=L606%20(liposomal%20treprostinil)%20Inhalation%20Suspension) L606 is an investigational, sustained-release liposomal formulation of treprostinil administered twice daily with a next-generation nebulizer, currently being evaluated in an open-label study for PAH and PH-ILD, with a global pivotal study planned for PH-ILD treatment - L606 is an investigational, sustained-release formulation of treprostinil administered twice-daily[17](index=17&type=chunk) - A global pivotal placebo-controlled efficacy study is planned for the treatment of PH-ILD[17](index=17&type=chunk) [Treprostinil Injection](index=4&type=section&id=Treprostinil%20Injection) This is a first-to-file, fully substitutable generic treprostinil for parenteral administration, equivalent to Remodulin, marketed in the United States through a commercial partnership with Sandoz - A fully substitutable generic treprostinil for parenteral administration[18](index=18&type=chunk) - Marketed in the U.S. in partnership with commercial partner Sandoz[18](index=18&type=chunk) [Other Information](index=5&type=section&id=Other%20Information) This section addresses forward-looking statements, highlighting litigation risks and the revision of prior financial statements due to immaterial accounting errors [Forward-Looking Statements](index=5&type=section&id=Forward-Looking%20Statements) This section contains standard cautionary language advising investors that the press release includes forward-looking statements involving significant risks and uncertainties, including ongoing patent litigation with United Therapeutics, which could materially affect actual results - The press release contains forward-looking statements with significant risks and uncertainties, and actual results could differ materially[23](index=23&type=chunk) - A key risk highlighted is the ongoing litigation with United Therapeutics, which is seeking an injunction that could block the continued sale of YUTREPIA[23](index=23&type=chunk) [Financial Statement Revision](index=6&type=section&id=Financial%20Statement%20Revision) The company disclosed that during Q1 2025, it identified and corrected immaterial errors in its accounting treatment of amendments to the HCR Agreement, leading to the voluntary revision of previously issued 2024 annual and interim financial statements - Immaterial errors were identified in the accounting treatment for the fourth and fifth amendments to the HCR Agreement[24](index=24&type=chunk) - Previously issued 2024 financial statements have been revised to correct the errors, with the financial data presented in this press release reflecting these revisions[24](index=24&type=chunk)

[Financial Performance Summary](index=1&type=section&id=Financial%20Performance%20Summary) Sotherly Hotels reported a Q2 2025 decline in key financial metrics, including revenues and a shift to net loss, reflecting decelerating hotel demand Q2 2025 vs Q2 2024 Financial Highlights ($ in thousands, except per share data) | Metric | Q2 2025 | Q2 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Total Revenues ($) | $48,794 | $50,694 | -3.7 | | Net Income ($) | $1,556 | $4,664 | -66.6 | | Net (Loss) Income to Common Stockholders ($) | $(416) | $2,622 | -115.9 | | Diluted EPS ($) | $(0.02) | $0.13 | -115.4 | | Hotel EBITDA ($) | $13,892 | $15,698 | -11.5 | | Adjusted FFO ($) | $4,758 | $7,503 | -36.6 | Six Months Ended June 30, 2025 vs 2024 Financial Highlights ($ in thousands) | Metric | H1 2025 | H1 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Total Revenues ($) | $97,106 | $97,243 | -0.1 | | Net Income ($) | $6,290 | $5,987 | +5.1 | | Net Income to Common Stockholders ($) | $2,274 | $1,962 | +15.9 | | Hotel EBITDA ($) | $26,813 | $28,058 | -4.4 | | Adjusted FFO ($) | $9,275 | $12,683 | -26.9 | - The CEO, Dave Folsom, attributed the Q2 **deceleration in hotel demand** to broader macroeconomic uncertainty, including the interest rate climate and tariffs, while noting resilient group booking pace[5](index=5&type=chunk) [Key Operating Metrics](index=3&type=section&id=Key%20Operating%20Metrics) The composite portfolio's Q2 2025 RevPAR decreased by **5.4%** to **$130.20**, driven by declines in occupancy and ADR Composite Portfolio Key Metrics - Q2 2025 vs Q2 2024 | Metric | Q2 2025 | Q2 2024 | Change (%) | | :--- | :--- | :--- | :--- | | RevPAR ($) | $130.20 | $137.67 | -5.4 | | Occupancy (%) | 70.8 | 73.4 | -3.5 | | ADR ($) | $183.88 | $187.51 | -1.9 | Composite Portfolio Key Metrics - Six Months Ended June 30 | Metric | H1 2025 | H1 2024 | Change (%) | | :--- | :--- | :--- | :--- | | RevPAR ($) | $129.97 | $130.64 | -0.5 | | Occupancy (%) | 69.8 | 69.2 | +0.9 | | ADR ($) | $186.14 | $188.91 | -1.5 | [Balance Sheet, Liquidity, and Strategic Updates](index=3&type=section&id=Balance%20Sheet%2C%20Liquidity%2C%20and%20Strategic%20Updates) Sotherly reported **$26.5 million** cash and **$315.8 million** debt as of June 30, 2025, with a **$17.75 million** parking garage sale planned to reduce debt - As of June 30, 2025, the Company had approximately **$26.5 million** of available cash and cash equivalents, of which about **$16.0 million** was restricted[7](index=7&type=chunk) - Total outstanding debt principal was approximately **$315.8 million** with a weighted average interest rate of **5.89%**[7](index=7&type=chunk) - The company has entered an agreement to sell the parking garage associated with the Georgian Terrace hotel in Atlanta for **$17.75 million**, expected to close in **Q4 2025**, with proceeds used to pay down the existing mortgage[6](index=6&type=chunk)[8](index=8&type=chunk) [Revised 2025 Outlook](index=3&type=section&id=2025%20Outlook) The company revised its full-year 2025 guidance downwards, anticipating lower revenues, a wider net loss, and reduced Hotel EBITDA and Adjusted FFO Revised Full-Year 2025 Guidance (Low Range) | Metric | Previous Guidance | Revised Guidance | Change (%) | | :--- | :--- | :--- | :--- | | Total Revenues ($k) | $183,388 | $185,157 | +1.0 | | Net Loss ($k) | $(676) | $(1,230) | -81.9 | | Hotel EBITDA ($k) | $48,829 | $45,340 | -7.1 | | Adj. FFO per Share ($) | $0.57 | $0.34 | -40.4 | | RevPAR ($) | $119.77 | $115.98 | -3.2 | Revised Full-Year 2025 Guidance (High Range) | Metric | Previous Guidance | Revised Guidance | Change (%) | | :--- | :--- | :--- | :--- | | Total Revenues ($k) | $188,168 | $188,168 | 0.0 | | Net Income/Loss ($k) | $129 | $(624) | -583.7 | | Hotel EBITDA ($k) | $49,619 | $45,821 | -7.7 | | Adj. FFO per Share ($) | $0.61 | $0.37 | -39.3 | | RevPAR ($) | $122.89 | $117.15 | -4.7 | [Financial Tables](index=8&type=section&id=Financial%20Tables) This section presents detailed unaudited financial statements, including balance sheets, statements of operations, property operating metrics, and non-GAAP reconciliations [Consolidated Balance Sheets](index=8&type=section&id=Consolidated%20Balance%20Sheets) As of June 30, 2025, total assets were **$411.1 million**, liabilities **$366.8 million**, and equity **$44.3 million**, reflecting minor shifts from year-end 2024 Balance Sheet Summary ($ in thousands) | Account | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Total Assets ($) | $411,118 | $414,376 | | Total Liabilities ($) | $366,835 | $372,777 | | Total Equity ($) | $44,282 | $41,599 | [Consolidated Statements of Operations](index=9&type=section&id=Consolidated%20Statements%20of%20Operations) For Q2 2025, total revenues were **$48.8 million**, net operating income **$6.6 million**, and the company reported a **$0.4 million** net loss Q2 Statement of Operations Summary ($ in thousands) | Account | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Total Revenue ($) | $48,794 | $50,694 | | Total Hotel Operating Expenses ($) | $34,902 | $34,997 | | Net Operating Income ($) | $6,575 | $9,300 | | Net Income ($) | $1,556 | $4,664 | | Net (Loss) Income to Common Stockholders ($) | $(416) | $2,622 | [Supplemental Data](index=11&type=section&id=Supplemental%20Data) This section details individual hotel property operating metrics (Occupancy, ADR, RevPAR) for Q2 and YTD periods across 2023-2025, showing varied performance - The tables provide **detailed Occupancy, ADR, and RevPAR data** for each individual hotel property in the portfolio for Q2 and YTD across 2025, 2024, and 2023[26](index=26&type=chunk) Q2 2025 RevPAR Performance for Select Properties | Property | Q2 2025 RevPAR ($) | Q2 2024 RevPAR ($) | YoY Change (%) | | :--- | :--- | :--- | :--- | | The DeSoto, Savannah | $171.69 | $190.14 | -9.7 | | Hotel Ballast, Wilmington | $168.61 | $166.44 | +1.3 | | Hyatt Centric, Arlington | $191.89 | $198.42 | -3.3 | | Georgian Terrace, Atlanta | $92.99 | $109.51 | -15.1 | [Reconciliation of Non-GAAP Measures](index=14&type=section&id=Reconciliation%20of%20Non-GAAP%20Measures) This section provides detailed reconciliations of GAAP Net Income to non-GAAP measures like FFO, Adjusted FFO, EBITDA, and Hotel EBITDA Q2 2025 Reconciliation Summary ($ in thousands) | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Net Income ($) | $1,556 | $4,664 | | FFO Attributable to Common Stockholders ($) | $4,317 | $7,356 | | Adjusted FFO Attributable to Common Stockholders ($) | $4,758 | $7,503 | | EBITDA ($) | $12,022 | $14,292 | | Hotel EBITDA ($) | $13,892 | $15,698 | - The company provides definitions for FFO, Adjusted FFO, EBITDA, and Hotel EBITDA, explaining them as **key supplemental measures of performance** used by industry analysts and investors[35](index=35&type=chunk)[36](index=36&type=chunk)[38](index=38&type=chunk)

Circle Q2 2025 Earnings Release [Performance Highlights](index=1&type=section&id=Performance%20Highlights) Circle's Q2 2025 saw strong USDC circulation and revenue growth, offset by an IPO-related net loss, alongside key strategic launches Q2 2025 Key Financial Metrics | Metric | Q2 2025 Value | Year-over-Year Change | | :--- | :--- | :--- | | USDC in Circulation | $61.3 billion | +90% | | Total Revenue and Reserve Income | $658 million | +53% | | Net Loss | $(482) million | - | | Adjusted EBITDA | $126 million | +52% | - The reported net loss of **$482 million** was significantly impacted by **$591 million** in non-cash charges related to the company's IPO. These charges consisted of **$424 million** for stock-based compensation and a **$167 million** increase in the fair value of convertible debt[5](index=5&type=chunk) - CEO Jeremy Allaire emphasized the successful IPO as a pivotal moment for both Circle and the broader adoption of stablecoins, noting accelerating interest from partners in the financial and internet sectors[4](index=4&type=chunk) - Key corporate developments include a successful **$1.2 billion IPO**, the launch of the Circle Payments Network, and the introduction of Arc, an open Layer-1 blockchain for stablecoin finance[5](index=5&type=chunk)[6](index=6&type=chunk) [Financial Results and Operating Indicators](index=2&type=section&id=Financial%20Results%20and%20Operating%20Indicators) Q2 2025 revenue grew **53%** to **$658 million**, with USDC circulation up **90%**, but a **$482 million** net loss was driven by IPO expenses [Key Financial Results and Operating Indicators Table](index=2&type=section&id=Key%20Financial%20Results%20and%20Operating%20Indicators%20Table) Q2 2025 Financial Results vs. Q2 2024 | Key Financial Results | Q2 2025 | YoY Change | | :--- | :--- | :--- | | Total Revenue and Reserve Income | $658M | 53% | | Revenue Less Distribution Costs (RLDC) | $251M | 38% | | RLDC Margin | 38% | (408bps) | | Net Income (Loss) | $(482)M | NM | | Adjusted EBITDA | $126M | 52% | | Adjusted EBITDA Margin | 50% | 463bps | Q2 2025 Key Operating Indicators vs. Q2 2024 | Key Operating Indicators | Q2 2025 | YoY Change | | :--- | :--- | :--- | | USDC in Circulation (end of period) | $61.3B | 90% | | Average USDC in Circulation | $61.0B | 86% | | Reserve Return Rate | 4.1% | (103bps) | | Stablecoin Market Share (end of period) | 28% | 595bps | | Meaningful Wallets (end of period) | 5.7M | 68% | [Detailed Financial Performance](index=3&type=section&id=Detailed%20Financial%20Performance) Reserve Income grew **50%** to **$634 million** from **86%** higher USDC circulation, with operating expenses including **$424 million** in IPO stock-based compensation - Reserve Income increased **50%** YoY to **$634 million**, primarily due to an **86%** growth in average USDC circulation, which was partially offset by a **103 bps** decline in the reserve return rate[10](index=10&type=chunk) - Other Revenue grew significantly by **252%** YoY to **$24 million**, driven by strong growth in Subscription and Services Revenue and Transaction Revenue[10](index=10&type=chunk) - Total Distribution, Transaction and Other Costs rose **64%** YoY to **$407 million**, mainly due to increased distribution payments tied to higher USDC circulation and new strategic partnerships[10](index=10&type=chunk) - Operating Expenses were **$577 million**, which includes a substantial **$424 million** in stock-based compensation expenses related to the vesting of RSUs upon the IPO[10](index=10&type=chunk) [Corporate & Commercial Highlights](index=2&type=section&id=Corporate%20%26%20Commercial%20Highlights) Circle completed a **$1.2 billion IPO**, launched CPN and Arc blockchain, expanded partnerships, and strengthened its regulated stablecoin position via the GENIUS Act [Initial Public Offering (IPO)](index=2&type=section&id=Initial%20Public%20Offering%20(IPO)) Circle completed a **$1.2 billion IPO** in June, selling **19.9 million shares** at **$31** for **$583 million** net proceeds - In June, Circle completed a **$1.2 billion** initial public offering. The company sold **19.9 million** new shares at **$31** per share, resulting in net proceeds of **$583 million** after underwriting discounts and before offering costs[6](index=6&type=chunk) [Strategic Initiatives and Partnerships](index=3&type=section&id=Strategic%20Initiatives%20and%20Partnerships) Circle launched the Circle Payments Network and Arc blockchain, showing strong momentum with **100+ institutions** and expanded strategic industry partnerships - The Circle Payments Network (CPN), launched in May, shows strong early momentum with **100+ financial institutions** in the pipeline and plans for expansion in H2 2025[10](index=10&type=chunk) - Circle introduced Arc, an open Layer-1 blockchain designed for stablecoin payments, FX, and capital markets, featuring USDC as the native gas token. A public testnet is expected in the fall[14](index=14&type=chunk) - The company announced new or expanded strategic partnerships with key industry players including Binance, Corpay, FIS, Fiserv, and OKX to broaden USDC adoption and integration[10](index=10&type=chunk)[14](index=14&type=chunk) [Regulatory Developments](index=3&type=section&id=Regulatory%20Developments) The GENIUS Act established a federal regulatory framework for payment stablecoins, strengthening Circle's position as a leading regulated issuer - The GENIUS Act was signed into law, establishing a federal regulatory framework for payment stablecoins. This development is seen as strengthening Circle's position as a leading regulated issuer, as the act codifies many of Circle's long-standing compliance practices[10](index=10&type=chunk) [Forward Outlook](index=4&type=section&id=Forward%20Outlook) Circle projects a multi-year **40% CAGR** for USDC circulation, with FY 2025 guidance for Other Revenue at **$75-$85 million** and Adjusted Operating Expenses at **$475-$490 million** Company Guidance | Key Indicator | Period | Outlook | | :--- | :--- | :--- | | USDC in Circulation | Multi-year through cycle | 40% CAGR | | Other Revenue | FY 2025 | $75-$85M | | RLDC Margin | FY 2025 | 36-38% | | Adjusted Operating Expenses | FY 2025 | $475-490M | [Financial Statements](index=8&type=section&id=Financial%20Statements) Total assets reached **$64.2 billion** by June 30, 2025, driven by stablecoin holdings, with Q2 2025 reporting a **$482.1 million net loss** due to **$503.4 million** in IPO compensation expense [Condensed Consolidated Balance Sheets](index=8&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets grew to **$64.15 billion** by June 30, 2025, driven by cash for stablecoin holders, with total liabilities at **$61.78 billion** Balance Sheet Summary (in thousands) | Account | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Total Assets** | **$64,153,508** | **$45,834,409** | | Cash and cash equivalents segregated for stablecoin holders | $61,365,920 | $43,918,572 | | **Total Liabilities** | **$61,782,677** | **$44,124,115** | | Deposits from stablecoin holders | $61,101,523 | $43,727,363 | | **Total Stockholders' Equity** | **$2,370,831** | **$570,529** | [Condensed Consolidated Statements of Operations](index=10&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Q2 2025 total revenue was **$658.1 million**, but a **$482.1 million net loss** resulted from **$503.4 million** in compensation expenses, contrasting with Q2 2024's net income Statement of Operations Summary - Three Months Ended June 30 (in thousands) | Account | 2025 | 2024 | | :--- | :--- | :--- | | Total revenue and reserve income | $658,078 | $430,030 | | Total distribution, transaction and other costs | $406,942 | $248,377 | | Total operating expenses | $576,718 | $131,407 | | *Compensation expenses* | *$503,392* | *$67,604* | | Operating income (loss) | $(325,582) | $50,246 | | **Net income (loss)** | **$(482,100)** | **$32,923** | | Earnings (loss) per share, basic and diluted | $(4.48) | $0.00 | [Quarterly Results of Operations](index=11&type=section&id=Quarterly%20Results%20of%20Operations) Quarterly revenue and reserve income trended upward, reaching **$658 million** in Q2 2025, with RLDC at **$251 million** and a **38% RLDC Margin** Quarterly Revenue and Margin Trend (in millions) | Metric | Q2 2025 | Q1 2025 | Q4 2024 | Q3 2024 | Q2 2024 | | :--- | :--- | :--- | :--- | :--- | :--- | | Total Revenue and Reserve Income | $658 | $579 | $435 | $446 | $430 | | RLDC | $251 | $231 | $131 | $188 | $182 | | RLDC Margin | 38% | 40% | 30% | 42% | 42% | [Non-GAAP Financial Measures and Reconciliations](index=12&type=section&id=Non-GAAP%20Financial%20Measures%20and%20Reconciliations) Circle uses non-GAAP measures; Q2 2025 Adjusted EBITDA was **$125.8 million**, reconciled from a **$482.1 million net loss** by excluding **$435.0 million** in stock-based compensation [Reconciliation of Adjusted EBITDA to Net Income](index=13&type=section&id=Reconciliation%20of%20Adjusted%20EBITDA%20to%20Net%20Income) Q2 2025 Adjusted EBITDA was **$125.8 million**, reconciled from a **$482.1 million net loss** by adding back **$435.0 million** in stock-based compensation and **$167.7 million** in fair value changes Q2 2025 Adjusted EBITDA Reconciliation (in thousands) | Line Item | Amount | | :--- | :--- | | Net income (loss) from continuing operations | $(482,100) | | Stock-based compensation expense | $434,966 | | Change in fair value of convertible debt, etc. | $167,724 | | Other adjustments (Depreciation, taxes, etc.) | $5,243 | | **Adjusted EBITDA** | **$125,833** | [Reconciliation of Adjusted Operating Expenses to Operating Expenses](index=14&type=section&id=Reconciliation%20of%20Adjusted%20Operating%20Expenses%20to%20Operating%20Expenses) Q2 2025 Adjusted Operating Expenses were **$128.2 million**, derived from **$576.7 million** in GAAP operating expenses by excluding **$435.0 million** in stock-based compensation and other non-cash items Q2 2025 Adjusted Operating Expenses Reconciliation (in thousands) | Line Item | Amount | | :--- | :--- | | Operating expenses | $576,718 | | Less: Stock-based compensation expense | $(434,966) | | Less: Depreciation and amortization expense | $(14,209) | | Less: Digital asset (gains) losses | $693 | | **Adjusted Operating Expenses** | **$128,236** | FY 2025 Forward Outlook Reconciliation for Adjusted Operating Expenses (in millions) | Line Item | Low | High | | :--- | :--- | :--- | | Operating expenses | $1,150 | $1,190 | | Less: Stock-based compensation expense | $(556) | $(571) | | Less: Depreciation and amortization | $(70) | $(80) | | Less: Other adjustments | $(49) | $(49) | | **Adjusted Operating Expenses** | **$475** | **$490** |

[PART 1 - FINANCIAL INFORMATION](index=6&type=section&id=PART%201%20-%20FINANCIAL%20INFORMATION) [Item 1. Condensed Consolidated Interim Financial Statements (unaudited)](index=6&type=section&id=Item%201.%20Condensed%20Consolidated%20Interim%20Financial%20Statements%20(unaudited)) This section presents DarioHealth Corp.'s unaudited condensed interim financial statements, including balance sheets, income, equity, and cash flow statements, highlighting continued net losses and going concern doubts [Condensed Consolidated Interim Balance Sheets](index=7&type=section&id=Condensed%20Consolidated%20Interim%20Balance%20Sheets) Balance Sheet Items (in thousands) | Balance Sheet Items (in thousands) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $21,954 | $27,764 | | Total current assets | $32,170 | $40,529 | | Total assets | $108,325 | $118,884 | | **Liabilities & Equity** | | | | Total current liabilities | $9,754 | $16,635 | | Total liabilities | $44,339 | $46,865 | | Total stockholders' equity | $63,986 | $72,019 | - Total assets decreased from **$118.9 million** at the end of 2024 to **$108.3 million** as of June 30, 2025, primarily driven by a reduction in cash and cash equivalents and trade receivables[16](index=16&type=chunk) [Condensed Consolidated Interim Statements of Comprehensive Loss](index=9&type=section&id=Condensed%20Consolidated%20Interim%20Statements%20of%20Comprehensive%20Loss) Income Statement (in thousands) | Income Statement (in thousands) | Q2 2025 | Q2 2024 | Six Months 2025 | Six Months 2024 | | :--- | :--- | :--- | :--- | :--- | | Total revenues | $5,369 | $6,255 | $12,121 | $12,013 | | Gross profit | $2,964 | $2,756 | $6,846 | $5,188 | | Total operating expenses | $12,164 | $18,947 | $25,455 | $39,234 | | Operating loss | $(9,200) | $(16,191) | $(18,609) | $(34,046) | | Net loss | $(12,990) | $(13,610) | $(22,217) | $(20,785) | | Basic and diluted loss per share | $(0.18) | $(0.08) | $(0.33) | $(0.27) | - Revenues for Q2 2025 decreased by **14.2%** year-over-year, while operating expenses were significantly reduced by **35.8%**, leading to a smaller operating loss compared to Q2 2024[22](index=22&type=chunk) [Condensed Consolidated Interim Statements of Changes in Stockholders' Equity](index=10&type=section&id=Condensed%20Consolidated%20Interim%20Statements%20of%20Changes%20in%20Stockholders'%20Equity) - Total stockholders' equity decreased from **$72.0 million** at the end of 2024 to **$64.0 million** as of June 30, 2025. The decrease was primarily driven by the net loss of **$22.2 million** for the six-month period, partially offset by capital raised from stock-based compensation and issuance of preferred stock[24](index=24&type=chunk) [Condensed Consolidated Interim Statements of Cash Flows](index=13&type=section&id=Condensed%20Consolidated%20Interim%20Statements%20of%20Cash%20Flows) Cash Flow Summary (in thousands) | Cash Flow Summary (in thousands) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(12,704) | $(24,473) | | Net cash used in investing activities | $(75) | $(8,881) | | Net cash provided by financing activities | $6,939 | $20,206 | - Cash used in operating activities for the first six months of 2025 was nearly halved compared to the same period in 2024, reflecting improved operational efficiency. Cash from financing activities decreased significantly, primarily due to lower proceeds from preferred stock issuance in 2025 compared to 2024[30](index=30&type=chunk) [Notes to Condensed Consolidated Interim Financial Statements](index=14&type=section&id=Notes%20to%20Condensed%20Consolidated%20Interim%20Financial%20Statements) - The company has incurred recurring losses and negative cash flows since inception, with an accumulated deficit of **$423.0 million** as of June 30, 2025. These conditions raise substantial doubt about its ability to continue as a going concern[35](index=35&type=chunk)[36](index=36&type=chunk) - On April 30, 2025, the company refinanced its debt with a new credit agreement from Callodine Commercial Finance for up to **$50 million**, initially borrowing **$32.5 million**. This new facility matures in April 2030[76](index=76&type=chunk)[172](index=172&type=chunk) - As of June 30, 2025, the company did not meet one of the financial covenants under the new Callodine credit agreement and has notified the lender of its intention to utilize an equity cure to address the event of default[84](index=84&type=chunk)[85](index=85&type=chunk) - Revenue from the Commercial B2B2C channel, a key strategic area, decreased to **$3.5 million** in Q2 2025 from **$5.5 million** in Q2 2024[55](index=55&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=51&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the company's whole-person digital health platform, analyzing Q2 and H1 2025 financial performance, noting decreased Q2 revenue, improved gross margin, reduced operating expenses, recent debt refinancing, and ongoing liquidity challenges [Business Overview](index=51&type=section&id=Business%20Overview) - DarioHealth operates as a global digital health company with a mission to deliver a comprehensive, whole-person health platform that integrates physical health (chronic conditions like diabetes, hypertension) and mental health needs[159](index=159&type=chunk)[161](index=161&type=chunk)[162](index=162&type=chunk) - The company's business model targets four primary market segments: Direct-to-Consumer (D2C), medium-to-large employers, health plans, and pharmaceutical companies, with B2B channels now accounting for **three-fourths** of revenues[166](index=166&type=chunk) [Recent Developments](index=53&type=section&id=Recent%20Developments) - The company added **21** new clients in the first half of 2025, progressing towards its annual goal of **40** new clients[171](index=171&type=chunk) - On May 1, 2025, DarioHealth closed a new debt financing facility for up to **$50 million** with Callodine, drawing an initial **$32.5 million** to refinance existing debt and provide operational flexibility[172](index=172&type=chunk) - In June 2025, the company announced a strategic commercial agreement with GreenKey Health to expand its solutions into the sleep apnea market[180](index=180&type=chunk) [Results of Operations](index=57&type=section&id=Results%20of%20Operations) Metric (in thousands) | Metric (in thousands) | Q2 2025 | Q2 2024 | Change | | :--- | :--- | :--- | :--- | | Revenues | $5,369 | $6,255 | -14.2% | | Gross Profit | $2,964 | $2,756 | +7.5% | | Gross Margin | 55.2% | 44.1% | +11.1 ppt | | Operating Expenses | $12,164 | $18,947 | -35.8% | | Net Loss | $(12,990) | $(13,610) | -4.6% | - The decrease in Q2 2025 revenue was primarily due to a decline in revenues from the pharma channel[182](index=182&type=chunk) - Operating expenses across R&D, Sales & Marketing, and G&A all saw significant year-over-year decreases, attributed mainly to efficiency and post-merger integration activities resulting in lower payroll and consulting expenses[187](index=187&type=chunk)[189](index=189&type=chunk)[191](index=191&type=chunk) [Non-GAAP Financial Measures](index=61&type=section&id=Non-GAAP%20Financial%20Measures) Non-GAAP Adjusted Loss (in thousands) | Non-GAAP Adjusted Loss (in thousands) | Q2 2025 | Q2 2024 | Six Months 2025 | Six Months 2024 | | :--- | :--- | :--- | :--- | :--- | | Net loss - as reported | $(12,990) | $(13,610) | $(22,217) | $(20,785) | | Non-GAAP adjusted loss | $(6,363) | $(10,671) | $(12,174) | $(19,749) | - The Non-GAAP adjusted loss, which excludes items like stock-based compensation and revaluation of warrants, showed significant improvement, decreasing by **39%** for the second quarter and **38%** for the first six months of 2025 compared to the prior year periods[203](index=203&type=chunk) [Liquidity and Capital Resources](index=65&type=section&id=Liquidity%20and%20Capital%20Resources) - As of June 30, 2025, the company had **$22.0 million** in cash and cash equivalents, down from **$27.8 million** at the end of 2024[204](index=204&type=chunk) - Management has concluded that the current cash on hand is insufficient to fund projected operating requirements for the next twelve months, which raises substantial doubt about the company's ability to continue as a going concern[235](index=235&type=chunk) - The company has a significant present need for capital and may be unable to continue activities without material alterations to its business plan if additional funding is not secured[235](index=235&type=chunk) [Cash Flows](index=73&type=section&id=Cash%20Flows) Cash Flow (in thousands) | Cash Flow (in thousands) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Cash used in operating activities | $(12,704) | $(24,473) | | Cash used in investing activities | $(75) | $(8,881) | | Cash provided by financing activities | $6,939 | $20,206 | - Net cash used in operating activities decreased by **48.1%** in the first half of 2025 compared to the same period in 2024, mainly due to a decrease in operating expenses from efficiency and post-merger integration activities[238](index=238&type=chunk) [Item 4. Controls and Procedures](index=73&type=section&id=Item%204.%20Control%20and%20Procedures) Management, including the CEO and CFO, concluded that the company's disclosure controls and procedures were effective as of June 30, 2025, with no material changes to internal control over financial reporting identified during the quarter - The company's CEO and CFO concluded that as of June 30, 2025, disclosure controls and procedures were effective at a reasonable assurance level[242](index=242&type=chunk) - No changes in internal control over financial reporting occurred during the quarter ended June 30, 2025, that have materially affected, or are reasonably likely to materially affect, the company's internal control over financial reporting[243](index=243&type=chunk) [PART II - OTHER INFORMATION](index=76&type=section&id=PART%20II%20-%20OTHER%20INFORMATION) [Item 1A. Risk Factors](index=76&type=section&id=Item%201A.Risk%20Factors) This section highlights key risks, including revenue concentration, geopolitical risks from Israel operations, substantial doubt about going concern due to insufficient cash, potential debt covenant breaches, and extreme stock price volatility with Nasdaq delisting risk - A major customer accounted for **16.4%** of accounts receivable and **9.3%** of revenue in Q2 2025, posing a significant concentration risk[249](index=249&type=chunk) - The company's current cash on hand is not sufficient to fund projected operating requirements for the next year, raising substantial doubt about its ability to continue as a going concern[255](index=255&type=chunk) - As of June 30, 2025, the company was not in compliance with a financial covenant under its Credit Agreement and is pursuing an equity cure, the success of which is not guaranteed[259](index=259&type=chunk) - The company is not in compliance with Nasdaq's minimum bid price requirement of **$1.00** per share and has until September 15, 2025, to regain compliance or face delisting[264](index=264&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=82&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) During Q2 2025, the company issued **525,000** common shares to service providers as compensation, claiming exemption from registration under Section 4(a)(2) of the Securities Act - In Q2 2025, the company issued **525,000** shares of common stock to certain service providers as compensation in lieu of cash, claiming exemption from registration under Section 4(a)(2) of the Securities Act[268](index=268&type=chunk) [Item 5. Other Information](index=82&type=section&id=Item%205.%20Other%20Information.) On August 8, 2025, following stockholder approval, the company increased its authorized common stock from **160 million** to **400 million** shares by filing a Certificate of Amendment - On August 8, 2025, the company increased its authorized common stock from **160 million** to **400 million** shares after receiving stockholder approval[269](index=269&type=chunk)[270](index=270&type=chunk) [Item 6. Exhibits](index=83&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with the Form 10-Q, including amendments to the Certificate of Incorporation, preferred stock designations, officer certifications, and XBRL data files - The report includes several filed exhibits, such as the Certificate of Amendment to increase authorized shares, various amended certificates for preferred stock, and required officer certifications under Sarbanes-Oxley[274](index=274&type=chunk)

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 ☐ 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: 001-34632 CRYOPORT, INC. (Exact Name of Registrant as Specified in its Charter) Nevada 88-0313393 (Sta ...