Co-Diagnostics, Inc. 10-Q

Item 1. Financial Statements CO – DIAGNOSTICS, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) June 30, 2026 December 31, 2025 Assets Current assets Cash and cash equivalents $ 3,649,632 $ 11,884,607 Accounts receivable, net 52,059 190,375 Inventory, net 841,669 992,397 Income taxes receivable 425 44,559 Prepaid expenses and other current assets 648,673 581,527 Total current assets 5,192,458 13,693,465 Property and equipment, net 1,975,111 2,272,098 Operating lease right-of-use asset 1,769,011 1,207,453 Intangible assets, net 7,219,000 7,219,000 Investment in joint ventures 435,051 350,569 Total assets $ 16,590,631 $ 24,742,585 Liabilities and stockholders’ equity Current liabilities Accounts payable $ 1,078,380 $ 1,878,225 Accrued expenses 899,183 865,301 Operating lease liability, current 784,261 662,258 Contingent consideration liabilities, current 72,927 119,036 Deferred revenue 28,644 14,800 Total current liabilities 2,863,395 3,539,620 Long-term liabilities Operating lease liability 1,014,887 574,301 Total long-term liabilities 1,014,887 574,301 Total liabilities 3,878,282 4,113,921 Commitments and contingencies (Note 11) - Stockholders’ equity Convertible preferred stock, $ 0.001 par value; 5,000,000 shares authorized; 0 shares issued and outstanding as of June 30, 2026 and December 31, 2025, respectively - - Common stock, $ 0.001 par value; 100,000,000 shares authorized; 5,040,580 shares issued and 4,878,957 shares outstanding as of June 30, 2026 and 2,256,654 shares issued and 2,095,031 shares outstanding as of December 31, 2025 70,484 67,700 Treasury stock, at cost; 161,623 shares held as of June 30, 2026 and December 31, 2025, respectively ( 15,575,795 ) ( 15,575,795 ) Additional paid-in capital 124,015,023 116,510,298 Accumulated deficit ( 95,797,363 ) ( 80,373,539 ) Total stockholders’ equity 12,712,349 20,628,664 Total liabilities and stockholders’ equity $ 16,590,631 $ 24,742,585 See accompanying notes to unaudited condensed consolidated financial statements 3 CO – DIAGNOSTICS, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (Unaudited) 2026 2025 2026 2025 Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 Product revenue $ 166,131 $ 162,910 $ 312,084 $ 213,187 Total revenue 166,131 162,910 312,084 213,187 Cost of revenue 45,303 32,106 239,071 53,696 Gross profit 120,828 130,804 73,013 159,491 Operating expenses Sales and marketing 466,681 609,713 934,637 1,266,743 General and administrative 1,500,803 2,599,982 4,003,929 5,373,131 Research and development 4,152,287 4,687,459 10,086,358 9,557,478 Depreciation and amortization 201,840 291,414 457,285 571,859 Total operating expenses 6,321,611 8,188,568 15,482,209 16,769,211 Loss from operations ( 6,200,783 ) ( 8,057,764 ) ( 15,409,196 ) ( 16,609,720 ) Other income (expense), net Interest income, net 17,493 12,158 24,469 25,759 Realized gain on investments - 340,358 - 641,823 Loss on disposition of assets - ( 9,004 ) - ( 9,004 ) Gain (loss) on remeasurement of acquisition contingencies ( 29,171 ) 10,222 46,109 727,289 Loss on equity method investment in joint ventures ( 52,157 ) ( 13,760 ) ( 65,518 ) ( 15,204 ) Total other income (expense), net ( 63,835 ) 339,974 5,060 1,370,663 Loss before income taxes ( 6,264,618 ) ( 7,717,790 ) ( 15,404,136 ) ( 15,239,057 ) Income tax provision 19,168 12,327 19,688 24,331 Net loss $ ( 6,283,786 ) $ ( 7,730,117 ) $ ( 15,423,824 ) $ ( 15,263,388 ) Other comprehensive loss Change in net unrealized gains on marketable securities, net of tax - ( 196,585 ) - ( 284,375 ) Total other comprehensive loss $ - $ ( 196,585 ) $ - $ ( 284,375 ) Comprehensive loss $ ( 6,283,786 ) $ ( 7,926,702 ) $ ( 15,423,824 ) $ ( 15,547,763 ) Loss per common share: Basic and Diluted $ ( 1.46 ) $ ( 7.00 ) $ ( 4.69 ) $ ( 14.05 ) Weighted average shares outstanding: Basic and Diluted 4,309,997 1,103,614 3,287,417 1,086,054 Diluted 4,309,997 1,103,614 3,287,417 1,086,054 See accompanying notes to unaudited condensed consolidated financial statements 4 CO – DIAGNOSTICS, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) 2026 2025 Six Months Ended June 30, 2026 2025 Cash flows from operating activities Net loss $ ( 15,423,824 ) $ ( 15,263,388 ) Adjustments to reconcile net loss to cash used in operating activities: Depreciation and amortization 457,285 571,859 Stock-based compensation expense 432,866 1,455,493 Common stock issued for financial advisory services - 135,000 Change in fair value of acquisition contingencies ( 46,109 ) ( 727,289 ) Non-cash lease expense 1,031 ( 2,003 ) Realized gain on investments - ( 641,823 ) Loss from equity method investment 65,518 15,204 Loss on disposition of assets - 9,004 Provision for credit losses 557 ( 13,248 ) Inventory obsolescence recoveries ( 59,215 ) ( 95,302 ) Changes in assets and liabilities: Accounts receivable 137,759 ( 65,150 ) Prepaid expenses and other assets ( 23,012 ) 690,010 Inventory 209,943 83,399 Deferred revenue 13,844 5,000 Income taxes payable - 23,290 Accounts payable, accrued expenses and other liabilities ( 765,963 ) ( 3,213,100 ) Net cash used in operating activities ( 14,999,320 ) ( 17,033,044 ) Cash flows from investing activities Purchases of property and equipment ( 160,298 ) ( 492,973 ) Proceeds from maturities of marketable investment securities - 31,509,485 Purchases of marketable securities - ( 6,588,577 ) Investment in joint ventures ( 150,000 ) - Net cash (used in) provided by investing activities ( 310,298 ) 24,427,935 Cash flows from financing activities Issuance of common stock related to private placement transaction and warrant exercises, net of offering costs 2,739,973 - Issuance of common stock related to at-the-market offering, net of offering costs 4,334,670 783,746 Net cash provided by financing activities 7,074,643 783,746 Net increase (decrease) in cash and cash equivalents ( 8,234,975 ) 8,178,637 Cash and cash equivalents at beginning of period 11,884,607 2,936,544 Cash and cash equivalents at end of period $ 3,649,632 $ 11,115,181 Supplemental disclosure of cash flow information Cash received for income taxes $ 26,592 $ - Supplemental disclosure of non-cash investing and financing transactions Right-of-use assets obtained in exchange for new operating lease liabilities $ 1,029,215 $ - See accompanying notes to unaudited condensed consolidated financial statements 5 CO – DIAGNOSTICS, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (Unaudited) Shares Amount Shares Amount Stock Capital Income (Deficit) Equity Convertible Preferred Stock Common Stock Treasury Additional Paid-in Accumulated Other Comprehensive Accumulated Earnings Total Stockholders’ Shares Amount Shares Amount Stock Capital Income (Deficit) Equity Balance as of December 31, 2025 - - 2,256,654 67,700 ( 15,575,795 ) 116,510,298 - ( 80,373,539 ) 20,628,664 Issuance of common stock related to at-the-market offering, net of offering costs - - 1,507,434 1,507 - 4,333,163 - - 4,334,670 Stock-based compensation - - - - - 219,114 - - 219,114 Net loss - - - - - - - ( 9,140,038 ) ( 9,140,038 ) Balance as of March 31, 2026 - - 3,764,088 69,207 ( 15,575,795 ) 121,062,575 - ( 89,513,577 ) 16,042,410 Stock-based compensation - - 29,045 29 - 213,723 - - 213,752 Issuance of common stock related to private placement transaction and warrant exercises, net of offering costs - - 1,247,447 1,248 - 2,738,725 - - 2,739,973 Net loss - - - - - - - ( 6,283,786 ) ( 6,283,786 ) Balance as of June 30, 2026 - $ - 5,040,580 $ 70,484 $ ( 15,575,795 ) $ 124,015,023 $ - $ ( 95,797,363 ) $ 12,712,349 Convertible Preferred Stock Common Stock Treasury Additional Paid-in Accumulated Other Comprehensive Accumulated Earnings Total Stockholders’ Shares Amount Shares Amount Stock Capital Income (Deficit) Equity Balance as of December 31, 2024 - $ - 1,263,408 $ 37,902 $ ( 15,575,795 ) $ 102,472,210 $ 418,443 $ ( 33,477,603 ) $ 53,875,157 Issuance of common stock related to at-the-market offering, net of offering costs - - 17,303 519 - 354,227 - - 354,746 Stock-based compensation - - - - - 875,228 - - 875,228 Other comprehensive loss, net of tax - - - - - - ( 87,790 ) - ( 87,790 ) Net loss - - - - - - - ( 7,533,271 ) ( 7,533,271 ) Balance as of March 31, 2025 - - 1,280,711 38,421 ( 15,575,795 ) 103,701,665 330,653 ( 41,010,874 ) 47,484,070 Balance - - 1,280,711 38,421 ( 15,575,795 ) 103,701,665 330,653 ( 41,010,874 ) 47,484,070 Issuance of common stock related to at-the-market offering, net of offering costs - - 45,845 1,375 - 427,625 - - 429,000 Stock-based compensation - - 24,482 735 - 579,530 - - 580,265 Issuance of common stock related to financial advisory services - - 16,667 500 - 134,500 - - 135,000 Other comprehensive loss, net of tax - - - - - - ( 196,585 ) - ( 196,585 ) Net loss - - - - - - - ( 7,730,117 ) ( 7,730,117 ) Balance as of June 30, 2025 - - 1,367,705 41,031 ( 15,575,795 ) 104,843,320 134,068 ( 48,740,991 ) 40,701,633 Balance - - 1,367,705 41,031 ( 15,575,795 ) 104,843,320 134,068 ( 48,740,991 ) 40,701,633 See accompanying notes to unaudited condensed consolidated financial statements 6 CO – DIAGNOSTICS, INC. AND SUBSIDIARIES NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) Note 1 – Overview and Basis of Presentation Description of Business Co-Diagnostics, Inc., a Utah corporation (the “Company” or “CODX”), is a molecular diagnostics company that develops, manufactures and markets state-of-the-art diagnostics technologies. The Company’s technologies are utilized for tests that are designed using the detection and/or analysis of nucleic acid molecules (DNA or RNA). The Company also uses its proprietary technology to design specific tests for its Co-Dx™ PCR platform and to locate genetic markers for use in applications other than infectious disease. In connection with the sale of our tests we may sell diagnostic equipment from other manufacturers as self-contained lab systems. Unaudited Condensed Consolidated Financial Statements The accompanying unaudited condensed consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial information as they are prescribed for smaller reporting companies. As permitted under those rules and regulations, certain notes or other financial information normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted. Accordingly, the accompanying unaudited condensed consolidated financial statements do not include all the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary to make the financial statements not misleading have been included. Operating results for the three and six months ended June 30, 2026 are not necessarily indicative of the results that may be expected for the year ending December 31, 2026. These statements should be read in conjunction with the Company’s audited financial statements and related notes for the year ended December 31, 2025, included in the Company’s Annual Report on Form 10-K filed with the SEC on March 31, 2026. A summary of the Company’s significant accounting policies is set forth in Note 2 to the consolidated financial statements in its Annual Report on Form 10-K for the year ended December 31, 2025. Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements and the accompanying notes. Such estimates include receivables and other long-lived assets, legal contingencies, income taxes, share based arrangements, and others. These estimates and assumptions are based on management’s best estimates and judgments. Actual amounts and results could differ from those estimates. Liquidity and Going Concern In accordance with Accounting Standards Codification (“ASC”) 205-40, Going Concern, (“ASC 205-40”) the Company evaluated whether there are conditions and events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date on which this Quarterly Report on Form 10-Q is filed. Based on the Company’s cash and cash equivalents as of June 30, 2026, the Company’s current and forecasted level of operations, and its forecasted cash flows, the Company’s ability to continue as a going concern is dependent upon its ability to obtain the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due, and to generate profitable operations in the future. Management plans to provide for the Company’s capital requirements through equity and/or debt financing, seeking additional grant funding, and through operational efficiencies. Our ability to obtain additional financing in equity capital markets is subject to several factors, including market and economic conditions, our performance and investor sentiment with respect to us and our industry. Accordingly, there can be no assurance that the Company will be able to raise a sufficient amount of additional capital to fund operations with terms acceptable to the Company, or at all. Because certain elements of management’s plans to mitigate the conditions that raised substantial doubt about the Company’s ability to continue as a going concern are outside of the Company’s control, including the ability to raise capital through equity or other financings, those elements cannot be considered probable according to ASC 205-40, and therefore cannot be considered in the evaluation of mitigating factors. As a result, management has concluded that substantial doubt exists about the Company’s ability to continue as a going concern for 12 months from the date these condensed consolidated financial statements are issued. 7 The condensed consolidated financial statements as of June 30, 2026 have been prepared under the assumption that the Company will continue as a going concern for the next 12 months after these financial statements are issued, and that contemplates the realization of assets and satisfaction of liabilities and commitments in the normal course of business. The Company’s ability to continue as a going concern is dependent upon its uncertain ability to obtain additional capital, reduce expenditures, and execute on its business plans. These consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. Note 2 – Summary of Significant Accounting Policies Reclassifications Certain prior year amounts have been reclassified to conform with the current year’s presentation. These reclassifications have no impact on the previously reported results. Operating Segments The Company operates as one operating segment. Operating segments are defined as components of an entity for which separate financial information is regularly evaluated by the chief operating decision maker (“CODM”), which is the Company’s Chief Executive Officer, in deciding how to allocate resources and assess performance. The Company’s CODM evaluates financial information and resources and assesses the performance of these resources on a consolidated basis. There is no expense or asset information that is supplemental to information disclosed within the condensed consolidated financial statements, that is regularly provided to the CODM. The allocation of resources and assessment of performance of the operating segment is based on consolidated net loss and functional expenses as reported on our condensed consolidated statements of operations and comprehensive loss. Because the Company operates as one operating segment, financial segment information, including expense and asset information, can be found in the condensed consolidated financial statements. All material long-lived assets are located in the United States and India. Accounts Receivable Trade accounts receivable are recorded at the invoiced amount (net of allowance) and do not bear interest. The Company maintains an allowance for credit losses for amounts the Company does not expect to collect. In establishing the required allowance, management considers historical losses, current market conditions, customers’ financial condition, the age of receivables, and current payment patterns. Account balances are written off against the allowance once the receivable is deemed uncollectible. Recoveries of trade receivables previously written off are recorded when collected. At June 30, 2026 total accounts receivable was $ 92,993 with an allowance for credit losses of $ 40,934 resulting in a net amount of $ 52,059 . At December 31, 2025 total accounts receivable was $ 230,752 with an allowance for credit losses of $ 40,377 resulting in a net amount of $ 190,375 . At December 31, 2024 total accounts receivable was $ 242,625 with an allowance for credit losses of $ 110,055 resulting in a net amount of $ 132,570 . Inventory Inventory is stated at the lower of cost or net-realizable value. Inventory cost is determined on a first-in first-out basis that approximates average cost in accordance with ASC 330-10-30-12. At June 30, 2026, the Company had $ 841,669 in net inventory, of which $ 362,879 was finished goods and $ 478,790 was raw materials. At December 31, 2025, the Company had $ 992,397 in net inventory, of which $ 512,186 was finished goods and $ 480,211 was raw materials. The Company establishes reserves to reduce low-moving, obsolete, or unusable inventories to their estimated useful or scrap values. The Company recognized $ 31,331 and $ 186,319 related to the change in inventory reserves during the three and six months ended June 30, 2026, respectively, compared to $ 59,591 and $ 101,065 during the three and six months ended June 30, 2025, respectively. 8 Revenue Recognition The Company generates revenue from customers from product and license sales. The Company recognizes revenue from customers when all of the following criteria are satisfied: (i) identification of the promised goods or services in the contract; (ii) determination of whether the promised goods or services are performance obligations, including whether they are distinct in the context of the contract; (iii) measurement of the transaction price, including the constraint on variable consideration; (iv) allocation of the transaction price to the performance obligations; and (v) recognition of revenue when, or as the Company satisfies each performance obligation. The Company constrains revenue by giving consideration to factors that could otherwise lead to a probable reversal of revenue. The Company records any payments received from customers prior to the Company fulfilling its performance obligation(s) as deferred revenue. Income Taxes The Company accounts for income taxes in accordance with the liability method of accounting for income taxes. Under this method, deferred income tax assets and deferred income tax liabilities represent the tax effect of temporary differences between financial reporting and tax reporting measured at enacted tax rates in effect for the year in which the differences are expected to reverse. The Company recognizes only the impact of tax positions that, based on their technical merits, are more likely than not to be sustained upon an audit by the taxing authority. Valuation allowances are provided when it is more-likely-than-not that some or all of the deferred income tax assets may not be realized. In assessing the need for a valuation allowance, the Company has considered its historical levels of income, expectations of future taxable income and ongoing tax planning strategies. Developing the provision for income taxes, including the effective tax rate and analysis of potential tax exposure items, if any, requires significant judgment and expertise in federal and state income tax laws, regulations and strategies, including the determination of deferred income tax assets and liabilities and any estimated valuation allowances deemed necessary to value deferred income tax assets. Judgments and tax strategies are subject to audit by various taxing authorities. The Company has uncertain income tax positions in the condensed consolidated financial statements, and adverse determinations by these taxing authorities could have a material adverse effect on the condensed consolidated financial position, results of operations, or cash flows. Concentrations Risk and Significant Customers The Company had certain customers which were each responsible for generating 10% or more of the total revenue for the three and six months ended June 30, 2026 and 2025. One customer accounted for approximately 37 % of product revenue recognized during the three months ended June 30, 2026. Two customers accounted for approximately 41 % of product revenue recognized during the six months ended June 30, 2026. Three customers accounted for approximately 53 % of product revenue recognized during the three months ended June 30, 2025. Three customers accounted for approximately 41 % of product revenue recognized during the six months ended June 30, 2025. 9 Two customers accounted for more than 10% of accounts receivable at June 30, 2026, and two customers accounted for more than 10% of accounts receivable at December 31, 2025. These customers together accounted for approximately 24 % and 82 % of accounts receivable at June 30, 2026 and December 31, 2025, respectively. Recently Issued Accounting Standards From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (“FASB”) that are adopted by the Company as of the specified effective date. If not discussed, management believes that the impact of recently issued standards, which are not yet effective, will not have a material impact on the Company’s financial statements upon adoption. In November 2024, the FASB issued ASU 2024-03, Income Statement (Subtopic 220-40): Reporting Comprehensive Income - Expense Disaggregation Disclosures, which requires an entity to disclose on an annual and interim basis, disaggregated information about specific income statement expense categories. The guidance should be applied prospectively with the option to apply the standard retrospectively. The standard becomes effective for the Company for full year 2027 reporting. The Company is currently evaluating the impact of this new standard on its consolidated financial statements. In July 2025, the FASB issued ASU 2025-05, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets, which provides all entities with a practical expedient when estimating expected credit losses for current accounts receivable and current contract assets arising from transactions accounted for under Topic 606. Early adoption is permitted and entities should apply the practical expedient, if elected, prospectively to financial statements issued for reporting periods after the effective date. The standard became effective for the Company for interim and full year 2026 reporting. The adoption of this standard did not have a material impact on the Company’s consolidated financial statements. In December 2025, the FASB issued ASU 2025-10, Government Grants (Topic 832): Accounting for Government Grants Received by Business Entities, which provides authoritative guidance for the accounting and presentation of government grants received by business entities, distinguishing between grants related to assets and grants related to income. Early adoption is permitted and entities may apply the standard using a modified prospective, modified retrospective, or full retrospective transition approach, subject to the specific criteria outlined in the ASU. The standard becomes effective for the Company for full year 2029 reporting. The Company is currently evaluating the impact of this new standard on its consolidated financial statements. In December 2025, the FASB issued ASU 2025-11, Interim Reporting (Topic 270): Narrow-Scope Improvements, which clarifies and improves the guidance in Accounting Standards Codification Topic 270, Interim Reporting. Early adoption is permitted and entities may apply the standard prospectively or retrospectively. The standard becomes effective for the Company for interim 2028 reporting. The Company is currently evaluating the impact of this new standard on its consolidated financial statements. In December 2025, FASB issued ASU 2025-12, Codification Improvements, which includes narrow-scope amendments to the FASB Accounting Standards Codification to clarify, correct errors, and make minor improvements to existing U.S. GAAP. This standard becomes effective for the Company for interim and full year 2027 reporting. As the amendments are not expected to introduce new recognition or measurement principles, the Company does not expect a material impact on its consolidated financial statements related to ASU 2025-12. Note 3 – Cash, Cash Equivalents, and Financial Instruments The following table shows the Company’s cash, cash equivalents, and marketable investment securities by significant investment category: Schedule of Cash, Cash Equivalents and Marketable Investment Securities June 30, 2026 Adjusted Cost Total Unrealized Gains / (Losses) Fair Value Cash and Cash Equivalents Marketable Investment Securities Cash $ 3,649,632 $ - $ 3,649,632 $ 3,649,632 $ - Total $ 3,649,632 $ - $ 3,649,632 $ 3,649,632 $ - December 31, 2025 Adjusted Cost Total Unrealized Gains / (Losses) Fair Value Cash and Cash Equivalents Marketable Investment Securities Cash $ 11,884,607 $ - $ 11,884,607 $ 11,884,607 $ - Total $ 11,884,607 $ - $ 11,884,607 $ 11,884,607 $ - 10 Note 4 – Fair Value Measurements The Company measures and records certain financial assets and liabilities at fair value on a recurring basis. Fair value is based on the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The following three levels of inputs are used to measure the fair value of financial assets and liabilities: Level 1: Quoted market prices in active markets for identical assets or liabilities. Level 2: Observable market-based inputs or unobservable inputs that are corroborated by market data. Level 3: Unobservable inputs that are not corroborated by market data. The following table summarizes the assets and liabilities measured at fair value on a recurring basis as of June 30, 2026 and December 31, 2025, by level within the fair value hierarchy: Schedule of Fair Value Assets and Liabilities (Level 1) (Level 2) (Level 3) Total June 30, 2026 (Level 1) (Level 2) (Level 3) Total Liabilities: Contingent consideration - common stock $ - $ - $ 72,927 $ 72,927 Total liabilities measured at fair value $ - $ - $ 72,927 $ 72,927 December 31, 2025 (Level 1) (Level 2) (Level 3) Total Liabilities: Contingent consideration - common stock $ - $ - $ 119,036 $ 119,036 Total liabilities measured at fair value $ - $ - $ 119,036 $ 119,036 11 In connection with previous acquisitions, the Company recorded a liability for contingent consideration in the form of shares of common stock and warrants to purchase common stock, both to be issued when certain milestones are achieved. The fair value of contingent consideration is calculated using a discounted probability weighted valuation model. Discount rates used in such calculations are a significant assumption that are not observed in the market, and therefore, the resulting fair value represents a Level 3 measurement. The changes for Level 3 items measured at fair value on a recurring basis are as follows: Schedule of Changes in the Fair Value Measurement Fair value as of December 31, 2025 $ 119,036 Change in fair value of contingent consideration issued for business acquisitions ( 46,109 ) Fair value as of June 30, 2026 $ 72,927 The fair value of the contingent consideration is based on the fair value of the contingent consideration-common stock and contingent consideration-warrants. The fair value of the contingent consideration-common stock is equal to the probability-adjusted value of the Company’s common stock as of the valuation date. The fair value of the contingent consideration-warrants is equal to the probability adjusted value of a call option with terms consistent with the terms of the warrants as of the valuation date. Prior to the probability adjustments, the warrants were valued based on the following inputs: Schedule of Contingent Consideration Common Stock and Warrants June 30, 2026 December 31, 2025 Stock price $ 3.10 $ 5.10 Strike price $ 273.75 $ 273.75 Volatility 25.0 % 21.4 % Risk-free rate 4.0 % 3.5 % Expected term (years) 0.5 1.0 Fair Value of Other Financial Instruments The carrying amounts of certain financial instruments, including cash held in banks, accounts receivable, notes receivable, accounts payable, accrued liabilities, and other liabilities approximate fair value due to their short-term maturities and are excluded from the fair value tables above. Note 5 – Intangible Assets, Net Intangible assets, net consisted of the following: Schedule of Intangible Assets, Net June 30, 2026 Weighted-Average Gross Net Useful Life Carrying Accumulated Carrying (in Years) Amount Amortization Amount In-process research and development Indefinite $ 7,219,000 $ - $ 7,219,000 Total intangible assets $ 7,219,000 $ - $ 7,219,000 December 31, 2025 Weighted-Average Gross Net Useful Life Carrying Accumulated Carrying (in Years) Amount Amortization Amount In-process research and development Indefinite $ 7,219,000 $ - $ 7,219,000 Total intangible assets $ 7,219,000 $ - $ 7,219,000 12 Note 6 – Revenue The following table sets forth revenue by geographic area: Summary of Revenue by Geographic Area 2026 2025 2026 2025 Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 United States Product revenue $ 105,386 $ 162,910 $ 186,439 $ 203,087 Total United States 105,386 162,910 186,439 203,087 Rest of World Product revenue 60,745 - 125,645 10,100 Total Rest of World 60,745 - 125,645 10,100 Total $ 166,131 $ 162,910 $ 312,084 $ 213,187 Percentage of revenue by area: United States 63 % 100 % 60 % 95 % Rest of World 37 % 0 % 40 % 5 % Changes in the Company’s deferred revenue balance for the six months ended June 30, 2026 were as follows: Schedule of Deferred Revenue Balance as of December 31, 2025 $ 14,800 Revenue recognized included in deferred revenue balance at the beginning of the period ( 14,800 ) Increase due to prepayments from customers 28,644 Balance as of June 30, 2026 $ 28,644 Note 7 – Loss Per Share All share and per-share data, including basic and diluted loss per share and weighted average shares outstanding, have been retroactively adjusted to reflect the 1-for-30 reverse stock split effected on January 1, 2026, as if the reverse stock split had occurred at the beginning of the earliest period presented. The following table reconciles the numerator and the denominator used to calculate basic and diluted loss per share for three and six months ended June 30, 2026 and 2025, respectively: Schedule of Basis and Diluted Earnings Per Share 2026 2025 2026 2025 Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 Numerator Net loss, as reported $ ( 6,283,786 ) $ ( 7,730,117 ) $ ( 15,423,824 ) $ ( 15,263,388 ) Denominator Weighted average shares, basic 4,309,997 1,103,614 3,287,417 1,086,054 Dilutive effect of stock options, warrants and RSUs - - - - Shares used to compute diluted earnings per share 4,309,997 1,103,614 3,287,417 1,086,054 Loss per share, basic and diluted $ ( 1.46 ) $ ( 7.00 ) $ ( 4.69 ) $ ( 14.05 ) 13 Common shares issuable upon exercise of the pre-funded warrants issued in the May 2026 Private Placement are included in the calculation of basic weighted average number of common shares outstanding as the underlying common shares are issuable for little to no consideration and there are no vesting conditions or contingencies associated with the warrants. Accordingly, the aggregate number of common shares underlying the pre-funded warrants have been considered outstanding for purposes of the calculation of basic net loss per share from the date of issuance. As a result of incurring a net loss for the three and six months ended June 30, 2026 and 2025, respectively, no potentially dilutive securities are included in the calculation of diluted loss per share because such effect would be anti-dilutive. The Company had potentially dilutive securities as of June 30, 2026, consisting of: (i) 81,565 restricted stock units, (ii) 27,688 options, and (iii) 3,710,394 warrants. The Company had potentially dilutive securities as of June 30, 2025, consisting of: (i) 63,418 restricted stock units, (ii) 32,353 options, and (iii) 15,500 warrants. Note 8 – Equity Transactions Reverse Stock Split On January 1, 2026, the Company effected a 1-for-30 reverse stock split of its common stock. The Reverse Stock Split did not change the par value of the Company’s common stock, which remains $ 0.001 per share, nor did it change the number of authorized shares of common stock. Proportionate adjustments were made to the number of shares of common stock underlying the Company’s outstanding equity awards and warrants, as well as to the applicable exercise prices. All historical and per-share information has been retroactively adjusted to reflect the Reverse Stock Split. At-the-Market Agreement The Company previously maintained an Amended and Restated Equity Distribution Agreement (the “Prior ATM Agreement”) with Piper Sandler & Co. (“Piper Sandler”) and Clear Street, LLC (“Clear Street”), pursuant to which the Company could offer and sell shares of its common stock having an aggregate offering price of up to $ 17,111,650 from time to time through Piper Sandler and Clear Street, acting as sales agents, under a prospectus supplement dated October 18, 2024. As of December 31, 2025, the Company had sold 151,675 shares of common stock under the Prior ATM Agreement, resulting in net proceeds to the Company of $ 1,660,805 . The Prior ATM Agreement was subsequently terminated, and no further sales will be made under that program. On October 20, 2025, the Company entered into an Equity Distribution Agreement (the “Equity Distribution Agreement”) with Maxim Group LLC (“Maxim”) to establish an at-the-market (“ATM”) equity offering program. Pursuant to the Equity Distribution Agreement, the Company was authorized to offer and sell shares of its common stock, par value $ 0.001 per share, having an aggregate offering price of up to $ 10.0 million, from time to time through Maxim, acting as the Company’s sales agent. Under the terms of the Equity Distribution Agreement, the Company agreed to pay Maxim a commission equal to 3.0% of the gross proceeds from the sale of shares and to reimburse Maxim for certain legal and other out-of-pocket expenses. The shares were offered pursuant to the Company’s shelf registration statement on Form S-3 (File No. 333-270628), which expired on April 6, 2026. As of June 30, 2026, the Company had sold 1,539,101 shares of common stock under the Equity Distribution Agreement, resulting in net proceeds to the Company of approximately $ 4,593,234 . On May 12, 2026, the Company filed a new shelf registration statement on Form S-3 (File No. 333-295803), which was declared effective by the Securities and Exchange Commission on May 15, 2026. On July 27, 2026, the Company amended the Equity Distribution Agreement and filed a prospectus supplement under the new shelf registration statement pursuant to which the Company may offer and sell shares of its common stock having an aggregate offering price of up to approximately $ 7,901,383 through Maxim. Sales under the amended Equity Distribution Agreement, if any, may be made in transactions deemed to be “at-the-market” offerings under Rule 415 promulgated under the Securities Act of 1933, as amended. Maxim will be entitled to a commission equal to 3.0% of the gross sales price of shares sold. The approximately $ 7,901,383 offering amount reflects the maximum amount the Company was eligible to offer under General Instruction I.B.6 of Form S-3 as of the date of the prospectus supplement. 14 Private Placement Transaction On May 19, 2026, the Company entered into a private placement transaction (the “Private Placement”), pursuant to a Securities Purchase Agreement (the “Purchase Agreement”) with certain institutional and accredited investors (the “Purchasers”) for aggregate gross proceeds of $ 3.0 million, before deducting fees to the placement agent and other expenses payable by the Company in connection with the Private Placement. Maxim Group LLC (“Maxim”) acted as the exclusive placement agent for the Private Placement. The Company paid approximately $ 259,989 in fees to Maxim. As part of the Private Placement, the Company agreed to issue (i) 54,915 shares of the Company’s common stock (the “Shares”), par value $ 0.001 per share (“Common Stock”), (ii) pre-funded warrants to purchase 1,592,532 shares of Common Stock (the “Pre-Funded Warrants”) with an exercise price of $ 0.0001 per share, and (iii) warrants to purchase 3,294,894 shares of Common Stock (the “Common Warrants”), with an exercise price of $ 1.571 per share. The Common Warrants are exercisable immediately and expire five years from issuance. The Pre-Funded Warrants are exercisable immediately and terminate when exercised in full. During the three months ended June 30, 2026, 1,192,532 of the Pre-Funded Warrants were exercised by the Purchasers. In accordance with ASC 815-40, Derivatives and Hedging-Contracts in Entity’s own Equity , the Company determined that all the different warrants issued met the conditions for equity classification and were included as a component of total stockholders’ equity. Warrants The Company has issued warrants related to acquisition and financing transactions. The following table provides the weighted-average exercise price and remaining contractual life for each warrant outstanding as of June 30, 2026 and December 31, 2025: Schedule of Weighted Average Exercise Price and Remaining Contractual Life June 30, 2026 Weighted-Average Number of Weighted-Average Remaining Contractual Warrants Exercise Price Life (in Years) 2021 Acquisition Related Warrants 15,500 $ 273.75 0.51 May 2026 Pre-Funded Warrants 400,000 $ 0.00 Indefinite May 2026 Warrants 3,294,894 $ 1.57 4.96 December 31, 2025 Weighted-Average Number of Weighted-Average Remaining Contractual Warrants Exercise Price Life (in Years) 2021 Acquisition Related Warrants 15,500 $ 273.75 1.00 The following table summarizes warrant activity for the six months ended June 30, 2026: Schedule of Warrant Activity Related Warrants Pre-Funded Warrants May 2026 Warrants 2021 Acquisition May 2026 Related Warrants Pre-Funded Warrants May 2026 Warrants Outstanding at December 31, 2025 15,500 - - Issued - 1,592,532 3,294,894 Expired - - - Forfeited/Cancelled - - - Exercised - ( 1,192,532 ) - Outstanding at June 30, 2026 15,500 400,000 3,294,894 15 There are 3,694,894 warrants exercisable at June 30, 2026. The ability to exercise the 15,500 warrants issued in connection with acquisitions in prior years is contingent upon the achievement of certain development and revenue milestones on or before January 1, 2027. Share Repurchase Program In March 2022, the Company’s Board of Directors authorized a share repurchase program that would allow the Company to repurchase up to $ 30.0 million of CODX common stock. The repurchase program does not obligate the Company to acquire any particular number of common shares, and the repurchase program may be suspended or discontinued at any time at the Company’s discretion. The timing and amount of any share repurchases under the share repurchase program will be determined by Co-Diagnostics’ management at its discretion based on ongoing assessments of the capital needs of the business, the market price of the Company’s common stock, corporate and regulatory requirements, and general market conditions. For accounting purposes, common stock repurchased under the stock repurchase program is recorded based upon the transaction date of the applicable trade. Such repurchased shares are held in treasury and are presented using the cost method. These shares are not retired and are considered issued but not outstanding. No shares were repurchased during the three and six months ended June 30, 2026. Note 9 – Stock-Based Compensation Stock Incentive Plans The Company’s board of directors adopted, and shareholders approved, the Co-Diagnostics, Inc. Amended and Restated 2015 Long Term Incentive Plan (the “2015 Incentive Plan”) providing for the issuance of stock-based incentive awards to employees, officers, consultants, directors and independent contractors. On August 31, 2022, the shareholders approved an increase in the number of awards available for issuance under the Incentive Plan to an aggregate of 400,000 shares of common stock. The 2015 Incentive Plan expired on December 31, 2025. The Company’s board of directors adopted in March 2025, and in May 2025 shareholders approved, the Co-Diagnostics, Inc. 2025 Equity Incentive Plan (the “2025 Plan”) providing for the issuance of up to 223,333 shares of common stock plus any shares that become available in connection with the cancellation or forfeiture of awards issued under the 2015 Incentive Plan. The 2025 Plan provides for the award of stock-based incentive awards to employees, officers, consultants, directors and independent contractors. At June 30, 2026, the number of awards available for issuance under the 2025 Plan was 255,374 , including unused awards which rolled over from the 2015 Incentive Plan upon its expiration. No awards have been made under the 2025 Plan. Stock Options The following table summarizes option activity during the six months ended June 30, 2026: Schedule of Option Activity Number of Options Weighted Average Exercise Price Weighted Average Fair Value Weighted Average Remaining Contractual Life (Years) Outstanding at December 31, 2025 31,603 $ 68.91 $ 43.05 3.14 Granted - - - Expired ( 3,915 ) $ 78.70 $ 75.38 Forfeited/Cancelled - - - Exercised - - - Outstanding at June 30, 2026 27,688 $ 67.52 $ 38.48 2.75 Exercisable at June 30, 2026 27,688 $ 67.52 $ 38.48 2.75 The aggregate intrinsic value of outstanding options at June 30, 2026 and 2025 was approximately $ 0 . 16 Stock-based compensation cost is measured at the grant date based on the fair value of the award granted and recognized as expense over the vesting period using the straight-line method. The Company uses the Black-Scholes model to value options granted. As of June 30, 2026, there were no unvested options and no unrecognized stock-based compensation expense related to options. Restricted Stock Units The grant date fair value of RSUs granted is determined using the closing market price of the Company’s common stock on the grant date with the associated compensation expense amortized over the vesting period of the awards. The following table sets forth the outstanding RSUs and related activity for the six months ended June 30, 2026: Schedule of Outstanding Restricted Stock Units and Related Activity Number of RSUs Weighted Average Grant Date Fair Value Unvested at December 31, 2025 114,025 $ 34.51 Granted - - Vested ( 29,045 ) 21.36 Forfeited/Cancelled ( 3,415 ) 75.58 Unvested at June 30, 2026 81,565 $ 37.47 As of June 30, 2026, there was approximately $ 1,505,523 of unrecognized stock-based compensation expense related to outstanding RSUs which is expected to be recognized over a weighted-average period of 1.7 years. Schedule of Warrant Activity Stock-Based Compensation Expense The Company recognized stock-based compensation expense as follows: Schedule of Recognized Stock-Based Compensation Expense 2026 2025 2026 2025 Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 Sales and marketing $ 25,996 $ 105,342 $ 57,416 $ 241,539 General and administrative 183,283 531,707 404,384 1,267,622 Research and development 4,473 ( 56,784 ) ( 28,934 ) ( 53,668 ) Total stock-based compensation expense $ 213,752 $ 580,265 $ 432,866 $ 1,455,493 Note 10 – Income Taxes For the three months ended June 30, 2026, the Company recognized expense from income taxes of $ 19,168 , representing an effective tax rate of 0.3 %. For the six months ended June 30, 2026, the Company recognized expense from income taxes of $ 19,688 , representing an effective tax rate of 0.1 % . The Company’s effective tax rate will generally differ from the U.S. Federal statutory rate of 21.0 %, primarily due to the full valuation allowance as well as state taxes, permanent items, and discrete items. For the three and six months ended June 30, 2025, the Company recognized expense from income taxes of $ 12,327 and $ 24,331 , respectively. Note 11 – Commitments and Contingencies Lease Obligations The Company leases administrative, R&D, sales and marketing and manufacturing facilities under non-cancellable operating leases. The components of lease expense are summarized as follows: Schedule of Lease Expense 2026 2025 2026 2025 Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 Operating lease costs $ 267,266 $ 258,122 $ 528,954 $ 516,188 Total lease costs $ 267,266 $ 258,122 $ 528,954 $ 516,188 17 As of June 30, 2026, the maturities of the Company’s lease liabilities are as follows: Schedule of Maturities on Company Lease Liabilities Years Ending December 31, 2026 (remainder) $ 517,070 2027 691,311 2028 710,904 Thereafter - Total lease payments 1,919,285 Less: imputed interest 120,137 Present value of operating lease liabilities 1,799,148 Less: current portion 784,261 Long-term portion $ 1,014,887 Other information related to operating leases was as follows: Schedule of Other Information Related to Operating Leases Six Months Ended June 30, 2026 Cash paid for operating leases included in operating cash flows $ 264,886 Remaining lease term of operating leases 2.3 Discount rate of operating leases 5.9 % Litigation Liabilities for loss contingencies arising from claims, assessments, litigation, fines, and penalties and other sources are recorded when it is probable that a liability has been incurred and the amount can be reasonably estimated. Legal costs incurred in connection with loss contingencies are expensed as incurred. The Company is a defendant in a class action suit claiming that the Company overstated the demand for its Logix Smart COVID-19 test and that the plaintiffs suffered losses when the Company’s stock dropped after the Company disclosed its financial results. The plaintiffs demand compensatory damages sustained as a result of the Company’s alleged wrongdoing in an amount to be proven at trial. The Company is a party to a commercial lawsuit in the Third Judicial District Court, Salt Lake County, Utah, against Hukui Technology, Inc. In May 2026, the Company received an amended final judgment and favorable ruling in its litigation with Hukui Technology, Inc., in which the trial court found in favor of the Company on its declaratory judgment claim and on all remaining counterclaims, concluding that the Company had no payment obligations and that the defendants were not entitled to damages. Hukui Technology, Inc. subsequently filed a notice of appeal of that judgment during May 2026. The Company is also a party to one civil action based on breach of contract claims against the Company. The Company believes these lawsuits are without merit and is defending the cases vigorously. The Company is unable to estimate a range of loss, if any, that could result were there to be an adverse final decision in these cases. As of the date of this report, the Company does not believe it is probable that these cases will result in an unfavorable outcome; however, if an unfavorable outcome were to occur in these cases, it is possible that the impact could be material to the Company’s results of operations in the period(s) in which any such outcome becomes probable and estimable. 18 Note 12 – Related Party Transactions The Company has a services agreement with CoSara Diagnostics Pvt Ltd (“CoSara”), one of the Company’s equity method investments, under which CoSara provides certain research and development consulting and support services. The Company recognized $ 262,129 and $ 488,525 of expense related to this agreement during the three and six months ended June 30, 2026, respectively, compared to $ 182,364 and $ 422,467 of expense during the three and six months ended June 30, 2025, respectively. Note 13 – Subsequent Events On July 1, 2026, the remaining 400,000 Pre-Funded Warrants from the Private Placement completed during May 2026 were exercised. On July 30, 2026, the Company entered into an inducement agreement with certain holders of certain of the Company’s existing warrants to purchase up to an aggregate of 1,702,362 shares of the Company’s common stock originally issued on May 21, 2026, with a five- 5 year term at an exercise price of $ 1.571 per share. Pursuant to the agreement, the warrant holders agreed to exercise for cash the existing warrants to purchase an aggregate of 1,702,362 shares of the Company’s common stock at an exercise price of $ 1.571 per share in consideration of the Company’s agreement to issue additional new common stock purchase warrants to purchase up to an aggregate of 3,404,724 shares of the Company’s common stock at an exercise price of $ 1.56 per share. These new warrants are not exercisable until the Company obtains stockholder approval of the exercise. The Company received aggregate gross proceeds of approximately $ 2.67 million from the exercise of the existing warrants, before deducting placement agent fees and other offering expenses payable by the Company. The Company agreed to pay Maxim (i) a cash fee equal to 7.0 % of the aggregate gross proceeds received from the exercise of the existing warrants and (ii) reimbursement of the Maxim’s reasonable expenses, including without limitation, fees and disbursements of the Maxim’s counsel, incurred in connection with the transactions contemplated by the inducement agreement in an amount equal to $ 50,000 . 19