What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2026-05-15 compared with 2025-11-12 · 478 added, 574 removed, 297 unchanged (78% of the section changed)

3 unchanged sentences

(in thousands, except per share amounts)

September 30,

Current Assets:

11 unchanged sentences

34,451 35,906

Finance lease right-of-use assets

20,425 22,658

Operating lease right-of-use assets

1 unchanged sentence

$ 138,247 $ 151,040

LIABILITIES AND SHAREHOLDERS’ EQUITY

LIABILITIES, TEMPORARY EQUITY, AND SHAREHOLDERS ’ EQUITY

Current Liabilities:

5 unchanged sentences

Current maturities of operating leases

Current maturities of finance leases

Short-term debt

Short-term contingent consideration, at fair value

Total Current Liabilities

1 unchanged sentence

Revolving credit facility

Term debt, net of deferred financing costs

33,501 34,583

Long-term debt

Long-term obligations under operating leases

Other non-current liabilities

Non-current operating lease liabilities

Non-current finance lease liabilities

14,785 17,844

Deferred tax liabilities

Total Liabilities

97,109 101,854

Commitments and contingencies (Note 10)

Series A Redeemable Convertible Preferred stock, $ 1,000 stated value, 50,000 shares authorized;

30 shares issued and outstanding as of March 31, 2026 and December 31, 2025

Liquidation preference of $ 30,623 and $ 30,232 as of March 31, 2026 and December 31 2025, respectively

28,079 27,688

Shareholders' Equity:

Common stock, $ 0.01 par value, 66,666 shares authorized;

10,519 and 10,447 shares issued and outstanding, respectively

10,567 and 10,519 shares issued and outstanding as of March 31, 2026 and December 31, 2025, respectively

Additional paid-in capital

2 unchanged sentences

( 72,591 ) ( 65,130 )

Accumulated other comprehensive income

Total Shareholders ’ Equity

13,059 21,498

Total Liabilities and Shareholders’ Equity

Total Liabilities, Temporary Equity, and Shareholders' Equity

$ 138,247 $ 151,040

4 unchanged sentences

For the Three Months Ended

For the Nine Months Ended

September 30,

Services and other

5 unchanged sentences

General and administrative expenses

Impairment of software asset

Total operating expenses

Operating (loss) income

Operating loss

Other expenses (income):

Interest expense

Interest expense, including amortization of debt discount

Gain on settlement of contingent consideration

Loss (gain) on change in fair value of contingent consideration

Loss on debt extinguishment

Other expense (income)

Total other expenses (income)

Net (loss) income before income taxes

Benefit (provision) for income taxes

Other expense, net

Total other expenses (income), net

Loss before income taxes

Income tax benefit (expense)

Net (loss) income

Basic (loss) earning per common share

Diluted (loss) earning per common share

Weighted average shares outstanding - basic

Weighted average shares outstanding - diluted

Series A Redeemable Convertible Preferred Stock dividends

Net (loss) income attributable to common stockholders

Basic and diluted net (loss) income per common share

Weighted average shares outstanding - basic and diluted

See accompanying Notes to Condensed Consolidated Financial Statements.

CREATIVE REALITIES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME

(in thousands)

For the Three Months Ended

Net (loss) income

Other comprehensive loss:

Foreign currency translation adjustments

Total comprehensive (loss) income

See accompanying Notes to Condensed Consolidated Financial Statements.

CREATIVE REALITIES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS ’ EQUITY

(in thousands, except shares)

Comprehensive

Balance at January 1, 2025

Stock-based compensation

Issuance of warrants

Balance at March 31, 2025

Balance at January 1, 2026

Series A Redeemable Convertible Preferred Stock dividends

Stock-based compensation

Repurchase of common stock warrants

Other comprehensive loss

Balance at March 31, 2026

See accompanying Notes to Condensed Consolidated Financial Statements.

CREATIVE REALITIES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

Nine Months Ended

September 30,

For the Three Months Ended March 31,

Operating Activities:

Adjustments to reconcile net loss to net cash (used in) provided by operating activities

Net (loss) income

Adjustments to reconcile net (loss) income to net cash used in operating activities

Depreciation and amortization

Amortization of debt discount

Amortization of stock-based compensation

Non-cash lease expense

Amortization of deferred financing costs

Bad debt expense

Stock-based compensation

Provision for credit losses

Provision for inventory reserves

Deferred income taxes

Gain on settlement of contingent consideration

Impairment of software asset

Loss on extinguishment of debt

Gain on change in fair value of contingent consideration

Changes to operating assets and liabilities:

Deferred income taxes

Changes to operating assets and liabilities, net of acquisitions:

Accounts receivable

4 unchanged sentences

Customer deposits

Net cash (used in) provided by operating activities

Lease liabilities

Other non-current liabilities

Net cash used in operating activities

Investing Activities:

Purchases of property and equipment

Capitalization of labor for software development

Capitalization of costs for software development

Net cash used in investing activities

Financing Activities:

Repayment of term debt and promissory note

Proceeds from borrowings under revolving credit facility

Repayment of borrowings under revolving credit facility

Settlement of contingent consideration

Repayment of term debt

Payment of deferred financing costs

Principal payments on finance leases

Net cash provided by (used in) financing activities

Decrease in cash and cash equivalents

Payment of contingent consideration

Repurchase of common stock warrants

Repayment of finance lease obligations

Net cash provided by financing activities

Effect of exchange rate on cash and cash equivalents

Net increase in cash and cash equivalents

Cash and cash equivalents, beginning of period

2 unchanged sentences

CREATIVE REALITIES, INC.

CONSOLIDATED STATEMENTS OF SHAREHOLDERS ’ EQUITY

(in thousands, except shares)

Three Months Ended September 30, 2025

Balance as of June 30, 2025

Stock-based compensation

Balance as of September 30, 2025

Nine Months Ended September 30, 2025

Balance as of December 31, 2024

Stock-based compensation

Shares issued to directors as compensation

Issuance of warrants

Balance as of September 30, 2025

Three Months Ended September 30, 2024

Balance as of June 30, 2024

Stock-based compensation

Balance as of September 30, 2024

Nine Months Ended September 30, 2024

Balance as of December 31, 2023

Stock-based compensation

Shares issued to employees pursuant to the Retention Bonus Plan

Balance as of September 30, 2024

See accompanying notes to condensed consolidated financial statements.

CREATIVE REALITIES, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(in thousands, except shares and per share amounts)

(in thousands, except share and per share amounts)

NATURE OF ORGANIZATION AND OPERATIONS

Unless the context otherwise indicates, references in these Notes to the accompanying Condensed Consolidated Financial Statements to “ we, ” “ us, ” “ our, ” and “ the Company ” refer to Creative Realities, Inc.

Unless the context otherwise indicates, references in these Notes to the accompanying consolidated financial statements to “ we, ” “ us, ” “ our ” and “ the Company ” refer to Creative Realities, Inc.

and its subsidiaries.

10 unchanged sentences

and proprietary processes and automation tools.

Our main operations are conducted directly through Creative Realities, Inc., and under our wholly owned subsidiaries Allure Global Solutions, Inc., a Georgia corporation (“Allure”), Creative Realities Canada, Inc., a Canadian corporation (“CRI Canada”), and Reflect Systems, Inc., a Delaware corporation (“Reflect”).

Our main operations are conducted directly through Creative Realities, Inc., and under our wholly owned subsidiaries, Cineplex Digital Media Inc., a Canadian corporation (“CDMI”), and Cineplex Digital Media U.S.

Inc., a Delaware corporation (“CDMUS”).

Liquidity and Financial Condition;

2 unchanged sentences

2014 - 15, Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern (Subtopic 205 - 40 ) (“ASU 205 - 40” ), the Company has evaluated whether there are certain 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 that the condensed consolidated financial statements are issued.

As of September 30, 2025, the Company had an accumulated deficit of $ 63,165 and positive working capital of $ 526 .

For the three months ended September 30, 2025, the Company generated an operating loss of $ 7,270 .

Net cash used by operating activities for the nine months ended September 30, 2025 was $ 834 .

On March 14, 2025, the Company successfully resolved its contingent consideration obligations related to the Reflect merger, reducing the short-term liability burden and eliminating a material uncertainty that had existed in prior periods.

The Company remained reliant on improved cash flow generation, revenue growth, or access to external financing to fund operations and meet upcoming debt service obligations, including required amortization under the Promissory Note beginning October 2025 and its debt service obligations under its current Credit Agreement .

As part of ongoing liquidity management, the Company has pursued several strategic alternatives including debt refinancing and capital market transactions.

While management had substantially advanced these initiatives as of September 30, 2025, they were not completed until after the period.

Based on conditions existing at September 30, 2025, management concluded that substantial doubt existed about the Company's ability to continue as a going concern within one year after the date of issuance of the Condensed Consolidated Financial Statements.

On November 6, 2025, the Company completed a refinancing of its senior debt facilities, and on November 7, 2025, the Company completed the acquisition of DDC Group International, Inc.

and related financing arrangements.

On November 6, 2025, the Company completed a refinancing of its senior debt facilities, and on November 7, 2025, the Company completed the acquisition of DDC Group International, Inc., and related financing arrangements.

Management believes these actions are likely to significantly improve the Company’s liquidity, scale, and overall financial condition.

Our ability to generate positive net income and cash flows from operations is reliant on the successful integration and operation of this newly acquired business and therefore the financial impacts of this acquisition were not fully known at the time of the Company's going-concern assessment.

Management believes the completion of these transactions and the planned integration and operating plan for the newly acquired business present the opportunity to mitigate the conditions giving rise to substantial doubt regarding the Company’s ability to continue as a going concern in future periods.

Its ability to generate positive net income and cash flows from operations is reliant on the successful integration and operation of this newly acquired business and therefore the financial impacts of this acquisition were not fully known at the time of the Company's going concern assessment.

Management believes the completion of these transactions and the planned integration and operating plan for the newly acquired business with expected realization of synergies present the opportunity to prospectively eliminate the conditions giving rise to substantial doubt regarding the Company’s ability to continue as a going concern in future periods.

However, there can be no assurance that these efforts will be successful.

As of March 31, 2026, the Company has an accumulated deficit of $ 72,591 and negative working capital of $ 9,528 .

For the three months ended March 31, 2026, the Company generated a net loss of $ 7,461 and used net cash in operations of $ 1,723 .

The Company remains dependent on improving cash flows from operations, securing additional sources of liquidity, or both, to fund ongoing operations to meet our financial obligations, including our debt obligations under our current Credit Agreement.

These conditions raise substantial doubt about the Company’s ability to continue as a going concern for at least twelve months after the issuance date of these condensed consolidated financial statements.

The condensed consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts, or the amounts and classification of liabilities that might result from the outcome of this uncertainty.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

A summary of the significant accounting policies consistently applied in the preparation of the accompanying Condensed Consolidated Financial Statements follows:

Since the Annual Report for the year ended December 31, 2025, there have been no material changes to the Company’s significant accounting policies, except as disclosed in this note.

Basis of Presentation

The accompanying unaudited Condensed Consolidated Financial Statements have been prepared in accordance with the instructions to Form 10 -Q and Article 10 of Regulation S- X and include all of the information and disclosures required by generally accepted accounting principles in the United States of America (“GAAP”) for interim financial reporting.

These unaudited Condensed Consolidated Financial Statements should be read in conjunction with the Consolidated Financial Statements of the Company and related footnotes for the year ended December 31, 2024, included in the Company’s Annual Report on Form 10 -K filed with the Securities and Exchange Commission on March 14, 2025.

The Condensed Consolidated Financial Statements include the accounts of Creative Realities, Inc.

and our wholly owned subsidiaries Allure, CRI Canada, and Reflect.

All intercompany balances and transactions have been eliminated in consolidation, as applicable.

Certain amounts have been reclassified to conform to current period presentation.

The results of operations for the interim periods are not necessarily indicative of results of operations for a full year.

Management believes the accompanying unaudited Condensed Consolidated Financial Statements reflect all adjustments, including normal recurring items, considered necessary for a fair statement of results for the interim periods presented.

Recently Issued Accounting Pronouncements Not Yet Adopted

In December 2023, the Financial Accounting Standards Board (“FASB”) issued ASU 2023 - 09, Income Taxes (Topic 740 ):

Improvements to Income Tax Disclosures , which requires public entities, on an annual basis, to provide disclosure of specific categories in the rate reconciliation, as well as disclosure of income taxes paid disaggregated by jurisdiction.

ASU 2023 - 09 is effective for fiscal years beginning after December 15, 2024, with early adoption permitted.

The Company is currently evaluating the impact of adopting ASU 2023 - 09.

In November 2024, the FASB issued ASU 2024 - 03, Income Statement — Reporting Comprehensive Income — Disaggregation of Income Statement Expenses (Subtopic 220 - 40 ) , which requires public entities to disclose, on an annual and interim basis, disaggregated information about certain income statement expense captions.

In January 2025, the FASB issued ASU 2025 - 01 to clarify the effective date guidance in ASU 2024 - 03.

The standard is effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027, with early adoption permitted.

The Company is currently evaluating the impact of adopting ASU 2024 - 03.

Cash and cash equivalents

Cash and cash equivalents consist of cash on deposit in financial institutions, in both the United States and Canada.

The Company does not hold any investments that qualify as cash equivalents as of September 30, 2025.

As of September 30, 2025, the Company had approximately $ 184 in cash that was held in a Canadian financial institution.

The Company does not believe the balance presents a material concentration of credit risk, as the cash is held with a reputable financial institution.

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“U.S.

GAAP”) for interim financial information and with the instructions to Form 10 -Q and Article 8 of Regulation S- X.

Accordingly, they do not include all of the information and disclosures required by U.S.

GAAP for complete financial statements.

In the opinion of management, such statements include all adjustments (consisting only of normal recurring items) which are considered necessary for a fair presentation of the condensed consolidated financial statements of the Company as of March 31, 2026 and for the three months then ended.

The results of operations for the three months ended March 31, 2026 are not necessarily indicative of the operating results for the full year ending December 31, 2026 or any other period.

These unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements of the Company and related footnotes for the year ended December 31, 2025, included in the Company’s Annual Report on Form 10 -K filed with the Securities and Exchange Commission on April 15, 2026.

Recently Issued and Adopted Accounting Pronouncements

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.

The amendments introduce a practical expedient that permits entities to assume current conditions as of the balance sheet date do not change for the remaining life of current accounts receivable and current contract assets within the scope of ASC 606 when developing reasonable and supportable forecasts of expected credit losses, thereby removing the requirement to incorporate macroeconomic forecasts for those assets.

The ASU also provides an accounting policy election to consider post-balance-sheet collection activity in estimating expected credit losses;

this election is available only to entities other than public business entities and is therefore not available to the Company.

The amendments are effective for annual reporting periods beginning after December 15, 2025, and interim periods within those annual periods, with early adoption permitted.

The Company adopted this standard on January 1, 2026.

The adoption of ASU 2025 - 05 did not have a material impact on its condensed consolidated financial statements and related disclosures.

In April 2026, the FASB issued ASU 2026 - 01, Equity (Topic 505 ):

Initial Measurement of Paid-in-Kind Dividends on Equity-Classified Preferred Stock.

The amendments in this update require entities to initially measure paid-in-kind ("PIK") dividends on equity-classified preferred stock using the PIK dividend rate stated in the preferred stock agreement, rather than at fair value.

The ASU is effective for annual periods beginning after December 15, 2026, including interim periods within those fiscal years, with early adoption permitted.

The Company is currently evaluating the impact of ASU 2026 - 01 on its condensed consolidated financial statements and related disclosures.

Cash Concentrations

Cash consists of cash on deposit in financial institutions in both the United States and Canada.

The Company does not hold any investments that qualify as cash equivalents as of March 31, 2026 or December 31, 2025.

Balances may exceed the Federal Deposit Insurance Corporation ("FDIC") limit of $250 USD in the United States and may exceed the Canada Deposit Insurance Corporation ("CDIC") limit of $100 CAD in Canada.

As of March 31, 2026 and December 31, 2025, the Company did not have USD cash in excess of FDIC insurance limits.

As of March 31, 2026 and December 31, 2025, the Company had CAD cash in excess of CDIC insurance limits of $ 1,925 and $ 1,037 , respectively.

The Company does not believe the balances present a material credit risk, as the cash is held with reputable financial institutions and the Company has never experienced any losses related to these balances, although no assurance can be provided that it will not experience any losses in the future.

Revenue Recognition

We recognize revenue in accordance with Accounting Standards Codification (“ASC 606” ), Revenue from Contracts with Customers , applying the five -step model.

If an arrangement involves multiple performance obligations, the obligations are analyzed to determine the separate units of accounting, whether the obligations have value on a standalone basis and whether there is objective and reliable evidence of their standalone selling price.

The total contract transaction price is allocated to the identified performance obligations based upon the relative standalone selling prices of the performance obligations.

The Company evaluates each customer contract to identify the distinct performance obligations promised therein.

A performance obligation is considered distinct if the customer can benefit from the good or service on its own or together with other resources that are readily available, and if the Company's promise to transfer the good or service is separately identifiable from other promises in the contract.

If an individual promised good or service is not distinct from another promised good or service, the Company combines those promised goods or services into a single combined performance obligation.

The total contract transaction price is allocated to the identified distinct performance obligations based upon the relative standalone selling prices of the performance obligations.

The standalone selling price is based on an observable price for services sold to other comparable customers, when available, or an estimated selling price using a cost plus margin approach.

For contracts when one or more performance obligations have observable standalone selling prices, the residual approach is applied to determine the allocation for highly variable components, including SaaS and support pricing, which both vary based on engagement size.

The Company estimates the amount of total contract consideration it expects to receive for variable arrangements by determining the most likely amount it expects to earn from the arrangement based on the expected quantities of services it expects to provide and the contractual pricing based on those quantities.

2 unchanged sentences

The Company receives variable consideration in very few instances.

The Company generally does not accept returns or provide refunds related to its customer contracts.

Revenue is recognized when a customer obtains control of promised goods or services under the terms of a contract and is measured as the amount of consideration the Company expects to receive in exchange for transferring goods or providing services.

The Company has very few contracts with material extended payment terms as payment is typically due at or shortly after the time of the sale, typically ranging between thirty and ninety days.

In those instances where the Company has material extended payment terms (most commonly in multi-year arrangements where the Company acts as an agent to a transaction on behalf of its customers), the Company evaluates and applies constraints to arrive at the revenue recognized in the period in which a contract is entered.

In those instances where the Company offers material extended payment terms (most commonly in multi-year arrangements), the Company determines whether a significant financing component exists.

Where the Company acts as an agent to a transaction on behalf of its customers (primarily for the sale of extended warranties that are performed by the equipment manufacturer), the Company recognizes revenue on a net basis.

Observable prices are used to determine the standalone selling price of separate performance obligations or a cost plus margin approach when one is not available.

Sales, value-added and other taxes collected concurrently with revenue producing activities are excluded from revenue.

The Company recognizes contract assets or unbilled receivables related to revenue recognized for services completed but not yet invoiced to the customers.

A contract liability is recognized as deferred revenue when the Company invoices customers in advance of performing the related services under the terms of a contract.

Deferred revenue is recognized as revenue when the Company has satisfied the related performance obligation.

Deferred revenue is recognized as revenue when or as the Company satisfies the related performance obligation.

The Company uses the practical expedient for recording an immediate expense for incremental costs of obtaining contracts, including certain design/engineering services, commissions, incentives and payroll taxes, as these incremental and recoverable costs have terms that do not exceed one year.

6 unchanged sentences

The allowance for credit losses is included in accounts receivable, net in the accompanying condensed consolidated balance sheets.

The Company had the following activity for its allowance for credit losses for the nine months ended September 30, 2025 and 2024:

September 30,

The Company had the following activity for its allowance for credit losses for the three months ended March 31, 2026 and 2025:

For the Three Months Ended

Balance as of beginning of period

Amounts accrued

Provision for credit losses

Write-offs charged against the allowance

2 unchanged sentences

Inventories are stated at the lower of cost or net realizable value, determined by the first -in, first -out (FIFO) method, and consist of the following:

September 30,

Raw materials

3 unchanged sentences

$ 6,562 $ 7,420

Impairment of Long-Lived Assets

We review the carrying value of all long-lived assets, including property and equipment, for impairment in accordance with ASC 360, Accounting for the Impairment or Disposal of Long-Lived Assets .

Under ASC 360, impairment losses are recorded whenever events or changes in circumstances indicate the carrying value of an asset may not be recoverable.

If the impairment tests indicate that the carrying value of the asset is greater than the expected undiscounted cash flows to be generated by such asset, an impairment loss would be recognized.

The impairment loss is determined as the amount by which the carrying value of such asset exceeds its fair value.

We generally measure fair value by considering sale prices for similar assets or by discounting estimated future cash flows from such assets using an appropriate discount rate.

Assets to be disposed of are carried at the lower of their carrying value or fair value less costs to sell.

Considerable management judgment is necessary to estimate the fair value of assets, and accordingly, actual results could vary significantly from such estimates.

Basic and Diluted Earning (Loss) per Common Share

Basic and diluted earning (loss) per common share for all periods presented is computed using the weighted average number of common shares outstanding.

Basic weighted average shares outstanding includes only outstanding common shares.

Diluted weighted average shares outstanding includes outstanding common shares and potential dilutive common shares outstanding in accordance with the treasury stock method.

Shares reserved for outstanding stock options totaling 1,891,013 and warrants totaling 5,364,802 at September 30, 2025 , were excluded from the computation of loss per share for the three and nine months ended September 30, 2025, as the exercise prices on those instruments were higher than the Company’s average market price during the period and therefore anti-dilutive.

In addition, 560,000 outstanding stock options were excluded from the computation of loss per share for the three and nine months ended September 30, 2025, as the company was in a net loss position, and their inclusion would have been anti-dilutive.

Shares reserved for outstanding stock options totaling 1,632,242 and warrants totaling 4,587,002 at September 30, 2024, were excluded from the computation of loss per share for the nine months ended September 30, 2024, as the exercise prices on those instruments were higher than the Company’s average market price during the period and therefore anti-dilutive.

Shares reserved for outstanding stock options totaling 1,632,242 and warrants totaling 1,731,499 at September 30, 2024, were excluded from the computation of earning per share for the three months ended September 30, 2024, as the exercise prices on those instruments were higher than the Company’s average market price during the period and therefore anti-dilutive.

Deferred income taxes are recognized in the financial statements for the tax consequences in future years of differences between the tax basis of assets and liabilities and their financial reporting amounts based on enacted tax laws and statutory tax rates.

Temporary differences arise from a number of matters including, but not limited to, net operating losses, differences in basis of intangibles, stock-based compensation, reserves for uncollectible accounts receivable and inventory, differences in depreciation methods, and accrued expenses.

Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized.

The Company accounts for uncertain tax positions utilizing an established recognition threshold and measurement attributes for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return.

We had no uncertain tax positions as of September 30, 2025 and December 31, 2024.

Goodwill and Intangible Assets

We follow the provisions of ASC 350, Goodwill and Other Intangible Assets .

Pursuant to ASC 350, goodwill acquired in a business combination is not amortized, but instead tested for impairment at least annually.

The Company uses an annual measurement date of September 30 to assess impairment of goodwill and indefinite-lived intangible assets, or as indicators are identified.

Definite-lived intangible assets are amortized straight-line in accordance with their identified useful lives.

Basic and Diluted Net (Loss) Income per Common Share

The Company’s net (loss) income per common share is calculated using the two -class method in accordance with ASC Topic 260, Earnings Per Share.

The two -class method allocates net income between common stockholders and holders of participating securities.

The Company’s Series A Convertible Preferred Stock are deemed to be participating securities due to their rights to participate in dividends with common stock.

However, the two -class method has no impact on the calculation of net loss per common share during periods when the Company has a net loss, because the holders of participating securities are not required to absorb losses.

Basic net (loss) income per common share is computed by dividing net (loss) income attributable to common stockholders by the weighted average number of common shares outstanding during the period.

Diluted net (loss) income per common share is computed by dividing net (loss) income attributable to common stockholders by the weighted average number of common shares outstanding, plus the number of additional common shares that would have been outstanding if the potential common shares had been issued (computed using the more dilutive of the treasury stock or the if converted method, as applicable, and the two -class method).

Shares reserved for outstanding stock options, including stock options with performance restricted vesting, and warrants totaling 6,634,533 and 30,000 shares of the Series A Preferred Stock, convertible into 10,000,000 shares of common stock as of March 31, 2026 were excluded from the computation of diluted net loss per common share for the three months ended March 31, 2026 as the Company was in a net loss position and their inclusion would have been anti-dilutive.

Shares reserved for outstanding stock options, including stock options with performance restricted vesting, and warrants totaling 6,913,928 at March 31, 2025 were excluded from the computation of diluted net income per common share for the three months ended March 31, 2025 as the strike price on the options and warrants were higher than the Company’s average market price of its common stock during the period and therefore anti-dilutive.

Foreign Currency Translation

The functional currency of the Company's Canadian subsidiaries is the Canadian dollar.

The financial statements of these subsidiaries are translated into U.S.

dollars in accordance with ASC 830, Foreign Currency Matters.

Assets and liabilities denominated in foreign currencies are translated into U.S.

dollars at the exchange rates in effect at the balance sheet date.

Revenue and expense accounts are translated at the average exchange rates during the period.

The resulting translation adjustments are recorded as a component of accumulated other comprehensive income (loss) within shareholders' equity.

Gains and losses arising from foreign currency transactions are included in other expense (income), net in the condensed consolidated statements of operations.

Use of Estimates

1 unchanged sentence

Our significant estimates include:

allowance for credit losses, valuation allowances related to deferred taxes, and assumptions and estimates used to evaluate the recoverability of goodwill and other intangible assets and the related amortization methods and periods.

the fair value of assets acquired and liabilities assumed in business combinations, including identifiable intangible assets;

allowance for credit losses;

valuation allowances related to deferred tax assets, including the realizability of acquired Canadian deferred tax assets;

assumptions and estimates used to evaluate the recoverability of goodwill and other intangible assets and the related amortization methods and periods;

the incremental borrowing rate used to measure right-of-use assets and lease liabilities;

the fair value of stock-based compensation awards;

and the assessment of the Company's ability to continue as a going concern, including projected cash flows and available liquidity.

Actual results could differ from those estimates.

FAIR VALUE MEASUREMENT

We measure certain financial assets, including cash equivalents, at fair value on a recurring basis.

In accordance with ASC 820 - 10 - 30, fair value is a market-based measurement that should be determined based on the assumptions that market participants would use in pricing an asset or liability.

As a basis for considering such assumptions, ASC 820 - 10 - 35 establishes a three -level hierarchy that prioritizes the inputs used in measuring fair value.

The three hierarchy levels are defined as follows:

Level 1 — Valuations based on unadjusted quoted prices in active markets for identical assets.

Level 2 — Valuations based on observable inputs (other than Level 1 prices), such as quoted prices for similar assets at the measurement date;

quoted prices in markets that are not active;

or other inputs that are observable, either directly or indirectly.

Level 3 — Valuations based on inputs that are unobservable and involve management judgment and the reporting entity’s own assumptions about market participants and pricing.

The calculation of the fair value of separately identifiable intangible assets rely on a discounted cash flow model which utilizes inputs including the calculation of the weighted average cost of capital and management’s forecast of future financial performance which are unobservable and involve management judgment and are considered Level 3 estimates.

The calculation of the weighted average cost of capital and management’s forecast of future financial performance utilized within our discounted cash flow model for the impairment of goodwill contains inputs which are unobservable and involve management judgment and are considered Level 3 estimates.

Reclassifications

Certain prior year amounts in the condensed consolidated financial statements and accompanying notes have been reclassified to conform to the current year presentation.

These reclassifications had no effect on previously reported net loss, total assets, total liabilities, shareholders’ equity, or cash flows from operations.

Management has evaluated these reclassifications and determined that they are not material, individually or in the aggregate, to the condensed consolidated financial statements taken as a whole.

REVENUE RECOGNITION

The Company applies ASC 606 for revenue recognition.

The following table disaggregates the Company’s revenue by major source for the three and nine months ended September 30, 2025 and 2024 :

September 30,

(in thousands)

$ 4,168 $ 5,241 $ 14,635 $ 14,409

The Company applies ASC 606, Revenue from Contracts with Customers, for revenue recognition.

The table below disaggregates the Company’s revenue by major source as follows:

For the Three Months Ended

Recognition Policy:

Point in time

Managed Services

4,456 4,885 13,187 14,506

Digital Media Advertising

Installation Services

1,109 2,911 3,943 7,109

Point in time

Other Services

814 1,405 1,546 3,818

Point in time

Total Services

6,379 9,201 18,676 25,433

Total Hardware and Services

The following table presents the activities in deferred revenue for the three months ended March 31, 2026:

Balance, January 1

Amounts billed and deferred during the period

Revenue recognized that was included in the beginning balance

Revenue recognized from amounts deferred during the period

Foreign currency translation adjustment on Canadian deferred revenue

Balance, March 31

There were no significant revenues recognized during the three months ended March 31, 2026 and 2025 from performance obligations that were satisfied (or partially satisfied) in prior periods as a result of contract price changes, changes in estimates or variable consideration true-ups.

As of March 31, 2026, the aggregate amount of the transaction price allocated to remaining performance obligations (i.e., unsatisfied or partially unsatisfied performance obligations) was $ 10,362 .

The following table presents the expected timing of recognition of that amount:

Recognition Period

Within 1 year

Between 1 and 2 years

Between 2 and 3 years

The remaining performance obligations in the table above primarily consist of non-cancellable multi-year SaaS and maintenance agreements, under which the Company recognizes SaaS and maintenance revenue ratably over the contract term.

The Company has elected the optional exemption under ASC 606 - 10 - 50 - 14 and does not disclose information about remaining performance obligations for contracts with an original expected duration of one year or less, which primarily consist of short-term digital media advertising contracts, month-to-month support agreements, media revenue, and transactional arrangements (e.g., hardware and installation, software design and development, content creation).

BUSINESS COMBINATION

On November 7, 2025, the Company completed the acquisition of DDC Group International, Inc.

(“DDC”), the parent of Cineplex Digital Media Inc.

and Cineplex Digital Media U.S.

(collectively, “CDM”), from Cineplex Entertainment Limited Partnership for cash consideration of approximately CAD $ 60,263 (approximately USD $ 42,761 ).

The acquisition was accounted for as a business combination under ASC 805, with November 7, 2025 as the acquisition date.

The Company’s preliminary purchase price allocation, including the related deferred tax assets and liabilities, remains subject to change during the one -year measurement period in accordance with ASC 805 - 10 - 25 - 13 through 25 - 19, which extends through November 6, 2026.

The initial accounting for the CDM acquisition is incomplete as of March 31, 2026 because the Company is continuing to obtain and evaluate information about facts and circumstances that existed as of the acquisition date.

The items for which the initial accounting remains incomplete include the valuation of acquired identifiable intangible assets, the assessment of acquired deferred tax assets and liabilities, the resolution of post-closing working capital adjustments, and the resulting goodwill.

During the three months ended March 31, 2026, the Company recorded measurement period adjustments to the preliminary purchase price allocation related to the acquired net deferred tax liability.

At the acquisition date, certain amounts in the preliminary purchase price allocation, including the acquired net deferred tax liability, were recorded on a provisional basis pending the receipt of additional information.

During the first quarter of 2026, the Company obtained additional information about facts and circumstances that existed as of the acquisition date, which resulted in a measurement period adjustment that decreased the acquired net deferred tax liability by $ 661 , with a corresponding decrease to goodwill.

After giving effect to this adjustment, the acquired net deferred tax liability and goodwill recognized in connection with the CDM acquisition were $ 1,554 and $ 25,353 , respectively, as of March 31, 2026 ( compared to $ 2,215 and $ 26,013 , respectively, as initially reported as of the acquisition date).

The following table summarizes the measurement period activity

Purchase Price

(Preliminary)

Purchase Price

Purchase Consideration:

Cash (net of cash acquired of $ 4,778 )

$ 37,983 $ - $ 37,983

System hardware revenue is recognized generally upon shipment of the product or customer acceptance depending upon contractual arrangements with the customer in instances in which the sale of hardware is the sole performance obligation.

Shipping charges billed to customers are included in hardware sales and the related shipping costs are included in hardware cost of sales.

The cost of freight and shipping to the customer is recognized in cost of sales at the time of transfer of control to the customer.

Managed Services

Software as a service ( “ SaaS ” ) license sales

Software as a service includes revenue from software licensing and delivery in which software is licensed on a subscription basis and is centrally hosted by the Company.

These services often include software updates which provide customers with rights to unspecified software product upgrades and maintenance releases and patches released during the term of the support period.

Contracts for these services are generally 12 - 36 months in length and typically have perpetual autorenewal terms.

We account for revenue from these services in accordance with ASC 985 - 20 - 15 - 5 and recognize revenue ratably over the performance period.

Maintenance and support services

The Company sells support services that include access to technical support personnel for software and hardware troubleshooting.

The Company offers a hosting service through our network operations center, or NOC, allowing the ability to monitor and support our customers’ networks 7 days a week, 24 hours a day.

These contracts are generally 12 - 36 months in length and typically have autorenewal terms.

Revenue is recognized over the term of the agreement in proportion to the costs incurred in fulfilling performance obligations under the contract.

Maintenance and support fees are based on the level of service provided to end customers, which can range from monitoring the health of a customer’s network, supporting a sophisticated web-portal, or managing the end-to-end hardware and software of a digital marketing system.

These agreements are renewable by the customer.

Rates for maintenance and support, including subsequent renewal rates, are typically established based upon a fee per location, per device, or a specified percentage of net software license fees as set forth in the arrangement.

These contracts are generally 12 - 36 months in length.

Revenue is recognized ratably and evenly over the service period.

The Company also performs time and materials-based maintenance and repair work for customers.

Revenue is recognized at a point in time when the performance obligation has been fully satisfied.

Installation Services

The Company performs installation services associated with system hardware sales to customers and recognizes revenue upon completion of the installations.

Installation services also include engineering and configuration services required to be performed to design and deploy a digital signage system that subsequently becomes an installation project.

When system hardware sales include installation services to be performed by the Company, the goods and services in the contract are, in certain instances, not distinct as the customer contract contemplates an installed solution, inclusive of system hardware.

In those instances, the arrangement is accounted for as a single performance obligation.

Our customers may control the work-in-process and can make changes to the design specifications over the contract term.

In these circumstances, revenues are recognized over time as the installation services are completed based on the relative portion of labor hours completed as a percentage of the budgeted hours for the installation.

Typically, in large scale deployments that include installation services, the contract terms segregate performance obligations related to hardware sales and installation services by providing for different legal transfer of title and risk of loss.

In those circumstances, installation services are deemed to be a separate performance obligation.

In each instance, installation services are recognized at the time of completion.

Other Services

Software design and development services

Software design and custom development sales represent fixed fee orders for work on a time and materials basis and are recognized as revenue when the application, feature, or custom software code has been received and delivery has occurred to the customer.

Revenue is recognized generally upon customer acceptance (point-in-time) of the software product and verification that it meets the required specifications.

Software is delivered to customers electronically.

Media revenues are derived from selling (i) promotion and sponsorship packages to monetize customer infrastructure assets, including mobile takeover or physical presence, or (ii) digital advertising inventory to advertisers on digital displays or other outdoor structures, owned or controlled by our customers, each within physical venues.

We sell advertising or sponsorship opportunities on behalf of our media network owner customers to brands and advertisers.

We generally do not own the devices that display the sold digital advertising.

The Company has concluded that it acts as an agent and reports media revenues on a net basis, with the Company recording its commission, which typically is between thirty percent ( 30 %) and forty percent ( 40 %) of the total media sales contract, as revenue in the consolidated financial statements.

The media sales contracts we facilitate on behalf of our customers range from a single day to eight years.

The Company invoices advertisers on behalf of our customers and remits the net cash to our customer after the advertiser has paid the Company the fees owed for such advertising.

Media revenue services are recognized when the Company has completed its performance obligations under the contract with our customers, which typically has concluded upon facilitating execution of contracts between our customer and a brand/advertiser.

The Company applies time-based constraints in accordance with ASC 606 to evaluate the earned portion of the contract to record at execution.

For revenues generated through the use of a subcontracted advertising agency, commissions are calculated based on a stated percentage of gross advertising revenue and reported in the Consolidated Statements of Operations within Sales and Marketing Expenses.

Business Combinations

Merger-related Contingent Consideration Settlement

On November 12, 2021, the Company entered into an Agreement and Plan of Merger with Reflect and RSI Exit Corporation, as representative of the former stockholders of Reflect (the “Stockholders’ Representative”), which was amended on February 8, 2022, February 11, 2023, February 17, 2025, and February 23, 2025 ( as amended, the “Merger Agreement”).

Pursuant to the Merger Agreement, the Company’s direct, wholly owned subsidiary, CRI Acquisition Corporation, merged with and into Reflect, with Reflect continuing as the surviving entity and becoming a wholly owned subsidiary of the Company (the “Merger”).

The Merger was closed on February 17, 2022.

The Merger Agreement required the Company to pay to the former Reflect stockholders on or after February 17, 2025 ( the “Guaranteed Date”) additional contingent supplemental cash payments (the “Guaranteed Consideration”) if the average closing price of the Company’s common stock in the fifteen ( 15 ) trading day period prior to the Guaranteed Date was below $ 6.40 per share (such applicable amount, the “Guaranteed Price”).

On March 14, 2025, the Company and Reflect entered into a Settlement Agreement and Fifth Amendment to Merger Agreement with the Stockholder’s Representative (the “Settlement Agreement”), pursuant to which the Company settled and resolved a dispute regarding the amount and enforceability of the Guaranteed Consideration.

Pursuant to the Settlement Agreement, the Company’s obligation to pay the Guaranteed Consideration to the former Reflect stockholders was terminated and released.

In consideration for such termination and release, (i) the Company deposited an aggregate of $ 3,000 in cash with an exchange agent for the ratable benefit of, and for distribution to, the former Reflect stockholders, (ii) the Company and Reflect (as co-obligors) delivered a subordinated promissory note in the principal amount of $ 4,000 payable to the order of the Stockholders’ Representative, as nominee for, and for the ratable benefit of, the former Reflect stockholders (the “Promissory Note”), and (iii) the Company agreed to issue to the former Reflect stockholders warrants to purchase their pro rata share of an aggregate of 777,800 shares of the Company’s common stock (the “Settlement Warrants”).

As a result of the Settlement Agreement, the Company derecognized the previously recorded contingent consideration liability related to the Merger of $ 12,815 and recorded the fair value of the settlement consideration of $ 8,040 , which included $ 3,000 in cash, the $ 4,000 Promissory Note, and Settlement Warrants with a fair value of $ 1,040 .

The Company recognized a gain on settlement of $ 4,775 during the nine months ended September 30, 2025 in the Condensed Consolidated Statement of Operations.

In conjunction with entering into the Settlement Agreement and related documents, the Company entered into a Consent Agreement dated March 14, 2025 with First Merchants Bank, among others (the “Consent Agreement”), pursuant to which (among other things) First Merchants Bank, the senior secured lender under the Company’s credit facility, agreed to waive certain negative covenants under the Company’s credit facility that may have otherwise been implicated by the transactions contemplated by the Settlement Agreement.

See Note 8 Debt and Note 11 Warrants for additional accounting considerations as a result of the issuance of the Promissory Note and Settlement Warrants.

Technology platform

6,656 - 6,656

Customer relationships

14,324 - 14,324

Non-compete covenant

Unfavorable lease

( 41 ) - ( 41 )

Operating lease right-of-use assets

Finance lease right-of-use assets

23,309 - 23,309

Operating lease liabilities

( 571 ) - ( 571 )

Finance lease liabilities

( 23,309 ) - ( 23,309 )

Property and equipment

2,711 - 2,711

Deferred tax liability

( 2,215 ) 661 ( 1,554 )

Debt-free net working capital deficit

( 9,486 ) - ( 9,486 )

Fair Value of Identified Net Assets $ 11,970 $ 661 $ 12,631

Remaining Goodwill Value $ 26,013 $ ( 661 ) $ 25,353

Fair Value of Net Assets Acquired $ 37,983 $ - $ 37,983

The measurement period adjustment recorded during the three months ended March 31, 2026 reflects new information obtained about facts and circumstances that existed as of the acquisition date and did not have a material impact on the Company’s results of operations in any prior period.

The preliminary purchase price allocation, including the items identified above, remains subject to further adjustment during the remainder of the measurement period as additional information is obtained, and any such adjustments will be recognized in the reporting period in which they are determined.

SUPPLEMENTAL CASH FLOW STATEMENT INFORMATION

Nine Months Ended

September 30,

For the Three Months Ended

Supplemental non-cash investing and financing activities

1 unchanged sentence

Property and equipment in accounts payable

Right-of-use assets obtained in exchange for new finance lease liabilities

Right-of-use assets obtained in exchange for new operating lease liabilities

Tenant allowance receivable recognized under lease incentive

Capitalized deferred financing costs in accounts payable

Issuance of term note as partial settlement of contingent consideration

Issuance of notes payable as partial settlement of contingent consideration

Issuance of warrants as partial settlement of contingent consideration

Effect of measurement period adjustments to goodwill

Supplemental disclosure information for cash flow

1 unchanged sentence

Operating leases

Income taxes, net

INTANGIBLE ASSETS, INCLUDING GOODWILL

Intangible Assets

Intangible assets consisted of the following at September 30, 2025 and December 31, 2024:

September 30,

Technology platform

Purchased and developed software

Customer relationships

Trademarks and trade names

Accumulated amortization

Net book value of amortizable intangible assets

For the three months ended September 30, 2025 and 2024 , amortization of intangible assets charged to operations was $ 1,171 and $ 1,081 , respectively.

For the nine months ended September 30, 2025 and 2024 , amortization of intangible assets charged to operations was $ 3,472 and $ 2,749 , respectively.

During the three months ended September 30, 2025, the Company recognized an impairment charge of $ 5,712 related to a proprietary software platform capitalized as an intangible asset under ASC 350 - 40.

The impairment was recorded after management determined that expected future cash flows associated with the platform were not sufficient to recover its carrying amount, primarily due to uncertainty regarding the renewal of an existing software license agreement.

The uncertainty arose in September 2025 when the customer communicated that it was unable to renew its license agreement with the Company due to budget constraints, representing a triggering event under ASC 350 - 40.

The impairment charge was measured as the excess of the asset’s carrying amount over its estimated fair value, which was determined using an income approach based on expected discounted cash flows and Level 3 inputs in accordance with ASC 820.

The impairment charge is presented within operating expenses in the Condensed Consolidated Statements of Operations.

Goodwill represents the excess of the purchase price paid by the Company over the fair value of net assets acquired by the Company.

Goodwill is subject to an impairment review at the reporting unit level, evaluated on an annual basis at September 30 of each fiscal year, or more frequently if events occur or circumstances change that indicate potential impairment.

The assessment may be performed quantitatively or qualitatively.

The Company has only one reporting unit, and therefore the entire goodwill balance is allocated to that reporting unit.

The Company assesses the carrying value of goodwill at the reporting unit level based on an estimate of the fair value of its reporting unit.

The Company performed its annual goodwill impairment assessment as of September 30, 2025, using a qualitative evaluation to determine whether it was more likely than not that the fair value of the reporting unit was below its carrying amount.

In performing the qualitative assessment, management considered relevant factors such as macroeconomic conditions, industry and market trends, overall financial performance, and changes in the Company’s operations or strategy.

Based on this assessment, management concluded that it was not more likely than not that the fair value of the reporting unit was less than its carrying amount, and therefore no goodwill impairment was recognized as of September 30, 2025.

The Company recognizes that any changes in its projected results could potentially have a material impact on the assessment of goodwill impairment.

The Company will continue to monitor the actual performance of its operations against expectations and assess indicators of possible impairment.

The valuation of goodwill and intangible assets is subject to a high degree of judgment, uncertainty, and complexity.

Should any indicators of impairment occur in subsequent periods, the Company will be required to perform an analysis to determine whether goodwill is impaired.

Debt for the Company consists of the following:

September 30,

Debt Instrument

Issuance Date

Maturity Date

Interest Rate Information

Revolving Credit Facility

PREPAID EXPENSES AND OTHER CURRENT ASSETS

As of March 31, 2026 and December 31, 2025, prepaid expenses and other current assets consisted of the following:

Vendor, project and hardware prepayments

Severance receivable

MAG reimbursement receivable

Other receivables

Prepaid subscriptions

Prepaid marketing

Prepaid other

Tax receivables

Prepaid insurance

SERIES A REDEEMABLE CONVERTIBLE PREFERRED STOCK

Dividend Rights

The Series A Preferred ranks senior to the Company’s common stock with respect to dividend rights and rights upon liquidation.

Each share has a liquidation preference equal to $ 1,000 per share plus accrued and unpaid dividends.

The liquidation preference of the Series A Preferred totaled $ 30,623 as of March 31, 2026.

The Series A Preferred bears cumulative dividends at a rate of 5.25 % per annum on the stated value.

Dividends accrue daily and compound quarterly beginning on November 6, 2025, and accrue for a five -year period (the “Guaranteed Term”).

Dividends are not payable in cash during the Guaranteed Term, except at the Company’s option.

Upon certain events occurring during the Guaranteed Term, including a liquidation, fundamental transaction (see below) or mandatory conversion, holders are entitled to a make-whole amount representing dividends that would have accrued through the end of the Guaranteed Term.

Dividends are recorded as an increase to the carrying value of the Series A Preferred and as an adjustment to net loss attributable to common shareholders in the calculation of basic and diluted net (loss) income per common share.

The Company recorded $ 391 in preferred dividends during the three months ended March 31, 2026.

The Series A Preferred stock was issued on November 6, 2025, therefore there were no preferred dividends during the three months ended March 31, 2025.

Redemption Rights

A fundamental transaction includes, among other events, a merger, consolidation, sale of substantially all assets, tender offer resulting in a change of control, recapitalization or similar transaction (a “Fundamental Transaction”).

Upon the occurrence of a Fundamental Transaction, holders are entitled to receive the greater of (i) the liquidation preference, including accrued dividends, or (ii) the amount they would have received on an as-converted basis.

Since the redemption of the Series A Preferred is contingently or optionally redeemable and therefore not certain to occur, the Series A Preferred is not required to be classified as a liability under ASC 480, Distinguishing Liabilities from Equity .

As the Series A Preferred is redeemable in certain circumstances at the option of the holder and is redeemable in certain circumstances upon the occurrence of an event that is not solely within the Company’s control, the Company has classified the Series A Preferred in temporary equity in the condensed consolidated balance sheets.

Because redemption is contingent and not currently probable, the Company has not accreted the carrying value to the redemption amount as of March 31, 2026 and December 31, 2025.

Registration Rights

In connection with the issuance, the Company entered into a Registration Rights Agreement (the “Registration Rights Agreement”) requiring the Company to file and maintain an effective registration statement covering the resale of the shares of common stock issuable upon conversion.

The Registration Rights Agreement provides for liquidated damages of up to 6 % of the aggregate purchase price in the event of certain registration failures.

As of March 31, 2026 and December 31, 2025, no liability has been recorded related to these provisions.

ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES

As of March 31, 2026 and December 31, 2025, accrued expenses and other current liabilities consisted of the following:

Accrued compensation

Sales and use taxes payable

Accrued interest

Accrued purchases

Other accrued expenses

As of March 31, 2026, and December 31, 2025 debt consisted of the following:

Amended and Restated Credit Agreement:

New Revolving Credit Facility

Term Loan Facility

Promissory Note

Total debt, gross

Deferred financing costs

debt issuance costs

Total debt, net

Current portion

Total long-term debt, net

Credit Facilities

On May 23, 2024, the Company entered into a Credit Agreement (the “Credit Agreement”) with First Merchants Bank (the “Bank”).

The Credit Agreement provides the Company with a $ 22,100 secured revolving credit facility, with an uncommitted accordion feature that provides for additional borrowing capacity of up to $ 5,000 , subject to the Bank’s approval and other customary terms and conditions set forth in the Credit Agreement.

The revolving credit facility matures on May 23, 2027, subject to any earlier default under the Credit Agreement.

The Credit Agreement requires the Company to pay the entire unpaid principal balance of the revolving credit facility on the maturity date, subject to any earlier default under the Credit Agreement.

The Credit Agreement includes, among other things, the occurrence of any event which could reasonably be anticipated to cause or result in a “Material Adverse Effect” (as defined in the Credit Agreement) as an event of default under which the outstanding balance could become due and payable to the Bank.

The Company has determined that the risk of such event is not probable and therefore has classified the outstanding balance in long-term liabilities in the Condensed Consolidated Balance Sheets based on the maturity date.

Effective March 31, 2025, the Company entered into an amendment to the Credit Agreement, modifying the financial covenant related to the Senior Funded to EBITDA ratio.

Pursuant to the amendment, the Company is required to maintain a Senior Funded Debt to EBITDA ratio of less than 4 to 1 through June 30, 2025, and less than 3.75 to 1 beginning with the quarter ending September 30, 2025 and thereafter.

Effective June 30, 2025, the Company entered into a second amendment to the Credit Agreement, amending the borrowing base used to determine the availability of the Company’s revolving line of credit under the Credit Agreement.

The borrowing base is equal to a percentage, or “Borrowing Base Margin,” of the sum of (a) the net orderly liquidation value of certain contracts of the Company eligible for inclusion, less (b) reserves required by the Bank, in each case as determined in accordance with the Credit Agreement.

The amendment provides that the Borrowing Base Margin means (i) 95 % from June 30, 2025 through September 29, 2025, ( ii) 90 % from September 30, 2025 through October 30, 2025, and (iii) 85 % on and after October 31, 2025.

The revolving credit facility accrues interest at a floating rate equal to the 1 -month SOFR, plus 0.11 %, plus a floating margin ranging from 2.00 % to 3.50 % that adjusts quarterly, depending upon the Company’s Senior Funded Debt to EBITDA Ratio.

The floating margin is determined as follows:

Senior Funded Debt to EBITDA Ratio

Floating Margin

≥ 1.00 to 1.00 but < 2.00 to 1.00

≥ 2.00 to 1.00 but < 3.00 to 1.00

≥ 3.00 to 1.00

The effective interest rate at September 30, 2025 was 7.74 %.

The Company pays accrued interest monthly on the first day of each successive calendar month.

The Company incurred $ 306 of deferred financing costs that were capitalized and recorded as other non-current assets within the Condensed Consolidated Balance Sheets.

Deferred financing costs are being amortized as interest expense over the respective debt instrument period, 36 months.

The Company had $ 18,163 in outstanding borrowings under the revolving credit facility as of September 30, 2025.

Total availability under the revolving facility was $ 3,937 .

On November 6, 2025 ( the “Refinancing Date”), the Company and certain of its subsidiaries (collectively, the “Borrowers”), entered into a new Credit Agreement (the “New Credit Agreement”) with the other loan parties signatory thereto (the “Loan Parties”), the financial institutions or other entities from time to time parties thereto (the “Lenders”) and First Merchants Bank, an Indiana bank, as Agent for the Lenders (“Agent”).

The New Credit Agreement amends and restates in its entirety the existing Credit Agreement dated as of May 23, 2024, as amended.

The New Credit Agreement provides the Borrowers with a $ 36,000 term loan (the “Term Loan”) and a $ 22,500 revolving credit facility (the “Revolver”), subject to the terms and conditions set forth in the New Credit Agreement.

The Term Loan and Revolver are further subject to the terms of the Term Loan Promissory Notes and Revolving Credit Promissory Notes executed in favor of the Lenders on the Refinancing Date.

Due to the timing of the refinancing, there was no covenant reporting requirement applicable for September 30, 2025.

Future financial covenant reporting will commence as of December 31, 2025.

current portion of debt, net

Total non-current portion of debt, net

Deferred financing costs related to the New Revolving Credit Facility of $ 397 and $ 435 as of March 31, 2026 and December 31, 2025, respectively, are included in other non-current assets on the condensed consolidated balance sheets.

Amended and Restated Credit Agreement

On November 6, 2025 ( the “Refinancing Date”), the Company and certain of its subsidiaries entered into the Amended and Restated Credit Agreement (the “Amended Credit Agreement”), with FMB acting as agent (“Agent”), and a new syndicate of lenders (“Lenders”) which included FMB and two additional creditors, Northwest Bank (“NWB”) and Axos Bank (“Axos”;

together with NWB, the “New Lenders”).

The Amended Credit Agreement provides the Company, CDMI and CDMUS (collectively, “Borrowers”) with two debt facilities, including a three -year term loan of $ 36,000 (the “Term Loan”) and a three -year revolving debt arrangement of up to $ 22,500 (the “New Revolving Credit Facility”).

The Term Loan and New Revolving Credit Facility in the Amended Credit Agreement both have maturity dates of November 6, 2028 ( the “Maturity Date”) and are secured by all the assets of the Borrowers.

Additionally, monthly interest payments for both facilities of the Amended Credit Agreement are due and payable on the first day of each successive calendar month following the Refinancing Date, which commenced on December 1, 2025, at a rate equal to the sums of (a) the one -month Term SOFR, (b) base rate of 0.11%;

and (c) a floating margin ranging between (i) 2.75 % to 3.25 % for the New Revolving Credit Facility, or (ii) 3.00 % to 3.50 % for the Term Loan, in each case adjusted quarterly based upon the Company’s Senior Funded Debt to EBITDA Ratio (as defined in the Amended Credit Agreement).

The floating margin is computed as follows:

On February 16, 2026, and in conjunction with the Warrant Repurchase Agreement (see Note 12 ), the Company and certain of its subsidiaries entered into a First Amendment to Amended and Restated Credit Agreement (the “Amendment”) with the other loan parties signatory thereto (the “Loan Parties”), the financial institutions or other entities from time to time parties thereto (the “Lenders”), and FMB, as Agent for the Lenders.

The Amendment amended the Company’s Amended Credit Agreement.

Pursuant to the Amendment, the Agent and Lenders provided requisite consent to the Company for the Warrant Repurchase and the parties agreed that payment of the Warrant Repurchase price would not reduce the amount of “Excess Cash Flow” of the Company for purposes of determining certain Company prepayment obligations.

During the three months ended March 31, 2026, the Company recorded amortization of debt discount on the Term Loan of $ 44 , and amortization of deferred financing costs on the New Revolving Credit Facility of $ 38 , in the Company's condensed consolidated statements of operations.

During the three months ended March 31, 2025, the Company recorded amortization of deferred financing costs on its prior revolving credit facility of $ 26 .

As of March 31, 2026 and December 31, 2025, the Company had remaining unamortized debt discount on the Term Loan of $ 452 and $ 497 , respectively, and deferred financing costs on the New Revolving Credit Facility of $ 397 and $ 435 , respectively.

During the three months ended March 31, 2026, the Company repaid $ 900 in principal related to the Term Loan.

During the three months ended March 31, 2026, the Company had borrowed $ 11,037 and repaid $ 6,472 , respectively, under the New Revolving Credit Facility.

During the three months ended March 31, 2025, the Company had borrowed $ 12,111 and repaid $ 5,917 , respectively, under the prior revolving credit facility.

At March 31, 2026, the remaining available amount under the New Revolving Credit Facility was $ 12,995 .

Promissory Note

1 unchanged sentence

It is an unsecured obligation of the Company.

The Promissory Note bears interest at a fixed annual rate of 14.0 %.

In the event of a default (as defined in the Promissory Note), or during any period of non-payment caused by restrictions under the Subordination Agreement (as defined below), the interest rate increases to 17.0 % per annum (the “Interest Rate”).

The Promissory Note requires monthly payments of interest only commencing April 14, 2025 and continuing through September 14, 2025.

The Promissory Note bears interest at a fixed annual rate of 14.0 % (the “Interest Rate”).

Commencing October 14, 2025, the Company is required to pay principal and interest in accordance with an amortization schedule that requires equal monthly payments of $ 109 on the 14th day of each calendar month through maturity on September 14, 2027.

On the maturity date, the Company is required to make a final balloon payment of $ 2,277 , representing the remaining principal and accrued but unpaid interest outstanding at maturity.

The make-whole payment is equal to the aggregate monthly payments of interest on the prepayment amount that would be due after the prepayment date and through the maturity date, using the percentage, if any, by which the Interest Rate exceeds a prescribed “yield maintenance treasury rate.”

The Stockholders’ Representative’s rights under the Promissory Note are subject to a Subordination Agreement dated of March 14, 2025 by and among the Company, Reflect, First Merchants Bank and the Stockholders’ Representative (the “Subordination Agreement”).

Under the terms of the Subordination Agreement, during any period in which an event of default exists under the senior debt facilities, the Company is prohibited from making any payments on the Promissory Note unless First Merchants Bank provides prior written consent, and the Stockholders’ Representative is prohibited from accepting or enforcing any payments during the subordination period.

The Promissory Note includes a default interest provision that increases the stated interest rate to 17 % in the event of nonpayment or other specified defaults.

The effective interest rate at September 30, 2025 was 14 %.

During the three months ended March 31, 2026, the Company made principal repayments of $ 197 on the Promissory Note.

The Stockholders' Representative's rights under the Promissory Note are subject to a Subordination Agreement dated March 14, 2025, by and among the Company, First Merchants Bank and the Stockholders' Representative (the "Subordination Agreement").

Under the terms of the Subordination Agreement, during any period in which an event of default exists under the Amended Credit Agreement, the Company is prohibited from making any payments on the Promissory Note unless FMB provided prior written consent, and the Stockholders' Representative is prohibited from accepting or enforcing any payments during the subordination period.

As of March 31, 2026, the Company is in compliance with the monthly required payments and there have been no events of default.

COMMITMENTS AND CONTINGENCIES

The Company is not party to any material legal proceedings, other than ordinary routine litigation incidental to the business, and there were no other such proceedings pending during the period covered by this Report.

Our deferred tax assets are primarily related to net federal and state operating loss carryforwards (“NOLs”).

We have substantial NOLs that are limited in usage by IRC Section 382.

The Company’s deferred tax assets are primarily related to net federal and state operating loss carryforwards (“NOLs”).

The Company has substantial NOLs that are limited in usage by IRC Section 382.

IRC Section 382 generally imposes an annual limitation on the amount of NOLs that may be used to offset taxable income when a corporation has undergone significant changes in stock ownership within a statutory testing period.

We have performed a preliminary analysis of the annual NOL carryforwards and limitations that are available to be used against taxable income.

Based on the history of losses of the Company, there continues to be a full valuation allowance against the net deferred tax assets of the Company with a definite life.

For the three and nine months ended September 30, 2025 the Company recorded an income tax benefit of $ 82 and $ 9 , respectively.

For the three and nine months ended September 30, 2024, the Company recorded income tax expense of $ 192 and $ 226 , respectively.

At September 30, 2025 , the Company had net deferred tax liabilities of $ 132 after consideration of the valuation allowance, compared to net tax liabilities of $ 133 at December 31, 2024.

The Company had outstanding warrants accounted for as equity instruments in the Company’s Condensed Consolidated Financial Statements totaling 5,364,802 and 4,587,002 at September 30, 2025 and December 31, 2024, respectively.

The weighted average exercise price of the outstanding warrants was $ 4.66 and $ 4.90 at September 30, 2025 and December 31, 2024, respectively.

The weighted average remaining contractual life of the outstanding warrants was 2.81 and 3.11 years at September 30, 2025 and December 31, 2024, respectively.

On March 14, 2025, as part of the contingent consideration settlement described in Note 5 , the Company issued to the former Reflect stockholders, in their capacities as selling stockholders and not as outside investors, the Settlement Warrants to purchase their pro rata share of an aggregate of 777,800 shares of the Company’s common stock at an exercise price equal to $ 3.25 per share, subject to adjustment for stock dividends, distributions, subdivisions, combinations, or reclassifications.

The Settlement Warrants are exercisable immediately and expire six years from the date of issuance.

They may be exercised for cash or, at the holder’s election, on a cashless (net settlement) basis.

The Company evaluated the Settlement Warrants under ASC 815 - 40, Derivatives and Hedging - Contracts in Entity ’ s Own Equity , and concluded that the Settlement Warrants meet the criteria for equity classification.

As such, the Settlement Warrants are not subject to remeasurement.

Accordingly, the fair value of the Settlement Warrants at issuance was recorded as a component of additional paid-in capital within shareholders’ equity.

The fair value of the Settlement Warrants was estimated at $ 1.34 per share as of the issuance date, using the Black-Scholes option pricing model.

Key assumptions included:

expected volatility of 94 %, expected term of 6 years (matching the exercise term), risk-free interest rate of 4.15 %, dividend yield of 0 %, and the Company’s stock price of $ 1.88 as of the valuation date.

The Company has performed a preliminary analysis of the annual NOL carryforwards and limitations that are available to be used against taxable income.

Deferred tax assets are evaluated quarterly for recoverability based on available positive and negative evidence.

Based on the history of losses the Company continues to maintain a full valuation allowance against U.S.

deferred tax assets with definite lives as management determined that realization of such assets does not meet the more-likely-than- not threshold.

In Canada, while CDM is in an overall net deferred tax liability position, a partial valuation allowance has been established against specific net operating loss carryforwards that are not expected to be realized due to statutory restrictions and limitations on future utilization.

For interim periods, the Company has historically utilized the estimated annual effective tax rate method under which the Company determined its provision for income taxes based on the current estimate of its annual effective tax rate.

For the three months ended March 31, 2026, the Company utilized the discrete effective tax rate method, as allowed under ASC Topic 740, Income Taxes—Interim Reporting, when the application of the estimated annual tax rate method is impractical and does not provide a reliable estimate of the annual effective tax rate.

The discrete method treats the year-to-date period as if it were the annual period and determines the interim income taxes on that basis.

The Company determined that since small changes in estimated annual pre-tax (loss) income would result in significant changes in the estimated annual effective tax rate and significant variations in the customary relationship between the benefit (expense) from income taxes and pre-tax accounting (loss) income, the historical method would not provide a reliable estimate of the effective tax rate for the three months ended March 31, 2026.

The Company will reevaluate the use of this method until the Company believes a return to the estimated annual effective tax rate method is deemed appropriate.

For the three months ended March 31, 2026 and 2025, the Company recorded income tax benefit (expense) of $ 530 and ($ 99 ), respectively.

At March 31, 2026, the net deferred tax liabilities were $ 2,190 after valuation allowance, compared to net tax liabilities of $ 3,541 at December 31, 2025.

The Company had outstanding warrants accounted for as equity instruments in the Company’s condensed consolidated financial statements totaling 3,633,303 shares and 5,364,802 shares at March 31, 2026 and December 31, 2025, respectively.

The weighted average exercise price of the outstanding warrants was $ 4.02 and $ 4.66 at March 31, 2026 and December 31, 2025, respectively.

The weighted average remaining contractual life of the outstanding warrants was 2.52 and 2.55 years at March 31, 2026 and December 31, 2025, respectively.

On February 16, 2026, the Company entered into a Warrant Repurchase Agreement (the “Warrant Repurchase Agreement”) with Slipstream Communications, LLC (the “Warrant Holder”).

Under the Warrant Repurchase Agreement, the Company agreed to repurchase from the Warrant Holder a warrant (the “Warrant”) to purchase shares of the Company’s common stock, par value $ 0.01 per share (the “Common Stock”), for an aggregate repurchase price of $ 200 .

There was no repurchase feature in the original warrant agreement that would have impacted the equity classification of these warrants while they were outstanding.

The repurchase was negotiated between the parties in a separate transaction.

The Warrant was initially issued to the Warrant Holder pursuant to a Second Amended and Restated Loan and Security Agreement, dated as of February 17, 2022, by and among the Company, the Warrant Holder and the other signatories thereto and was subsequently amended and restated twice, as of June 30, 2022 and as of October 17, 2024, respectively.

As amended and restated, the Warrant was exercisable for up to an aggregate of 1,731,499 shares of Common Stock (the “Warrant Shares”) at an exercise price per Warrant Share equal to $ 6.00 .

The closing of the Warrant Repurchase was completed on February 17, 2026.

Upon settlement of the transaction, the Warrant was cancelled and is of no further force or effect.

STOCK-BASED COMPENSATION

7 unchanged sentences

1,502,896 7.61 $ 4.29 488,896 $ 8.06

1,477,679 7.81 $ 4.54 524,679

Performance Vesting Options

240,000 4.17 $ 7.59 240,000 $ 7.59

Market Vesting Options

Performance Vesting

733,334 6.21 $ 3.00 733,334 $ 3.00

Market Vesting Options

Time Vesting Options

Performance Vesting Options

Date/Activity

1 unchanged sentence

Forfeited or expired

Balance, September 30, 2025

The weighted average remaining contractual life for options exercisable is 5.65 years as of September 30, 2025 .

Balance, March 31, 2026

The weighted average remaining contractual life for options exercisable is 5.24 years as of March 31, 2026.

Employee Awards

On April 1, 2025, the Company granted stock options to purchase an aggregate of 567,500 shares of common stock to employees pursuant to the Company’s 2023 Stock Incentive Plan (the “Plan”), which was previously approved by shareholders.

The options have an exercise price of $ 1.95 per share, equal to the closing market price of the Company’s common stock on the grant date.

The options vest in equal annual installments over a three -year period, subject to continued service through each vesting date, and expire ten years from the date of grant.

The Company determined the grant-date fair value using the Black-Scholes option pricing model with key assumptions including expected volatility of 96 %, expected term of 6.5 years, risk-free interest rate of 4.00 %, dividend yield of 0 %, and the Company’s stock price of $ 1.95 as of the valuation date.

The awards will be recognized as stock-based compensation expense over the requisite service period in accordance with ASC 718 Compensation - Stock Compensation , based on the grant-date fair value of the options.

On June 2, 2025, the Company granted stock options to purchase an aggregate of 378,000 shares of common stock to employees under the Plan.

The options have an exercise price of $ 3.05 per share, equal to the closing market price of the Company’s common stock on the grant date.

The options vest in equal annual installments over a three -year period, subject to continued service through each vesting date, and expire ten years from the date of grant.

The Company determined the grant-date fair value using the Black-Scholes option pricing model with key assumptions including expected volatility of 94 %, expected term of 6.5 years, risk-free interest rate of 4.17 %, dividend yield of 0 %, and the Company’s stock price of $ 3.05 as of the valuation date.

On June 2, 2025, the Company accelerated the vesting of options to purchase 733,334 shares of common stock.

Prior to such acceleration, the vesting of these options depended on the Company’s share price meeting various price targets.

One such share price target was an amount equal to the “Guaranteed Price,” as such term is defined in the Merger Agreement by and among the Company, Reflect, CRI Acquisition Corporation, a Delaware corporation, and RSI Exit Corporation, a Texas corporation and representative of the former stockholders of Reflect (“RSI”).

On March 14, 2025, the Company and RSI settled and resolved a dispute related to the Guaranteed Consideration.

On June 2, 2025, in consideration of the efforts in resolving and settling such dispute, the Compensation Committee of the Company fully vested the 733,334 options.

As a result of the amendment and corresponding vesting, the Company recognized stock compensation expense of $ 1,149 during the three months ended June 30, 2025.

On July 3, 2025, the Company granted 575,000 restricted stock units under the Plan.

The restricted stock units vest in three equal installments over a period of three years, subject to continued service through the applicable vesting dates.

The grant date fair value of the restricted stock units was estimated at $ 3.30 per share based on the closing price of the Company’s common stock on the grant date.

The Company expects to recognize stock-based compensation expense of approximately $ 1,898 over the requisite service periods.

On September 15, 2025, the Company granted stock options to purchase an aggregate of 15,000 shares of common stock to employees under the Plan.

The options have an exercise price of $ 2.31 per share, equal to the closing market price of the Company’s common stock on the grant date.

The options vest in equal annual installments over a three -year period, subject to continued service through each vesting date, and expire ten years from the date of grant.

The Company determined the grant-date fair value using the Black-Scholes option pricing model with key assumptions including expected volatility of 94 %, expected term of 6.5 years, risk-free interest rate of 3.75 %, dividend yield of 0 %, and the Company’s stock price of $ 2.31 as of the valuation date.

Stock-based compensation expense recognized for the three and nine months ended September 30, 2025 and 2024 was $ 308 and $ 1,559 , and $ 3 and $ 9 , respectively, and is included within general and administrative expense in the Condensed Consolidated Statements of Operations.

At September 30, 2025, unrecognized compensation cost related to unvested share-based awards totaled $ 3,278 , which is expected to be recognized over a weighted-average period of approximately 2.67 years.

Stock-based compensation expense recognized related to stock options and restricted stock units to employees for the three months ended March 31, 2026 and 2025 was $ 270 and $2, respectively, and is included in general and administrative expenses in the condensed consolidated financial statements.

As of March 31, 2026, there was $ 2,601 of total unrecognized compensation expense related to unvested share-based awards, which is expected to be recognized over a weighted average period of approximately 2.03 years.

Director Awards

Compensation expense recognized for the issuance of stock options awarded to our Board of Directors for the three months ended March 31, 2026 and 2025 was $ 54 and $ 0 , respectively, and was included in general and administrative expenses in the condensed consolidated financial statements.

As of March 31, 2026 there was $ 162 unrecognized compensation expense related to share-based awards to directors, which is expected to be recognized over a weighted average period of approximately 0.75 years.

SEGMENT REPORTING

In November 2023, the FASB issued ASU 2023 - 07, Segment Reporting (Topic 280 ):

Improvements to Reportable Segment Disclosures , which requires public entities to disclose information about their reportable segments’ significant expenses and other segment items on an interim and annual basis.

Public entities with a single reportable segment are required to apply the disclosure requirements in ASU 2023 - 07, as well as all existing segment disclosures and reconciliation requirements in ASC 280 on an interim and annual basis.

ASU 2023 - 07 is effective for fiscal years beginning after December 15, 2023, and for interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted.

The Company adopted the new standard for the fiscal year ending December 31, 2024.

Segment Information

We currently operate in one reportable segment, marketing technology solutions.

The marketing technology solutions segment generates revenue through three primary sources which includes ( 1 ) hardware sales from reselling digital signage hardware from original equipment manufacturers, ( 2 ) services from helping customers design, deploy, and manage their digital signage and ad-based networks, and ( 3 ) recurring subscription licensing and support revenue from our digital signage and ad-tech software platforms, which are generally sold via a SaaS model.

The marketing technology solutions segment generates revenue through four primary sources which includes ( 1 ) hardware sales from reselling digital signage hardware from original equipment manufacturers, ( 2 ) services from helping customers design, deploy, and manage their digital signage and ad-based networks, ( 3 ) recurring subscription licensing and support revenue from our digital signage and ad-tech software platforms, which are generally sold via a SaaS model, and ( 4 ) selling digital out-of-home (“DOOH”) advertising on infrastructure it owns or operates at retail malls, shopping centers, office buildings, and other commercial properties.

Our Chief Executive Officer is our chief operating decision maker (the “CODM”).

4 unchanged sentences

In addition, the CODM reviews supplementary metrics such as disaggregated revenue as disclosed in Note 3, Revenue Recognition, and customer growth to ensure that our strategic decisions are aligned with long-term performance goals.

The measure used by our CODM to assess performance and make operating decisions is net income (loss) as reported on our Condensed Consolidated Statements of Operations.

The measure used by our CODM to assess performance and make operating decisions is net loss as reported on our condensed consolidated statements of operations.

Significant segment expenses are reported as total expenses on the condensed consolidated statements of operations.

1 unchanged sentence

Significant Customers

The Company had two customers that accounted for 28 % and 11 % of accounts receivable at September 30, 2025 and one customer that accounted for 16 % of accounts receivable at December 31, 2024.

No customer accounted for more than 10% of revenue for the three months ended September 30, 2025 , compared to two customers that accounted for 14 % and 12 %, of revenue for the three months ended September 30, 2024 .

No customer accounted for more than 10% of revenue for the nine months ended September 30, 2025 , compared to one customer that accounted for 12 % of revenue for the nine months ended September 30, 2024 .

We had one customer that accounted for 11 % of revenue for the three months ended March 31, 2026, compared to three customers that accounted for 20 %, 11 % and 10 % of revenue for the three months ended March 31, 2025.

We had one customer that accounted for 10 % of accounts receivable as of March 31, 2026 and one customer that accounted for 12 % of accounts receivable as of December 31, 2025.

Revenues by Geographical Area

The following table summarizes our revenue recognized in the condensed consolidated statements of operations by geographical area:

Three Months Ended

Revenues by Geographical Area:

United States

Total Revenues

Significant Vendors

The Company had one vendor that accounted for 50 % of outstanding accounts payable at September 30, 2025 , and two vendors that accounted for 27 % and 10 % of outstanding accounts payable at December 31, 2024.

No vendor accounted for more than 10% of outstanding accounts payable at March 31, 2026, and three vendors accounted for 30 %, 18 % and 10 % of outstanding accounts payable at December 31, 2025.

Long Lived Assets by Geographical Region

The following table sets forth our long-lived assets by geographic area, which consists of property and equipment, net and operating and finance lease right-of-use assets:

United States

The Company's lease portfolio is primarily comprised of operating leases for office space and finance leases for computer equipment and DOOH media assets from the acquisition of CDM.

At the inception of an arrangement, the Company determines whether the arrangement is or contains a lease based on whether the contract conveys the right to control the use of identified property or equipment for a period of time in exchange for consideration.

Leases are classified as operating or finance leases at the commencement date of the lease.

Leases may include one or more options to renew.

We do not assume renewals in our determination of the lease term unless the renewals are deemed to be reasonably assured at lease commencement.

Our lease agreements do not contain any material residual value guarantees or material restrictive covenants.

The Company determines the discount rate used to measure lease liabilities based on the rate implicit in the lease, if readily determinable.

If the implicit rate is not available, the Company uses its incremental borrowing rate, which is determined based on the rate at which the Company could borrow on a collateralized basis over a similar term and in a similar economic environment to the lease.

The following table summarizes the classification of operating and finance lease assets and liabilities in the Company's condensed consolidated balance sheet as follows:

Finance lease assets

Operating lease assets

Total lease assets

Operating lease liabilities:

Current portion of operating lease liabilities

Non-current portion of operating lease liabilities

Finance lease liabilities:

Current portion of finance lease liabilities

Non-current portion of finance lease liabilities

Total lease liabilities

The following table summarizes the operating and financing lease expenses in the Company's condensed consolidated statements of operations as follows:

For the Three Months Ended

Operating lease expense

Finance lease expense:

Amortization of right-of-use assets

Interest on lease liabilities

Total lease expense

The following table provides lease term and discount rate information related to operating and finance leases as follows:

For the Three Months Ended

Weighted average remaining lease term (years):

Operating leases

Finance leases

Weighted average discount rate:

Operating leases

Finance leases

The following sets forth future minimum lease payments as follows:

Future minimum payments:

Remainder of 2026

Total undiscounted cash flows

Less imputed interest

Present value of lease liabilities

Supplemental cash flow information and non-cash activity related to leases include the following:

For the Three Months Ended

Cash paid for amounts included in the measurement of lease liabilities:

Operating cash flows paid for operating leases

Operating cash flows paid for finance leases

Financing cash flows paid for finance leases

SUBSEQUENT EVENTS

On October 15, 2025, the Company entered into a Share Purchase Agreement with its wholly owned subsidiary, 1001372953 Ontario Inc., and Cineplex Entertainment Limited Partnership to acquire all of the issued and outstanding shares of DDC Group International, Inc.

(“DDC”), including its subsidiaries Cineplex Digital Media Inc.

and Cineplex Digital Media U.S.

(collectively, the “CDM Business”).

The total purchase price is approximately CAD $ 70,000 or USD $ 42,761 , subject to customary adjustments.

The acquisition was completed on November 7, 2025.

On October 15, 2025, the Company entered into a Securities Purchase Agreement with certain accredited investors to issue 30,000 shares of a newly designated Series A Convertible Preferred Stock (the “Preferred Stock”) for aggregate gross proceeds of $ 30,000 , which has a stated value of $ 1,000 per share (the “Stated Value”)(the “Offering”).

The Offering was completed on November 6, 2025.

The Preferred Stock will accrue dividends for a period of five years from and after the issuance date (the “Guaranteed Term”) at a rate of 5.25 % per year on the Stated Value, which will be payable in cash at the Company’s option after the Guaranteed Term.

To the extent that, during the Guaranteed Term, (i) the Company undergoes any liquidation, dissolution, winding up, or “Fundamental Transaction” (as defined in the Certificate of Designations, Preferences and Rights of Series A Convertible Preferred Stock (the “Certificate of Designations”)), or (ii) the Company elects to effect a mandatory conversion under circumstances permitted by the rights and preferences of the Preferred Stock (each, a “Make Whole Event”), then, immediately prior to the effective time of such Make Whole Event, the amount of dividends accrued on the Preferred Stock will automatically be increased by an amount equal to any additional dividends that would have otherwise accrued on the Preferred Stock between the date of the Make Whole Event and the end of the Guaranteed Term (the “Make Whole Payment”), and the dividends will thereafter cease to accrue.

Each share of Preferred Stock is convertible at the option of the holder into shares of the Company’s common stock (“Conversion Shares”) at a rate (the “Conversion Rate”) calculated by dividing (i) the Stated Value plus an amount per share equal to dividends accrued and unpaid through the date of determination (including, if applicable, any Make Whole Payment) (the “Liquidation Preference”), by (ii) a conversion price of $ 3.00 , subject to customary adjustment in the event of stock splits, stock dividends, and similar events (the “Conversion Price”), subject to certain conversion limitations set forth in the Certificate of Designations.

Holders of Preferred Stock are entitled to vote on an as-converted basis with holders of the Company’s common stock (after taking into the account the applicable conversion limitations).

The Company used net proceeds of the Offering to fund a portion of the purchase price to acquire the CDM Business.

The New Credit Agreement amends and restates in its entirety the existing Credit Agreement dated as of May 23, 2024, as amended.

The Term Loan and Revolver are further subject to the terms of the Term Loan Promissory Notes and Revolving Credit Promissory Notes executed in favor of the Lenders on the Refinancing Date.

On November 10, 2025, the Compensation Committee of the Board of Directors approved a transaction bonus in the amount of $ 270 payable to Richard Mills, Chief Executive Officer, for his services in connection with the New Credit Agreement, Offering and acquisition of the CDM Business.

The Company has evaluated subsequent events occurring after the balance sheet date through the date the condensed consolidated financial statements were issued and has determined that there were no such events that would require recognition or disclosure in the financial statements.

Management ’ s Discussion and Analysis of Financial Condition and Results of Operations

3 unchanged sentences

These forward-looking statements are subject to numerous risks and uncertainties that could cause actual results to differ materially from those anticipated, and many of which are beyond our control.

Factors that could cause actual results to differ materially from those anticipated are set forth under the caption “Risk Factors” in the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2025, and the Company’s Annual Report on Form 10-K for the year ended December 31, 2024, as filed with the Securities and Exchange Commission on May 14, 2025 and March 14, 2025, respectively.

Factors that could cause actual results to differ materially from those anticipated are set forth under the caption “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025, as filed with the Securities and Exchange Commission on April 15, 2026.

Our actual results, performance or achievements could differ materially from those expressed in, or implied by, forward-looking statements.

4 unchanged sentences

Entertainment and Sports Venues

Restaurants, including quick-serve restaurants (“QSR”);

Restaurants, including Quick Service Restaurants (“QSR”)

Convenience Stores

Financial Services

Medical and Healthcare Facilities;

Mixed Use Developments

Corporate Communications, Employee Experience;

Digital out of Home (“DOOH”) Advertising Networks.

DOOH Advertising Networks

We serve market-leading companies, so there is a good chance that if you leave your home today to shop, work, eat or play, you will encounter one or more of our digital signage experiences.

6 unchanged sentences

Increased customer/guest engagement;

Through a combination of organically grown platforms and a series of strategic acquisitions, the Company assists customers to design, deploy, manage, and monetize their digital signage networks.

The Company sources leads and opportunities for its solutions through its digital and content marketing initiatives, close relationships with key industry partners, specifically equipment manufacturers, and the direct efforts of its in-house industry sales experts.

Traffic content and advertising

Through a combination of organically grown platforms and a series of strategic acquisitions, the Company assists customers to design, deploy, manage, and monetize their digital signage and in-store retail media networks.

The Company sources leads and opportunities for its solutions through its digital and content marketing initiatives, close relationships with key industry partners, including equipment manufacturers and a media sales agent, and the direct efforts of its in-house industry sales experts.

Customer engagements focus on consultative conversations that ensure the Company’s solutions are positioned to help customers achieve their business objectives in the most cost-effective manner possible.

1 unchanged sentence

Breadth of solutions – Creative Realities offers a wide breadth of solutions to our customers.

Creative Realities is one of only a few companies in the industry capable of providing the full portfolio of products and services required to implement and run an effective digital signage network.

We leverage a ‘single vendor’ approach, providing customers with a one-stop-shop for sourcing digital signage solutions from design through day two services.

Creative Realities is one of only a few companies in the industry capable of providing the full portfolio of products and services required to implement and run an effective digital signage and in-store retail media networks.

We leverage a ‘single vendor’ approach, providing customers with a one-stop-shop for sourcing digital signage and media solutions from design through day two services.

Managed labor pool – Unlike most companies in our industry, we have a curated labor pool of qualified and vetted field technicians available to service customers quickly nationwide.

4 unchanged sentences

This also provides us purchasing power to source products and services for our customers, enabling us to deliver cost effective, reliable and powerful solutions to small and medium size business customers.

AdTech platforms – The Company has developed and deployed the AdLogic and Adlogic CPM+ platforms, which, working in conjunction with our CMS platforms, present completely integrated digital advertising solutions for existing and prospective customers seeking to monetize their in-store retail media networks.

AdTech platforms – The Company has developed and deployed the AdLogic and CPM+ platforms, which, working in conjunction with our CMS platforms, present completely integrated digital advertising solutions for existing and prospective customers seeking to monetize their in-store retail media networks.

These platforms anchor the Company's vertical expansion into AdTech bringing new, and expanding existing, addressable markets.

Market sector expertise – Creative Realities has in-house experts in key market segments such as automotive, retail, QSRs, convenience stores, and DOOH advertising.

Market sector expertise – Creative Realities has in-house experts in key market segments such as retail, QSRs, convenience stores, and DOOH advertising.

Our expertise in these business segments enable our teams to provide meaningful business conversations and offer tailored solutions with prospects and customers to their unique business objectives.

3 unchanged sentences

Technical support – Digital signage networks present unique challenges for corporate IT departments.

We simplify and improve end user support by leveraging our own NOC in Louisville, Kentucky.

We simplify and improve end user support by leveraging our own network operations center (“NOC”) in Louisville, Kentucky.

The NOC resolves many issues remotely and when field support is required, it can be dispatched quickly from the NOC, leveraging our managed labor pool to resolve customer issues quickly and effectively.

1 unchanged sentence

We believe that interactive applications and integrations with other data sources will dominate the future.

From social media feeds, mobile integrations, corporate data stores, or point of sale systems, our proven ability to build scalable applications and integrations is a key advantage that customers can leverage to deliver more compelling and engaging experiences for their customers.

From social media feeds, mobile integrations, corporate data stores, or POS systems, our proven ability to build scalable applications and integrations is a key advantage that customers can leverage to deliver more compelling and engaging experiences for their customers.

Hardware support – A number of digital signage providers sell a proprietary media player or align themselves with just one operating system.

We utilize a range of media players including Windows, Android and BrightSign to provide customers flexibility to select the appropriate hardware for any application knowing the entire network can still be served by a single digital signage platform, reducing complexity and improving the productivity of our customers.

We utilize a range of media players including Windows, Android and BrightSign to provide customers the flexibility they need to select the appropriate hardware for any application knowing the entire network can still be served by a single digital signage platform, reducing complexity and improving the productivity of our customers.

Retail Media Network – The Company owns and operates the largest mall shopping network in Canada.

Our Sources of Revenue

The three primary sources of revenue for the Company are:

The four primary sources of revenue for the Company are:

Hardware sales from reselling digital signage hardware from original equipment manufacturers such as Samsung and BrightSign.

Services revenue from helping customers design, deploy and manage their digital signage network, including:

Services revenue from helping customers design, deploy and manage their digital signage and in-store retail media networks, including:

Hardware system design/engineering

3 unchanged sentences

Post-deployment network and field support

AdTech to traffic advertising and content directly and through programmatic channels

Recurring subscription licensing and support revenue from our digital signage software platforms, which are generally sold via a SaaS model.

Our platforms include:

Our platforms:

ReflectView , the Company’s core digital signage platform for most applications, scalable and cost effective from 10 to 100,000+ devices;

Reflect Xperience , a web-based interface that allows customers to give content scheduling access to local users via the web or mobile devices, while still maintaining centralized programming control;

Reflect AdLogic , the Company’s ad management platform for digital signage networks, which presently delivers approximately 50 million ads daily;

Clarity , the Company’s menu board solution, which has become a market leader for a range of restaurant and convenience store applications;

Reflect Zero Touch , which allows customers to turn any screen into an interactive experience by allowing guests to engage using their mobile device;

AdLogic , the Company’s ad management platform for digital signage networks, which presently delivers approximately 50 million ads daily;

Clarity , the Company’s digital signage platform for menu board solutions, which has become a market leader for a range of restaurants, including QSRs and convenience store applications;

iShowroomProX , an omni-channel digital sales support platform targeted at original equipment manufacturers in the transportation sector, which integrates with dozens of key data services including dealer inventory at the VIN level.

OSx+ , a digital VIN-level checklist used to assist in the tracking and delivery of new vehicles in the transportation sector, providing measurable lift in customer satisfaction scores and connected vehicle enrollments and subscription activations.

While hardware sales and support services revenues can fluctuate more significantly year over year based on new, large-scale network deployments, the Company expects to see continuous growth in recurring SaaS revenue for the foreseeable future as digital signage adoption/utilization continues to expand across the vertical markets we serve.

Selling digital out-of-home (DOOH) advertising on infrastructure it owns or operates at retail malls, shopping centers, office buildings, and other commercial properties.

While hardware sales and support services revenues can fluctuate more significantly year over year based on new, large-scale network deployments, the Company is focusing on maintaining and increasing recurring SaaS revenue as digital signage adoption/utilization expands across the vertical markets we serve.

Our Operating Expenses

3 unchanged sentences

Our general and administrative expenses consist of corporate overhead, including administrative salaries, real property lease payments, salaries, and benefits for our corporate officers and other expenses such as legal and accounting fees.

Critical Accounting Policies and Estimates

The Company’s significant accounting policies are described in Note 2 Summary of Significant Accounting Policies of the Company’s Condensed Consolidated Financial Statements included elsewhere in this Report.

The Company’s Condensed Consolidated Financial Statements are prepared in conformity with GAAP.

Certain accounting policies involve significant judgments, assumptions, and estimates by management that could have a material impact on the carrying value of certain assets and liabilities and disclosure of contingent assets and liabilities at the date of the Condensed Consolidated Financial Statements and the reported amounts of revenue and expenses during the reporting period.

Our actual results could differ from those estimates.

Results of Operations

All dollar amounts reported in Results of Operations are in thousands, except share and per-share information.

Three Months Ended September 30, 2025 Compared to Three Months Ended September 30, 2024

The tables presented below compare our results of operations and present the results for each period and the change in those results from one period to another in both dollars and percentage change.

All dollar amounts reported in Results of Operations are in thousands, except per-share information.

Three Months Ended March 31, 2026 Compared to Three Months Ended March 31, 2025

The tables presented below compare our results of operations from one period to another and present the results for each period and the change in those results from one period to another in both dollars and percentage change.

For The Three Months

ended September 30,

Cost of sales

Sales and marketing expenses

General and administrative expenses

Impairment of software asset

Total operating expenses

Operating (loss) income

Other expenses (income):

Interest expense

Loss on change in fair value of contingent consideration

Other expense (income)

Total other expenses (income)

Net (loss) income before income taxes

Benefit (provision) for income taxes

Sales decreased $3,895, or 27%, for the three months ending September 30, 2025 as compared to the same period in 2024.

Hardware revenues were $4,168, a decrease of $1,073, or 20%, for the three months ending September 30, 2025 as compared to the same period in 2024.

The decrease in hardware revenues was primarily driven by a significant sports and entertainment installation in the prior year that did not occur in 2025.

Services and other revenues were $6,379, a decrease of $2,822 or 31%.

Installation services revenue decreased $1,802, or 62% for the three months ending September 30, 2025 as compared to the same period in 2024, due to fewer deployments in the period.

Managed services revenue, which includes the Company’s SaaS subscription services, were $4,456, a decrease of $429, or 9%, as compared to the same period in 2024, as a result of reductions in the quantity of licenses subject to software subscriptions on our platforms driven by a single customer which insourced a portion of their hosted environment.

Other services revenue decreased $591, or 42% for the three months ending September 30, 2025 as compared to the same period in 2024, as a result of the Company exiting media sales effective October 1, 2024.

Gross profit margin was 45% and 46% for the three months ending September 30, 2025 and 2024, respectively.

Hardware gross margin increased 6% as a result of deployments utilizing hardware with more favorable margins due to the Company’s purchasing power.

Services and other gross margin decreased 3% as a result of a reduction in our SaaS subscription services and our exit from media sales effective October 1, 2024.

Sales and Marketing Expenses

Sales and marketing expenses generally include the salaries, taxes, and benefits of our sales and marketing personnel, as well as trade show activities, travel, and other related sales and marketing costs.

Sales and marketing expenses decreased by $153, or 10%, for the three-month period ended September 30, 2025 as compared to the same period in 2024, driven primarily by a decreases of $265 in fixed and variable salaries, taxes and benefits of our sales and marketing personnel, partially offset by an increase of $111 related to an increased investment in trade show and marketing activities during the quarter.

General and Administrative Expenses

General and administrative expenses increased by $1,036 or 26%, for the three months ending September 30, 2025 as compared to the same period in 2024.

The increase was driven by (1) a $331 rise in stock-based compensation expense for employees and directors and (2) $766 in expenses related to deal and transaction costs incurred in relation to the announced acquisition of Cineplex Digital Media, which is expected to close in the fourth quarter of 2025.

Impairment of software asset

During the three months ended September 30, 2025, the Company recognized a non-cash impairment charge of $5,712 related to a proprietary software platform capitalized as an intangible asset under ASC 350-40.

The impairment loss was measured as the excess of the asset’s carrying amount over its estimated fair value, which was determined using an income approach based on discounted cash flows and Level 3 inputs under ASC 820.

The impairment did not impact cash flows or liquidity, but it did result in a significant increase in total operating expenses for the three months ended September 30, 2025 compared to the same periods in 2024.

Interest Expense

See Note 8 Debt to the Condensed Consolidated Financial Statements for a discussion of the Company’s debt and related interest expense obligations.

Nine Months Ended September 30, 2025 Compared to Nine Months Ended September 30, 2024

The tables presented below compare our results of operations and present the results for each period and the change in those results from one period to another in both dollars and percentage change.

For the Nine Months

Ended September 30,

Services and other

Cost of sales:

Services and other

Total cost of sales

Operating expenses:

Sales and marketing expenses

General and administrative expenses

Impairment of software asset

Total operating expenses

Operating (loss) income

Operating loss

Other expenses (income):

Interest expense

Interest expense, including amortization of debt discount

Gain on settlement of contingent consideration

Gain on change in fair value of contingent consideration

Loss on debt extinguishment

Other expense (income)

Total other expenses (income)

Net loss before income taxes

Provision from income taxes

Sales decreased $6,531, or 16%, for the nine months ending September 30, 2025 as compared to the same period in 2024.

Hardware revenues were $14,635, an increase of $226, or 2%, for the nine months ending September 30, 2025 as compared to the same period in 2024.

The increase in hardware revenues was primarily driven by purchases from customers in our QSR and sports and entertainment verticals.

Services and other revenues were $18,676, a decrease of $6,758 or 27%.

Installation services revenue decreased $3,166, or 45% for the nine months ending September 30, 2025 as compared to the same period in 2024, due to fewer deployments in the period.

Managed services revenue, which includes the Company’s SaaS subscription services, were $13,187, a decrease of $1,319, or 9%, as compared to the same period in 2024, as a result of reductions in the quantity of licenses subject to software subscriptions on our platforms driven by a single customer which insourced a portion of their hosted environment.

Other services revenue decreased $2,272, or 60% for the nine months ending September 30, 2025 as compared to the same period in 2024, as a result of the Company exiting media sales effective October 1, 2024.

Gross profit margin was 43% and 48% for the nine months ending September 30, 2025 and 2024, respectively.

Hardware gross margin increased 2% as a result of deployments utilizing hardware with more favorable margins due to the Company’s purchasing power, combined with increased pricing on certain hardware-only purchases by customers.

Services and other gross margin decreased 6% as a result of a reduction in our SaaS subscription services and our exit from media sales effective October 1, 2024.

Other expense, net

Total other (income) expenses, net

Loss before income taxes

Income tax benefit (expense)

Net (loss) income

Sales increased by $6,614 or 68%, to $16,348 for the three months ended March 31, 2026 compared to the same period in 2025.

Hardware revenues during the first quarter 2026 were $4,557, an increase of $1,163 as compared to the same period in 2025.

Approximately sixty percent of the increase was due to the inclusion of CDM, while the remaining forty percent increase was driven by new customer deployments during the quarter.

The number of new deployments was lower than expected due to adverse weather conditions that delayed planned installations in multiple regions.

Services and other revenues were $11,791, an increase of $5,451 for the three months ended March 31, 2026, as compared to the same period in 2025, due to the acquisition of CDM.

Managed services revenue, which includes the Company’s SaaS subscription services, were $5,106, an increase of $859, or 20%, as compared to the same period in 2025, largely driven by the inclusion of CDM in 2026, which represented approximately $2,118.

Other services revenue also increased as a result of the acquisition of CDM, up $851 for the three months ended March 31, 2026 as compared to the same period in 2025.

Gross profit margin was 34% compared to 46% for the three months ended March 31, 2026 and 2025, respectively.

Hardware gross margin decreased 18 points, due to an unusually higher mix of lower margin QSR deployments during the period and $486 in costs associated with transitioning away from an outsourced installer of a large CDM customer.

Services and other gross margin decreased 11 points in the quarter compared to prior year driven by the expiration of certain customer contracts in 2025.

Sales and Marketing Expenses

Sales and marketing expenses decreased by $880, or 19%, for the nine-month period ended September 30, 2025 as compared to the same period in 2024, driven primarily by decreases of (1) $839 in fixed and variable salaries, taxes and benefits of our sales and marketing personnel, and (2) $41 in trade show and marketing activities.

Costs increased by $1,650, or 132% for the three months ended March 31, 2026 as compared to the same period in 2025, driven primarily by the inclusion of CDM which contributed $1,398 of expenses for the period.

General and Administrative Expenses

General and administrative expenses increased by $1,249 or 10%, for the nine months ending September 30, 2025 as compared to the same period in 2024.

The increase was primarily driven by (1) a $1,669 rise in stock-based compensation expense for employees and directors and (2) $766 in expenses related to deal and transaction costs incurred in relation to the announced acquisition of Cineplex Digital Media, which is expected to close in the fourth quarter of 2025.

Excluding stock-based compensation and deal and transaction expenses, general and administrative expenses decreased by $1,186, reflecting the impact of various cost containment efforts.

These included a $700 reduction in fixed and variable salaries, benefits, and payroll taxes for general and administrative personnel, as well as broad-based savings achieved across multiple spending categories.

The Company implemented a number of low-cost restructuring measures and targeted vendor spend reductions, none of which were individually material, but which collectively contributed to a more efficient back-office cost structure.

These actions were further supported by the retirement of legacy software platforms and the transition to a unified ERP system, which has enabled modest improvements in workflow efficiency and systems integration.

Impairment of software asset

During the nine months ended September 30, 2025, the Company recognized a non-cash impairment charge of $5,712 related to a proprietary software platform capitalized as an intangible asset under ASC 350-40.

The uncertainty arose in September 2025 when the customer communicated that it was unable to renew their license agreement due to budget constraints, representing a triggering event under ASC 350-40.

The impairment did not impact cash flows or liquidity, but it did result in a significant increase in total operating expenses for the nine months ended September 30, 2025 compared to the same periods in 2024.

General and administrative expenses increased by $4,977 or 127%, for the three months ended March 31, 2026 as compared to the same period in 2025.

The increase was primarily driven by the inclusion of CDM, which represented $3,778 of expense and additional accounting, compliance, legal and other one-time fees and severance costs in connection with the integration of CDM.

Interest Expense

Interest expense increased by $1,144 or 356%, during the three months ended March 31, 2026 as compared to March 31, 2025 primarily as a result of the new Term Loan entered into during November 2025.

See Note 9, Debt , to the Condensed Consolidated Financial Statements for a discussion of the Company’s debt and related interest expense obligations.

Gain on Settlement of Contingent Consideration

See Note 5 Business Combinations to the Condensed Consolidated Financial Statements for a discussion of the Company’s gain on settlement of contingent consideration.

Other expenses (income)

The Company recognized $408 in other expenses for the nine months ending September 30, 2025 , consisting primarily of (1) $121 in legal expenses incurred in connection with the contingent consideration settlement and (2) $283 in severance-related expenses in connection with the termination of certain employees as part of a cost-reduction initiative.

Other Expense (Income)

The Company recognized $320 in other expenses for the three months ended March 31, 2026 as compared to $265 for the three months ended March 31, 2025.

The increase is a result of legal costs with respect to patent infringement and the inclusion of CDM in 2026.

Summary Unaudited Quarterly Financial Information (Non-GAAP)

1 unchanged sentence

generally accepted accounting principles ("GAAP") measure.

Earnings before interest, depreciation, and amortization (“EBITDA”) and adjusted EBITDA (“Adjusted EBITDA”) are non-GAAP financial performance measures we believe offer a useful view of the overall operations of our business.

Earnings before interest, taxes, depreciation, and amortization ("EBITDA") and adjusted EBITDA ("Adjusted EBITDA") are non-GAAP financial performance measures we believe offer a useful view of the overall operations of our business.

These non-GAAP financial performance measures, which may not be comparable to, and may be defined differently than, similarly titled measures used or reported by other companies, should not be considered in isolation from or as a substitute for the related GAAP measures and should be read together with financial information presented on a GAAP basis.

13 unchanged sentences

The table below shows the reconciliation of the Company's net (loss) income to EBITDA and Adjusted EBITDA:

Quarters Ended

September 30,

Quarters ended

GAAP net (loss) income

Interest expense:

Amortization of deferred financing costs

Interest expense, net

1 unchanged sentence

Amortization of intangible assets

Amortization of employee share-based awards

Depreciation of property & equipment

Income tax (benefit) expense

Loss (Gain) on fair value of contingent consideration

Depreciation of property and equipment

Income tax expense (benefit)

Gain on settlement of contingent consideration

Stock-based compensation - Director grants

Stock-based compensation

Deal & transaction expenses

CDM related integration and transition costs

Loss on impairment of software asset

Other (income) expense

Loss on modification of revolver

Other expense (income)

Adjusted EBITDA

Liquidity and Capital Resources

As of September 30, 2025, we had an accumulated deficit of $63,165 and positive working capital of $526.

For the three months ended September 30, 2025, the Company generated an operating loss of $7,270.

During the nine months ended September 30, 2025, the Company used $834 of net cash in operating activities.

We remain dependent on improving cash flows from operations, securing additional sources of liquidity, or both, to fund ongoing operations to meet our financial obligations, including our debt obligations under our credit facilities.

Going Concern

In response to our accumulated deficit and capital requirements, we continue to evaluate our available options for amending our debt facilities or accessing the capital markets via equity financing.

However, these plans have not been finalized, are subject to market conditions, and in some respects are outside of our control.

Therefore, they cannot be deemed probable as of September 30, 2025.

As a result of the matters discussed above, including our losses, current liquidity level and projected capital needs, we have concluded that management’s plans do not alleviate substantial doubt about our ability to continue as a going concern within one year after the issuance date of the Condensed Consolidated Financial Statements included in this Report.

To the extent revenues from operations are insufficient to meet our liquidity requirements, our ability to continue as a going concern will depend on our ability to effectively raise capital through private or public placement of our equity securities.

If we are unable to maintain sufficient financial resources, our business, financial condition and results of operations, as well as our ability to continue to execute on our business plan, and satisfy our obligations as they become due, will be materially and adversely affected.

Failure to obtain additional financing will have a material, adverse impact on our business operations.

There can be no assurance that we will be able to obtain the financing needed to achieve our goals on acceptable terms or at all.

Additionally, any equity or equity-linked financings would likely have a dilutive effect on the holdings of our existing stockholders.

Our current level of cash and cash equivalents are not sufficient to execute our business plan.

For the foreseeable future, we will incur significant operating expenses, capital expenditures and working capital funding that will deplete our cash on hand.

Market conditions, including our current stock price and the dilutive impact of equity-linked financing, significantly limit our ability to raise capital.

Without alternative funding sources, we may need to further scale back operations or defer strategic initiatives.

If we are unable to identify other sources of funding, we may need to further adjust our operations.

Considering the cumulative impact of our historical losses, constrained liquidity, and projected capital needs, substantial doubt exists about our ability to continue as a going concern over the next twelve months from the date of issuance of the accompanying Condensed Consolidated Financial Statements.

Summary of Cash Flows

See Note 1, Nature of Organization and Operations, to the accompanying Condensed Consolidated Financial Statements for a detailed discussion of liquidity and financial resources.

Operating Activities

The net cash used by operating activities during the nine months ended September 30, 2025 was $834, compared to net cash provided by operating activities of $4,750 for the same period in 2024.

During the nine month period ending September 30, 2025, the Company generated a net loss of $6,311, which included a $4,775 gain on settlement of contingent liability, depreciation and amortization expense (including amortization of stock compensation expense) of $5,308, and impairment expense of software asset of $5,712.

The Company used $1,054 in cash due to changes in operating assets and liabilities.

Net cash used in operating activities was $1,723 for the three months ended March 31, 2026 compared to net cash used in operating activities of $2,449 for the three months ended March 31, 2025.

Cash used in 2026 was primarily attributable to a net loss of $7,461, adjusted for net non-cash charges of $3,882, partially offset by a $1,856 net source of cash from changes in operating assets and liabilities.

Cash used in 2025 was primarily attributable to net income of $3,368 reduced by net non-cash charges of $(3,398) (including a $4,775 gain on settlement of contingent consideration) and a net use of cash from changes in operating assets and liabilities of $2,419.

Investing Activities

Net cash used in investing activities during the nine months ended September 30, 2025 was $1,973, compared to $2,302 during the same period in 2024.

We currently do not have any material commitments for capital expenditures as of September 30, 2025.

Net cash used in investing activities was $552 for the three months ended March 31, 2026 compared to $621 for the three months ended March 31, 2025.

Capitalization of internally developed software costs was $369 for the three months ended March 31, 2026 compared to $613 for the three months ended March 31, 2025.

Purchases of property and equipment were $183 for the three months ended March 31, 2026 compared to $8 for the three months ended March 31, 2025.

The Company did not have any material commitments for capital expenditures as of March 31, 2026.

Financing Activities

Net cash provided by financing activities during the nine months ended September 30, 2025 was $2,084, compared to net cash used in financing activities of $4,490 for the same period in 2024.

Net cash provided by financing activities during the nine month period ended September 30, 2025 is primarily the result of net proceeds of $5,119 from borrowings and payments under the Company’s revolving credit facility, partially offset by $3,000 in cash payments made to former Reflect stockholders pursuant to the Settlement Agreement.

Credit Facilities

On May 23, 2024, we entered into a Credit Agreement (the “Prior Credit Agreement”) with First Merchants Bank (the “Bank”).

The Prior Credit Agreement provided us with a $22,100 secured revolving credit facility, with an uncommitted accordion feature that provides for additional borrowing capacity of up to $5,000, subject to the Bank’s approval and other customary terms and conditions set forth in the Prior Credit Agreement.

The Prior Credit Agreement was amended effective March 31, 2025 to temporarily modify our Senior Funded Debt to EBITDA covenant, allowing a ratio of less than 4.0 to 1 through June 30, 2025 and less than 3.75 to 1 thereafter.

The Prior Credit Agreement matured in May 2027 and required us to pay the entire unpaid principal balance upon maturity.

The Prior Credit Agreement also included customary events of default, including the occurrence of a material adverse effect, which could accelerate repayment of outstanding amounts at the Bank’s discretion.

The revolving credit facility accrued interest at a floating rate equal to the 1-month SOFR, plus 0.11%, plus a floating margin ranging from 2.00% to 3.50% that adjusted quarterly, depending upon our Senior Funded Debt to EBITDA Ratio.

The effective interest rate at September 30, 2025 was 7.74%.

We pay accrued interest monthly on the first day of each successive calendar month.

We had $18,163 in outstanding borrowings under the revolving credit facility as of September 30, 2025.

Total availability under the revolving facility was $3,937.

Effective June 30, 2025, we entered into a second amendment to the Prior Credit Agreement that modifies the borrowing base margin over time, decreasing from 95% to 90% on September 30, 2025 and to 85% on October 31, 2025.

On November 6, 2025, we amended and restated the Prior Credit Agreement (the “New Credit Agreement”), pursuant to which the Company obtained a $36,000 term loan and a $22,500 secured revolving credit facility.

See Note 14 Subsequent Events to the Condensed Consolidated Financial Statements for a description of the New Credit Agreement.

Promissory Note

The Promissory Note was issued on March 14, 2025 in the original principal amount of $4,000, as a component of the settlement of our contingent consideration obligations related to the Reflect Merger.

The note was not issued to raise new capital, but rather to satisfy a portion of a previously accrued liability.

The Promissory Note is subordinated to the Company’s senior secured credit facility pursuant to a Subordination Agreement executed with First Merchants Bank and the Stockholders’ Representative and bears interest at a fixed annual rate of 14%.

The interest rate increases to 17% per annum during any event of default (as defined in the Promissory Note) or during any period in which payments are restricted under the related Subordination Agreement.

The effective interest rate at June 30, 2025 was 14%.

The Promissory Note requires monthly payments of interest only commencing April 14, 2025 and continuing through September 14, 2025.

Commencing October 14, 2025, we are required to pay principal and interest in accordance with an amortization schedule that requires equal monthly payments of $109 on the 14th day of each calendar month through maturity on September 14, 2027.

On the maturity date, we are required to make a final balloon payment of $2,277, representing the remaining principal and accrued but unpaid interest outstanding at maturity.

The principal balance of the Promissory Note (together with accrued but unpaid interest on such amounts) may be prepaid in whole or in part at any time prior to maturity, subject to our payment of a make-whole amount, which approximates the foregone interest the holders would have earned through the maturity date, based on a comparison to a benchmark “yield maintenance treasury rate.” The make-whole payment is equal to the aggregate monthly payments of interest on the prepayment amount that would be due after the prepayment date and through the maturity date, using the percentage, if any, by which the applicable interest rate exceeds a prescribed “yield maintenance treasury rate.”

We had outstanding warrants accounted for as equity instruments in our Condensed Consolidated Financial Statements totaling 5,364,802 and 4,587,002 at September 30, 2025 and December 31, 2024, respectively.

The weighted average exercise price of the outstanding warrants was $4.66 and $4.90 at September 30, 2025 and December 31, 2024, respectively.

The weighted average remaining contractual life of the outstanding warrants was 2.81 and 3.11 years at September 30, 2025 and December 31, 2024, respectively.

On March 14, 2025, as part of the negotiated settlement of our contingent consideration obligations related to the Reflect merger, we issued to the former Reflect stockholders the Settlement Warrants to purchase their pro rata share of an aggregate of 777,800 shares of our common stock at an exercise price equal to $3.25 per share, subject to adjustment for stock dividends, distributions, subdivisions, combinations, or reclassifications.

The Settlement Warrants are exercisable immediately, expire six years from the date of issuance, and may be exercised for cash or, at the holder’s election, on a cashless (net settlement) basis.

The fair value of the Settlement Warrants was estimated at $1.34 per share as of the issuance date, using the Black-Scholes option pricing model.

Key assumptions included:

expected volatility of 94%, expected term of 6 years (matching the exercise term), risk-free interest rate of 4.15%, dividend yield of 0%, and our stock price of $1.88 as of the valuation date.

On October 15, 2025, we entered into a Securities Purchase Agreement with certain accredited investors to issue 30,000 shares of a newly designated Series A Convertible Preferred Stock (the “Preferred Stock”) for aggregate gross proceeds of $30,000, which has a stated value of $1,000 per share (the “Stated Value”)(the “Offering”).

The Offering was completed on November 6, 2025.

See Note 14 Subsequent Events to the Condensed Consolidated Financial Statements for a description of the Offering and the Preferred Stock.

Net cash provided by financing activities was $2,515 for the three months ended March 31, 2026 compared to $3,182 for the three months ended March 31, 2025.

Cash provided in 2026 was primarily attributable to net borrowings of $4,565 under the New Revolving Credit Facility ($11,037 in proceeds and $6,472 in repayments), partially offset by $1,097 of scheduled principal payments comprised of $900 on the Term Loan and $197 on the Promissory Note, $753 in repayments of finance lease obligations (which increased relative to the prior-year period as a result of finance leases assumed in the CDM Acquisition), and $200 used to repurchase Common Stock warrants pursuant to the Warrant Repurchase Agreement entered into on February 16, 2026.

Remaining available amounts under the New Revolving Credit Facility were $12,995 as of March 31, 2026.

Cash provided in 2025 was primarily attributable to net borrowings of $6,194 under the Revolving Credit Facility under the Prior Credit Agreement ($12,111 in proceeds and $5,917 in repayments), partially offset by a $3,000 cash payment in connection with the partial settlement of the contingent consideration liability and $12 in repayments of finance lease obligations.

See Note 9, Debt , and Note 12, Warrants , to the condensed consolidated financial statements for further discussion.

Contractual Obligations and Commitments

As of March 31, 2026, we had operating and finance lease obligations of approximately $22,658 payable over the next five years.

These obligations relate primarily to corporate office space, warehousing and light-assembly facilities used to stage and deploy digital signage hardware, and leased equipment supporting our operations.

Critical Accounting Estimates

The preparation of financial statements and related disclosures in conformity with U.S.

GAAP requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenue and expense, and the related disclosures.

We base our estimates on historical experience and on assumptions that we believe are reasonable under the circumstances;

actual results may differ from these estimates.

Our critical accounting estimates are described in Part II, Item 7, Critical Accounting Estimates in our Annual Report on Form 10-K for the year ended December 31, 2025, and our significant accounting policies are described in Note 2, Summary of Significant Accounting Policies, in our financial statements included elsewhere in this quarterly report.

There have been no material changes to our critical accounting estimates or significant accounting policies since the filing of our Annual Report on Form 10-K for the year ended December 31, 2025.

Off-Balance Sheet Arrangements

During the three and nine months ended September 30, 2025, we did not engage in any off-balance sheet arrangements set forth in Item 303(a)(4) of Regulation S-K.

Quantitative and Qualitative Disclosures about Market Risk

Not applicable.

During the three months ended March 31, 2026, we did not engage in any off-balance sheet arrangements set forth in Item 303(a)(4) of Regulation S-K.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements