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Item 1. Financial Statements

2025-09-15 compared with 2025-03-17 · 163 added, 178 removed, 320 unchanged (52% of the section changed)

25 unchanged sentences

Total liabilities $ 27,008 $ 28,572

Stockholders’ equity (deficiency):

Stockholders’ equity:

Common stock, $ .001 par value;

1 unchanged sentence

13,908,754 and 13,897,503 shares issued;

and 13,705,570 and 13,593,766 outstanding as of January 31, 2025 and April 30, 2024, respectively

and 13,788,421 and 13,777,170 outstanding as of July 31, 2025 and April 30, 2025, respectively

Treasury stock, at cost ( 708 ) ( 708 )

1 unchanged sentence

Accumulated deficit ( 80,358 ) ( 79,892 )

Total stockholders’ equity (deficiency) 5,469 ( 1,903 )

Total liabilities and stockholders’ equity (deficiency) $ 30,627 $ 26,132

Total stockholders’ equity attributable to Champions Oncology, Inc.

Noncontrolling interest 30 —

Total stockholders' equity 3,538 3,772

Total liabilities and stockholders’ equity $ 30,546 $ 32,344

The accompanying notes are an integral part of these condensed consolidated financial statements.

3 unchanged sentences

Three Months Ended

January 31, Nine Months Ended

2025 2024 2025 2024

Oncology revenue $ 13,995 $ 14,061

4 unchanged sentences

General and administrative 2,570 2,527

Loss on disposal of equipment 20 —

Total costs and operating expenses 14,522 12,732

Income (loss) from operations 4,499 ( 2,577 ) 6,560 ( 7,085 )

Other income (expense) 19 58 30 ( 33 )

Income (loss) before provision for income taxes 4,518 ( 2,519 ) 6,590 ( 7,118 )

(Loss) income from operations ( 527 ) 1,329

Other income, net 75 5

(Loss) income before provision for income taxes ( 452 ) 1,334

Provision for income taxes 14 21

Net income (loss) $ 4,495 $ ( 2,530 ) $ 6,536 $ ( 7,167 )

Net income (loss) per common share outstanding

Net (loss) income $ ( 466 ) $ 1,313

net loss attributable to noncontrolling interest 30 —

Net (loss) income attributable to Company's common shares $ ( 436 ) $ 1,313

Net (loss) income per common share outstanding

basic $ ( 0.03 ) $ 0.10

and diluted $ 0.31 $ ( 0.19 ) $ 0.46 $ ( 0.53 )

diluted $ ( 0.03 ) $ 0.09

Weighted average common shares outstanding

6 unchanged sentences

Common Stock Treasury Stock Additional

Capital Accumulated

Capital Non-Controlling Interest Accumulated

Deficit Total

Stockholders'

Equity (Deficiency)

Shares Amount Shares Amount

1 unchanged sentence

Stock-based compensation — — — — 178 30 — 208

Net income — — — — — 1,313 1,313

Balance July 31, 2024 13,714,099 $ 14 120,333 $ ( 708 ) $ 83,642 $ ( 83,280 ) $ ( 332 )

Stock-based compensation — — — — 9 — 9

Issuance of common stock on exercise of stock options 11,251 — — — 24 — — 24

Net income — — — — — 728 728

Balance October 31, 2024 13,819,236 $ 14 120,333 $ ( 708 ) $ 83,927 $ ( 82,552 ) $ 681

Stock-based compensation — — — — 256 — 256

Issuance of common stock on exercise of stock options 6,667 — — — 37 — 37

Net income — — — — — 4,495 4,495

Balance January 31, 2025 13,825,903 $ 14 120,333 ( 708 ) $ 84,220 $ ( 78,057 ) $ 5,469

Net Loss — — — — — — ( 466 ) ( 466 )

Balance July 31, 2025 13,908,754 $ 14 120,333 $ ( 708 ) $ 84,560 $ 30 $ ( 80,358 ) $ 3,538

Common Stock Treasury Stock Additional

5 unchanged sentences

Stock-based compensation — — — — 258 — 258

Issuance of common stock on exercise of stock options 40,897 — — — 12 — 12

Repurchase of common stock ( 101,015 ) — 101,015 ( 602 ) ( 602 )

Net loss — — — — — ( 2,566 ) ( 2,566 )

Net income — — — — — 1,313 1,313

Balance July 31, 2024 13,714,099 $ 14 120,333 $ ( 708 ) $ 83,642 $ ( 83,280 ) $ ( 332 )

Stock-based compensation — — — — 53 — 53

Issuance of common stock on exercise of stock options 114,552 — — 240 — 240

Repurchase of common stock ( 4,896 ) 4,896 ( 32 ) ( 32 )

Net loss — — — — — ( 2,071 ) ( 2,071 )

Balance October 31, 2023 13,593,766 $ 14 120,333 ( 708 ) $ 82,741 $ ( 81,954 ) $ 93

Stock-based compensation — — — — 379 — 379

Net loss — — — — — ( 2,530 ) ( 2,530 )

Balance January 31, 2024 13,593,766 $ 14 120,333 ( 708 ) $ 83,120 $ ( 84,484 ) $ ( 2,058 )

The accompanying notes are an integral part of these condensed consolidated financial statements.

2 unchanged sentences

(Dollars in Thousands)

Nine Months Ended

Three Months Ended

Operating activities:

Net income (loss) $ 6,536 $ ( 7,167 )

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

Net (loss) income $ ( 466 ) $ 1,313

Adjustments to reconcile net (loss) income to net cash provided by operating activities:

Stock-based compensation 208 258

2 unchanged sentences

Operating lease right-of use assets 310 289

Allowance for doubtful accounts and net reversal of provision for estimated credit losses ( 320 ) 314

Allowance and estimated credit losses ( 29 ) ( 71 )

Changes in operating assets and liabilities:

1 unchanged sentence

Prepaid expenses and other current assets 154 241

Other long term assets — ( 170 )

Accounts payable 411 ( 565 )

2 unchanged sentences

Deferred revenue ( 1,014 ) ( 1,782 )

Net cash provided by (used in) operating activities 518 ( 4,321 )

Net cash provided by operating activities 600 311

Investing activities:

4 unchanged sentences

Finance lease payments ( 38 ) ( 37 )

Repurchases of common stock — ( 634 )

Net cash provided by (used in) financing activities 202 ( 490 )

Increase (decrease) in cash 584 ( 5,650 )

Net cash used in financing activities ( 14 ) ( 37 )

Increase in cash 540 274

Cash at beginning of period 9,785 2,618

7 unchanged sentences

Champions Oncology, Inc.

(the "Company", "us", "we", and "our") is a technology-enabled research organization engaged in creating technology solutions to be utilized in drug discovery and development.

The Company's research center operates in both regulatory and non-regulatory environments and consists of a comprehensive set of computational and experimental research platforms.

Its pharmacology, biomarker, and data platforms are designed to facilitate drug discovery and development at lower costs and increased speeds.

(the "Company", or "we", or "our") is engaged in drug discovery and development through data-driven research strategies and innovative pharmacology, biomarker and data platforms.

The Company’s TumorGraft Technology Platform (the "Platform"), a comprehensive bank of unique, well characterized "Patient Derived XenoGrafts" (PDX) models, is an approach to personalizing cancer care based upon the implantation of human tumors in immune-deficient mice.

The Company provides a technology platform to pharmaceutical and biotechnology companies using proprietary TumorGraft studies, which the Company believes may be predictive of how drugs may perform in clinical settings.

Utilizing the Platform, the Company offers multiple services to pharmaceutical and biotechnology companies seeking personalized approaches to drug development.

By performing studies to predict the efficacy of oncology drugs, our Platform is designed to facilitate drug discovery with lower costs and increased speed of drug development as well as increased adoption of existing drugs.

The Company has four operating subsidiaries:

Champions Oncology (Israel), Limited, Champions Biotechnology U.K., Limited, Champions Oncology, S.R.L.

Champions Oncology (Israel), Limited, Champions Oncology U.K.

Limited, Champions Oncology, S.R.L.

(Italy), and Corellia A.I.

For the three and nine months ended January 31, 2025 and 2024, there were no revenues earned by these subsidiaries.

The Company’s functional currency for its foreign subsidiaries is the U.S.

("Corellia").

For the three months ended July 31, 2025 and 2024, there were no revenues earned by these subsidiaries.

The Company’s foreign subsidiaries' functional currency is the U.S.

Transaction gains and losses are recognized in earnings.

The Company is subject to foreign exchange rate fluctuations in connection with the Company’s international operations.

The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP").

The accompanying condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP").

The Company operates in one reportable business segment.

These unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission, or the SEC.

The condensed consolidated financial statements include the accounts of the Company and its subsidiaries in which it holds a controlling financial interest.

Intercompany transactions and accounts have been eliminated.

Non-controlling interests represent the portion of the equity in consolidated subsidiaries not attributable to the company.

The non-controlling interests' share of the net assets, net income, and comprehensive income is separately presented in the condensed consolidated financial statements where applicable.

These unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission, or the SEC.

Certain information related to the Company’s organization, significant accounting policies and footnote disclosures normally included in financial statements prepared in accordance with GAAP has been condensed or omitted.

The April 30, 2024 condensed consolidated balance sheet in the accompanying interim condensed consolidated financial statements was derived from audited consolidated financial statements.

The accounting policies followed in the preparation of these unaudited condensed consolidated financial statements are consistent with those followed in the Company’s annual consolidated financial statements for the fiscal year ended April 30, 2024, as filed in the Company's Annual Report on Form 10-K with the SEC on July 19, 2024 (the "Annual Report").

The April 30, 2025 condensed consolidated balance sheet in the accompanying interim condensed consolidated financial statements was derived from audited condensed consolidated financial statements.

The accounting policies followed in the preparation of these unaudited condensed consolidated financial statements are consistent with those followed in the Company’s annual condensed consolidated financial statements for the fiscal year ended April 30, 2025, as filed in the Company's Annual Report on Form 10-K with the SEC on July 23, 2025 (the "Annual Report").

In the opinion of management, these unaudited condensed consolidated financial statements contain all material adjustments necessary to fairly state our financial position, results of operations and cash flows for the periods presented and the presentations and disclosures herein are adequate when read in conjunction with the Annual Report.

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Significant Accounting Policies

The significant accounting policies used in the preparation of these condensed consolidated financial statements are disclosed in our 2024 Annual Report and there have been no changes to the Company's significant accounting policies during the nine months ended January 31, 2025.

Liquidity and Going Concern

In accordance with Accounting Standards Codification ("ASC") Subtopic 205-40, Presentation of Financial Statements—Going Concern (“ASC 205-40”), the Company has the responsibility to evaluate whether conditions and/or events raise substantial doubt about its ability to meet its obligations as they become due within one year after the date that the financial statements are issued.

As required under ASC 205-40, management’s evaluation should initially not take into consideration the potential mitigating effects of management’s plans that have not been fully implemented as of the date the financial statements are issued.

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern.

The Company has experienced negative operating cash flows and has incurred substantial operating losses from its activities, until recently.

The Company also has a working capital deficit and an accumulated deficit of $ 173,000 and $ 78.1 million, respectively, as of January 31, 2025.

While the Company believes it has strategies to continue to increase revenues and reduce costs which can be implemented without disrupting the business or completely restructuring the Company, there can be no assurances that these efforts will be successful.

The Company's liquidity needs have typically arisen from the funding of our research and development programs and the launch of new products and services, working capital requirements, and other strategic initiatives.

Most recently, the Company has met these cash requirements through cash on hand, working capital management, and sales of products and services.

The significant accounting policies used in the preparation of these condensed consolidated financial statements are disclosed in our 2025 Annual Report and there have been no changes to the Company's significant accounting policies during the three months ended July 31, 2025.

The Company's liquidity needs have typically arisen from the funding of its research and development programs and the launch of new products and services, working capital requirements, and other strategic initiatives.

Historically, the Company has met these cash requirements through cash on hand, working capital management, and sales of products and services.

In the past, the Company has also received proceeds from certain private placements and public offerings of our securities.

For the three months ended July 31, 2025, the Company had a net loss of approximately $ 466,000 , an accumulated deficit of approximately $ 80.4 million negative working capital of $ 1.7 million and cash of $ 10.3 million.

Despite the negative working capital, we believe that our cash on hand, together with expected cash flows from operations, are adequate to fund operations through at least the next twelve months from the filing of this report.

Should the Company be required to raise additional capital or seek to obtain financing, there can be no assurance that management would be successful in raising such capital or obtaining such financing on terms acceptable to us, if at all.

Such conditions raise substantial doubts about the Company’s ability to continue as a going concern.

These condensed consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Earnings Per Share

2 unchanged sentences

Such dilutive shares consist of incremental shares that would be issued upon exercise of the Company’s common stock options.

The following table reflects these calculations.

For the three and nine months ended January 31, 2024, all of the Company's potential common stock was considered anti-dilutive due to the Company's net losses in these periods.

A reconciliation of net income and number of shares used in computing basic and diluted earnings per share was as follows:

Three Months Ended

January 31, Nine Months Ended January 31,

(Dollars in Thousands) 2025 2024

9 unchanged sentences

Diluted net income (loss) per share $ ( 0.03 ) $ 0.09

The following table reflects the total potential common stock instruments outstanding at January 31, 2025 and 2024 including those that could have an effect on the future computation of dilution per common share, had their effect not been anti-dilutive.

The following table reflects the total potential common stock instruments outstanding at July 31, 2025 and 2024 including those that could have an effect on the future computation of dilution per common share, had their effect not been anti-dilutive.

Total common stock equivalents 2,531,806 1,131,624

Deferred income taxes have been provided to show the effect of temporary differences between the recognition of expenses for financial and income tax reporting purposes and between the tax basis of assets and liabilities, and their reported amounts in the consolidated financial statements.

In assessing the realizability of deferred tax assets, the Company assesses the likelihood that deferred tax assets will be recovered through tax planning strategies or from future taxable income, and to the extent that recovery is not likely or there is insufficient earnings history, a valuation allowance is established.

The Company's ability to utilize net operating losses (“NOL”) carryforwards to offset future taxable income would be limited if the Company had undergone or were to undergo an “ownership change” within the meaning of Section 382 of the Internal Revenue Code (the “IRC”).

The Company adjusts the valuation allowance in the period management determines it is more likely than not that deferred tax assets will or will not be realized.

Changes in valuation allowances from period to period are included in the tax provision in the period of change.

As of January 31, 2025 and April 30, 2024, the Company provided a valuation allowance for all net deferred tax assets as it is more likely than not that the assets will not be recovered based on an insufficient history of earnings.

The Company reflects tax benefits only if it is more likely than not that the Company will be able to sustain the tax position, based on its technical merits.

If a tax benefit meets this criterion, it is measured and recognized based on the largest amount of benefit that is cumulatively greater than 50% likely to be realized.

The Company recorded $ 181,000 of liabilities related to uncertain tax positions relative to one of its foreign operations as of January 31, 2025 and April 30, 2024.

The Company’s practice is to recognize interest and/or penalties related to income tax matters in income tax expense.

The Company did no t recognize interest or penalties on its consolidated statements of operations during the three or nine month periods ended January 31, 2025 and 2024.

The Company does no t anticipate unrecognized tax benefits will be recorded during the next 12 months.

The provision for income taxes for the three months ended January 31, 2025 and 2024 was $ 23,000 and $ 11,000 , respectively.

The provision for income taxes for the nine months ended January 31, 2025 and 2024 was $ 54,000 and $ 49,000 ,

respectively.

The provision is mainly attributable to taxable income earned in Israel and/or Italy relating to transfer pricing, and U.S.

state income taxes for which net operating losses are limited.

Revenue Recognition

The Company recognizes revenue in accordance with Accounting Standards Codification ("ASC") 606 ("ASC 606"), Revenue from Contracts with Customers.

The objective of the standard is to establish a single comprehensive revenue recognition model that is designed to create greater comparability of financial statements across industries and jurisdictions.

Under this standard, companies recognize revenue to depict the transfer of goods or services to customers in amounts that reflect the consideration to which the Company expects to be entitled in exchange for those goods or services.

All revenue is generated from contracts with customers.

The Company's arrangements are service type contracts that mainly have a duration of less than a year.

The Company recognizes revenue when control of these services is transferred to the customer in an amount, referred to as the transaction price, that reflects the consideration to which the Company is expected to be entitled in exchange for those services.

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License Revenue

The Company also enters into contracts to provide access to certain Patient Derived Xenograft ("PDX") model data via a license agreement with payments based on a fixed-fee arrangement.

The Company's current data licenses contain a single performance obligation of delivering access to the data license.

The Company recognizes this license revenue up-front, at a point in time, when the performance obligation is satisfied with the delivery of the data.

The Company also enters into contracts to provide access to certain PDX model data via a license agreement with payments based on a fixed-fee arrangement.

The Company's current data licenses contain a single performance obligation of delivering access to the licensed data.

The Company recognizes this license revenue at a point in time when the performance obligation is satisfied by delivery of the access to the data.

Incremental Costs of Obtaining a Contract (Sales Commissions)

2 unchanged sentences

Therefore, under ASC 606, the Company elected the practical expedient to expense these costs as incurred.

Variable Consideration

In some cases, contracts provide for variable consideration that is contingent upon the occurrence of uncertain future events, such as the success of the initial performance obligation.

Variable consideration is estimated at the expected value or at the most likely amount depending on the type of consideration.

Estimated amounts are included in the transaction price to the extent it is probable that a significant reversal of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is resolved.

The estimate of variable consideration and determination of whether to include estimated amounts in the transaction price are based largely on an assessment of its anticipated performance and all information (historical, current and forecasted) that is reasonably available to the Company.

Trade Receivables, Unbilled Services and Deferred Revenue

Accounts Receivables, Unbilled Services and Deferred Revenue

In general, billings and payments are established by contractual provisions including predetermined payment schedules, which may or may not correspond to the timing of the transfer of control of the Company's services under the contract.

5 unchanged sentences

Unbilled services are classified as a component of accounts receivable on the balance sheet.

Accounts receivable are customer obligations due under normal trade terms.

The Company extends credit to its customers based on their creditworthiness and historical data and performs ongoing credit evaluations of our customers’ financial condition.

The Company maintains a provision for estimated credit losses related to accounts receivable for future expected bad debt resulting from the inability or unwillingness of our customers to make required payments.

We estimate our provision for estimated credit losses based on relevant information such as historical experience, current economic conditions, and future expectations of specifically identified customer balances.

This provision is adjusted as appropriate to reflect current conditions.

After all attempts to collect a receivable have failed, the receivable is written off against the provision.

We do not obtain collateral from our customers to secure accounts receivable.

Deferred revenue consists of unearned payments received in excess of revenue recognized.

1 unchanged sentence

Deferred revenue is classified as a current liability on the condensed consolidated balance sheet as the Company expects to recognize the associated revenue in less than one year.

Segment Reporting

Operating segments are identified as components of an enterprise for which separate discrete financial information is available for evaluation by the Company’s chief operating decision maker (“CODM”) and relied upon when making decisions regarding resource allocation and assessing performance.

When evaluating the Company’s financial performance, the CODM reviews total revenues, total expenses, and expenses by functional classification, using this information to make decisions on a Company-wide basis.

The Company currently operates in one reportable segment pertaining to oncology services.

The CODM for the Company is the Chief Executive Officer (the “CEO”).

The Company’s CEO reviews operating results on an aggregate basis and manages the Company’s operations on a consolidated basis for the purpose of evaluating financial performance and allocating resources.

Accordingly, the Company has determined that it has a single reportable and operating segment structure.

The CEO uses net income or loss as well as revenue results to allocate resources in the annual budgeting and forecasting process and also uses that measure as a basis for evaluating financial performance regularly by comparing actual results with established budgets and forecasts.

All significant expense categories are presented on our condensed Consolidated Statements of Operations.

The measure of segment assets is reported on the condensed Consolidated Balance Sheet as total assets.

Segment revenues and expenses are identical to that disclosed in the accompanying condensed Consolidated Statements of Operations.

Reclassifications

1 unchanged sentence

Recently Issued Accounting Pronouncements

In November 2023, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2023-07, “Segment Reporting” (Topic 280):

Improvements to Reportable Segment Disclosures.

The new guidance is intended to improve reportable segment disclosure requirements primarily through enhanced disclosures about significant segment expenses.

The ASU is effective retrospectively for fiscal years beginning after December 15, 2023 and interim periods within fiscal years beginning after December 15, 2024.

The Company is in the process of evaluating the impact that the adoption of this ASU will have on its financial statements and related disclosures, which is not expected to be material.

In December 2023, the FASB issued ASU 2023-09, “Improvements to Tax Disclosures” (Topic 740).

1 unchanged sentence

The ASU is effective retrospectively for fiscal years beginning after December 15, 2024, with early adoption permitted.

The Company is in the process of completing the assessment of the impact that the adoption of this ASU will have on its financial statements and will include the related disclosure for the fiscal year ending April 30, 2025 in its next Annual Report.

The Company adopted this ASU as of May 1, 2025 and the impact on its financial statements was not material.

In November 2024 and January 2025, the FASB issued ASU 2024-03, "Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures" (Subtopic 220-40) "Disaggregation of Income Statement Expenses" and ASU 2025-01 "Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures" (Subtopic 220-40):

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Accounts receivable and unbilled services were as follows (in thousands):

January 31, 2025 April 30, 2024 May 1, 2023

July 31, 2025 April 30, 2025 May 1, 2024

Accounts receivable $ 5,139 $ 6,835 $ 4,886

3 unchanged sentences

Total accounts receivable, net $ 9,474 $ 11,204 $ 9,526

Allowances for doubtful accounts and estimated credit losses were as follows:

Allowances for doubtful accounts and estimated credit losses were as follows (in thousands):

Beginning balance April 30, 2025 $ ( 1,029 )

2 unchanged sentences

Reversal for amounts subsequently collected —

Write offs ( 56 )

Ending balance January 31, 2025 $ 981

Ending balance July 31, 2025 $ ( 1,000 )

Deferred revenue was as follows (in thousands):

January 31, 2025 April 30, 2024 May 1, 2023

July 31, 2025 April 30, 2025 May 1, 2024

Deferred revenue $ 14,430 $ 15,443 $ 12,094

1 unchanged sentence

Oncology Revenue

The following table represents disaggregated revenue for the three and nine months ended January 31, 2025 and 2024:

The following table represents disaggregated revenue for the three months ended July 31, 2025 and 2024 (in thousands):

Three Months Ended

January 31, Nine Months Ended January 31,

2025 2024 2025 2024

Pharmacology services $ 13,230 $ 13,069

TOS license revenue 4,500 — 4,500 —

TOS data license revenue 311 —

Other TOS revenue 454 992

Personalized oncology services — — — 18

Total oncology revenue $ 13,995 $ 14,061

3 unchanged sentences

Property and equipment is recorded at cost and primarily consists of laboratory equipment, computer equipment and software, capitalized software development costs, and furniture and fixtures.

Depreciation and amortization is calculated on a

straight-line basis over the estimated useful lives of the various assets ranging from three to nine years .

Depreciation and amortization is calculated on a straight-line basis over the estimated useful lives of the various assets ranging from three to nine years .

Property and equipment consisted of the following (table in thousands):

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Property and equipment, net $ 4,230 $ 4,375

Depreciation and amortization expense was $ 398,000 and $ 481,000 for the three months ended January 31, 2025 and 2024, respectively.

Depreciation and amortization expense, excluding expense recorded under finance leases, was $ 360,000 and $ 445,000 for the three months ended January 31, 2025 and 2024, respectively.

Depreciation and amortization expense was $ 1.2 million and $ 1.4 million for the nine months ended January 31, 2025 and 2024, respectively.

Depreciation and amortization expense, excluding expense recorded under finance leases, was $ 1.1 million and $ 1.3 million for the nine months ended January 31, 2025 and 2024, respectively.

As of January 31, 2025 and April 30, 2024, property, plant and equipment included gross assets held under finance leases of $ 1.0 million.

Related depreciation expense was approximately $ 38,000 and $ 36,000 for the three months ended January 31, 2025 and 2024, respectively.

Related depreciation expense was approximately $ 112,000 and $ 108,000 for the nine months ended January 31, 2025 and 2024, respectively.

Capitalized Software Development Costs Under a Hosting Arrangement

The Company accounts for the cost of computer software obtained or developed for internal use as well as the software development and implementation costs associated with a hosting arrangement ("internal-use software") that is a service contract in accordance and with ASC 350, Intangibles - Goodwill and Other ("ASC-350").

The Company capitalizes certain costs in the development of our internal-use software when the preliminary project stage is completed and it is probable that the project itself will be completed and the software will perform as intended.

These capitalized costs include personnel and related expenses for employees and costs of third-party consultants who are directly associated with and who devote time to these internal-use software projects.

Capitalization of these costs ceases once the project is substantially complete and the software is ready for its intended purpose.

Costs incurred for significant upgrades, increased functionality, and enhancements to the Company's internal-use software solutions are also capitalized.

Costs incurred for training, maintenance, and minor modifications are expensed as incurred.

Capitalized software development costs are amortized using the straight-line method over an estimated useful economic life of three years .

Depreciation and amortization expense was $ 358,000 and $ 449,000 for the three months ended July 31, 2025 and 2024, respectively.

Depreciation and amortization expense, excluding expense recorded under finance leases, was $ 320,000 and $ 412,000 for the three months ended July 31, 2025 and 2024, respectively.

As of July 31, 2025 and April 30, 2025, property, plant and equipment included gross assets held under finance leases of $ 1.0 million.

Related depreciation expense was approximately $ 38,000 and $ 37,000 for the three months ended July 31, 2025 and 2024, respectively.

During the three months ended July 31, 2025, the Company disposed of lab equipment with a cost of $ 44,000 and accumulated depreciation of $ 24,000 as of the disposal date, resulting in a loss on disposal of equipment recorded of $ 20,000 .

During the three months ended July 31, 2024, the Company did not dispose of any equipment.

Finance Lease

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The present value of the minimum future obligations of $ 368,000 was calculated based on an interest rate of 3.5 %.

Depreciation and amortization expense related to this finance lease was $ 18,400 and $ 17,800 for the three months ended January 31, 2025 and 2024, respectively, and $ 55,000 and $ 52,800 for the nine months ended January 31, 2025 and 2024, respectively.

Depreciation and amortization expense related to this finance lease was $ 19,000 and $ 18,000 for the three months ended July 31, 2025 and 2024.

Interest on the related finance lease liability was less than $ 1,000 and approximately $ 1,000 for the three months ended July 31, 2025 and 2024, respectively.

During fiscal year 2022, the Company recognized a finance lease for laboratory equipment.

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At the commencement of the commitment, the present value of the minimum future obligations of $ 370,000 was calculated based on an interest rate of 3.25 %.

Depreciation and amortization expense related to this finance lease was $ 19,300 and $ 18,700 for the three months ended January 31, 2025 and 2024, respectively, and $ 57,000 and $ 55,600 for the nine months ended January 31, 2025 and 2024, respectively.

The liabilities related to these finance leases are classified under other current liability and other non-current liabilities on the Company's balance sheet.

Depreciation and amortization expense related to this finance lease was $ 19,000

and $ 19,000 for the three months ended July 31, 2025 and 2024, respectively.

Interest on the related finance lease liability was approximately $ 1,300 and $ 2,000 for the three months ended July 31, 2025 and 2024, respectively.

As noted above, the Company's financing leases are for laboratory equipment.

The associated liabilities for these leases are classified on the condensed consolidated balance sheets within other current and other non-current liabilities.

The weighted average remaining lease term of these leases is 1.54 years.

Financing lease assets (lab equipment) and lease liabilities related to our current financing leases are as follows (in thousands):

January 31, 2025 April 30, 2024

July 31, 2025 April 30, 2025

Financing lease net asset $ 182 $ 220

7 unchanged sentences

Refer to Note 7, Leases, for information on operating leases.

Share-Based Payments

Stock-Based Payments

Stock-based compensation expense was recognized as follows (table in thousands):

Three Months Ended

January 31, Nine Months Ended

2025 2024 2025 2024

General and administrative $ 148 $ 185

3 unchanged sentences

Total stock-based compensation expense $ 208 $ 258

The Company has in place a 2021 Equity Incentive Plan and 2010 Equity Incentive Plan (collectively, the "Plans").

For the three months ended July 31, 2025, stock-based compensation expense for research and development includes approximately $ 30,000 for options granted by the Company's wholly-owned subsidiary, Corellia, to certain of its employees.

The Company has in place a 2021 Equity Incentive Plan and 2010 Equity Incentive Plan as well as the 2023 Global Equity Incentive Plan which is specific to Corellia AI (collectively, the "Plans").

In general, these Plans provide for stock-based compensation to the Company’s employees, directors and non-employees.

The Plans also provide for limits on the aggregate number of shares that may be granted, the term of grants and the strike price of option awards.

The 2010 and 2021 Plans also provide for limits on the aggregate number of shares that may be granted, the term of grants and the strike price of option awards.

2021 Equity Incentive Plan

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(iii) Restricted Stock Awards;

and/or (iv) Stock Appreciation Rights (collectively, stock-based compensation) to its employees, directors and non-employees.

and/or (iv) Stock Appreciation Rights (collectively, stock-based compensation) to its

employees, directors and non-employees.

Total stock awards under the 2021 Equity Plan shall not exceed 2 million shares of common stock.

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Options and Stock Appreciation Rights have a strike price not less than 100 % of the fair market value of the common stock subject to the option or right at the date of grant.

As of January 31, 2025, approximately 1.2 million shares were available for issue under this plan.

As of July 31, 2025, approximately 342,000 shares were available for issue under this plan.

2010 Equity Incentive Plan

On February 18, 2011, shareholders owning a majority of the issued and outstanding shares of the Company executed a written consent approving the 2010 Equity Incentive Plan (“2010 Equity Plan”).

The purpose of the 2010 Equity Plan is to grant (i) Non-statutory Stock Options;

(ii) Restricted Stock Awards;

and (iii) Stock Appreciation Rights (collectively, stock-based compensation) to its employees, directors and non-employees.

Total stock awards under the 2010 Equity Plan shall not exceed 30,000,000 shares of common stock.

Options and Stock Appreciation Rights expire no later than ten years from the date of grant and the awards vest as determined by the Board.

Options and Stock Appreciation Rights have a strike price not less than 100 % of the fair market value of the common stock subject to the option or right at the date of grant.

After February 2021, no more shares were available to be issued from this plan.

As of July 31, 2025, approximately 885,000 options granted under the 2010 plan were still outstanding.

2023 Global Equity Incentive Plan

As part of the establishment of Corellia, the subsidiary's Board of Directors approved the adoption of the 2023 Global Equity Incentive Plan ("the Plan").

The purpose of the Plan is to grant (i) Non-statutory Stock Options;

(ii) Incentive Stock Options;

and/or (iii) Restricted Stock Awards (collectively, stock-based compensation) to its employees, directors and non-employees.

Options expire no later than ten years from the date of grant.

Options awards vest as follows, unless otherwise determined by the subsidiary's Board or Plan Administrator, twenty-five percent ( 25 %) of the options grant on the first anniversary of the vesting commencement date (and in the absence of such determination, of date on which such Options were granted), and six and one-quarter percent ( 6.25 %) of the options grant at the end of each subsequent three-month period thereafter over the course of the following three ( 3 ) years.

Stock Option Grants

Black-Scholes assumptions used to calculate the fair value of options granted during the three and nine months ended January 31, 2025 and 2024 were as follows:

Black-Scholes and Monte Carlo assumptions used to calculate the fair value of Champions options granted by the Company during the three months ended July 31, 2025 and 2024 were as follows:

Three Months Ended

January 31, Nine Months Ended

2025 2024 2025 2024

Expected term in years 6

Risk-free interest rates 4.08 % - 4.50 %

3.58 % - 4.48 %

3.95 % - 4.49 %

Volatility 55.65 % - 62.00 %

54.54 % - 62.72 %

62.83 % - 63.41 %

Dividend yield — % — %

The weighted average fair value of stock options granted during the three months ended January 31, 2025 and 2024 was $ 2.64 and $ 3.41 , respectively.

The weighted average fair value of stock options granted during the nine months ended January 31, 2025 and 2024 was $ 2.58 and $ 3.77 , respectively.

The Company’s stock options activity for the nine months ended January 31, 2025 was a s follows:

The weighted average fair value of stock options granted during the three months ended July 31, 2025 and 2024 was $ 4.33 and $ 3.02 , respectively.

Black-Scholes assumptions used to calculate the fair value of Corellia options granted by Corellia during the three months ended July 31, 2025 and 2024 were as follows:

Three Months Ended

Expected term in years 6 0

Risk-free interest rates 4.15 % — %

Volatility 65 % — %

Dividend yield — % — %

The weighted average fair value of stock options granted during the three months ended July 31, 2025 was $ 1,364.00 .

There have been no Corellia stock options granted prior to the first quarter of fiscal 2026.

Due to the absence of an active market for the Corellia's common stock, Corellia utilized methodologies in accordance with the framework of the American Institute of Certified Public Accountants Technical Practice Aid, Valuation of Privately-Held Company Equity Securities Issued as Compensation, to estimate the fair value of its common stock.

In determining the exercise prices for stock options granted, Corellia has considered the estimated fair value of the common stock as of the measurement date.

The estimated fair value of the common stock has been determined at each grant date based upon a variety of factors, including the illiquid nature of the common stock.

Among other factors are Corellia's financial position and historical financial performance, the status of technological developments within its' research, the composition and ability of the current research and management team, an evaluation or benchmark of the Company’s competition and the current business climate in the marketplace.

Significant changes to the key assumptions underlying the factors used could result in different fair values of common stock at each valuation date.

The Company’s stock options activity for the 2021 and 2010 equity incentive plans for the three months ended July 31, 2025 was a s follows:

Employees Non-

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Forfeited ( 9,625 ) — ( 9,625 ) 7.90

Canceled ( 3,750 ) — ( 3,750 ) 5.99

Expired ( 36,666 ) — ( 36,666 ) 5.43

Outstanding, January 31, 2025 1,797,776 36,331 1,834,107 $ 4.91 5.1 $ 11,196,000

Vested and expected to vest as of January 31, 2025 1,797,776 36,331 1,834,107 $ 4.91 5.1 $ 11,196,000

Exercisable as of January 31, 2025 1,561,755 5,625 1,567,380 $ 4.92 4.4 $ 9,571,000

Outstanding, July 31, 2025 2,495,475 36,331 2,531,806 $ 5.81 6.5 $ 3,514,000

Vested and expected to vest as of July 31, 2025 2,495,475 36,331 2,531,806 $ 5.81 6.5 $ 3,514,000

Exercisable as of July 31, 2025 1,504,457 5,625 1,510,082 $ 4.90 4.2 $ 3,259,000

The stock options activity for the Corellia 2023 Global equity incentive plan for the three months ended July 31, 2025 was as follows:

Employees Non-

Employees Total Weighted

Price Weighted

Life (Years) Aggregate

Outstanding, April 30, 2025 — — — $ — 0 $ —

Granted 300 — 300 1,682.00 9.81

Outstanding, July 31, 2025 300 — 300 $ 1,682.00 9.81 $ 110,000

Vested and expected to vest as of July 31, 2025 300 — 300 $ 1,682.00 9.81 $ 110,000

Exercisable as of July 31, 2025 — — — $ — — $ —

Share Repurchase Program

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The program does not obligate the Company to acquire a minimum number of shares.

As of January 31, 2025, the Company had purchased 120,333 shares of its common stock, at an average price of $ 5.73 per share, totaling approximately $ 708,000 and leaving an available balance of approximately $ 4.3 million authorized by the Board for use in the program as of that date.

As of July 31, 2025, the Company had purchased 120,300 shares of its common stock, at an average price of $ 5.73 per share, totaling approximately $ 708,000 and leaving an available balance of approximately $ 4.3 million authorized by the Board for use in the program as of that date.

The last purchase was made during fiscal year 2024.

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Rent expense for operating leases is recognized on a straight-line basis over the lease term from the lease commencement date through the scheduled expiration date.

Rent expense totaled $ 453,000 and $ 454,000 for the three months ended January 31, 2025 and 2024, respectively.

Rent expense totaled $ 1.4 million for the nine months ended January 31, 2025 and 2024, respectively.

Rent expense totaled $ 453,000 for both the three months ended July 31, 2025 and 2024.

The Company considers its facilities adequate for its current operational needs.

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The lease expires in November 2026.

The Company recognized $ 17,000 and $ 19,000 of rent expense relative to this lease for the three months ended January 31, 2025 and 2024, respectively.

The Company recognized $ 55,000 and $ 57,000 of rent expense relative to this lease for the nine months ended January 31, 2025 and 2024, respectively.

The Company recognized $ 19,000 of rent expense relative to this lease for both the three months ended July 31, 2025 and 2024.

• 1330 Piccard Drive Suite 025, Rockville, MD 20850, which consists of laboratory and office space where the Company conducts operations related to its primary service offerings.

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This lease expires in February 2029.

The Company recognized $ 422,000 and $ 423,000 of rent expense relative to this lease for the three months ended January 31, 2025 and 2024, respectively.

The Company recognized $ 1.3 million of rent expense relative to this lease for both the nine months ended January 31, 2025 and 2024, respectively.

The Company recognized $ 422,000 of rent expense relative to this lease for both the three months ended July 31, 2025 and 2024.

• VIA LEONE XIII, 14, Milan, Italy, which consists of laboratory and office space where the Company conducts operations related to its flow cytometry service offerings.

The Company executed separate leases for its laboratory space and office space during fiscal 2022.

During fiscal 2023, the Company executed a new lease to consolidate its office and laboratory space at a new nearby location in Italy.

The lease expires October 31, 2028 and it replaces the previous two leases, which were terminated during fiscal year 2023.

The Company recognized $ 13,000 of rent expense relative to its current lease for both the three months ended January 31, 2025 and 2024.

The Company recognized $ 38,000 of rent expense relative to this lease for both the nine months ended January 31, 2025 and 2024, respectively.

The Company executed the lease in November 2022.

The lease expires October 31, 2028.

The Company recognized $ 13,000 of rent expense relative to this lease for both the three months ended July 31, 2025 and 2024.

ROU assets and lease liabilities related to our current operating leases are as follows (in thousands):

January 31, 2025 April 30, 2024

July 31, 2025 April 30, 2025

Operating lease right-of-use assets, net

2 unchanged sentences

Non-current portion of operating lease liabilities 4,244 4,634

As of January 31, 2025, the weighted average remaining operating lease term and the weighted average discount rate were 4.00 years and 5.88 %, respectively.

As of January 31, 2024, the weighted average remaining operating lease term and the weighted average discount rate were 4.98 years and 5.88 %, respectively.

As of July 31, 2025, the weighted average remaining operating lease term and the weighted average discount rate were 3.51 years and 5.89 %, respectively.

As of July 31, 2024, the weighted average remaining operating lease term and the weighted average discount rate were 4.49 years and 5.88 %, respectively.

Future minimum lease payments due each fiscal year as follows (in thousands):

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Present value of minimum lease payments $ 5,750

The composition of total lease cost for three and nine months ended January 31, 2025 and 2024 were as follows (in thousands):

Three Months Ended January 31, Nine Months Ended January 31,

2025 2024 2025 2024

The composition of total lease cost for three months ended July 31, 2025 and 2024 were as follows (in thousands):

Three Months Ended July 31,

Operating lease costs $ 441 $ 429

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Consulting Services

During the three months ended January 31, 2025 and 2024, the Company recognized $ 0 and $ 9,000 , respectively, for consulting services provided by an affiliate of a Board member, unrelated to his duty as a Board member.

During the nine months ended January 31, 2025 and 2024, the Company recognized $ 12,000 and $ 27,000 , respectively, for consulting services provided by an affiliate of a Board member, unrelated to his duty as a Board member.

During the three months ended July 31, 2025 and 2024, the Company recognized $ 0 and $ 9,000 , respectively, for consulting services provided by an affiliate of a Board member, unrelated to his duty as a Board member.

Such amounts are included in general and administrative expenses in the accompanying condensed consolidated statements of operations.

As of January 31, 2025, $ 0 was due to this related party.

As of July 31, 2025, $ 0 was due to this related party.

Commitments and Contingencies

7 unchanged sentences

Some of these arrangements also set forth an annual minimum royalty due regardless of tumor models used for sale.

For the three months ended January 31, 2025 and 2024, we have recognized approximately $ 117,000 and $ 114,000 , respectively, in expense related to these royalty arrangements.

For the nine months ended January 31, 2025 and 2024, we have recognized approximately $ 302,000 and $ 240,000 , respectively, in expense related to these royalty arrangements.

For the three months ended July 31, 2025 and 2024, we have recognized approximately $ 39,000 and $ 81,000 , respectively, in expense related to these royalty arrangements.

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