What changed in this filing

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Item 1. Financial Statements

2026-08-19 compared with 2026-05-15 · 593 added, 588 removed, 613 unchanged (66% of the section changed)

3 unchanged sentences

(in thousands, except share and per share data)

March 31, 2026 December 31, 2025

(unaudited) (1)

June 30, 2026 December 31, 2025

Current Assets:

11 unchanged sentences

Property and equipment, net 2,452 606

Intangible assets 102,618 94,816

Intangible assets, net 100,235 94,816

Goodwill 27,285 19,135

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Total assets $ 276,642 $ 274,704

Liabilities, Convertible Redeemable Preferred Stock and Stockholders’ Equity

Liabilities and Stockholders' Equity

Current Liabilities:

5 unchanged sentences

Total current liabilities 27,266 26,881

Convertible notes 3,380 5,917

Warrant liabilities 9 9

Convertible notes payable — 5,917

Other liabilities 3,482 3,932

Total liabilities 30,748 36,730

Commitments and contingencies (Note 9)

Common stock, par value $ 0.0001 ;

2,000,000,000 shares authorized;

617,813,176 and 573,438,153 shares issued and outstanding as of March 31, 2026 and December 31, 2025, respectively

854,456,625 and 573,438,153 shares issued and outstanding as of June 30, 2026 and December 31, 2025, respectively

Additional paid-in capital 764,408 615,360

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Total liabilities and stockholders’ equity $ 276,642 $ 274,704

________________________________________________

(1) The condensed consolidated balance sheet as of December 31, 2025 was derived from the audited consolidated balance sheet as of that date.

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

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

DATAVAULT AI INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

For the three months ended March 31, 2026 and 2025

For the three and six months ended June 30, 2026 and 2025

(in thousands, except share and per share data)

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2026 2025 2026 2025

Live event production revenue $ 2,839 $ 1,432 $ 5,338 $ 1,432

Consumer audio products, components, and other revenue, net 1,053 277 1,829 895

Consumer audio products and components, related party, net

316 26 457 37

Patent license revenue

2,509 — 2,509 —

Total net revenue 6,717 1,735 10,133 2,364

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Cost of revenue, consumer audio products, components, and other 557 304 1,067 864

Cost of revenue, patent license

Total cost of net revenue 3,839 1,700 7,144 2,260

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Total operating expenses 29,334 12,494 60,395 21,994

Income (loss) from operations ( 30,950 ) ( 9,431 )

Loss from operations ( 26,456 ) ( 12,459 ) ( 57,406 ) ( 21,890 )

Interest expense, net ( 1,000 ) ( 17,202 ) ( 2,121 ) ( 17,322 )

Change in fair value of warrant liabilities — 17

Change in fair value of 2025 Notes measured at fair value

— ( 8,804 ) — ( 8,804 )

Change in fair value of convertible note to related party measured at fair value

— 1,355 — 1,355

Loss on Crypto assets

( 8,094 ) — ( 25,050 ) —

Extinguishment of debt — — ( 1,725 ) —

Impairment of investment in nonmarketable security ( 2,534 ) —

Other expense, net ( 16,801 ) ( 29 )

Impairment of investments in non-marketable securities

( 56,372 ) — ( 58,906 ) —

Change in fair value of warrant liabilities

3,866 2 3,866 19

Other income/(expense), net 31 ( 3 ) 186 ( 32 )

Loss before provision for income taxes ( 88,025 ) ( 37,111 ) ( 141,156 ) ( 46,674 )

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Weighted average number of common shares used in computing net loss per common share 727,623,511 68,174,418 651,345,981 60,968,158

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

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

DATAVAULT AI INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

For the three months ended March 31, 2026 and 2025

For the three and six months ended June 30, 2026 and 2025

(in thousands, except share and per share data)

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Balance as of March 31, 2026

617,813,176 $ 63 $ 650,541 $ ( 430,576 ) $ 220,028

Stock-based compensation 46,094,139 — 5,657 — 5,657

Equity issuance costs — — ( 2,108 ) — ( 2,108 )

Issuance of common stock with NYIAX transaction 2,000,000 — — — —

Issuance of common stock in connection with Vivasor investment 75,942,666 8 56,190 — 56,198

Issuance of common stock in connection with May Offering, net of fees

109,090,910 11 55,729 — 55,740

Issuance of common stock in connection with ATM offering, net of fees 3,515,734 5 2,371 — 2,376

Warrant dividend classified as liability

— — ( 3,972 ) — ( 3,972 )

— — — ( 88,025 ) ( 88,025 )

Balance as of June 30, 2026 854,456,625 $ 87 $ 764,408 $ ( 518,601 ) $ 245,894

Common Shares Additional

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Balance as of March 31, 2025 66,024,190 $ 6 $ 389,694 $ ( 308,014 ) $ 81,686

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

Stock-based compensation 3,701,197 — 1,151 — 1,151

Issuance of common stock in connection with warrant exercise 2,989,887 — — — —

Issuance of common stock for conversions 1,845,945 — 1,545 — 1,545

Issuance of common stock with NYIAX transaction 1,500,000 — — — —

Issuance of warrants with the 2025 Notes — — 16,657 — 16,657

Issuance of common stock for the acquisition of CompuSystems, Inc.

10,600,000 1 10,282 — 10,283

Equity Issuance costs — — ( 137 ) — ( 137 )

Net loss — — — ( 37,116 ) ( 37,116 )

Balance as of June 30, 2025 86,661,219 $ 7 $ 419,192 $ ( 345,130 ) $ 74,069

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

DATAVAULT AI INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

For the three months ended March 31, 2026 and 2025

For the six months ended June 30, 2026 and 2025

(in thousands)

Three Months Ended March 31,

Six Months Ended June 30,

Cash flows from operating activities:

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Amortization of debt discounts and paid-in-kind interest 1,308 520

Change in fair value of convertible debt — 7,595

Fair value of equity warrants in interest expense — 16,657

Change in fair value of crypto currency 16,133 —

Loss on sale of bitcoin 822 —

Loss on digital assets 25,050 —

Debt extinguishment 1,725 —

Impairment of nonmarketable security 2,534 —

Impairment of investments in non-marketable securities 58,906 —

Shares payable to NYIAX — 1,088

Change in fair value of warrant liability ( 3,866 ) ( 19 )

Changes in operating assets and liabilities:

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Accounts payable ( 2,404 ) 962

Due to related party 18,818 —

Related party payable

Accrued liabilities 393 ( 68 )

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Cash flows from investing activities:

Issuance of note receivable ( 500 ) —

Deposit for business combination — ( 1,000 )

Cash paid for acquisition of API Media, net ( 12,949 ) —

Issuances of notes receivable ( 2,000 ) —

Repayment of note receivable 100 —

Cash paid for acquisition of API Media, net of cash ( 12,949 ) —

Cash paid for acquisition of CSI, net of cash

Purchases of property and equipment ( 582 ) ( 52 )

Disposals of property and equipment ( 171 ) —

Construction in progress ( 555 ) —

Purchases of intangible assets ( 824 ) —

Investment in non-marketable securities ( 300 ) —

Net cash used in investing activities ( 17,110 ) ( 6,552 )

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

DATAVAULT AI INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

For the six months ended June 30, 2026 and 2025

(in thousands)

Six Months Ended June 30,

Cash flows from financing activities:

Repayments on notes payable ( 6,963 ) ( 406 )

Proceeds form issuing shares through an At-The-Market (ATM) program 29,985 4,945

Proceeds from issuance of short-term debt

Proceeds from issuing shares through an At-The-Market (ATM) program

Proceeds from issuance of common stock in connection with May Offering 55,740 —

Proceeds from issuance of convertible notes, net of issuance costs — 13,698

Proceeds from issuance of common stock, net of issuance costs — 4,722

Advances from related party

Debt issuance costs

Equity issuance costs ( 1,626 ) —

Repayments of notes payable ( 6,688 ) —

Repayments of convertible note payable, related party

( 3,940 ) ( 1,083 )

Repurchase of common stock warrants — ( 622 )

Net cash provided by financing activities 96,469 16,715

Net increase (decrease) in cash and cash equivalents 201 ( 3,159 )

Net decrease in cash and cash equivalents

( 604 ) ( 2,668 )

Cash and cash equivalents as of beginning of period 2,004 3,330

Cash and cash equivalents as of end of period $ 1,400 $ 662

Noncash Investing and Financing Activities:

Capitalized acquisition costs — 117

Unpaid financing issuances costs — 86

Unpaid deferred offering costs 469 117

Settlement of Related Party Payable with Bitcoin 18,156 —

Intangible assets acquired with issuance of common stock 5,400 —

Non-cash Investing and Financing Activities:

ATM non-cash offering costs

Repayment of advances from related party with Bitcoin

Intangible assets acquired with issuance of common stock 5,401 —

Investment in Vivasor, Inc.

through common stock issuance

Warrant dividend classified as liability

Capitalized acquisition costs — 117

CompuSystems, Inc.

Convertible Notes issued for CompuSystems, Inc.

Non cash common shares issued in CompuSystems, Inc.

Deposit paid in December 2024 used in CompuSystems, Inc.

acquisition closing

Shares payable to NYIAX in share exchange agreement — 1,088

Reclass liability warrant to equity — 15

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

May 2025 10% note conversions — 1,545

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

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Three Months Ended March 31, 2026 and 2025

For the three and six months ended June 30, 2026 and 2025

Business and Summary of Significant Accounting Policies

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(together with its subsidiaries also referred to herein as “we,” “us,” “our,” “Datavault,” “Datavault AI” or the “Company”), was originally formed as a limited liability company in Delaware on July 23, 2010.

The Company’s business is to deliver the best-in-class data management and monetization, as well as using wireless audio to transmit data and audio for consumer use.

Datavault stands at the forefront of innovation, delivering cutting-edge Web 3.0 data management and high-performance computing solutions to a global audience.

The Company operates through two synergistic technology platforms, Data Sciences and Acoustic Sciences.

The Data Sciences platform is focused on data management, valuation and monetization technologies, while the Acoustic Sciences platform is focused on technologies and solutions involving data-over-sound, spatial and high-definition audio, and live-event data capture and engagement.

On May 20, 2025, the Company completed its previously announced asset purchase of technology assets, customer contracts, trademarks, and other intellectual property (collectively, the “CSI Acquired Assets”) from CompuSystems, Inc.

CSI is a provider of registration, data analytics, and lead management services for live events, offering customer support to clients in the trade, association, corporate, and government event markets.

Only the results of operations attributable to the CSI Acquired Assets acquired from CompuSystems, Inc.

are included in the Company’s unaudited condensed consolidated financial statements from May 20, 2025, onward.

Following the acquisition, the Company began operating the CSI Acquired Assets under the brand name “Event Citadel."

The Company operates the CSI Acquired Assets under the brand name “Event Citadel” as part of its Acoustic Sciences platform.

The results of operations attributable to the CSI Acquired Assets are included in the Company’s unaudited condensed consolidated financial statements from May 20, 2025, onward.

On January 22, 2026, the Company completed its previously announced acquisition of all of the outstanding shares of API Media Innovations Inc.

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API Media is a technology provider specializing in on-site media capture, data collection, and digital engagement services for live outdoor events, including sporting events and large-scale experiential activations.

The results of operations of API Media are included in the Company’s unaudited condensed consolidated financial statements from January 22, 2026, onward.

Accordingly, the results of operations of API Media are included in the Company’s unaudited condensed consolidated financial statements for the three months ended March 31, 2026.

API Media operates as part of the Company’s Acoustic Sciences platform.

The results of operations of API Media are included in the Company’s unaudited condensed consolidated financial statements from January 22, 2026, onward and, accordingly, are included in the Company’s unaudited condensed consolidated financial statements for the three and six months ended June 30, 2026.

Nasdaq Compliance

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Three Months Ended March 31, 2026 and 2025

For the three and six months ended June 30, 2026 and 2025

Basis of Presentation

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

GAAP”) and include all adjustments necessary for the fair presentation of the Company’s financial position, results of operations and cash flows for the periods presented.

The condensed consolidated financial statements reflect the accounts of Datavault AI Inc.

and its wholly-owned subsidiaries, WISA Technologies Korea, LTD, a Korean limited company, which was established in September 2022, and WiSA, LLC, a Delaware limited liability company.

All intercompany balances and transactions are eliminated.

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

GAAP”) for interim financial information and the instructions to Article 8-03 of Regulation S-X and should be read in conjunction with the Company's Annual Report on Form 10-K for the year ended December 31, 2025.

The condensed consolidated balance sheet as of June 30, 2026 was derived from the audited annual financial statements as of December 31, 2025 but does not include all information required by U.S.

GAAP for annual financial statements.

The financial statements include the accounts of the Company, all entities that are wholly owned by the Company, and all entities in which the Company has a controlling financial interest.

All adjustments that, in the opinion of management, are necessary for a fair presentation for the periods presented have been reflected by the Company.

Such adjustments are of a normal, recurring nature.

The results of operations for the three and six months ended June 30, 2026 are not necessarily indicative of the results that may be expected for the entire fiscal year or for any other interim period.

All significant intercompany balances and transactions have been eliminated in consolidation.

Use of Estimates

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Actual results could differ from those estimates.

Reclassification

Certain reclassifications have been made to prior periods’ consolidated financial statements to conform to the current period presentation.

These reclassifications did not result in any change in previously reported net loss, total assets or stockholders’ equity.

Concentration of Credit Risk and Other Risks and Uncertainties

Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash and cash equivalents and accounts receivable.

Cash and cash equivalents are deposited in demand and money market accounts at one financial institution.

Cash and cash equivalents are deposited in demand and money market accounts with financial institutions.

At times, such deposits may be in excess of insured limits.

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The Company performs credit evaluations of its customers’ financial condition and may, in certain circumstances, require full or partial payment in advance of shipping.

As of March 31, 2026 and December 31, 2025, there was no allowance for credit losses.

As of March 31, 2026, the Company had two customers accounting for 65 % and 31 % of accounts receivable.

As of June 30, 2026 and December 31, 2025, there was no allowance for credit losses.

As of June 30, 2026, the Company had two customers accounting for 54 % and 32 % of accounts receivable.

As of December 31, 2025, the Company had two customers accounting for 65 % and 32 % of accounts receivable.

The Company had two customers accounting for 14 % and 11 % of its net revenue for the three months ended March 31, 2026.

The Company had three customers accounting for 29 %, 25 % and 18 % of its net revenue for the three months ended March 31, 2025.

These receivables are with related parties, Vivasor and Scilex.

See related party footnote disclosure.

The Company had two customers accounting for 37 % and 9 % of its net revenue for the three months ended June 30, 2026.

The Company had two customers accounting for 25 % and 10 % of its net revenue for the six months ended June 30, 2026.

The Company had two customer accounting for 18 % and 10 % of its net revenue for the three months ended June 30, 2025.

The Company had two customers accounting for 13 % and 10 % of its net revenue for the six months ended June 30, 2025.

The Company’s future results of operations involve a number of risks and uncertainties.

Factors that could affect the Company’s future operating results and cause actual results to vary materially from expectations include, but are not limited to, rapid technological change, continued acceptance of the Company’s products, competition from substitute products and larger companies, protection of proprietary technology, strategic relationships and dependence on key individuals.

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the three and six months ended June 30, 2026 and 2025

The Company relies on sole-source suppliers to manufacture some of the components used in its product.

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Additionally, certain licensing arrangements may include variable consideration or milestone-based payments, which could impact the timing and amount of revenue recognized.

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Three Months Ended March 31, 2026 and 2025

Revenue from the Company’s live event and media services business is dependent on the successful execution of events, customer demand, and the continuation of relationships with key customers and partners.

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The Company may also rely on a limited number of significant customers, which could result in revenue concentration and variability in operating results from period to period.

Cash and Cash Equivalents

The Company considers all highly liquid investments purchased with original maturities of three months or less to be cash equivalents.

Accounts Receivable and Allowance for Credit Losses

Accounts receivable are recorded at the invoice amount and are generally not interest bearing.

The Company reviews its trade receivables aging to identify specific customers with known disputes or collection issues.

The Company exercises judgment when determining the adequacy of these reserves as it evaluates historical bad debt trends and changes to customers’ financial conditions.

No allowance for credit losses was deemed necessary as of March 31, 2026 or December 31, 2025.

Fair Value of Financial Instruments

Carrying amounts of certain of the Company’s financial instruments, including cash and cash equivalents, accounts receivable, prepaid expenses and other current assets, accounts payable and accrued liabilities approximate fair value due to their relatively short maturities.

The carrying value of the Company’s borrowings and capital lease liabilities approximates fair value based upon borrowing rates currently available to the Company for loans and capital leases with similar terms.

The Company’s Crypto assets, NYIAX Investment, Convertible note payable and Warrant liability, are the only financial instruments that are adjusted to fair value on a recurring basis.

Inventories, principally purchased components, are stated at the lower of cost or net realizable value.

Cost is determined using an average cost, which approximates actual cost on a first-in, first-out basis.

Inventory in excess of salable amounts and inventory which is considered obsolete based upon changes in existing technology is written off.

At the point of loss recognition, a new lower cost basis for that inventory is established and subsequent changes in facts and circumstances do not result in the restoration or increase in the new cost basis.

Deferred Offering Costs

Deferred offering costs, consisting of legal, accounting and filing fees relating to public offerings, are capitalized.

The deferred offering costs will be offset against public offering proceeds upon the effectiveness of an offering.

The offering costs for the July ATM were offset with proceeds on a pro-rata basis.

In the event that an offering is terminated, deferred offering costs will be expensed.

As of March 31, 2026 and December 31, 2025, the Company had capitalized $ 0.7 million and $ 5.5 million deferred offering costs, respectively.

The carrying value of the Company’s borrowings and capital lease liabilities approximates fair value based upon borrowing rates currently available to the Company for loans with similar terms.

The Company’s Crypto assets are the only financial instruments that are adjusted to fair value on a recurring basis.

Goodwill and Intangible Assets

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All other intangible assets are definite-lived intangible assets and are amortized over their respective estimated lives, ranging from 3 to 10 years.

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Three Months Ended March 31, 2026 and 2025

The Company is required to perform an impairment review of indefinite-lived intangible assets, including goodwill annually, and more frequently under certain circumstances.

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If the Company determines through the impairment process that the indefinite-lived intangible asset has been impaired, the Company will record the impairment charge in its results of operation.

Through March 31, 2026, the Company has never recorded a goodwill impairment charge.

In the event that facts and circumstances indicate definite-lived intangible assets may be impaired, the Company evaluates the recoverability and estimated useful lives of such assets.

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If less, the Company measures the fair value of the asset (group) and recognizes an impairment loss if the carrying amount of the assets exceeds their respective fair values.

Property and Equipment, Net

Property and equipment are stated at cost less accumulated depreciation and amortization.

Depreciation of property and equipment is computed using the straight-line method over their estimated useful lives of two to five years .

Leasehold improvements and assets acquired under capital lease are amortized on a straight-line basis over the shorter of the useful life or term of the lease.

Upon retirement or sale, the cost and related accumulated depreciation are removed from the balance sheet and the resulting gain or loss is reflected in operations.

Maintenance and repairs are charged to operations as incurred.

Convertible Financial Instruments

The Company bifurcates conversion options and warrants from their host instruments and accounts for them as freestanding derivative financial instruments if certain criteria are met.

The criteria include circumstances in which (a) the economic characteristics and risks of the embedded derivative instrument are not clearly and closely related to the economic characteristics and risks of the host contract, (b) the hybrid instrument that embodies both the embedded derivative instrument and the host contract is not re-measured at fair value under otherwise applicable generally accepted accounting principles with changes in fair value reported in earnings as they occur and (c) a separate instrument with the same terms as the embedded derivative instrument would be considered a derivative instrument.

An exception to this rule is when the host instrument is deemed to be conventional, as that term is described under applicable U.S.

When the Company has determined that the embedded conversion options and warrants should be bifurcated from their host instruments, discounts are recorded for the intrinsic value of conversion options embedded in the instruments based upon the differences between the fair value of the underlying common stock at the commitment date of the transaction and the effective conversion price embedded in the instrument.

Debt discounts under these arrangements are amortized to interest expense using the interest method over the earlier of the term of the related debt or their earliest date of redemption.

Warrants for Common Shares, Convertible Redeemable Preferred Shares, and Derivative Financial Instruments

Warrants for our common shares, convertible redeemable preferred shares, and derivative financial instruments are classified as equity if the contracts (1) require physical settlement or net-share settlement or (2) give the Company a choice of net-cash settlement or settlement in its own shares (physical settlement or net-share settlement).

Contracts which (1) require net-cash settlement (including a requirement to net cash settle the contract if an event occurs and if that event is outside the control of the Company), (2) give the counterparty a choice of net-cash settlement or settlement in shares (physical settlement or net-share settlement), or (3) contain reset provisions that do not qualify for

Business Combinations

We account for acquisitions of entities or asset groups that qualify as businesses using the acquisition method of accounting.

Purchase consideration is allocated to the tangible and intangible assets acquired and liabilities assumed

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Three Months Ended March 31, 2026 and 2025

the scope exception are classified as equity or liabilities.

The Company assesses classification of its warrants for shares of common stock and other derivatives at each reporting date to determine whether a change in classification between equity and liabilities is required.

Product Warranty

The Company’s products are generally subject to a one-year warranty, which provides for the repair, rework, or replacement of products (at the Company’s option) that fail to perform within the stated specification.

The Company has assessed its historical claims and, to date, product warranty claims have not been significant.

The Company will continue to assess if there should be a warranty accrual going forward.

For the three and six months ended June 30, 2026 and 2025

based on the estimated fair values as of the acquisition date, which are measured in accordance with fair value measurement accounting principles.

The determination of fair value requires management to make estimates about discount rates, future expected cash flows, market conditions and other future events that are highly subjective in nature.

The excess of the total purchase consideration over the fair value of the identified net assets acquired is recognized as goodwill.

The results of the acquired businesses are included in our results of operations beginning from the date of acquisition.

Acquisition-related costs are expensed as incurred.

During the measurement period, which may be up to one year from the acquisition date, we may record adjustments to the allocation of purchase consideration and to the fair values of assets acquired and liabilities assumed to the extent that additional information becomes available.

After this period, any subsequent adjustments are recorded in the consolidated statements of operations.

Asset Acquisitions

We account for acquisitions of assets or groups of assets that do not meet the definition of a business as asset acquisitions.

The cost of an asset acquisition, including transaction costs, is allocated to the individual assets acquired and liabilities assumed based on their relative fair values.

No goodwill is recognized in an asset acquisition.

Acquired intangible assets are amortized over their estimated useful lives when finite-lived and are evaluated for impairment in accordance with the applicable accounting guidance.

Revenue Recognition

The Company generates revenue from the sale of consumer audio products and components (“Consumer Audio and Components”), registration, data analytics, and lead management services for live events (“Event Citadel Live Events”), and event-based media and broadcasting services (“API Media”).

The Company generates revenue from the sale of consumer audio products and components (“Consumer Audio and Components”), registration, data analytics, and lead management services for live events (“Event Citadel Live Events”), event-based media and broadcasting services (“API Media”), and licensing patents.

The Company recognizes revenue in accordance with Accounting Standards Codification ("ASC") 606, Revenue from Contracts with Customers, using the following five-step model:

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Event Citadel Live Events contracts generally relate to registration, data analytics, lead management, and event preparation and management services provided for trade shows, conferences, and other live events in both the corporate and government sectors.

Contracts are generally multi-year arrangements with terms of approximately three years and typically terminate upon completion of the final event specified within the agreement, unless extended by mutual written consent.

Contracts are generally multi-year arrangements with terms of approximately three years and typically terminate upon completion of the final event specified within the agreement, unless extended by

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the three and six months ended June 30, 2026 and 2025

mutual written consent.

Event Citadel contracts generally do not contain termination-for-convenience provisions.

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The transaction price generally includes fixed service fees, pass-through costs, and other reimbursable expenses, including personnel and supply-related costs incurred on behalf of clients.

The Company has concluded it acts as principal in these arrangements and therefore recognizes pass-through and

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Three Months Ended March 31, 2026 and 2025

reimbursable costs on a gross basis within revenue, with the corresponding expenses recognized within cost of services.

The Company has concluded it acts as principal in these arrangements and therefore recognizes pass-through and reimbursable costs on a gross basis within revenue, with the corresponding expenses recognized within cost of services.

Certain contracts also include rebates payable to customers, which are estimated as variable consideration using the most likely amount method and reduce the transaction price.

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Sales-based or usage-based royalties promised in exchange for a license of intellectual property are recognized in the period in which the subsequent sales or usage occurs in accordance with the sales- or usage-based royalty exception under ASC 606-10-55-65.

During the three months ended March 31, 2026 and 2025, net revenue consisted of the following:

For the Three Months Ended March 31,

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the three and six months ended June 30, 2026 and 2025

During the three and six months ended June 30, 2026 and 2025, net revenue consisted of the following:

For the Three Months Ended June 30, For the Six Months Ended June 30,

(in thousands) 2026 2025 2026 2025

Components $ 903 $ 492

Consumer Audio Products 14 137

Live Events $ 2,839 $ 1,432 $ 5,338 $ 1,432

Consumer Audio Products 10 45 24 182

Components 1,359 258 2,262 750

Patent License 2,509 — 2,509 —

Total $ 6,717 $ 1,735 $ 10,133 $ 2,364

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Three Months Ended March 31, 2026 and 2025

Contract Balances

The Company receives payments from customers based on a billing schedule as established in our contracts to partially offset prepayments required by our vendors on long lead time materials as well as for Live Events.

Amounts collected prior to the fulfillment of the performance obligation are considered contract liabilities and classified as customer advances within accrued liabilities on the consolidated balance sheets.

Contract assets are recorded when the Company has a conditional right to consideration for our completed performance under the contracts.

Accounts receivables are recorded when the right to this consideration becomes unconditional.

The Company has $ 1.3 million and $ 1.7 million of contract assets as of March 31, 2026 and December 31, 2025, respectively, which are recorded in the current assets section on the condensed consolidated balance sheets.

The Company expects to collect 100 % of the contract assets as of March 31, 2026 in the next twelve months.

During the three months ended March 31, 2026, the Company recognized $ 907,000 of revenue from contract liabilities that were included in accrued liabilities on the condensed consolidated balance sheets as of December 31, 2025.

(in thousands) March 31,

The Company has $ 0.6 million and $ 1.7 million of contract assets as of June 30, 2026 and December 31, 2025, respectively, which are recorded in the current assets section on the condensed consolidated balance sheets.

The Company expects to collect 100 % of the contract assets as of June 30, 2026 in the next twelve months.

During the six months ended June 30, 2026, the Company recognized $ 1,535,000 of revenue from contract liabilities that were included in accrued liabilities on the condensed consolidated balance sheets as of December 31, 2025.

(in thousands) June 30,

2026 December 31,

9 unchanged sentences

In addition, the Company does not disclose the value of unsatisfied performance obligations for contracts with an original expected length of one year or less.

Stock-Based Compensation

The Company measures and recognizes the compensation expense for restricted stock units and restricted stock awards granted to employees and directors based on the fair value of the award on the grant date.

Restricted stock units give an employee an interest in Company stock but they have no tangible value until vesting is complete.

Restricted stock units and restricted stock awards are equity classified and measured at the fair market value of the underlying stock at the grant date and recognized as expense over the related service or performance period.

The Company elected to account for forfeitures as they occur.

The fair value of stock awards is based on the quoted price of our common stock on the grant date.

Compensation cost for restricted stock units and restricted stock awards is recognized using the straight-line method over the requisite service period.

Crypto Assets

The Company accounts for cryto assets as indefinite-lived intangible assets in accordance with ASC 350-60, Intangibles—Goodwill and Other—Crypto Assets.

Crypto assets are initially measured at cost and subsequently

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Three Months Ended March 31, 2026 and 2025

Crypto Assets

We hold crypto assets primarily for operational purposes and to support short-term liquidity needs within our normal operating cycle.

We reasonably expect to convert such assets to cash or utilize them in operations within a short period of time, typically within one year.

All of our crypto assets are held in Bitcoin.

Consistent with this intent and realization pattern, we have classified all crypto assets as current assets in our consolidated balance sheets in accordance with ASC 210-10 and ASC 350-60.

We do not hold crypto assets for long-term investment, speculative, or collateral purposes, and we do not engage in trading activities involving crypto assets.

Our crypto asset holdings are considered less liquid than cash and cash equivalents and may not serve as an equivalent source of liquidity during periods of market stress.

Research and Development

Research and development costs are charged to operations as incurred and include salaries, consulting expenses and an allocation of facility costs.

For the three and six months ended June 30, 2026 and 2025

measured at fair value, with changes in fair value recognized in earnings.

Fair value is measured using quoted prices in the Company’s principal market for the applicable digital assets as of the measurement date.

The Company assigns cost to crypto assets sold using the first-in, first-out (“FIFO”) method.

The Company holds crypto assets primarily for operational purposes and to support short-term liquidity needs within its normal operating cycle.

The Company reasonably expects to convert such assets to cash or utilize them in operations within a short period of time, typically within one year.

Consistent with this intent and realization pattern, the Company classifies its crypto assets as current assets in its consolidated balance sheets.

The Company does not hold crypto assets for long-term investment, speculative, or collateral purposes and does not engage in trading activities involving crypto assets.

Advertising Costs

Advertising costs are charged to sales and marketing expenses as incurred.

Advertising costs for the three months ended March 31, 2026 and 2025 were $ 1.7 million and $ 0.1 million respectively.

Comprehensive Loss

Comprehensive loss represents the changes in equity of an enterprise, other than those resulting from stockholder transactions.

Accordingly, comprehensive loss may include certain changes in equity that are excluded from net loss.

For the three months ended March 31, 2026 and 2025, the Company’s comprehensive loss is the same as its net loss.

Foreign Currency

The financial position and results of operations of the Company’s foreign operations are measured using currencies other than the U.S.

dollar as their functional currencies.

Accordingly, for these operations all assets and liabilities are translated into U.S.

dollars at the current exchange rates as of the respective balance sheet date.

Expense items are translated using the weighted average exchange rates prevailing during the period.

Cumulative gains and losses from the translation of these operations’ financial statements are reported as a separate component of stockholders’ equity, while foreign currency transaction gains or losses, resulting from re-measuring local currency to the U.S.

dollar are recorded in the condensed consolidated statement of operations in Other expense, net and were not material for the three months ended March 31, 2026 and 2025.

Net Loss per Common Share

Basic and diluted net loss per common share is presented in conformity with the two-class method required for participating securities.

The Company considers all series of convertible preferred stock to be participating securities.

Under the two-class method, the net loss attributable to common stockholders is not allocated to the convertible preferred stock as the holders of the convertible preferred stock do not have a contractual obligation to share in the losses of the Company.

Under the two-class method, net income would be attributed to common stockholders and participating securities based on their participation rights.

Basic net loss per common share is calculated by dividing the net loss attributable to common stockholders by the weighted average number of shares of common stock outstanding during the period, without consideration for potentially dilutive securities.

Diluted net loss per common share is computed by dividing the net loss attributable to common stockholders by the weighted average number of common shares and potentially dilutive common share equivalents outstanding for the period determined using the treasury-stock and if-converted methods.

For purposes of

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Three Months Ended March 31, 2026 and 2025

the diluted net loss per common share calculation, warrants exercisable for common stock, restricted stock units and shares issuable upon the conversion of convertible notes payable are considered to be potentially dilutive securities.

Net loss is adjusted for any deemed dividends to preferred stockholders to compute income available to common stockholders.

For the three months ended March 31, 2026, warrants to purchase 9,683,027 shares of common stock, 6 shares underlying shares of restricted stock units, 1,050,000 shares underlying shares of restricted stock units issued under an inducement grant, 18,159,535 shares underlying restricted stock awards and 437,501 shares under two grants of restricted stock under inducement grants have been excluded from the calculation of net loss per common share because the inclusion would be antidilutive.

For the three months ended March 31, 2025, warrants to purchase 15,204,647 shares of common stock, 12 shares of restricted stock, 1,200,000 shares underlying shares of restricted stock units issued under an inducement grant, 7,014,260 shares underlying restricted stock awards, and 64,183 shares of two grants of restricted stock under inducement grants have been excluded from the calculation of net loss per common share because the inclusion would be antidilutive.

Deferred taxes are provided on the liability method whereby deferred tax assets are recognized for deductible temporary differences, and operating loss and tax credit carryforwards and deferred tax liabilities are recognized for taxable temporary differences.

Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases.

Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is “more-likely-than-not” that some portion or all of the deferred tax assets will not be realized.

The Company has recognized valuation allowances against its deferred tax assets as of March 31, 2026 and December 31, 2025.

Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment.

The Company uses a comprehensive model for recognizing, measuring, presenting, and disclosing in the condensed consolidated financial statements tax positions taken or expected to be taken on a tax return.

A tax position is recognized as a benefit only if it is “more-likely-than-not” that the tax position would be sustained in a tax examination, with a tax examination being presumed to occur.

The amount recognized is the largest amount of tax benefit that is greater than 50% likely of being realized on examination.

For tax positions not meeting the “more-likely-than-not” test, no tax benefit is recorded.

The Company recognizes interest accrued and penalties related to unrecognized tax benefits in tax expense.

As of March 31, 2026 and December 31, 2025, the Company recognized no interest and penalties.

Advertising costs for the three and six months ended June 30, 2026 were $ 3.3 million and $ 5.0 million respectively.

Advertising costs for the three and six months ended June 30, 2025 were $ 29 thousand and $ 175 thousand respectively.

Net Loss Per Share

For the six months ended June 30, 2026, warrants to purchase 17,864,830 shares of common stock, 3,571,429 shares of common stock issuable upon conversion of convertible notes, 6 shares underlying shares of restricted stock units, 1,000,000 shares underlying shares of restricted stock units issued under an inducement grant, and 61,890,038 shares underlying restricted stock awards have been excluded from the calculation of diluted net loss per common share because the inclusion would be antidilutive.

For the six months ended June 30, 2025, warrants to purchase 31,232,173 shares of common stock, 12 shares of restricted stock, 1,200,000 shares underlying shares of restricted stock units issued under an inducement grant, 10,108,368 shares underlying restricted stock awards, and 564,183 shares of two grants of restricted stock under inducement grants have been excluded from the calculation of diluted net loss per common share because the inclusion would be antidilutive.

Equity Investments

The Company accounts for equity investments in accordance with ASC 321, Investments—Equity Securities.

Equity investments with readily determinable fair values are measured at fair value, with changes in fair value recognized in earnings.

For equity investments without readily determinable fair values for which the Company has not elected to apply the practical expedient to estimate fair value using net asset value, the Company may elect the measurement alternative and measure such investments at cost, less impairment, adjusted for observable price changes in orderly transactions for identical or similar investments of the same issuer.

At each reporting period, the Company evaluates investments accounted for under the measurement alternative for impairment and considers whether observable transactions indicate a change in the carrying value of the investment.

If an impairment exists, the investment is written down to its fair value, with the impairment loss recognized in earnings.

Costs to Fulfill Contracts

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The Company expenses all direct costs related to the execution of the show and all post-show costs as incurred, as those activities do not meet the criteria for capitalization under ASC 340-40.

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Six Months Ended June 30, 2026 and 2025

Capitalized pre-show costs are amortized on a systematic basis that is consistent with the transfer of the related services to the customer, which the Company determines based on the percentage of completion of each contract.

1 unchanged sentence

Amortization of costs to fulfill a contract is recorded in cost of sales in the condensed consolidated statements of operations.

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Three Months Ended March 31, 2026 and 2025

At March 31, 2026, the balance of capitalized costs to fulfill contracts was $ 0.4 million, all of which is classified as a current asset.

During the three months ended March 31, 2026, the Company recognized $ 0.6 million of amortization related to capitalized contract fulfillment costs.

At June 30, 2026, the balance of capitalized costs to fulfill contracts was $ 0.5 million, all of which is classified as a current asset.

During the three and six months ended June 30, 2026, the Company recognized amortization related to capitalized contract fulfillment costs of $ 0.6 million and $ 1.2 million, respectively.

No impairment losses were recognized during the period.

Recently Adopted Accounting Pronouncements

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

Improvements to Income Tax Disclosures” to help investors better understand an entity’s exposure to potential changes in jurisdictional tax legislation and the ensuing risks and opportunities.

Furthermore, the update improves disclosures used to assess income tax information that affects cash flow forecasts and capital allocation decisions.

The update is effective for public business entities for annual periods beginning after December 15, 2024, on a prospective basis but does not impact interim financial statements.

The Company has adopted this standard as of January 1, 2025 and the adoption did not have a material impact on the condensed consolidated financial statements.

In December 2023, the FASB issued ASU No.

2023-08, Accounting for and Disclosure of Crypto Assets (Subtopic 350-60) (“new crypto assets standard”).

The new crypto assets standard requires certain crypto assets to be measured at fair value separately on the balance sheet with changes reported in the statement of operations each reporting period.

The new crypto assets standard also enhances the other intangible asset disclosure requirements by requiring the name, cost basis, fair value, and number of units for each significant crypto asset holding.

The Company first received crypto assets during the third quarter of 2025 and therefore adopted ASU 2023-08 as of that date.

Because the Company had no crypto asset holdings prior to that period, no retrospective application or recast of prior-period financial statements was required.

The adoption did not have an impact on previously reported results.

In March 2025, the FASB issued ASU 2025-02, which amended ASC 450-10-S99-1 to remove the text of SAB Topic 5.FF, “Accounting for Obligations to Safeguard Crypto-Assets an Entity Holds for Its Platform Users.” The amendment reflects the Securities and Exchange Commission ("SEC") staff’s issuance of SAB 122, which rescinded SAB 121 in January 2025.

The adoption of ASU 2025-02 did not have a material impact on the Company’s condensed consolidated financial statements.

In July 2025, the FASB issued ASU 2025-05, Financial Instruments—Credit Losses (Topic 326):

11 unchanged sentences

We do not expect the pronouncement to have a material impact on our condensed consolidated financial statements.

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Three Months Ended March 31, 2026 and 2025

ASU 2024-03 Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40):

7 unchanged sentences

The Company has reviewed other recent accounting pronouncements and concluded they are either not applicable to the business, or no material effect is expected on the consolidated financial statements as a result of future adoption.

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the three and six months ended June 30, 2026 and 2025

Going Concern

The condensed consolidated financial statements of the Company have been prepared on a going concern basis, which contemplates the realization of assets and the discharge of liabilities in the normal course of business.

As of June 30, 2026, the Company had cash and cash equivalents of $ 1.4 million, crypto assets of $ 49 million and reported net cash used in operations of $ 80 million during the six months ended June 30, 2026.

The Company expects operating losses to continue in the foreseeable future because of additional costs and expenses related to research and development activities, plans to expand its product portfolio, and increase its market share.

The Company’s ability to attain profitable operations is dependent upon achieving a level of revenues adequate to support its cost structure.

Based on current operating levels, the Company will need to raise additional funds in the next 12 months by selling additional equity or incurring debt.

To date, the Company has funded its operations primarily through sales of its securities in public and private markets, proceeds from the exercise of warrants to purchase common stock and the sale of convertible notes.

Additionally, future capital requirements will depend on many factors, including the rate of revenue growth, the selling price of the Company’s products, the expansion of sales and marketing activities, the timing and extent of spending on research and development efforts and the continuing market acceptance of the Company’s products.

These factors raise substantial doubt about the Company’s ability to continue as a going concern for the twelve months from the date that the financial statements are issued.

Management of the Company intends to raise additional funds through the issuance of equity securities or debt.

There can be no assurance that, in the event the Company requires additional financing, such financing will be available at terms acceptable to the Company, if at all.

Failure to generate sufficient cash flows from operations, raise additional capital and reduce discretionary spending could have a material adverse effect on the Company’s ability to achieve its intended business objectives.

As a result, the substantial doubt about the Company’s ability to continue as a going concern has not been alleviated.

The accompanying condensed consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern .

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Six Months Ended June 30, 2026 and 2025

Business Combination and Asset Purchase

1 unchanged sentence

At the closing (the “CSI Closing”), pursuant to an asset purchase agreement, by and between the Company and CSI, dated as of December 19, 2024, as amended by that certain amendment to the asset purchase agreement, dated as of December 30, 2024, and as further amended by that certain second amendment to the asset purchase agreement, dated as of February 25, 2025, and as further amended by that certain third amendment to the asset purchase agreement, dated March 31, 2025, and as further amended by that certain fourth amendment to the asset purchase agreement, dated May 14, 2025 (the “CSI Asset Purchase Agreement”), the Company acquired the CSI Acquired Assets for an aggregate purchase consideration of $ 32.8 million consisting of (i) exclusivity fee of $ 1.0 million paid in the fourth fiscal quarter of 2024 (the “Exclusivity Fee”), (ii) amount in cash of $ 1.0 million paid to an escrow account in January 2025 (the “Escrow Amount”) (iii) an amount in cash equal to $ 5.0 million, (iv) 10,600,000 validly issued, fully paid and nonassessable shares of restricted common stock of the Company, (the “Closing Stock Consideration”), (v) $ 5.0 million payable in the form of the convertible note (the “Initial Convertible Note”) issued by the Company to CSI, (vi) $ 5.0 million payable in the form of the convertible note (the “First Convertible Note”) issued by the Company to CSI, (vii) $ 5.0 million payable in the form of convertible note (the “Second Convertible Note”, and together with the Initial Convertible Note and First Convertible Note, the “CSI Convertible Notes”) issued by the Company to CSI, (viii) $ 500,000 for the reimbursement of fees incurred by CSI due to the acquisition, and (ix) the assumption of certain transferred liabilities, as described in the CSI Asset Purchase Agreement.

The fair values assigned to the identifiable intangible assets acquired were estimated using valuation techniques consistent with the income and cost approaches described in ASC 820.

Customer relationships were valued using the multi-period excess earnings method, which incorporates significant assumptions including projected revenue growth, customer attrition, operating margins, contributory asset charges, and discount rates.

Trade names and trademarks were valued using the relief-from-royalty method, which incorporates assumptions regarding estimated royalty rates, projected revenues, expected useful life, and discount rates.

Developed technology was valued using the cost approach, which incorporates assumptions regarding the estimated time and cost to recreate the technology, entrepreneurial profit, economic obsolescence, and the expected remaining useful life of the technology.

These estimates are based on management's assumptions regarding future operating performance and market participant assumptions and are inherently subject to uncertainty.

Pursuant to the CSI Asset Purchase Agreement, in connection with the CSI Closing, the Company issued the CSI Convertible Notes in an aggregate principal amount of $ 15.0 million, each due on the second anniversary of the closing (the “Maturity Date”).

6 unchanged sentences

Total purchase price consideration $ 27,500

Cash of $ 7.5 million includes initial cash paid of $ 1.0 million as Exclusivity Fee in December 2024, $ 1.0 million Break-up Fee paid in January 2025, and cash paid at closing in May 2025 amounting to $ 5.5 million

Cash of $ 7.5 million includes initial cash paid of $ 1.0 million as Exclusivity Fee in December 2024, $ 1.0 million escrow amount paid in January 2025, and cash paid at closing in May 2025 amounting to $ 5.5 million

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Three Months Ended March 31, 2026 and 2025

For the Three and Six Months Ended June 30, 2026 and 2025

The final purchase price and purchase price allocation of assets acquired and liabilities assumed follows:

17 unchanged sentences

Total $ 8,870

The results of operations of CSI are included in the unaudited consolidated financial statements of the Company for the three months ended March 31, 2026.

The goodwill recorded in the CSI acquisition is not deductible for tax purposes.

API Media Innovations

5 unchanged sentences

Any such adjustments will be recorded in the period in which they are identified.

The fair values assigned to the identifiable intangible assets acquired were estimated using valuation techniques consistent with the income and cost approaches described in ASC 820.

Customer relationships were valued using the multi-period excess earnings method, which incorporates assumptions regarding projected revenue growth, customer attrition, operating margins, contributory asset charges, and discount rates.

The trade name was valued using the relief-from-royalty method, which incorporates assumptions regarding estimated royalty rates, projected revenues, useful life, and discount rates.

These estimates are based on management's assumptions regarding future operating performance and market participant assumptions and are inherently subject to uncertainty.

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Three Months Ended March 31, 2026 and 2025

For the Three and Six Months Ended June 30, 2026 and 2025

The following table summarizes the preliminary allocation of the purchase price to the estimated fair values of assets acquired and liabilities assumed at the acquisition date:

17 unchanged sentences

The Company expects to derive synergy from the acquired intangibles from API with it's own intellectual property.

The goodwill recorded in the CSI acquisition is not deductible for tax purposes.

The Company recorded fees in three months ended March 31, 2026 of $ 84,000 .

The goodwill recorded in the API acquisition is not deductible for tax purposes.

The Company recorded fees in the six months ended June 30, 2026 of $ 84,000 .

Supplemental Pro Forma Information:

The revenue and net loss of API included in consolidated statement of operations since the acquisition date were $ 187,000 and $ 311,000 , respectively.

The revenue and net loss of API included in consolidated statement of operations since the acquisition date were $ 1.2 million and $ 0.1 million, respectively.

Revenue and net income for the 3 months ended June 30, 2026 were $ 1.0 million and $ 0.4 million , respectively .

Had the acquisition occurred on January 1, 2025, consolidated pro forma revenue, net loss and net loss per common share, basic and diluted would have been as follows:

Pro Forma (Unaudited) for the three months ended March 31,

Pro Forma (Unaudited) for the three months ended June 30,

Pro Forma (Unaudited) for the six months ended June 30,

2026 2025 2026 2025

Net revenue $ 5,701 $ 2,792 $ 9,170 $ 3,675

1 unchanged sentence

Other Intangible Asset Acquisitions

For the three months ended March 31, 2026, the Company acquired an additional patent from three inventors for an aggregate fair value of $ 5.4 million and a useful life of 10 years, based on expected future economic benefit, in exchange for the issuance of 7,500,000 shares of common stock.

This transaction was considered a related party

During the six months ended June 30, 2026, the Company acquired an additional patent from three inventors for an aggregate fair value of $ 5.4 million and a useful life of 10 years, based on expected future economic benefit, in exchange for the issuance of 7,500,000 shares of common stock.

This transaction was considered a related party transaction as described in the related party note.

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Three Months Ended March 31, 2026 and 2025

transaction as described in the related party note.

The Company recorded amortization expense of $ 0.1 million and $ 0 for the three months ended March 31, 2026 and 2025, respectively.

For the Three and Six Months Ended June 30, 2026 and 2025

Salieri Platform Acquisition

During the six months ended June 30, 2026, the Company acquired the Salieri platform, including related developed technology, software, source code, documentation, algorithms, and associated intellectual property, pursuant to an agreement with an individual developer for an aggregate purchase price of £ 0.6 million (approximately $ 0.8 million).

The acquired technology was capitalized as an intangible asset and is being amortized over its estimated useful life based on the expected period of future economic benefit.

The Company also entered into a separate four-year consulting agreement with the seller for ongoing platform support, maintenance, and development, which is accounted for separately as services are received.

Balance Sheet Components

Inventories (in thousands):

2026 December 31,

Raw materials $ 165 $ 129

Work in progress 66 67

Finished goods 486 440

Total inventories $ 717 $ 636

Property and equipment, net (in thousands):

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Leasehold improvements 309 280

Accumulated depreciation and amortization ( 1,519 ) ( 1,616 )

Accumulated depreciation ( 1,600 ) ( 1,616 )

Property and equipment, net 2,452 606

Depreciation and amortization expense for property and equipment for the three months ended March 31, 2026 and 2025 were approximately of $ 74,000 and $ 12,000 , respectively.

Intangible assets, net consisted of the following at March 31, 2026.

Depreciation expense for property and equipment for the three months ended June 30, 2026 and 2025 were approximately of $ 80,000 and $ 26,000 , respectively.

Depreciation expense for the six months ended June 30, 2026 and 2025 were approximately $ 154,000 and $ 38,000 , respectively.

Intangible assets, net consisted of the following at June 30, 2026.

Gross Carrying

6 unchanged sentences

$ 116,761 $ ( 16,526 ) $ 100,235

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Three Months Ended March 31, 2026 and 2025

As of March 31, 2026, the future amortization of the intangibles acquired is as follows:

As of June 30, 2026, the future amortization of the intangibles acquired is as follows:

2026 remainder $ 6,501

Thereafter 33,281

The Company recognized amortization expense related to intangibles of $ 3.1 million and $ 2.3 million for the three months ended March 31, 2026 and 2025, respectively.

Notes Receivable

In March 2026, the Company entered into a promissory note agreement with NYIAX, Inc.

(“NYIAX”), pursuant to which the Company advanced $ 0.4 million.

The note bears interest at an annual rate of 5 % and matures on the earlier of (i) June 9, 2026 or (ii) the closing of a merger among NYIAX, the Company, and DVLT Merger Sub Inc.

The note is unsecured and may be prepaid without penalty.

The note contains customary events of default, including nonpayment, covenant breaches, insolvency events, and certain change-in-control transactions.

Upon an event of default, the outstanding balance may become immediately due and payable, and a default penalty of 6 % per month may accrue.

As of March 31, 2026, the outstanding principal balance was $ 0.4 million.

The Company evaluates collectibility of the note and records an allowance for credit losses, if necessary.

As of March 31, 2026, no allowance for credit losses was recorded.

In March 2026, the Company entered into a promissory note agreement with Triton Geothermal LLC (“Triton”), pursuant to which the Company advanced $ 0.1 million.

The note bears interest at a rate of 5 % per annum and matures on or after July 26, 2026, upon written notice by the Company, with payment due within five days of such notice.

The note may be prepaid at any time without penalty.

The note is unsecured and contains customary events of default, including nonpayment, covenant breaches, and insolvency-related events.

Upon the occurrence of an event of default and expiration of applicable cure periods, the outstanding principal and accrued interest may become immediately due and payable.

As of March 31, 2026, the outstanding principal balance was $ 0.1 million.

The Company evaluates collectibility of the note and records an allowance for credit losses, if necessary.

As of March 31, 2026, no allowance for credit losses was recorded.

The Company did not recognize interest income on the notes receivable for the period ended March 31, 2026, as such amounts were immaterial.

Deposits for Business Combination

On October 28, 2025, the Company entered into a Stock Purchase Agreement (the “API Purchase Agreement”) with API Media Innovations Inc.

(“API Media”) and its shareholders, pursuant to which the Company agreed to acquire all of the issued and outstanding shares of API Media (the “API Acquisition”) for total consideration of $ 14.0 million, subject to the terms and conditions of the agreement.

Pursuant to the API Purchase Agreement, the Company paid a non-refundable deposit of $ 1.0 million.

The acquisition was completed on January 22, 2026 and thus the deposit was credited as part of purchase consideration.

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Three Months Ended March 31, 2026 and 2025

For the Three and Six Months Ended June 30, 2026 and 2025

The Company recognized amortization expense related to intangibles of $ 3.2 million and $ 2.5 million for the three months ended June 30, 2026 and 2025, respectively.

The Company recognized amortization expense related to intangibles of $ 6.3 million and $ 4.8 million for the six months ended June 30, 2026 and 2025, respectively.

Notes Receivable

In March 2026 and June 2026, the Company entered into promissory note agreements with NYIAX, Inc.

(“NYIAX”), pursuant to which the Company advanced $ 0.4 million and $ 1.5 million, respectively, for aggregate advances of $ 1.9 million.

Each note bears interest at an annual rate of 5 % and matured on the earlier of (i) June 9, 2026 (in the case of the March note) or June 30, 2026 (in the case of the June note) or (ii) the closing of a merger among NYIAX, the Company, and DVLT Merger Sub Inc.

The notes are unsecured and may be prepaid without penalty.

The notes contains customary events of default, including nonpayment, covenant breaches, insolvency events, and certain change-in-control transactions.

Upon an event of default, the outstanding balance may become immediately due and payable, and a default penalty of 6 % per month may accrue.

As of June 30, 2026, neither note had been repaid at maturity and both are therefore in default.

The Company does not intend to seek remedy for the default at this time.

The aggregate outstanding principal balance of $ 1.9 million is immediately due and payable, and the default penalty rate of 6 % per month has begun to accrue.

The default penalties are de minimis and not accrued for as of June 30, 2026.

The Company evaluates collectability of the note and records an allowance for credit losses, if necessary.

As of June 30, 2026, no allowance for credit losses was recorded.

Accrued liabilities (in thousands):

2026 December 31,

Accrued compensation $ 3,118 $ 3,448

Accrued vacation 788 459

Accrued audit fees 80 332

Accrued compensation 3,583 3,448

Customer advances 1,512 1,883

Accrued other 1,362 670

Accrued royalty payable to related party — 810

Accrued escrow liability 2,550 2,550

Accrued interest — 210

Accrued legal fees 1,136 —

Accrued lease liability, current portion 967 640

Accrued legal fees 1,329 —

Accrued royalty payable to related party 814 810

Accrued other 622 670

Customer advances 1,281 1,883

Total accrued liabilities $ 11,549 $ 11,002

4 unchanged sentences

The EOS Convertible Note uses a conversion price equaling to seventy-five percent ( 75 %) of the average VWAP (as defined in the EOS Convertible Note) during the ten (10) consecutive trading days ending on the trading day that is immediately prior to the conversion date subject to a floor price of $ 1.116 per share.

At EOS Holding’s sole discretion, upon a change of control (as defined in the EOS Convertible Note), the Company shall (i) cause any successor entity to assume in writing all of the obligations of the Company under the EOS Convertible Note, (ii) pay or cause to be paid to EOS Holdings the outstanding balance under the EOS Convertible Note in cash, or (iii) pay, at the closing of such change of control, in full satisfaction of the Company’s obligations under the EOS Convertible Note, an amount in cash or equivalent common stock to the amount EOS Holdings would have been paid if it had converted the outstanding balance under the EOS Convertible Note into shares of common stock immediately prior to such closing, at the conversion price.

When the Company entered into capital raising or financing transactions, including the issuance by the Company of shares of common stock or common stock equivalents (as defined in the EOS Convertible Note) for cash consideration, indebtedness or a combination of units thereof (each, a “Subsequent Financing”), then the Company was required first to pay to EOS Holdings at least 10 % of the gross proceeds of such Subsequent Financing to redeem all or a portion of the EOS Convertible Note, plus accrued but unpaid interest, plus liquidated damages, if any, and any other amounts then owing to EOS Holdings.

On February 14, 2025, the Company paid a portion of principal and interest of $ 0.4 million, net, as a result of the February 2025 Public Offering (defined below in Note 6).

For the three months ended March 31, 2026, the Company

At EOS Holding’s sole discretion, upon a change of

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Three Months Ended March 31, 2026 and 2025

paid an aggregate of $ 3.9 million in cash resulting in the EOS Convertible Note being paid in full.

For the Three and Six Months Ended June 30, 2026 and 2025

control (as defined in the EOS Convertible Note), the Company shall (i) cause any successor entity to assume in writing all of the obligations of the Company under the EOS Convertible Note, (ii) pay or cause to be paid to EOS Holdings the outstanding balance under the EOS Convertible Note in cash, or (iii) pay, at the closing of such change of control, in full satisfaction of the Company’s obligations under the EOS Convertible Note, an amount in cash or equivalent common stock to the amount EOS Holdings would have been paid if it had converted the outstanding balance under the EOS Convertible Note into shares of common stock immediately prior to such closing, at the conversion price.

On February 14, 2025, the Company paid a portion of principal and interest of $ 0.4 million, net, as a result of the February 2025 public offering.

For the six months ended June 30, 2026, the Company paid an aggregate of $ 3.9 million in cash resulting in the EOS Convertible Note being paid in full.

The ending balance and fair value as of December 31, 2025 was $ 3.9 million.

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On March 18, 2026, the Company entered into the settlement agreement with the holders of the First Convertible Note to settle the debt including accrued interest in the aggregate amount of $ 5.2 million.

As of March 31, 2026, the Company has paid $ 2.0 million of the principal in payments scheduled in the settlement agreement to occur in March 2026 and is required per the settlement agreement to pay the remaining $ 3.2 million in principal and accrued interest in scheduled payments to occur in April 2026 and May 2026.

The balance is included in Short-term promissory notes on the condensed consolidated balance sheet as of March 31, 2026.

The Company has paid $ 2.0 million in the three months ended March 31, 2026 and $ 3.2 million in the three months ended June 30, 2026 of the principal in payments scheduled in the settlement agreement.

The balance has been fully paid off as of June 30, 2026.

The Company recorded a debt extinguishment expense of $ 1.7 million for the three months ended March 31, 2026 equal to the difference of the settlement amount due and the carrying value of the First Convertible Note at the settlement date.

The extinguishment expense is recorded on the condensed consolidated statement of operations for the three months ended March 31, 2026.

The extinguishment expense is recorded on the condensed consolidated statement of operations for the six months ended June 30, 2026.

The Second Convertible Note can be converted, partially or entirely, into shares of common stock, any time after the nine-month anniversary of the closing until the Second Convertible Note is fully paid off.

The Second Convertible Note use a conversion price equaling to the average VWAP during the thirty (30) consecutive trading days ending on the trading day that is immediately prior to the conversion date subject to a floor price of $ 1.40 per share and ceiling price of $ 2.50 per share (the “Conversion Price”).

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Six Months Ended June 30, 2026 and 2025

price of $ 2.50 per share (the “Conversion Price”).

The entire outstanding principal and accrued interest shall automatically be converted into shares of common stock on the maturity date at the Conversion Price.

The CSI Convertible Notes carrying value at March 31, 2026 was $ 6.5 million, net of a discount of $ 1.7 million.

Discount accretion expense was $ 0.6 million for the three months ended March 31, 2026.

The CSI Convertible Notes carrying value at June 30, 2026 was $ 3.7 million, net of a discount of $ 1.4 million.

Discount accretion expense was $ 0.3 million and $ 0.9 million for the three and six months ended June 30, 2026, respectively.

Short Term Financing

On May 5, 2026, the Company entered into an agreement for a loan in the amount of $ 2.0 million and received proceeds of $ 1.9 million net of $ 80,000 origination fees.

The loan has weekly payments of $ 125,000 until the maturity date October 16, 2026.

The effective interest rate on the loan is 183.5 % per annum.

There is no prepayment penalty.

The loan is guaranteed by both the Chief Executive Officer and the Chief Financial Officer.

The carrying amount of $ 1.5 million is included in short term notes payable on the condensed consolidated balance sheet as of June 30, 2026.

The interest expense recognized in the three and six months ended June 30, 2026 is $ 0.6 million.

Fair Value Measurements

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Therefore, determining fair value for Level 1 investments generally does not require significant judgment, and the estimation is not difficult.

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Three Months Ended March 31, 2026 and 2025

• Level 2 – Pricing is provided by third-party sources of market information obtained through investment advisors.

3 unchanged sentences

The determination of fair value for Level 3 instruments involves the most management judgment and subjectivity.

The Company’s financial assets and liabilities that are measured at fair value on a recurring basis as of March 31, 2026 and December 31, 2025 by level within the fair value hierarchy, are as follows:

(in thousands) March 31, 2026

Quoted prices

markets Significant

inputs Significant

(Level 1) (Level 2) (Level 3)

Equity investment - NYIAX $ — $ — $ 1,766

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Six Months Ended June 30, 2026 and 2025

The Company’s financial assets and liabilities that are measured at fair value on a nonrecurring and recurring basis as of June 30, 2026 and December 31, 2025 by level within the fair value hierarchy, are as follows:

June 30, 2026

Quoted prices in active markets Significant other observable inputs Significant unobservable inputs

(in thousands) (Level 1) (Level 2) (Level 3)

Nonrecurring fair value measurements:

$ — $ — $ 792

Vivasor, Inc.

$ — $ — $ 800

Total non recurring fair value measurements

$ — $ — $ 1,592

Recurring fair value measurements:

Bitcoin $ 49,016 $ — $ —

Convertible note payable $ — $ — $ —

Warrant liabilities $ — $ 115 $ —

NYIAX Investment

The Company's investment in NYIAX consists of 2,150,000 shares of NYIAX common stock accounted for at cost less impairments.

The Company's investment in NYIAX consists of 2,150,000 shares of NYIAX common stock, which represents approximately 3 % ownership, accounted for at cost less impairments.

See Note 9 for further details.

During the three months ended March 31, 2026, the Company recorded an impairment of the NYIAX investment of $ 2.5 million which is recorded in the Impairment of investment in nonmarketable security line on the condensed consolidated statement of operations for the three months ended March 31, 2026.

The impairment was primarily driven by a decrease in NYIAX stock price.

(in thousands) December 31, 2025

Quoted prices

markets Significant

inputs Significant

(Level 1) (Level 2) (Level 3)

The investment in NYIAX had a historical cost of $ 4.3 million and is carried at cost less impairment and has a carrying amount of $ 0.8 million.

During the three and six months ended June 30, 2026, the Company recorded an impairment of the NYIAX investment of $ 1.0 million and $ 3.5 million which is recorded in the Impairment of investment in nonmarketable security line on the condensed consolidated statement of operations for the three and six months ended June 30, 2026.

Vivasor, Inc.

The Company's investment in Vivasor Inc.

consists of an approximate 2 % ownership interest in the privately held company and is accounted for under the measurement alternative in accordance with ASC 321.

During the three and six months ended June 30, 2026, the Company recognized an impairment on the investment of $ 55.4 million as it was determined the carrying amount was not recoverable.

The investment's cost was $ 56.2 million and is carried at cost less impairment and has a carrying balance of $ 0.8 million on the condensed consolidated balance sheet as of June 30, 2026.

Vivasor, Inc.

is a related party of the Company, see Note 10 for related party details.

Triton GT 1 LLC Investment

The Company's investment in Triton GT 1 LLC consists of an approximate 2 % membership interest in the privately held limited liability company and is accounted for under the measurement alternative in accordance with ASC 321.

During the three and six months ended June 30, 2026, the Company recognized no impairment or observable price adjustments related to the investment.

The investment continues to be carried at its initial cost of approximately $ 0.3 million, as no qualifying observable transactions or impairment indicators requiring adjustment were identified during the period.

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Six Months Ended June 30, 2026 and 2025

December 31, 2025

Quoted prices in active markets Significant other observable inputs Significant unobservable inputs

(in thousands) (Level 1) (Level 2) (Level 3)

Equity investment - NYIAX $ — $ — $ 4,300

$ — $ — $ 4,300

$ 92,222 $ — $ —

Bitcoin $ 92,222 $ — $ —

Convertible note payable $ — $ — $ 3,936

Warrant liabilities $ — $ — $ 9

There were no transfers between Level 1, 2 or 3 during the three months ended March 31, 2026 or 2025.

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Three Months Ended March 31, 2026 and 2025

There were no transfers between Level 1, 2 or 3 during the three and six months ended June 30, 2026 or 2025.

Convertible Notes

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The Company uses level 3 inputs to measure the fair value in subsequent periods.

The Company paid off the EOS Convertible Note during the three months ended March 31, 2026.

The Company paid off the EOS Convertible Note during the six months ended June 30, 2026.

See Note 5, Borrowings, for more details.

The following table includes a summary of changes in fair value of the EOS Convertible Notes.

For the three months ended March 31,

For the six months ended June 30,

(in thousands) 2026 2025

Beginning balance $ 3,936 $ 10,000

Accrued interest on DV note 3 —

Change in fair value recorded in interest expense 3 7,456

Amounts settled on DV note

Conversion of 10% notes

Payoff on DV note ( 3,939 ) —

2 unchanged sentences

The following table summarizes Crypto assets held for operations (in thousands, except units):

March 31, 2026

Units Cost Basis Fair Value

June 30, 2026

BTC Cost Basis Fair Value

Bitcoin 837 $ 73,108 $ 49,016

December 31, 2025

Units Cost Basis Fair Value

BTC Cost Basis Fair Value

Bitcoin 1,054 $ 92,051 $ 92,222

March 31, 2026

Units Cost Basis Fair Value

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Six Months Ended June 30, 2026 and 2025

For the six months ended June 30, 2026

Cost Basis Fair Value

Beginning balance 1,054 $ 92,051 $ 92,222

3 unchanged sentences

Ending balance 837 $ 73,108 $ 49,016

During the three months ended March 31, 2026, the Company sold 217 Bitcoin to Scilex Holding Company ("Scilex") for aggregate proceeds of $ 18.2 million.

The Bitcoin sold had a cost basis of $ 18.9 million, resulting in a realized loss of $ 0.7 million.

The sales were executed to fund the Company’s operations.

Scilex is a related party.

For the three months ended March 31, 2026, the Company recognized a fair value remeasurement loss of $ 16.1 million related to changes in the fair value of its Bitcoin holdings.

Realized gains and losses and fair value remeasurement gains and losses from crypto assets are recorded in Other expense, net in the consolidated statements of operations.

During the six months ended June 30, 2026, the Company repaid $ 18.1 million of cash advances previously received from Scilex Holding Company (“Scilex”), a related party, by transferring 217 Bitcoin to Scilex in satisfaction of the related liability.

The Bitcoin used to settle the liability had a cost basis of $ 18.9 million, resulting in a realized loss of $ 0.8 million and is recorded in Loss on digital assets in the condensed consolidated statements of operations.

The Company had no transfers of Bitcoin during the three months ended June 30, 2026.

For the three and six months ended June 30, 2026, the Company recognized a fair value remeasurement loss of $ 8.1 million and $ 24.2 million, respectively.

Realized gains and losses and fair value remeasurement gains and losses from Crypto assets are recorded in Loss on digital assets in the condensed consolidated statements of operations.

The Company accounts for disposals of Bitcoin using the first-in, first-out (“FIFO”) method.

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Three Months Ended March 31, 2026 and 2025

Convertible Redeemable Preferred Stock and Stockholders’ Equity

A summary of the common stock and warrant activity and related information for the three months ended March 31, 2026 and 2025 is provided as follows.

February 2024 Warrants Black Scholes Value Payout

On December 31, 2024 on the closing of the EOS Asset Acquisition, a provision requiring a Black Scholes Value payout was triggered in the remaining outstanding February 2024 Warrants.

This provision was triggered because the EOS Asset Acquisition met the criteria for a fundamental change as described in the warrant agreement.

The Black Scholes Value payout was valued at $ 1.96 per share and there was an aggregate number of warrants outstanding of 328,483 .

In order to receive the payout, holders must elect within 30 days of the fundamental change otherwise the warrants convert to warrants in the Company.

The warrants were equity classified prior to the close of the EOS Asset Acquisition and were reclassified to liability treatment as a result of the payout liability on December 31, 2024.

In the three months ended March 31, 2025, 316,415 warrants received requests from the holders to receive the Black Scholes Value payout and thus were paid in cash $ 622,000 with the remaining unrequested warrants being reclassified to equity treatment as the January 30, 2025 deadline passed and they reverted to equity warrants.

The Company recognized a gain of $ 8,000 as a result of reclassifying the warrants to equity.

February 2025 Registered Direct Transaction

On February 14, 2025, the Company closed an offering (the “February 2025 Offering”) pursuant to a securities purchase agreement (the “February 2025 Purchase Agreement”) with certain investors (the “February 2025 Investors”).

In the February 2025 Offering, the Company issued and sold to the February 2025 Investors in a registered direct offering, (a) an aggregate of 4,757,126 shares (the “February 2025 Shares”) of common stock of the Company, and (b) common stock purchase warrants (the “February 2025 Warrants”, and together with the Shares, the “February 2025 Securities”) exercisable for an aggregate of up to 4,757,126 shares of common stock, at an exercise price of $ 1.14 per share (the “February 2025 Warrant Shares”) at a combined offering price of $ 1.14 per share and accompanying February 2025 Warrant, for aggregate gross proceeds of approximately $ 5.4 million.

The February 2025 Warrants are immediately exercisable upon issuance and will expire on the fifth anniversary of the issuance date of the February 2025 Warrants.

The February 2025 Warrants may be exercised, in certain circumstances, on a cashless basis pursuant to the formula contained in the February 2025 Warrants.

The grant date fair value of the 4,757,126 warrants was approximately $ 5.3 million, which were treated as equity instruments.

The fair value of such warrants was determined using the Black-Scholes Model based on the following weighted average assumption:

common stock price on the date of grant of $ 1.22 ;

expected yield of 0 %;

expected volatility of 143.4 %;

risk-free interest rate of 4.3 % and expected life of 5 years.

Obligations Under the Purchase Agreement

Pursuant to the February 2025 Purchase Agreement, the Company agreed, subject to certain exceptions, (i) not to offer for sale, issue, sell, contract to sell, pledge or otherwise dispose of any of its shares of common stock or securities convertible into common stock until 30 days after the closing date of the February 2025 Offering, and (ii) not to issue certain securities if the issuance would constitute a variable rate transaction for a period of 4 months from the closing date of the February 2025 Offering, in each case unless the Company is required to complete a financing prior to the applicable date in order to satisfy Nasdaq’s continued listing requirements.

Placement Agency Agreement

In connection with the February 2025 Offering, on February 13, 2025, the Company entered into a placement agency agreement (the “February 2025 Placement Agency Agreement”) with Maxim Group LLC (the “February 2025 Placement Agent”), pursuant to which the February 2025 Placement Agent agreed to act as placement agent on a

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Three Months Ended March 31, 2026 and 2025

“reasonable best efforts” basis in connection with the February 2025 Offering.

Pursuant to the February 2025 Placement Agency Agreement, the Company agreed to pay the February 2025 Placement Agent an aggregate fee equal to 7.0 % of the gross proceeds raised in the February 2025 Offering and reimburse the February 2025 Placement Agent an amount up to $ 75,000 for expenses in connection with the February 2025 Offering.

The Company also issued the February 2025 Placement Agent a private warrant (the “February 2025 Placement Agent Warrant”) to purchase up to 5.0 % of the aggregate number of February 2025 Securities sold in the February 2025 Offering, or warrants to purchase up to 475,713 shares of common stock (such shares, the “February 2025 Placement Agent Warrant Shares”), at an exercise price equal to 125.0 % of the offering price per share of common stock and accompanying February 2025 Warrant, or $ 1.425 per share.

The February 2025 Placement Agent Warrants will be exercisable 6 months after the commencement of sales in the February 2025 Offering and will expire on the five year anniversary of the initial exercise date.

During the three months ended March 31, 2025, three holders of warrants executed their right under the “alternative cashless exercise” provision to effect a cashless exercise of a total of 3,246,111 shares of common stock.

No warrants were exercised in the three months ended March 31, 2026.

Securities Purchase Agreement

On September 25, 2025, the Company entered into a Securities Purchase Agreement (the “September Purchase Agreement”) with Scilex, to sell in a registered offering, (a) 15,000,000 shares (the “September Shares”) of common stock of the Company, and (b) a pre-funded warrant (the “Pre-Funded Warrant”) to purchase 263,914,094 shares (the “Pre-Funded Warrant Shares”) of common stock, for an aggregate purchase price of $ 150.0 million in the native currency of the Bitcoin blockchain (“BTC”) upon satisfaction of certain closing conditions applicable to the September Shares and Pre-Funded Warrant, respectively.

The BTC paid to the Company in both Closings (as defined below) is valued at the spot exchange rate for BTC as published by Coinbase.com at 8:00 p.m.

(New York City time) on the trading day immediately prior to the September Initial Closing Date (as defined below).

The closing with respect to the September Shares (the “September Initial Closing”) took place on September 26, 2025 (the date of the Initial Closing, the “September Initial Closing Date”).

The closing with respect to the Pre-Funded Warrant (the “Pre-Funded Warrant Additional Closing,” and together with the September Initial Closing, the “BTC Closings”), took place on November 25, 2025 (the date after the Company received the approval of its stockholders (i) as required by Nasdaq rules with respect to the transactions contemplated by the September Purchase Agreement including with respect to issuance of all of the Pre-Funded Warrant Shares and (ii) with respect to an amendment to the Company’s certificate of incorporation to increase the number of shares of common stock authorized for issuance to up to 2,000,000,000 .

On the September Initial Closing, the Company received approximately 71 BTC with an aggregate fair value of $ 7.8 million at the date of receipt.

On the Pre-Funded Warrant Additional Closing date the Company received 1,257 BTC with an aggregate fair value of $ 109.8 million.

As of March 31, 2026, the fair value of the BTC was $ 57.1 million and is recorded in Crypto assets on the condensed consolidated balance sheets.

See Note 5 for fair value disclosures.

The loss of $ 16.9 million is recorded in Other expense, net on the condensed consolidated statement of operations.

The Pre-Funded Warrant issued in the Pre-Funded Warrant Additional Closing, is immediately exercisable upon issuance without any beneficial ownership limitation at an exercise price of $ 0.0001 per share, and will remain exercisable until exercised in full and the Company has treated the shares as though they are outstanding as in-substance common shares.

The fair value of the Pre-Funded Warrants of $ 109.8 million based on the aggregate fair value of the BTC received was recorded to additional paid-in capital as of December 31, 2025.

As a condition to the September Initial Closing, the Company was required to obtain stockholder support agreements (the “Voting Agreements”) from stockholders holding an aggregate of 38,000,000 shares of common stock, pursuant to which each such stockholder will agree to vote their shares of common stock in favor of the proposals for the

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Three Months Ended March 31, 2026 and 2025

stockholder approval at any stockholder meeting held for that purpose.

Additionally, each of the directors and executive officers of the Company, pursuant to lock-up agreements, agreed not to sell or transfer any of the Company securities which they hold, subject to certain exceptions, until the Pre-Funded Warrant Additional Closing Date.

Purchaser Rights

Upon the September Initial Closing, (i) for so long as Scilex beneficially owns an aggregate of at least 10 % of the issued and outstanding shares of common stock, Scilex may designate two directors to the board of directors of the Company, and (ii) for so long as Scilex beneficially owns at least 5 % but no more than 10 % of the issued and outstanding shares of common stock, Scilex may designate one director to the board of directors of the Company.

The Company sold 36,663,892 in shares of common stock under the Maxim ATM for net proceeds of $ 24.8 million for the three months ended March 31, 2026.

Stockholders’ Equity

A summary of the common stock and warrant activity and related information for the six months ended June 30, 2026 is provided as follows.

The Company sold 40,179,626 in shares of common stock under the Maxim ATM for net proceeds of $ 32.4 million for the six months ended June 30, 2026.

Maxim receives a fee of 3 % of gross proceeds or $ 1.0 million.

Gross proceeds net of fees is recorded in additional paid-in capital on the statement of stockholders' equity for three months ended March 31, 2026 for $ 24.8 million net of non cash deferred offering costs of $ 5.2 million.

Gross proceeds net of fees is recorded in additional paid-in capital on the statement of stockholders' net of non-cash offering costs of $ 5.5 million which were previously capitalized and reclassified to equity upon raising the funds.

Consultant Equity Awards

In the three months ended March 31, 2026, the Company recognized $ 1.0 million of compensation expense for equity awards granted to consultants outside of the 2018 LTIP plan in the aggregate of 909,427 shares of common stock.

In the three and six months ended June 30, 2026, the Company recognized $ 0.2 million and $ 1.2 million of compensation expense for equity awards granted to consultants outside of the 2018 LTIP plan in the aggregate of 1,409,427 shares of common stock.

The shares vest immediately or after six months.

4 unchanged sentences

Holders with fewer than sixty shares of common stock or common stock equivalents were not be entitled to receive any Meme Coins.

The Meme Coins are digital collectibles intended solely for personal, non-commercial use in connection with the Dream Bowl XIV event and do not represent or confer any equity, voting, dividend, profit-sharing, or ownership rights in the Company or any other entity, nor do they provide any right to receive cash or other monetary consideration.

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Six Months Ended June 30, 2026 and 2025

in the Company or any other entity, nor do they provide any right to receive cash or other monetary consideration.

The Meme Coins are not designed or intended to function as an investment, currency, or financial product.

5 unchanged sentences

Holders with fewer than sixty shares of common stock or common stock equivalents were not be entitled to receive any warrants.

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Three Months Ended March 31, 2026 and 2025

Each warrant entitles the holder to purchase one share of the Company’s common stock at an exercise price of $ 5.00 per share (subject to adjustment for recapitalizations, stock splits, stock dividends and similar types of transactions) and will expire on the first anniversary of the distribution date.

The exercise of each warrant is subject to certain conditions, including a requirement that the applicable beneficial owner possess a corresponding Meme Coin at the time of exercise.

The warrants were recorded as an in and out to additional paid in capital for their aggregate fair value of $ 4.0 million as of the record date of January 7, 2026.

The fair value of the common stock warrants uses significant unobservable inputs (Level 3).

The warrants were recorded as liability classified for their aggregate fair value of $ 4.0 million as of the record date of January 7, 2026.

The fair value of the common stock warrants uses significant observable inputs (Level 2).

The fair value of the common warrants was determined using the Black-Scholes Model based on the following key inputs and assumptions:

stock price on January 7, 2026 of $ 1.16 , exercise price of $ 5.00 , term of 1 year, volatility of 179.0 % and risk-free rate of 3.48 %.

On the distribution date of February 27, 2026 the Company adjusted the fair value to it's distribution date fair value of $ 1.9 million for which the adjustment was and in and out to additional paid in capital for three months ended March 31, 2026.

On the distribution date of February 27, 2026 the Company adjusted the fair value to it's distribution date fair value of $ 1.9 million for which the adjustment was to the warrant liability.

The fair value of the common warrants was determined using the Black-Scholes Model based on the following key inputs and assumptions:

stock price on January 7, 2026 of $ 0.71 , exercise price of $ 5.00 , term of 1 year, volatility of 183.7 % and risk-free rate of 3.48 %

Warrants exercisable as of March 31, 2026 exclude warrants to purchase 12,068 shares of common stock issued to investors that participated in the February 2024 Public Offering that requires shareholder approval prior to the warrants being exercisable.

Information regarding warrants for common stock outstanding and exercisable as of March 31, 2026 is as follows:

stock price on February 27, 2026 of $ 0.71 , exercise price of $ 5.00 , term of 1 year, volatility of 183.7 % and risk-free rate of 3.48 %.

Vivasor Subscription Agreement

On April 16, 2026, the Company entered into a subscription agreement with Vivasor, Inc.

(Vivasor), a related party, pursuant to which the Company acquired 8,163,265 shares of Vivasor’s Series A common stock, at a purchase price of $ 6.125 per share for aggregate consideration of $ 50 million.

In exchange for the Vivasor shares, the Company issued 75,942,666 shares of its common stock to Vivasor.

The transaction closed on April 23, 2026.

Registered Direct Offering

On May 3, 2026, the Company entered into a Securities Purchase Agreement (the "May Purchase Agreement") with certain institutional investors, pursuant to which the Company agreed to sell and issue in a registered direct offering (the "May Offering") an aggregate of 109,090,910 shares of common stock at an offering price of $ 0.55 per share for aggregate gross proceeds to the Company from the May Offering of approximately $ 60.0 million, before deducting the May Placement Agent’s (as defined below) fees and offering expenses payable by the Company.

The Company intends to use the net proceeds from the Offering for the deployment of its quantum-ready graphics processing unit edge network, including build-out and equipment, as well as working capital and general corporate purposes.

The May Offering closed on May 5, 2026.

Pursuant to the May Purchase Agreement, the Company has agreed that, subject to certain exceptions, from the date of the prospectus supplement until forty-five ( 45 ) days after the closing of the Offering, (i) neither it nor any of its subsidiaries shall (a) issue, enter into any agreement to issue or announce the issuance or proposed issuance of any

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Six Months Ended June 30, 2026 and 2025

common stock or common stock equivalents or (b) file any registration statement or any amendment or supplement thereto, and (ii) it shall not enter into a variable rate transactions .

In connection with the May Offering, the Company entered into a Placement Agency Agreement, dated as of May 3, 2026, with Titan Partners Group LLC, a division of American Capital Partners, LLC (the “May Placement Agent”), pursuant to which the May Placement Agent agreed to serve as the sole placement agent for the issuance and sale of securities of the Company pursuant to the May Purchase Agreement.

As compensation for such services, the Company agreed to pay the May Placement Agent a cash fee of $ 4.2 million and issue to the May Placement Agent, or its designees, warrants to purchase up to 5,454,545 shares of common stock (the “May Placement Agent Warrants”) at the closing of the May Offering.

The May Placement Agent Warrants have a term of five years from the date of the prospectus supplement and have an exercise price of $ 0.6325 per share.

The Company also agreed to reimburse the May Placement Agent for legal and other expenses incurred by it in connection with the offering in an aggregate amount up to $ 60,000 .

The shares, the May Placement Agent Warrants and the shares of common stock issuable upon exercise of the May Placement Agent Warrants (the “Placement Agent Warrant Shares”) were offered and sold by the Company pursuant to an effective shelf registration statement on Form S-3 (File No.

333-294502), which was originally filed with the SEC on March 20, 2026, and was declared effective on March 25, 2026, a base prospectus forming a part of the effective registration statement dated March 25, 2026 and a prospectus supplement dated May 3, 2026.

In connection with the May Offering, the Company issued 2,727,272 warrants for the issuance of common stock to Maxim and paid a cash fee of $ 1.0 million for the participation requirement of the Maxim ATM (the "Participation Warrants").

The warrants have a term of five years from the date of the prospectus supplement and have an exercise price of $ 0.6325 per share.

The warrants are accounted for as equity issuance costs and are classified as equity instruments.

They are recorded at their grant date fair value of $ 1.0 million.

The May Placement Agent Warrants were recorded to equity with an aggregate fair value of $ 2.9 million as of the issuance date of May 5, 2026.

The fair value of the common stock warrants uses significant observable inputs (Level 2).

The fair value of the common warrants was determined using the Black-Scholes Model based on the following key inputs and assumptions:

stock price on May 5, 2026 of $ 0.57 , exercise price of $ 0.63 , term of 5 years, volatility of 160.2 % and risk-free rate of 4.08 %.

Warrants exercisable as of June 30, 2026 exclude warrants to purchase 12,068 shares of common stock issued to investors that participated in the February 2024 Public Offering that requires shareholder approval prior to the warrants being exercisable.

Information regarding warrants for common stock outstanding and exercisable as of June 30, 2026 is as follows:

Price Warrants

Outstanding as of

March 31, 2026 Weighted Average

June 30, 2026 Weighted Average

Life (years) Warrants

Exercisable as of

March 31, 2026

June 30, 2026

$ 0.63 8,181,817 4.8 8,181,817

4 unchanged sentences

17,864,830 2.6 17,852,762

________________________________________

* Weighted average

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Six Months Ended June 30, 2026 and 2025

Information regarding warrants for common stock outstanding and exercisable as of December 31, 2025 is as follows:

14 unchanged sentences

Warrants exercisable as of December 31, 2025 exclude warrants to purchase 1 share of common stock issued to a marketing firm, which vest upon the achievement of certain milestones and warrants to purchase 12,068 shares of common stock issued to investors that participated in the February 2024 Public Offering that requires shareholder approval prior to the warrants being exercisable.

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Three Months Ended March 31, 2026 and 2025

Stock-Based Compensation

2 unchanged sentences

Under the LTIP, the aggregate maximum number of shares of common stock (including shares underlying options) that may be issued under the LTIP pursuant to awards of Restricted Shares or Options will be limited to 15 % of the outstanding shares of common stock, which calculation shall be made on the first trading day of each fiscal quarter.

As of March 31, 2026, up to 61,080,567 shares of common stock are available for grants to participants under the LTIP.

A summary of activity related to restricted stock awards with service-based vesting conditions for the three months ended March 31, 2026 is presented below:

As of June 30, 2026, up to 21,755,186 shares of common stock are available for grants to participants under the LTIP.

A summary of activity related to restricted stock awards with service-based vesting conditions for the six months ended June 30, 2026 is presented below:

Stock Awards Shares Weighted-Average

4 unchanged sentences

Forfeited ( 2,517,876 ) $ 0.95

Non-vested as of March 31, 2026 17,914,535 $ 1.83

A summary of activity related to restricted stock awards with performance-based vesting conditions for the three months ended March 31, 2026 is presented below:

Non-vested as of June 30, 2026 61,645,038 $ 1.00

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Six Months Ended June 30, 2026 and 2025

A summary of activity related to restricted stock awards with performance-based vesting conditions for the six months ended June 30, 2026 is presented below:

Stock Awards Shares Weighted-Average

4 unchanged sentences

Forfeited ( 200,000 ) $ 0.96

Non-vested as of March 31, 2026 245,000 $ 0.70

As of March 31, 2026, the unamortized compensation costs related to the unvested restricted stock awards with service based vesting conditions was approximately $ 32.2 million which is to be amortized on a straight-line basis over a weighted-average period of approximately 2.63 years.

Non-vested as of June 30, 2026 245,000 $ 0.70

As of June 30, 2026, the unamortized compensation costs related to the unvested restricted stock awards with service based vesting conditions was approximately $ 61.1 million which is to be amortized on a straight-line basis over a weighted-average period of approximately 2.6 .

In the three months ended March 31, 2026, 1,480,000 performance awards granted in February 2025 met their vesting criteria and the Company recognized $ 0.6 million in compensation cost.

These performance awards vested upon the achievement of the Company’s aggregate revenue equaling or exceeding $ 40.0 million over a trailing 12 calendar month period ending on or prior to the date that is 5 years from the grant date.

As of March 31, 2026, the unamortized compensation costs related to the unvested restricted stock awards with performance based vesting criteria was $ 0.1 million which is to be amortized on a straight-line basis over a weighted-average period of approximately 1.75 years.

As of June 30, 2026, the unamortized compensation costs related to the unvested restricted stock awards with performance based vesting criteria was $ 0.1 million which is to be amortized on a straight-line basis over a weighted-average period of approximately 1.5 .

These performance awards vest upon the achievement of revenue equaling or exceeding certain a threshold over a trailing 12 calendar month period ending on or prior to the date that is 5 years from the grant date.

The performance awards are assigned a 100 % probability to achieve the performance conditions.

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Three Months Ended March 31, 2026 and 2025

For the three months ended March 31, 2026, 1,788,688 shares of restricted stock awards were released under the LTIP with an intrinsic value of $ 1.2 million.

For the six months ended June 30, 2026, 2,230,017 shares of restricted stock awards were released under the LTIP with an intrinsic value of $ 1.5 million.

Inducement Grants

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Of this grant, 600,000 units have service-based conditions and vest in 3 -month equal installments over a 36 -month period, while the other 600,000 units have performance-based condition and vest upon the Company’s aggregate revenue equaling or exceeding $ 40,000,000 over the trailing 12 calendar month period ending on or prior to the date that is 5 years from the grant date.

The performance-based vesting criteria was met in the three months ended March 31, 2026 and the Company recognized $ 0.5 million in compensation cost.

As of March 31, 2026, the unamortized compensation cost for the time-based award related to the Bradley Inducement Grant was approximately $ 0.7 million which is being amortized on a straight-line basis over a period of 1.72 years.

The performance-based vesting criteria was met in the three months ended March 31, 2026 and the Company recognized $ 0.5 million of the remaining expense for acheiving the milestone in compensation cost.

As of June 30, 2026, the unamortized compensation cost for the time-based award related to the Bradley Inducement Grant was approximately $ 0.7 million which is being amortized on a straight-line basis over a period of 1.72 years.

On May 20, 2025, the Company issued 500,000 units of restricted stock at a fair value per share of $ 0.97 , to Mark LoGuirato, as an inducement grant (“LoGuirato Inducement Grant”) pursuant to an inducement award agreement dated May 20, 2025.

Of this grant, 250,000 awards have service-based conditions and vest in 3 -month equal installments over a 36 -month period, while the other 250,000 awards have performance-based condition and vest upon the Company’s CSI revenue equaling or exceeding $ 25,000,000 over trailing 12 calendar month period ending on or prior to the date that is 5 years from the grant date.

As of March 31, 2026, the unamortized compensation cost related to the LoGuirato Inducement Grant was approximately $ 0.3 million which is being amortized on a straight-line basis over a period of 1.66 years.

The Company recorded no provision for income taxes for the three months ended March 31, 2026 and 2025.

For interim periods, the Company estimates its annual effective income tax rate and applies the estimated rate to the year-to-date income or loss before income taxes.

The Company also computes the tax provision or benefit related to items reported separately and recognizes the items net of their related tax effect in the interim periods in which they occur.

The Company also recognizes the effect of changes in enacted tax laws or rates in the interim periods in which the changes occur.

As of March 31, 2026 and December 31, 2025, the Company retains a full valuation allowance on its deferred tax assets.

The realization of the Company’s deferred tax assets depends primarily on its ability to generate taxable income in future periods.

The amount of deferred tax assets considered realizable in future periods may change as management continues to reassess the underlying factors it uses in estimating future taxable income.

The provision for income taxes for the three months ended March 31, 2026 and 2025 was calculated on a jurisdiction basis.

Commitments and Contingencies

Operating Leases

The Company leases office and warehouse facilities under noncancelable operating lease agreements used to support its corporate headquarters, administrative offices, and operational activities.

Lease terms range from approximately two to five years .

Certain leases include renewal options that may extend the lease term;

however, such options are not included in the lease term unless it is reasonably certain that the option will be exercised.

Lease agreements generally

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Three Months Ended March 31, 2026 and 2025

require the Company to pay fixed base rent and may also include variable payments related to common area maintenance, property taxes, insurance, or other operating costs, which are expensed as incurred.

The Company’s leases do not contain residual value guarantees, and the Company does not currently sublease any of its leased facilities.

At lease commencement, the Company recognizes a right-of-use (“ROU”) asset and a corresponding lease liability based on the present value of lease payments over the lease term.

The Company uses its incremental borrowing rate to determine the present value of lease payments when the implicit rate is not readily determinable.

Leases with an initial term of twelve months or less are not recorded on the consolidated balance sheet, and lease expense for these leases is recognized on a straight-line basis over the lease term.

The following table reflects our lease assets and our lease liabilities at March 31, 2026 and December 31, 2025 (in thousands):

2026 December 31,

Operating lease right-of-use assets $ 4,518 $ 4,657

Operating lease liabilities, current $ 865 $ 640

Operating lease liabilities, non-current $ 3,568 $ 3,808

Operating lease right-of-use assets are included in other assets.

Operating lease liabilities, current, are included in accrued liabilities and Operating lease liabilities, non-current, are include in other liabilities on the condensed consolidated balance sheets.

The components of lease costs were as follows (in thousands):

Three Months Ended

Operating lease cost $ 374 $ 47

Short term lease cost $ 15 8

Total lease cost $ 389 $ 55

As of March 31, 2026, the maturity of operating lease liabilities was as follows (in thousands):

Payments due in:

Year ending December 31, 2026 (9 months remaining) $ 886

Year ending December 31, 2027 1,470

Year ending December 31, 2028 1,395

Year ending December 31, 2039 950

Year ending December 31, 2030 684

Total minimum lease payments 5,385

Amounts representing interest ( 952 )

Present value of operating lease obligations $ 4,433

LoGuirato's employment terminated in the three months ended June 30, 2026 and there is no unamortized compensation cost as of June 30, 2026.

The Company reversed $ 132,000 of compensation in the three months ended June 30, 2026 as a result of the termination.

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Three Months Ended March 31, 2026 and 2025

Lease Term and Discount Rate:

March 31, 2026

Weighted-average remaining lease term (in years) 4

Weighted-average discount rate 9.7 %

The discount rate was calculated by using the Company’s estimated incremental borrowing rate.

Other Information:

Supplemental cash flow information related to leases was as follows (in thousands):

Three Months Ended

March 31, 2026 Three Months Ended

March 31, 2025

Operating cash outflows from operating leases $ 271 $ 45

For the Three and Six Months Ended June 30, 2026 and 2025

Commitments and Contingencies

Contingencies

4 unchanged sentences

The accrual for a litigation loss contingency might include, for example, estimates of potential damages, outside legal fees and other directly related costs expected to be incurred.

On March 13, 2026, the Company was named as a defendant in a lawsuit captioned, Li et al v.

Datavault AI, Inc., Case No.

1:26-cv-02091, filed in the U.S.

District Court for the Southern District of New York.

The complaint alleges breach of contract, conversion and that Datavault violated Section 10(b) of the Exchange Act and Rule 10b-5 promulgated thereunder, seeking monetary damages.

The Company filed a motion to dismiss the complaint on May 15, 2026.

Plaintiffs filed an opposition to that motion on June 12, 2026, and the Company filed its reply brief on June 26, 2026.

The motion to dismiss is thus fully briefed and awaiting decision from the Court.

If denied, the Company intends to continue to defend this action vigorously.

At this time, we are unable to predict the outcome of this action or reasonably estimate the range of possible losses.

Class Action Lawsuit

On August 5, 2026, a class action lawsuit was filed against the Company and certain of its current officers in the Eastern District of Pennsylvania, by plaintiff Carla Aramouni seeking to represent a class of all persons who purchased the Company’s securities between September 4, 2024 and October 30, 2025, alleging violations of Section 10(b) and 20(a) of the Exchange Act.

The matter is styled Aramouni v.

Datavault AI Inc., et al., Case No.

2:26-cv-05548-JS (E.D.

The complaint alleges that the Company made false and/or misleading statements and/or failed to disclose material information about the Company’s business, customer contracts, operations, and commercialization prospects in its public statements and SEC filings.

The plaintiff seeks unspecified monetary damages on behalf of a purported class of stockholders plus attorney’s fees and costs.

The Company believes the claims asserted in the complaint are without merit and intends to vigorously defend against them.

The matter is in its early stages, and the Company is unable to predict the outcome of the litigation or to reasonably estimate the range of possible loss, if any, that may result from the matter.

The Company’s management does not believe that any such matters, individually or in the aggregate, will have a materially adverse effect on the Company’s condensed consolidated financial statements.

3 unchanged sentences

The Exchange Agreement closed on April 9, 2025.

Pursuant to the Exchange Agreement, as full consideration for the sale, assignment, transfer and delivery of the NYIAX Shares by NYIAX to the Company, the Company agreed to issue to NYIAX (i) 3,000,000 shares of common stock (such shares of common stock, the “NYIAX Closing Shares”), and (ii) 2,000,000 shares of common stock (such shares of common stock, the “NYIAX Additional Shares”), The NYIAX Closing Shares will be issued in four equal quarterly tranches starting from the closing.

The NYIAX Additional Shares will be issued only upon completion of a complete advertising cycle for a third party clientele, and upon the parties’ mutual written agreement that the Adio platform has been integrated into the NYIAX platform upon completion of the advertising cycle.

The NYIAX Additional Shares will be issued within thirty ( 30 ) days from the completion of the integration.

The Exchange Agreement includes customary representations and warranties and various customary covenants and closing conditions that are subject to certain limitations, including, without limitation, certain agreements.

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Three Months Ended March 31, 2026 and 2025

Intellectual Property Cross-License Agreement

In connection with the Exchange, on March 16, 2025, the Company entered into a white label, co-marketing and intellectual property cross-license agreement (the “License Agreement”) with NYIAX, pursuant to which the Company received a non-exclusive license under certain of NYIAX’s jointly owned patent rights and know-how, and a non-exclusive license to white label NYIAX’s proprietary software-as-a-service advertising brokerage platform, all within the field of data, information and asset monetization and exchange.

In exchange, the Company granted to NYIAX a non-exclusive license under certain of the Company’s wholly owned patent rights, know-how and trademarks, including with respect to the Company’s ADIO platform, in the field of advertising buying, selling and brokerage.

Pursuant to the License Agreement, as consideration for the services provided by NYIAX pursuant to the License Agreement and the rights to access and use the NYIAX platform granted to the Company, and upon the terms and subject to all of the conditions contained in the License Agreement, the Company agreed to issue to NYIAX 2,530,000 shares (such shares, the “NYIAX Consideration Shares”) of common stock.

Pursuant to the License Agreement, in consideration of the rights granted to NYIAX under the License Agreement, NYIAX agreed to pay to the Company a license fee in the form of a convertible promissory note in the aggregate amount $ 2,500,000 (the “NYIAX Convertible Note”).

The NYIAX Convertible Note was due on the first anniversary of the closing (the “Maturity Date”).

NYIAX agreed to pay interest to the Company on the aggregate unconverted and then outstanding principal amount of the NYIAX Convertible Note at the rate of four percent ( 4 %) per annum, accruing from the closing.

The NYIAX Convertible Note may be prepaid in full at NYIAX’s election.

The NYIAX Convertible Note will automatically convert at the earlier of (i) the Maturity Date, and (ii) the first underwritten public offering of NYIAX pursuant to an effective registration statement under the Securities Act, covering the offer and sale by NYIAX of its equity securities, as a result of or following which NYIAX shall be a reporting issuer under the Exchange Act, and NYIAX’s common stock is listed on the Trading Market (as defined in the NYIAX Convertible Note), at a conversion price of $ 2.00 per share.

The Company entered into an Extinguishment Agreement with NYIAX in September 2025 to convert the NYIAX Convertible Note to 1,250,000 shares of NYIAX in full repayment of the note.

The License Agreement includes customary representations and warranties and various customary covenants and closing conditions that are subject to certain limitations, including, without limitation, certain agreements.

Software Development Agreement

In connection with the Exchange, on March 16, 2025, the Company entered into a software development agreement (the “Software Development Agreement”) with NYIAX, pursuant to which NYIAX has engaged the Company to develop certain software and provide certain additional professional services as the parties will agree under one or more statements of work.

The Software Development Agreement includes customary representations and warranties and various customary covenants and closing conditions that are subject to certain limitations, including, without limitation, certain agreements.

Lock-up Agreements

On April 9, 2025, the Company and NYIAX entered into the Lock-Up Agreements (defined below).

In connection with the Exchange Agreement, the Company agreed to enter into a lock-up agreement in respect of the NYIAX Shares, pursuant to which the NYIAX Shares shall be subject to lock-up restrictions for four ( 4 ) years from the issuance (the “Datavault Lock-Up Agreement).

Concurrently, NYIAX agreed to enter into (i) a lock-up agreement in respect of the Additional Shares to be issued by the Company to NYIAX pursuant to the Exchange Agreement, pursuant to which

As full consideration for the sale, assignment, transfer and delivery of the NYIAX Shares by NYIAX to the Company, the Company agreed to issue to NYIAX (i) 3,000,000 shares of common stock (such shares of common stock, the “NYIAX Closing Shares”), and (ii) 2,000,000 shares of common stock (such shares of common stock, the “NYIAX Additional Shares”), The NYIAX Closing Shares will be issued in four equal quarterly tranches starting from the closing.

The 2,000,000 of Additional Shares were issued to NYIAX on April 1, 2026.

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Three Months Ended March 31, 2026 and 2025

the Additional Shares shall be subject to lock-up restrictions for two ( 2 ) years from the issuance (the “Additional Lock-Up Agreement”), (ii) a lock-up agreement in respect of the consideration shares (the “Consideration Shares”) to be issued by the Company to NYIAX pursuant to that certain White Label, Co-Marketing and Intellectual Property Cross-License Agreement, by and between the Company and NYIAX, dated as of March 16, 2025, pursuant to which the Consideration Shares shall be subject to lock-up restrictions for one ( 1 ) year from the issuance (the “Consideration Lock-Up Agreement”), and (iii) a lock-up agreement in respect of the Closing Shares to be issued by the Company to NYIAX pursuant to the Exchange Agreement, pursuant to which the Closing Shares shall be subject to lock-up restrictions for one ( 1 ) year from the issuance (the “Closing Lock-Up Agreement”, and together with the Datavault Lock-Up Agreement, the Additional Lock-Up Agreement, and the Consideration Lock-Up Agreement, the “Lock-Up Agreements”).

For the Three and Six Months Ended June 30, 2026 and 2025

The Company accounted for the NYIAX transactions as a collaborative arrangement and allocated fair values of exchanged assets on their relative fair value.

1 unchanged sentence

The NYIAX common shares received in the aggregate of 2,150,000 were valued at $ 4.3 million and are recorded as an investment at fair value under the measurement alternative of ASC 321 at the close date fair value of $ 2 per share on the condensed consolidated balance sheet.

The Company recognized an impairment on the investment of $ 2.5 million in the three months ended March 31, 2026.

The Company recognized an impairment on the investment of $ 3.5 million in the six months ended June 30, 2026.

See Note 6 for details.

The fair value method was determined due to the Company not having significant influence over NYIAX.

IP licenses received from NYIAX represents the net amount of the shares exchanged and is expensed to research and development of $ 0.6 million on the condensed consolidated statement of operations.

The Company’s IP license granted to NYIAX represents functional intellectual property accounted for under ASC 606 with point-in-time revenue recognition.

Initial value allocated of $ 2.5 million is based on the fair value of the NYIAX Convertible Note.

However, as the collaborative arrangement includes consideration paid to the customer, NYIAX, for distinct goods and services for which the fair value was not reasonably estimable, the transaction price was reduced for any consideration paid in excess of goods or services with a readily determinable fair value, the NYIAX Investment.

Accordingly, the transaction price was reduced to zero as the excess fair value of the consideration paid to the customer was in excess of $ 2.5 million.

The contingently issuance shares are accounted for under ASC 718, Share-based payments as an equity-classified share-based payment to a customer.

Due to the probable achievement of the performance condition on the grant date, the shares are initially recorded at the grant date fair value of $ 1.3 million with no subsequent remeasurement.

The Company accounts for the NYIAX investment under ASC 321 measurement alternative, which accounts for the investment as cost less impairment, due to the Company not having significant influence over NYIAX.

NYIAX Agreement and Plan of Merger

3 unchanged sentences

See Note 6 for discussion of impairment of the NYIAX investment.

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Three Months Ended March 31, 2026 and 2025

Merger Partner Stockholder that is an Unaccredited Investor (as defined in the Merger Agreement) will be converted into the right to receive the unaccredited investor cash consideration, which will be the higher of (i) price per share equal to the VWAP (as defined in the NYIAX Merger Agreement) of the common stock for the five ( 5 ) consecutive trading days ending on the trading day immediately preceding the date of the NYIAX Merger Agreement, or (ii) price per share equal to the VWAP of the common stock for the five ( 5 ) consecutive trading days ending on the trading day immediately preceding the Closing Date.

Pursuant to the terms of the NYIAX Merger Agreement, at the effective time of the Merger (the “Effective Time”), by virtue of the Merger and without any action on the part of the stockholders of NYIAX (the “Merger Partner Stockholders”), (i) each outstanding share of NYIAX’s common stock, par value $ 0.0001 per share (the “NYIAX Common Stock”), other than any shares of NYIAX Common Stock held in the treasury of NYIAX will be converted into the right to receive (i) a number of shares of common stock equal to the Exchange Ratio (as defined in ther Merger Agreement), or (ii) each share of NYIAX Common Stock held immediately prior to the Effective Time by a Merger Partner Stockholder that is an Unaccredited Investor (as defined in the Merger Agreement) will be converted into the right to receive the unaccredited investor cash consideration, which will be the higher of (i) price per share equal to the VWAP (as defined in the NYIAX Merger Agreement) of the common stock for the five ( 5 ) consecutive trading days ending on the trading day immediately preceding the date of the NYIAX Merger Agreement, or (ii) price per share equal to the VWAP of the common stock for the five ( 5 ) consecutive trading days ending on the trading day immediately preceding the Closing Date.

Pursuant to the NYIAX Merger Agreement, if the Company effects or announces an intent to effect a reverse stock split of the common stock at any time within one hundred twenty ( 120 ) days following the date of the NYIAX Merger Agreement, then the Company will issue to the Merger Partner Stockholders, on a pro rata basis in accordance with their respective entitlements to the Merger Consideration, an aggregate of 10,000,000 duly authorized, validly issued, fully paid and nonassessable additional shares of common stock.

Pursuant to the terms of the NYIAX Merger Agreement, the Company has also agreed to appoint two new members to the board of directors of the board of directors of the Company, nominated by NYIAX and subject to such nominees being acceptable to the Company, effective as of the Closing Date.

Pursuant to the terms of the NYIAX Merger Agreement, the Company has also agreed to appoint two new members to the board of directors of the Company, nominated by NYIAX and subject to such nominees being acceptable to the Company, effective as of the Closing Date.

The NYIAX Merger Agreement contains representations and warranties from both the Company and Merger Sub, on the one hand, and NYIAX, on the other hand, customary for a transaction of this nature.

1 unchanged sentence

The completion of the Merger will also be subject to closing conditions, customary for a transaction of this nature.

NYIAX will be subject to customary “no-shop” restrictions on its ability to solicit alternative acquisition proposals from third parties and to provide information to, and continue or participate in discussions and engage in negotiations with, third parties regarding any alternative acquisition proposals, subject to a customary “fiduciary out” provision that allows the Company, under certain specified circumstances and subject to other terms and conditions in the NYIAX Merger Agreement, to provide information to, and continue or participate in discussions and engage in negotiations with, third parties with respect to an alternative acquisition proposal if the board of directors of NYIAX (the “NYIAX Board”) (or a committee thereof) determines in good faith (after consultation with its financial advisor and outside legal counsel) that such alternative acquisition proposal either constitutes a superior proposal or is reasonably likely to lead to a superior proposal, and the NYIAX Board (or a committee thereof) has determined in good faith (after consultation with its financial advisor and outside legal counsel) that the failure to take such actions could reasonably be expected to be inconsistent with its fiduciary duties pursuant to applicable law.

Pursuant to the NYIAX Merger Agreement if, at any time during the period beginning on the Closing Date and ending on the date that is twelve (12) months following the Closing Date, the surviving corporation (as defined in the NYIAX Merger Agreement), or the Company, executed and announced a definitive commercial, strategic, joint venture, licensing, partnership, or other bona fide revenue generating or value enhancing agreement with a trading market (a “Trading Market Transaction”), approved by the the board of directors of the Company, then the Company shall issue to the Merger Partner Stockholders, on a pro rata basis in accordance with their respective ownership immediately prior to the Effective Time, an aggregate of 13,000,000 duly authorized, validly issued, fully paid and nonassessable restricted shares of common stock (the “Earn-Out Shares”).

In lieu thereof, each unaccredited investor shall be entitled to receive, with respect to each share of NYIAX Common Stock held immediately prior to the Effective Time, a cash payment equal to the higher of (i) price per share equal to the VWAP of the common stock for the five ( 5 ) consecutive trading days ending on the trading day immediately preceding the Closing Date, or (ii) price per share equal to the VWAP of the common stock for the five ( 5 ) consecutive trading days ending on the trading day immediately preceding the execution and announcement of Trading Market Transaction, without interest and subject to applicable tax withholding.

From the closing, NYIAX and for a period of twelve ( 12 ) months thereafter has agreed to a special indemnity, pursuant to which NYIAX will indemnify, defend and hold harmless the Company, the surviving corporation from and against any and all losses (as defined in the NYIAX Merger Agreement) arising out of, relating to, or resulting from certain specific, enumerated claims, actions, suits, proceedings, investigations or demands against NYIAX set forth in

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Three Months Ended March 31, 2026 and 2025

the NYIAX Merger Agreement, including any continuation, amendment, extension or escalation thereof.

For the Three and Six Months Ended June 30, 2026 and 2025

regarding any alternative acquisition proposals, subject to a customary “fiduciary out” provision that allows the Company, under certain specified circumstances and subject to other terms and conditions in the NYIAX Merger Agreement, to provide information to, and continue or participate in discussions and engage in negotiations with, third parties with respect to an alternative acquisition proposal if the board of directors of NYIAX (the “NYIAX Board”) (or a committee thereof) determines in good faith (after consultation with its financial advisor and outside legal counsel) that such alternative acquisition proposal either constitutes a superior proposal or is reasonably likely to lead to a superior proposal, and the NYIAX Board (or a committee thereof) has determined in good faith (after consultation with its financial advisor and outside legal counsel) that the failure to take such actions could reasonably be expected to be inconsistent with its fiduciary duties pursuant to applicable law.

Any and all losses for which indemnification is required under the NYIAX Merger Agreement will be satisfied solely by a reduction in the number of Trading Market Transaction earn-out shares otherwise issuable to the Merger Partner Stockholders pursuant to NYIAX Merger Agreement.

6 unchanged sentences

IBM agreed to license the Programs to the Company for two payments of $ 18.9 million on June 30, 2025 and $ 4.8 million on September 30, 2025, respectively (the “Program Payments”).

According to an Embedded Solution Agreement (the “Base Agreement”), of which the Purchase Commitment and the Cloud Services Agreement (as defined below) form a part, the Program Payments become due once an invoice is sent from IBM to the Company and are due within 30 days of receipt of the invoice.

On September 23, 2025, the Company entered into an amendment to the IBM Purchase Commitment (the “Amendment 1”) to amend the payment schedule to be as follows:

$ 2.5 million to be paid at the time of the agreement, $ 3.3 million on December 23, 2025 and eight payments of $ 2.2 million each quarter after that to end with the final payment on December 23, 2027.

The Company having paid $ 2.5 million on August 8, 2025, the total payments are $ 25.9 million.

According to an Embedded Solution Agreement (the “Base Agreement”), of which the Purchase Commitment and the Cloud Services

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Six Months Ended June 30, 2026 and 2025

Agreement (as defined below) form a part, the Program Payments become due once an invoice is sent from IBM to the Company and are due within 30 days of receipt of the invoice.

On September 23, 2025, the Company entered into an amendment to the IBM Purchase Commitment (the “Amendment 1”), revising the total commitment to $ 25.9 million, payable according to the following schedule:

$ 2.5 million paid at the signing of the agreement, $ 3.3 million on December 23, 2025, followed by eight quarterly payments of $ 2.2 million each, with the final payment due on December 23, 2027.

Under the IBM Purchase Commitment, the Company must send a report to IBM every 90 days summarizing the use of each Program.

3 unchanged sentences

Payments under the IBM Purchase Commitment are capitalized to prepaid expenses and are amortized on a straight-line basis over the contractual term, which ends on June 29, 2028, with amortization recorded to research and development expense in the same manner as the related hosting fees.

As of March 31, 2026, the Company had approximately $ 15.3 million of remaining purchase commitments payable under the agreement.

As of June 30, 2026, the Company had approximately $ 15.2 million of remaining purchase commitments payable under the agreement.

Cloud Services Subscription Agreement

On July 7, 2025, the Company entered into a cloud services subscription agreement (the “Cloud Services Agreement”) with IBM, pursuant to which the Company has agreed to purchase certain subscriptions to IBM cloud services (the “Cloud Services”).

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Three Months Ended March 31, 2026 and 2025

The Company has selected their Cloud Services, with the minimum value of the Cloud Services actually purchased within each annual period being (i) $ 0.1 in the first year, (ii) $ 2.1 in the second year, and (iii) $ 4.1 in the third year.

9 unchanged sentences

Pursuant to the SanQtum Agreement, the Company committed to purchase a minimum contract value of $ 10.0 million over the three-year term.

In connection with the agreement, the Company made an initial payment of $ 10.0 million upon execution.

In connection with the agreement, the Company made an initial payment of $ 10.0 million

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Six Months Ended June 30, 2026 and 2025

upon execution.

If the Company does not place purchase orders sufficient to meet the committed contract value during the term, IBM may invoice the Company for the remaining balance of the commitment.

The Company accounts for the arrangement as a prepaid software and amortizes the related expense on a straight line basis within research and development expense over the contractual term.

As of March 31, 2026, the unamortized portion of the initial payment is recorded under prepaid software license on the consolidated balance sheet.

As of June 30, 2026, the unamortized portion of the initial payment is recorded under prepaid software license on the condensed consolidated balance sheet.

Master Purchase Order Agreement - SanQtum

1 unchanged sentence

The agreement provides for an upfront payment of $ 250,000 and has an initial term of twelve months , subject to earlier termination in accordance with its terms.

During quarter ended June 30, 2026 we paid an upfront deposit of $ 32.4 million which relieves the Company of the commitment to AP Global Holdings LLC.

Earnout Agreement

In connection with the closing of the EOS Asset Acquisition, the Company and EOS Holdings entered into the Earnout Agreement, dated as of December 31, 2024, pursuant to which the Company shall pay an amount equal to three percent ( 3 %) of the gross revenue of the Company generated from or otherwise attributable to any patents and patent applications included in the EOS Acquired Assets, subject to customary deductions calculated in accordance with U.S.

In connection with the closing of the EOS Asset Acquisition, the Company and EOS Holdings entered into the Earnout Agreement, dated as of December 31, 2024, pursuant to which the Company shall pay an amount equal to three percent ( 3 %) of the net revenue of the Company generated from or otherwise attributable to any patents and patent applications included in the EOS Acquired Assets, subject to customary deductions calculated in accordance with U.S.

GAAP, and as further set forth in the Earnout Agreement.

2 unchanged sentences

The Earnout Agreement includes customary covenants regarding how the Company can operate its business during the term of the Earnout Agreement.

On July 29, 2026, the Company and EOS Holdings entered into a letter agreement that amended the settlement provisions of the Earnout Agreement to permit EOS Holdings, in its sole discretion, to elect to receive all or any portion of an earnout payment in shares of the Company’s common stock in lieu of cash.

Any shares issued pursuant to such election are subject to certain limitations, including an exchange cap, with any portion that cannot be settled in shares payable in cash.

Helmex Agreement

On May 30, 2026, the Company entered into a term sheet with Helmex Global LLP and certain affiliated parties (collectively, “Helmex”) in connection with a proposed financing transaction.

The contemplated transaction provides for an aggregate investment of up to $ 2.0 billion through four successive tranches of $ 500.0 million each, with the initial tranche expected to consist of an investment of $ 500.0 million in exchange for shares of the Company’s common stock and/or preferred stock, subject to the execution of definitive agreements and satisfaction of applicable closing conditions.

In connection with the proposed initial tranche, the Company agreed to fund $ 25.0 million of administrative, operational and structuring costs associated with establishing the investment fund and facilitating the proposed financing.

The transaction fee provision represents a binding obligation under the term sheet.

As of June 30, 2026, the Company had paid $ 5.0 million toward the $ 25.0 million transaction fee.

The proposed financing remains subject to significant conditions, including completion of due diligence, execution of definitive transaction agreements, receipt of required regulatory and stockholder approvals, completion and acceptance of an independent valuation of the preferred units, satisfaction of applicable collateral and other documentation requirements, and the Company’s determination that it will be able to monetize the preferred units received in the transaction.

Accordingly, there can be no assurance that the proposed financing will be completed on the contemplated

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Three Months Ended March 31, 2026 and 2025

For the Three and Six Months Ended June 30, 2026 and 2025

terms or at all.

Amounts paid toward the transaction fee are non-refundable and therefore are subject to significant risk of loss if the proposed financing is not consummated.

Related Parties

6 unchanged sentences

In addition to the EOS Convertible Note, on January 16, 2025, the Company entered into a Transition Services Agreement (“Transition Services Agreement”) to receive from EOS Holdings, employees to provide transition services in connection with the EOS Acquired Assets for a period of up to three months.

For the three months ended March 31, 2026, the Company has paid $ 11,431 to EOS Holdings and has a balance due to EOS as of March 31, 2026 of $ 0.5 million.

$ 0.4 million was paid to EOS Holdings during the quarter ended March 31, 2025 in connection with the Transition Services Agreement.

For the three and six months ended June 30, 2026, the Company has paid $ 0 and $ 11,431 , respectively, to EOS Holdings and has a balance due to EOS as of June 30, 2026 of $ 0.5 million.

$ 0.4 million and $ 0.5 million was paid to EOS Holdings for the three and six months ended June 30, 2025.

Pursuant to the asset acquisition agreement with EOS Holdings, the Company is obligated to pay an earnout equal to 3 % of Net Revenue (as defined in the agreement) generated from products and/or services utilizing the acquired Patent Rights.

For the three months ended March 31, 2026, the Company recorded no earnout expense.

There was no earnout expense or associated revenue during the quarter ended March 31, 2025.

As of March 31, 2026, the Company had accrued approximately $ 0.8 million in earnout payable to EOS Holdings which is included in the accrued liabilities section of the balance sheet.

For the three and six months ended June 30, 2026, the Company recorded $ 4,050 earnout expense.

There was no earnout expense or associated revenue for the three and six months ended June 30, 2025.

As of June 30, 2026, the Company had accrued approximately $ 0.8 million in earnout payable to EOS Holdings which is included in the accrued liabilities section of the balance sheet.

As of December 31, 2025, the Company had accrued approximately $ 0.8 million in earnout payable.

This transaction is expected to be settled with the issuance of stock.

No payments or stock issuances were made during the three months ended March 31, 2026.

No payments or stock issuances were made during the six months ended June 30, 2026.

Helge Kristensen

1 unchanged sentence

Kristensen serves as vice president of Hansong Technology, an original device manufacturer of audio products based in China, president of Platin Gate Aps, a company with focus on service-branding in lifestyle products as well as pro line products based in Denmark and co-founder and director of Inizio Capital, an investment company based in the Cayman Islands.

For the three months ended March 31, 2026 and 2025, Hansong Technology purchased modules from the Company and was assessed fees of approximately $ 141,000 and $ 11,000 , respectively, and made no payments to the Company for the three months ended March 31, 2026.

No payments were made for the three months ended March 31, 2025.

At March 31, 2026, there was a Hansong deposit liability of $ 0.3 million.

See Note 1 for further details regarding contract liabilities.

At March 31, 2026 and 2025, Hansong Technology owed the Company zero and $ 35,000 , respectively.

For the three months ended March 31, 2026 and 2025, Hansong Technology sold speaker products to the Company of approximately $ 4,000 and $ 0 , respectively, and the Company made no payments to the Hansong Technology for the three months ended March 31, 2026 and 2025.

At March 31, 2026 and 2025, the Company owed Hansong approximately $ 4,000 and $ 43,000 , respectively.

As of March 31, 2026 and December 31, 2025, Mr.

Kristensen owned less than 1.0 % of the outstanding shares of the Company’s common stock.

Scilex Advances and Bitcoin Transactions

For the three months ended June 30, 2026 and 2025, Hansong Technology purchased modules from the Company and was assessed fees of approximately $ 316,000 and $ 26,000 , respectively, and made no payments for the three months ended June 30, 2026 and 2025.

At June 30, 2026 and 2025, Hansong Technology owed the Company $ 290,000 and $ 42,000 , respectively.

For the six months ended June 30, 2026 and 2025, Hansong Technology purchased modules from the Company and was assessed fees of approximately $ 457,000 and $ 37,000 , respectively, and made no payments to the company for the six months ended June 30, 2026 and 2025.

For the three months ended June 30, 2026 and 2025, Hansong Technology sold speaker products to the Company of approximately $ 4,000 and $ 1,000 , respectively, and the Company made zero and $ 2,000 payments to Hansong Technology for the three months ended June 30, 2026 and 2025.

At June 30, 2026 and 2025, the Company owed Hansong approximately zero and $ 42,000 , respectively.

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Three Months Ended March 31, 2026 and 2025

During the three months ended March 31, 2026, Scilex, a related party and significant shareholder of the Company, provided short-term cash advances to the Company to support working capital and operating needs.

For the Three and Six Months Ended June 30, 2026 and 2025

For the six months ended June 30, 2026 and 2025, Hansong Technology sold speaker products to the Company of approximately $ 4,000 and $ 1,000 , respectively, and the Company made no and $ 2,000 payments to Hansong Technology for the six months ended June 30, 2026 and 2025.

As of June 30, 2026 and December 31, 2025, Mr.

Kristensen owned less than 1.0 % of the outstanding shares of the Company’s common stock.

Scilex Advances and Bitcoin Transactions

During the six months ended June 30, 2026, Scilex, a related party and significant shareholder of the Company, provided short-term cash advances to the Company to support working capital and operating needs.

The advances bore interest at an annual rate of 15.42 %.

During the three months ended March 31, 2026, the Company received aggregate cash advances from Scilex of approximately $ 18.7 million and repaid approximately $ 18.1 million of principal and $ 0.1 million of accrued interest through transfers of Bitcoin.

As of March 31, 2026, amounts outstanding under the advances totaled approximately $ 0.7 million of principal and $ 19,000 of accrued interest.

The Company accounts for transfers of Bitcoin used to settle related party obligations as noncash financing activities and derecognizes the digital assets at their carrying value on the date of transfer.

Any resulting realized gains or losses are recognized in Other expense, net.

There were no Scilex advances for the three months ended March 31, 2025.

During the six months ended June 30, 2026, the Company received aggregate cash advances from Scilex of approximately $ 18.7 million and repaid approximately $ 18.1 million of principal and $ 0.1 million of accrued interest through transfers of Bitcoin.

There were no advances or repayments during the three months ended June 30, 2026.

As of June 30, 2026, amounts outstanding under the advances totaled approximately $ 0.7 million of principal and $ 28,000 of accrued interest.

There were no Scilex advances for the three or six months ended June 30, 2025.

Other Intangible Asset Acquisitions

For the three months ended March 31, 2026, the Company acquired an additional patent from three inventors, including Dr.

During the six months ended June 30, 2026, the Company acquired an additional patent from three inventors, including Dr.

Henry Ji and Stephen Ma, both related parties, for an aggregate fair value of approximately $ 5.4 million.

3 unchanged sentences

As consideration for the acquisition, the Company agreed to issue an aggregate of 7,500,000 shares of common stock, consisting of 2,500,000 initial closing shares and 5,000,000 contingent shares issuable upon achievement of specified milestones.

The Company recorded amortization expense related to the acquired patent of approximately $ 0.1 million and $ 0 for the three months ended March 31, 2026 and 2025, respectively.

The contingent shares were issued during the six months ended June 30, 2026.

The Company recorded amortization expense related to the acquired patent of approximately $ 0.1 million and $ 0.2 million for the three and six months ended June 30, 2026, respectively.

There was no amortization expense related to the acquired patent for the three and six months ended June 30, 2025.

Investment in Vivasor, Inc.

Vivasor, Inc.

(“Vivasor”) is a related party of the Company.

Henry Ji, a related party of the Company, serves as Chief Executive Officer of Vivasor.

During the six months ended June 30, 2026, the Company acquired an approximately 2 % ownership interest in Vivasor for aggregate consideration of approximately $ 56.2 million, which was paid in the Company's common stock.

The investment is accounted for as an equity security without a readily determinable fair value under the measurement alternative in accordance with ASC 321, Investments—Equity Securities.

During the three and six months ended June 30, 2026, the Company recognized an impairment loss of approximately $ 55.4 million related to its investment in Vivasor.

As a result, the carrying value of the investment was approximately $ 0.8 million as of June 30, 2026.

See Note 6, Investments, for additional information regarding the Company’s investment in Vivasor and the related impairment.

Segment Information

5 unchanged sentences

therefore, the total asset disclosure by segment has not been included.

The Company operates in one business segment.

Our chief decision-maker, the Chief Executive Officer, evaluates our performance based on company-wide condensed consolidated results.

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Six Months Ended June 30, 2026 and 2025

The following table reflects results of operations of the Company’s reportable segment (in thousands):

For the Three Months Ended March 31,

For the Three Months Ended June 30, For the Six Months Ended June 30,

2026 2025 2026 2025

Net revenue $ 6,717 $ 1,735 $ 10,133 $ 2,364

1 unchanged sentence

Salaries, benefits, and stock based compensation expense 11,208 4,664 20,676 8,223

Other segment expenses 18,432 3,621

Depreciation and amortization expense 3,287 2,500 6,449 4,825

Other segment expenses 14,839 5,335 33,270 8,951

Interest (expense), net ( 1,000 ) ( 24,646 ) ( 2,121 ) ( 24,766 )

Other (expense) income, net ( 21,060 ) ( 12 )

Other (expense), net ( 60,569 ) ( 1 ) ( 81,629 ) ( 13 )

Income tax expense — 5 — 5

Net loss $ ( 88,025 ) $ ( 37,116 ) $ ( 141,156 ) $ ( 46,679 )

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Three Months Ended March 31, 2026 and 2025

Net revenue from customers is designated based on the geographic region to which the product is delivered.

Net revenue by geographic region for the three months ended March 31, 2026 and 2025 was as follows:

For the Three Months Ended March 31,

Net revenue by geographic region for the three and six months ended June 30, 2026 and 2025 was as follows:

For the Three Months Ended June 30, For the Six Months Ended June 30,

(in thousands) 2026 2025 2026 2025

Asia Pacific $ 424 $ 365

North America $ 5,357 $ 1,477 $ 7,871 $ 1,615

Asia Pacific 731 199 1,155 565

Europe 629 59 1,107 184

2 unchanged sentences

Subsequent Events

Vivasor Subscription Agreement

On April 23, 2026, the Company filed a prospectus supplement to the registration statement of which this prospectus supplement forms a part (Registration No.

333-294502), for the purpose of registering the sale and issuance by us of 75,942,666 shares of our Common Stock to Vivasor, Inc.

(“Vivasor”), a related party, in consideration for our purchase of 8,163,265 shares of Vivasor’s Series A common stock, at a purchase price of $ 6.125 per share for aggregate consideration of $ 50 million, pursuant to a Subscription Agreement by and between the Company and Vivasor, dated as of April 16, 2026.

Scilex Binding Term Sheet

On April 26, 2026, the Company entered into a binding term sheet (the “Scilex Term Sheet”) with Scilex, which sets forth the principal terms and conditions of a proposed cash contribution and revenue participation arrangement between the Company and Scilex (the "Scilex Transaction").

Pursuant to the Scilex Term Sheet, and subject to the finalization of mutually agreeable definitive transaction documents and, ultimately, the satisfaction of certain customary closing conditions, to be contained therein, it is expected that Scilex will make an upfront cash contribution to the Company in the amount $ 120.0 million, to be paid in multiple closings, with the final closing to occur no later than December 31, 2026 (the “Upfront Payment”).

The Company will use the proceeds from the Upfront Payment exclusively to fund the deployment of our quantum-ready graphics processing units (“GPUs”) infrastructure across an estimated 100 cities in the United States (the “Quantum-Ready Edge Network”), including build-out, equipment, related working capital, and reasonable overhead expenses directly attributable thereto.

In consideration of the Upfront Payment, the Company would become obligated to pay Scilex an amount equal to (i) 30 % of gross revenues recognized by the Company attributable exclusively to the Quantum-Edge Nextwork (the "Network Revenues") until the aggregate amount of such payments to Scilex equals $ 250.0 million (the "Interim Cap"), (ii) from and after the time that the Interim Cap has been reached, 15 % of Network Revenues until aggregate amount of such payments to Scilex (when combined with amounts applied to the Interim Cap) equals $ 1.2 billion (the "Additional Cap"), and (iii) from and after the time that the Additional Cap has been reached, 5 % of Network Revenues during the remaining lifetime of the GPU's purchased using the Upfront Payment.

The Term Sheet contemplates the execution of definitive agreements containing customary representations, warranties, covenants, indemnification provisions, and closing conditions.

There can be no assurance that definitive agreements will be executed or that the proposed transaction will be consummated on the terms currently contemplated, or at all.

The proposed transaction remains subject to further negotiation, regulatory and corporate approvals, market conditions, and other customary conditions outside the Company’s control.

CyberCatch Binding Letter of Intent

NYIAX Bridge Loan Guarantee

On July 17, 2026, subsequent to the reporting period, the Company entered into a Guarantee Bridge Loan Agreement with Abri Capital LTD.

and NYIAX, Inc.

in connection with the pending acquisition of NYIAX.

Under the agreement, the Company serves as guarantor of a short-term bridge loan facility providing NYIAX with borrowings of up to $ 0.8 million.

The proceeds of the facility are intended to fund transaction-related expenses, legal and regulatory costs, employee obligations, and working capital requirements associated with the proposed merger.

Amounts borrowed under the facility bear interest at 13 % per annum, are issued at a 10 % original issue discount, and mature on September 11, 2026, unless earlier repaid upon the closing of the proposed merger, at which time all outstanding principal and accrued interest become due within three days .

The Bridge Loan Agreement contains customary representations, warranties, covenants, and events of default.

The guarantee and related financing arrangement are subject to customary funding conditions.

As of the date these condensed consolidated financial statements were issued, the proposed merger had not been completed.

EOS Technology Holdings

On July 29, 2026, subsequent to the reporting period, the Company entered into a letter agreement with EOS Technology Holdings Inc.

amending certain terms of the Earnout Agreement dated December 31, 2024.

Under the letter agreement, EOS Technology Holdings Inc.

may elect, in its sole discretion, to receive all or a portion of future earnout payments in shares of the Company's common stock in lieu of cash.

Shares issued pursuant to such elections will generally be valued based on the volume-weighted average price of the Company's common stock for the five

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Three Months Ended March 31, 2026 and 2025

On April 26, 2026, the Company entered into a binding letter of intent (the “CyberCatch LOI”) with CyberCatch Holdings, Inc.

(“CyberCatch”), under which the Company and CyberCatch will enter into a definitive agreement for the Company to acquire 100 % of CyberCatch in an all-stock transaction structured as a court-approved plan of arrangement under the Business Corporations Act (British Columbia) (the “CyberCatch Acquisition”).

Under the CyberCatch LOI and subject to a definitive agreement, the Company will acquire 100 % of CyberCatch’s issued and outstanding common shares (being approximately 26.8 million shares) in exchange for approximately 49.9 million newly issued shares of the Company's common stock at CAD $ 5.11 per CyberCatch share, which implies an aggregate value to CyberCatch’s issued and outstanding common shares of CAD $ 136.8 million.

All issued and outstanding CyberCatch securities convertible into or exercisable for CyberCatch common shares will be exchanged for shares of the Company's common stock on a cashless exercise basis at a deemed value of USD $ 2.00 per share of common stock.

Upon closing of the transaction, subject to customary board, stock exchange and any necessary regulatory and shareholder approvals, it is anticipated that the Company's stockholders will hold approximately 92.48 % and CyberCatch shareholders approximately 7.52 % of the Company's outstanding equity.

It is anticipated that CyberCatch will operate as a wholly-owned subsidiary of the Company from San Diego, California, and CyberCatch founder, Chairman, and Chief Executive Officer Sai Huda will serve as President of the subsidiary, reporting to Nathaniel T.

Bradley, the Company's Chief Executive Officer.

Registered Direct Offering

On May 3, 2026, the Company entered into a Securities Purchase Agreement (the "Purchase Agreement") with certain institutional investors, pursuant to which the Company agreed to sell and issue in a registered direct offering (the "Offering") an aggregate of 109,090,910 shares of common stock at an offering price of $ 0.55 per share for aggregate gross proceeds to the Company from the Offering of approximately $ 60.0 million, before deducting the Placement Agent’s (as defined below) fees and offering expenses payable by the Company.

The Offering closed on May 5, 2026.

Pursuant to the Purchase Agreement, the Company has agreed that, subject to certain exceptions, from the date of the prospectus supplement until forty-five (45) days after the closing of the Offering, (i) neither it nor any of its subsidiaries shall (a) issue, enter into any agreement to issue or announce the issuance or proposed issuance of any Common Stock or Common Stock Equivalents (as defined in the Purchase Agreement) or (b) file any registration statement or any amendment or supplement thereto, and (ii) it shall not enter into a Variable Rate Transaction (as defined in the Purchase Agreement) .

In connection with the Offering, the Company entered into a Placement Agency Agreement, dated as of May 3, 2026, with Titan Partners Group LLC, a division of American Capital Partners, LLC (the “Placement Agent”), pursuant to which the Placement Agent agreed to serve as the sole placement agent for the issuance and sale of securities of the Company pursuant to the Purchase Agreement.

As compensation for such services, the Company agreed to pay the Placement Agent a cash fee of $ 4.2 million and issue to the Placement Agent, or its designees, warrants to purchase up to 5,454,545 shares of Common Stock (the “Placement Agent Warrants”) at the closing of the Offering.

The Placement Agent Warrants have a term of five years from the date of the prospectus supplement and have an exercise price of $ 0.6325 per share.

The Company also agreed to reimburse the Placement Agent for legal and other expenses incurred by it in connection with the offering in an aggregate amount up to $ 60,000 .

The warrants have a five-year term.

The Shares, the Placement Agent Warrants and the shares of Common Stock issuable upon exercise of the Placement Agent Warrants (the “Placement Agent Warrant Shares”) were offered and sold by the Company pursuant to an effective shelf registration statement on Form S-3 (File No.

For the Three and Six Months Ended June 30, 2026 and 2025

consecutive trading days immediately preceding the applicable payment due date, subject to certain specified terms.

The issuance of shares under the letter agreement is subject to an exchange cap equal to 19.99 % of the Company's outstanding common stock as of the date of the agreement, unless stockholder approval or another applicable Nasdaq exception is obtained.

Any earnout payments that cannot be satisfied with shares due to the exchange cap will continue to be settled in cash.

The Company also agreed to file registration statements covering the resale of shares issued pursuant to the agreement, subject to the terms and limitations set forth therein.

The Company is evaluating the accounting implications of the amendment to the Earnout Agreement, including its impact, if any, on the related earnout liability.

CyberCatch Acquisition

On August 14, 2026, the Company entered into a definitive agreement to acquire 100 % of the issued and outstanding common shares of CyberCatch Holdings, Inc.

(“CyberCatch”), a provider of AI-enabled cybersecurity compliance and cyber risk mitigation solutions, in an all-cash transaction structured as a court-approved plan of arrangement under the Business Corporations Act (British Columbia).

Under the terms of the agreement, the Company will acquire approximately 26.8 million outstanding common shares of CyberCatch for aggregate cash consideration of approximately $ 86.2 million, or $ 3.22 per share.

Outstanding dilutive securities of CyberCatch will be exchanged on a cashless-exercise basis.

The transaction is subject to customary closing conditions, including approval by CyberCatch shareholders, court approval of the plan of arrangement, applicable stock exchange and regulatory approvals, and other customary closing conditions.

Upon completion of the transaction, CyberCatch is expected to become a wholly owned subsidiary of the Company.

As the transaction had not closed as of the date the financial statements were issued, the Company has not recorded the acquisition in the accompanying financial statements.

In connection with the transaction, the Company is also obligated to provide CyberCatch with an additional bridge loan of $ 0.5 million within seven days following execution of the definitive agreement.

August 2026 Offering

On August 18, 2026, the Company entered into the Securities Purchase Agreement for the issuance and sale of convertible promissory notes with an aggregate principal value of $ 25.0 million (the "August Convertible Promissory Notes"), with up to $ 25.0 million in aggregate principal amount of additional convertible promissory notes (the "Additional August Convertible Promissory Notes") issuable from time to time upon exercise of the Reinvestment Right (as defined below).

In addition, the Company is issuing 15,000,000 shares of common stock, to be used as pre-delivery shares (the "Pre-Delivery Shares").

The August Convertible Promissory Notes and the Additional August Convertible Promissory Notes are convertible into shares of common stock.

The August Convertible Promissory Note and Additional August Convertible Promissory Notes bears simple interest at a rate of 8 % per annum and has no original issue discount with a term of 30 months.

The investor may convert all or any part of the outstanding balance of any August Convertible Promissory Note or Additional August Convertible Promissory Note, at a fixed conversion price of $ 1.55 per share, into shares of the Company's common stock.

The investor has the right (the “Reinvestment Right”), but not the obligation, to invest up to $ 25.0 million in Additional Convertible Promissory Notes on the same terms and conditions as the August Convertible Promissory Note at any time during the 12-month period following August 18, 2026 (the “Closing Date”).

Any August Convertible Promissory Notes issued pursuant to the Reinvestment Right will have new 30-month maturity periods from their respective issuance dates.

In addition to the conversion rights described above, the August Convertible Promissory Note grants the investor additional conversion rights that permit it to convert specified portions of the August Convertible Promissory Note at a variable market price.

In addition to the fixed-price conversion right described above, the August Convertible Promissory Note grants the investor the right to convert at a variable market price (each, a "Market Price Conversion").

For each Market Price Conversion, the number of conversion shares issuable equals the conversion amount divided by the market price, where "Market Price" means 92 % of the lowest daily VWAP of the Company's common stock during the seven (7) trading day period immediately preceding the applicable conversion date.

Each conversion amount includes make-whole interest calculated as if the converted amount had been held to maturity.

The Market Price Conversion rights are

DATAVAULT AI INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Six Months Ended June 30, 2026 and 2025

structured as follows:

Limited market price conversion (the "Limited Market Price Conversions").

During the period beginning September 1, 2026 and ending December 31, 2026, if a Limited Redemption Event (defined below) occurs, the investor may submit a conversion notice to effect a Market Price Conversion during the applicable limited redemption window.

A "Limited Redemption Event" occurs on any trading day on which the Company's common stock trades at a price at least 5 % greater than the Nasdaq minimum price for such trading day.

A "Limited Redemption Window" begins on the date a Limited Redemption Event occurs and ends five (5) Trading Days later, and more than one Limited Redemption Window may be open at the same time.

The amount the investor may convert pursuant to any such Conversion is capped at the maximum limited conversion amount, which equals 10 % of the cumulative daily dollar trading volume of the Company's common stock on the trading day on which the Limited Redemption Event occurs, plus make-whole interest.

The unrestricted market price conversions (the "Unrestricted Market Price Conversions") begins January 1, 2027 and continues until the August Convertible Promissory Note has been repaid in full, and allows the investor to submit a conversion notice to convert all or any portion of the outstanding balance of the August Convertible Promissory Note at the market price, without regard to the limited redemption event condition or the maximum limited conversion amount cap.

NYIAX Acquisition

On August 19, 2026, the Company completed its acquisition of NYIAX, Inc.

(“NYIAX”), a provider of blockchain-enabled exchange and contract management technology, through the merger of a wholly owned subsidiary of the Company with and into NYIAX, with NYIAX surviving the merger as a wholly owned subsidiary of the Company.

The Company issued approximately 78,947,368 shares of its common stock in connection with the acquisition, with an estimated fair value of approximately $ 30.8 million based on the closing price of the Company’s common stock immediately preceding the acquisition date.

The Company is currently evaluating the accounting for the acquisition in accordance with ASC 805, Business Combinations.

As the acquisition was completed subsequent to June 30, 2026, the transaction has not been reflected in the Company’s condensed consolidated financial statements as of and for the three and six months ended June 30, 2026.

The initial accounting for the business combination, including the allocation of the purchase consideration to the identifiable assets acquired and liabilities assumed, has not yet been completed.

BankWyse Acquisition

On August 19, 2026, the Company entered into a definitive agreement to acquire BankWyse, a Wyoming-chartered Special Purpose Depository Institution that provides digital asset custody, commercial banking and related services.

The acquisition is subject to regulatory approval and other customary closing conditions, including approvals associated with the change of control of BankWyse and its continued operation under its Wyoming Special Purpose Depository Institution charter.

The merger consideration is $ 22 million, consisting of approximately $ 14.7 million in DVLT common stock and $ 7.3 million in cash, plus contingent earnout consideration of up to $ 10 million.

Upon completion of the transaction, BankWyse is expected to become a wholly owned subsidiary of the Company.

As the transaction had not closed as of the date the financial statements were issued, the Company has not recorded the acquisition in the accompanying condensed consolidated financial statements.

AP Cyber Warrant

On July 22, 2026, the Company issued a warrant to AP Cyber LLC (“AP Cyber”) as partial consideration for services to be provided pursuant to a mutual services agreement entered into between the Company and AP Cyber on July 16, 2026.

The warrant provides AP Cyber with the right to purchase up to 24,000,000 shares of the Company’s common stock at an initial exercise price of $ 0.40 per share, subject to adjustment in accordance with the terms of the warrant.

The warrant expires on July 22, 2036.

The warrant becomes exercisable based upon the achievement of specified sales thresholds for Qestral Coin.

One-third of the warrant shares become exercisable when net proceeds from sales of Qestral Coin equal or exceed $100 million, one-half of the warrant shares become exercisable when net proceeds equal or exceed $1 billion, and all warrant shares become exercisable when net proceeds equal or exceed $2.5 billion.

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