What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2026-08-13 compared with 2026-05-12 · 147 added, 74 removed, 418 unchanged (35% of the section changed)

6 unchanged sentences

Cash and cash equivalents $ 11,837 $ 9,650

Accounts receivable, net of allowance for credit losses of $ 157 at March 31, 2026 and December 31, 2025

Accounts receivable, net of allowance for credit losses of $ 157 at June 30, 2026 and December 31, 2025

Other current assets 816 892

16 unchanged sentences

30,000 shares authorized;

Series A convertible preferred stock, zero shares issued and outstanding at March 31, 2026 and December 31, 2025

Series A convertible preferred stock, zero shares issued and outstanding at June 30, 2026 and December 31, 2025

Common stock - $ 0.001 par value;

40,000,000 shares authorized;

20,239,060 and 20,225,323 shares issued and outstanding at March 31, 2026 and December 31, 2025, respectively

20,252,888 and 20,225,323 shares issued and outstanding at June 30, 2026 and December 31, 2025, respectively

Additional paid-in capital 154,380 153,887

6 unchanged sentences

(In thousands, except share and per share amounts)

Three months ended March 31,

Three months ended June 30, Six months ended June 30,

2026 2025 2026 2025

REVENUES $ 5,941 $ 5,123 $ 11,465 $ 10,017

6 unchanged sentences

Income (loss) from operations 573 ( 298 ) 1,115 ( 646 )

OTHER INCOME AND EXPENSE

OTHER INCOME (EXPENSE), NET

Other income, net 90 47 184 77

14 unchanged sentences

(In thousands, except number of shares)

Three months ended March 31, 2026

Three months ended June 30, 2026

Common Stock Additional

3 unchanged sentences

Shares Amount

BALANCE, December 31, 2025 20,225,323 $ 20 $ 153,887 $ ( 133,210 ) $ 20,697

BALANCE, March 31, 2026 20,239,060 $ 20 $ 154,087 $ ( 132,574 ) $ 21,533

Stock-based compensation – – 289 – 289

Stock option exercises, net of

cashless exercises 1,667 – 4 – 4

Issuance of shares for vested

1 unchanged sentence

Net income – – – 663 663

BALANCE, June 30, 2026 20,252,888 $ 20 $ 154,380 $ ( 131,911 ) $ 22,489

Three months ended June 30, 2025

Common Stock Additional

Capital Accumulated

Deficit Total

Stockholders’

Shares Amount

BALANCE, March 31, 2025 19,816,043 $ 19 $ 152,390 $ ( 134,801 ) $ 17,608

Three months ended March 31, 2025

Stock-based compensation – – 202 – 202

Stock option exercises, net of

cashless exercises 181,256 1 445 – 446

Issuance of shares for vested

restricted stock grants 28,544 – – — —

Net loss – – – ( 251 ) ( 251 )

BALANCE, June 30, 2025 20,025,843 $ 20 $ 153,037 $ ( 135,052 ) $ 18,005

Six months ended June 30, 2026

Common Stock Additional

5 unchanged sentences

Stock-based compensation – – 489 – 489

Stock option exercises, net of

cashless exercises 1,667 4 – 4

Issuance of shares for vested

restricted stock grants 25,898 – – – –

Net income – – – 1,299 1,299

BALANCE, June 30, 2026 20,252,888 $ 20 $ 154,380 $ ( 131,911 ) $ 22,489

Six months ended June 30, 2025

Common Stock Additional

Capital Accumulated

Deficit Total

Stockholders’

Shares Amount

BALANCE, December 31, 2024 19,782,311 $ 19 $ 152,211 $ ( 134,483 ) $ 17,747

Stock-based compensation – – 381 – 381

Stock option exercises, net of

cashless exercises 181,256 1 445 – 446

Issuance of shares for vested

restricted stock grants 62,276 – – – –

Net loss – – – ( 569 ) ( 569 )

BALANCE, March 31, 2025 19,816,043 $ 19 $ 152,390 $ ( 134,801 ) $ 17,608

BALANCE, June 30, 2025 20,025,843 $ 20 $ 153,037 $ ( 135,052 ) $ 18,005

See accompanying notes to unaudited condensed financial statements.

2 unchanged sentences

(In thousands)

Three months ended March 31,

Six months ended June 30,

CASH FLOWS FROM OPERATING ACTIVITIES:

5 unchanged sentences

Changes in assets and liabilities:

(Increase) in accounts receivable ( 2,391 ) ( 2,846 )

(Increase) in other current assets and other assets ( 2 ) ( 200 )

Increase in accounts payable and accrued expenses 532 251

Increase in deferred revenue 1,261 3,518

Decrease in accounts receivable 663 1,920

Decrease (Increase) in other current assets and other assets 75 ( 94 )

(Decrease) in accounts payable and accrued expenses ( 242 ) ( 161 )

(Decrease) Increase in deferred revenue ( 466 ) 2,037

Net cash provided by operating activities 2,242 3,884

4 unchanged sentences

CASH FLOWS FROM FINANCING ACTIVITIES:

Proceeds from exercises of stock options 4 445

Repayment of insurance financing arrangements — ( 190 )

Net cash used in financing activities — ( 95 )

Net cash provided by financing activities 4 255

Net increase in cash 2,187 3,907

14 unchanged sentences

and one ( 1 ) Canadian patent.

For the three months ended March 31, 2026, the Company realized a net income of $ 636 and generated cash from operations of $ 445 .

As of March 31, 2026, the Company had cash and cash equivalents of $ 10,062 , working capital (defined as current assets minus current liabilities) of $ 11,119 and an accumulated deficit of $( 132,574 ).

Based on the Company’s business plan and cash resources, Intellicheck expects its existing cash and future resources and revenues generated from operations to satisfy its working capital requirements for at least the next 12 months from the date of issuance of these audited condensed financial statements.

For the six months ended June 30, 2026, the Company realized a net income of $ 1,299 and generated cash from operations of $ 2,242 .

As of June 30, 2026, the Company had cash and cash equivalents of $ 11,837 , working capital (defined as current assets minus current liabilities) of $ 12,237 and an accumulated deficit of $( 131,911 ).

SIGNIFICANT ACCOUNTING POLICIES

2 unchanged sentences

Accordingly, they do not include all of the information and notes required by GAAP for complete financial statements.

In the opinion of management, the unaudited interim financial statements furnished herein include all adjustments necessary for a fair presentation of the Company’s financial position at March 31, 2026, the results of operations, and stockholders’ equity for the three months ended March 31, 2026 and 2025 and cash flows for the three months ended March 31, 2026 and 2025.

In the opinion of management, the unaudited interim financial statements furnished herein include all adjustments necessary for a fair presentation of the Company’s financial position at June 30, 2026, the results of operations, and stockholders’ equity for the three and six months ended June 30, 2026 and 2025 and cash flows for the six months ended June 30, 2026 and 2025.

All such adjustments are of a normal and recurring nature.

Interim financial statements are prepared on a basis consistent with the Company’s annual financial statements.

Results of operations for the three month periods ended March 31, 2026, are not necessarily indicative of the operating results that may be expected for the year ending December 31, 2026.

Results of operations for the three and six months periods ended June 30, 2026, are not necessarily indicative of the operating results that may be expected for the year ending December 31, 2026.

The condensed balance sheet as of December 31, 2025 has been derived from the audited financial statements at that date but does not include all of the information and notes required by GAAP for complete financial statements.

3 unchanged sentences

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

Measurement of Credit Losses for Accounts Receivable and Contract Assets." This standard allows entities to apply a practical expedient when estimating expected credit losses for current accounts receivable and current contract assets that arise from transactions accounted for under ASC 606, Revenue from Contracts with Customers .

Measurement of Credit Losses for Accounts Receivable and Contract Assets.

This standard allows entities to apply a practical expedient when estimating expected credit losses for current accounts receivable and current contract assets that arise from transactions accounted for under ASC 606, Revenue from Contracts with Customers .

The standard is effective for all the entities for fiscal years beginning after December 15, 2025, including interim periods within those fiscal years.

2 unchanged sentences

and elected to apply the practical expedient provided in ASC 326-20-30-10C.

The adoption did not have a material impact on our consolidated financial statements and related disclosures.

The adoption did not have a material impact on our condensed financial statements and related disclosures.

Recently Issued Accounting Pronouncements

36 unchanged sentences

The Company performed its annual impairment test of goodwill in the fourth quarter for the year ended December 31, 2025.

For the three months ended March 31, 2026 and 2025, the Company did not recognize any impairment charges.

For the three and six months ended June 30, 2026 and 2025, the Company did not recognize any impairment charges.

The Company also evaluated whether the expected volume reductions constituted a triggering event requiring an interim assessment of goodwill for impairment under ASC 350 as of June 30, 2026, and concluded that no such triggering event had occurred.

Intangible assets, net

1 unchanged sentence

The Company amortizes these assets on a straight-line basis over their estimated useful lives, as it represents the pattern of economic benefits consumed.

There were no impairment charges recognized during the three months ended March 31, 2026 and 2025.

There were no impairment charges recognized during the three and six months ended June 30, 2026 and 2025.

The Company capitalizes internal-use software costs which includes costs incurred in connection with the development of new software solutions and enhancements to existing software solutions that are expected to result in increased functionality.

9 unchanged sentences

Advertising Costs

Advertising costs, which are expensed as incurred, were $ 64 and $ 25 for the three months ended March 31, 2026 and 2025, respectively.

Advertising costs, which are expensed as incurred, were $ 161 and $ 46 for the six months ended June 30, 2026 and 2025, respectively.

Advertising costs were $ 97 and $ 21 for the three months ended June 30, 2026 and 2025, respectively.

These costs are recorded as a component of selling, general and administrative expenses within the condensed Statements of Operations.

3 unchanged sentences

The Company has elected to contribute a matching contribution equal to 100 % of the first 3 % and 50 % of the next 2 % of an eligible employee’s deferral election.

The Company’s matching contributions were $ 48 and $ 0 for the three months ended March 31, 2026 and 2025, respectively.

During the three months ended March 31, 2025, funds from the Retirement Plan's forfeiture account were used to fund matching contributions in accordance with the terms of the Retirement Plan and as such, the Company recorded no expense in certain periods related to its retirement plans.

The Company’s matching contributions were $ 106 and $ 29 for the six months ended June 30, 2026 and 2025, respectively.

The Company’s matching contributions were $ 58 and $ 29 for the three months ended June 30, 2026 and 2025, respectively.

During the three and six months ended June 30, 2025, funds from the Retirement Plan's forfeiture account were used to fund matching contributions in accordance with the terms of the Retirement Plan and as such, the Company recorded no expense in certain periods related to its retirement plans.

These costs are recorded as a component of selling, general and administrative expenses within the condensed Statements of Operations.

7 unchanged sentences

Deferred tax assets are recognized subject to management’s judgment that realization is more likely than not.

The Company has recorded a full valuation allowance against its net deferred tax assets as of March 31, 2026 and December 31, 2025, as it is more likely than not these assets may not be fully realized due to the uncertainty of the realizability of those assets.

The Company has recorded a full valuation allowance against its net deferred tax assets as of June 30, 2026 and December 31, 2025, as it is not more likely than not that these assets will be realized due to the uncertainty of the realizability of those assets.

Management continues to evaluate positive and negative evidence related to the realizability of deferred tax assets, including recent operating results and forecasts of future taxable income.

2 unchanged sentences

The Company’s financial instruments include cash and cash equivalents, accounts receivable, other current assets, accounts payable and accrued expenses.

At March 31, 2026 and December 31, 2025, the carrying value of the Company’s financial instruments approximated fair value, due to their short-term nature.

At June 30, 2026 and December 31, 2025, the carrying value of the Company’s financial instruments approximated fair value, due to their short-term nature.

FASB guidance specifies a hierarchy of valuation techniques based on whether the inputs to those valuation techniques are observable or unobservable.

4 unchanged sentences

Level 1 primarily consists of financial instruments whose value is based on quoted market prices such as exchange-traded instruments and listed equities.

The Company's Level 1 assets consisted primarily of cash and cash equivalents totaling $ 10,062 and $ 9,650 as of March 31, 2026 and December 31, 2025, respectively.

The Company's Level 1 assets consisted primarily of cash and cash equivalents totaling $ 11,837 and $ 9,650 as of June 30, 2026 and December 31, 2025, respectively.

• Level 2—Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly (e.g., quoted prices of similar assets or liabilities in active markets, or quoted prices for identical or similar assets or liabilities in markets that are not active).

Level 2 includes financial instruments that are valued using models or other valuation methodologies.

The Company had no Level 2 assets or liabilities as of March 31, 2026 and December 31, 2025.

The Company had no Level 2 assets or liabilities as of June 30, 2026 and December 31, 2025.

• Level 3—Unobservable inputs for the asset or liability.

Financial instruments are considered Level 3 when the fair values are determined using pricing models, discounted cash flows or similar techniques and at least one significant model assumption or input is unobservable.

The Company had no Level 3 assets or liabilities as of March 31, 2026 and December 31, 2025.

The Company had no Level 3 assets or liabilities as of June 30, 2026 and December 31, 2025.

Revenue Recognition and Deferred Revenue

7 unchanged sentences

Customers typically receive the benefit of the Company’s services as they are performed.

The Company's performance obligations are satisfied over time, and as a result, we follow the right to invoice practical expedient meaning we may recognize revenue monthly as invoiced based on its contract terms.

The Company's performance obligations are satisfied over time, and as a result, the Company follows the right to invoice practical expedient meaning the Company may recognize revenue monthly as invoiced based on our contract terms.

The Company has an additional revenue model where customers purchase a predetermined number of transactions for the term of the contract.

37 unchanged sentences

In the following tables, revenue is disaggregated by product and service and the timing of revenue recognition.

For the Three Months Ended March 31,

For the Three Months Ended June 30,

Products and services

6 unchanged sentences

$ 5,941 $ 5,123

For the Six Months Ended June 30,

Products and services

SaaS $ 11,435 $ 9,948

Equipment 12 6

$ 11,465 $ 10,017

Timing of revenue recognition

Products transferred at a point in time $ 12 $ 6

Services transferred over time 11,453 10,011

$ 11,465 $ 10,017

Contract balances

The deferred revenue at March 31, 2026 and December 31, 2025 was $ 2,922 and $ 1,661 , respectively, and primarily consists of revenue to be earned that is recognized over time for software license contracts and hosted subscription services.

The deferred revenue at June 30, 2026 and December 31, 2025 was $ 1,195 and $ 1,661 , respectively, and primarily consists of revenue to be earned that is recognized over time for software license contracts and hosted subscription services.

The changes in these balances are related to purchases of a predetermined number of transactions, partially offset by the satisfaction or partial satisfaction of these contracts.

Of the December 31, 2025 balance, $ 1,224 was recognized as revenue in the three months ended March 31, 2026.

Accounts receivable, net of allowance for credit losses, at March 31, 2026 and December 31, 2025 was $ 5,740 and $ 3,365 , respectively.

The allowance for credit losses at March 31, 2026 and December 31, 2025 was $ 157 .

Of the December 31, 2025 balance, $ 1,541 was recognized as revenue in the six months ended June 30, 2026.

Accounts receivable, net of allowance for credit losses, at June 30, 2026 and December 31, 2025 was $ 2,660 and $ 3,365 , respectively.

The allowance for credit losses at June 30, 2026 and December 31, 2025 was $ 157 .

Transaction price allocated to the remaining performance obligations

12 unchanged sentences

The Company performs ongoing credit evaluations, generally does not require collateral, and establishes an allowance for credit losses based upon factors surrounding the credit risk of customers, historical trends, and other market and economic information.

During the three-month period ended March 31, 2026, the Company made sales to three customers that accounted for approximately 55 % of total revenues, 27 %, 17 % and 11 %, respectively, for each customer.

During the six-month period ended June 30, 2026, the Company made sales to three customers that accounted for approximately 56 % of total revenues, 29 %, 16 % and 11 %, respectively, for each customer.

The revenue was primarily associated with commercial identity sales customers.

These three customers represented 74 % of total accounts receivable at March 31, 2026, 50 %, 17 %, and 7 %, respectively, for each customer.

During the three-month period ended March 31, 2025, the Company made sales to three customers that accounted for approximately 56 % of total revenues, 28 %, 19 % and 9 %, respectively for each customer.

These three customers represented 81 % of total accounts receivable at March 31, 2025, 64 %, 13 %, and 4 %, respectively, for each customer.

These three customers represented 55 % of total accounts receivable at June 30, 2026, 0 %, 37 %, and 18 %, respectively, for each customer.

During the six-month period ended June 30, 2025, the Company made sales to three customers that accounted for approximately 58 % of total revenues, 31 %, 18 % and 9 %, respectively for each customer.

These three customers represented 42 % of total accounts receivable at June 30, 2025, 2 %, 34 %, and 6 %, respectively, for each customer.

The Company was recently informed by its customer representing 29 % of revenue for the six months ending June 30, 2026, as part of a vendor-resilience initiative, the customer is transitioning certain identity verification use cases to an alternative vendor under a primary/secondary vendor architecture in which the Company will remain the primary provider for certain use cases and will retain secondary or failover roles for certain of the transitioned use cases.

The first phase of the transition commenced June 30, 2026 and did not materially affect the results for the periods presented.

The customer’s communicated plans indicate a reduction of approximately 70 %– 75 % in its transaction volumes with the Company during the second half of 2026 relative to the baseline reflected in those plans;

the customer has indicated its plans are dependent on the alternative vendor’s performance and may be adjusted.

The Company’s agreement with this customer is transaction-based and does not contain minimum purchase commitments.

This customer accounted for approximately 30 % of total revenue for the three months ended June 30, 2026, and approximately 31 % for the year ended December 31, 2025, and approximately none of accounts receivable at June 30, 2026.

The Company assessed whether the expected volume reductions constituted an indicator that the carrying amount of its long-lived assets, including capitalized software development costs, may not be recoverable as of June 30, 2026, and concluded that no such indicator was present.

The Company expects the transition to materially reduce its revenue in future periods;

the Company’s expectations assume the customer implements its current plan as communicated and that no volumes are added above the levels reflected in that plan.

See Part I, Item 2.

As of August 13, 2026, the transition was underway and transaction volumes with this customer had declined from prior-year levels;

however, the reductions observed through that date were less than the pace and magnitude contemplated by the customer’s communicated plan.

Net Income (Loss) Per Share

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

Diluted net income (loss) per share is computed by dividing the net income (loss) for the period by the weighted average number of shares of common stock and potentially dilutive common stock equivalents outstanding during the period.

Diluted net income (loss) per share is computed by dividing the net income (loss) for the period by the weighted average number of shares of common stock and potentially

dilutive common stock equivalents outstanding during the period.

The dilutive effect of outstanding options and restricted stock is reflected in diluted earnings per share by application of the treasury stock method.

2 unchanged sentences

Three Months Ended

June 30, Six Months Ended

2026 2025 2026 2025

Net income (loss) $ 663 $ ( 251 ) $ 1,299 $ ( 569 )

6 unchanged sentences

Three Months Ended

June 30, Six Months Ended

2026 2025 2026 2025

Stock options — 1,500,749 — 1,500,749

5 unchanged sentences

The key measure that the CODM uses to allocate resources and in assessing performance is the Company's net income (loss).

Accordingly, the Company has determined that it operates in a single

reportable segment.

Accordingly, the Company has determined that it operates in a single reportable segment.

All of the Company’s assets are located in the United States.

Since the Company operates in one operating segment, all required financial segment information can be found in the financial statements.

CASH EQUIVALENTS

CASH AND CASH EQUIVALENTS

Short-term investments include investments in U.S.

1 unchanged sentence

Short-term investments with original maturities of approximately three months or less from the date of purchase are classified within cash and cash equivalents.

Debt investments with original maturities at the date of purchase greater than approximately three months but less than one year are classified as short-term investments, as they represent the investment of cash available for current operations.

As of March 31, 2026

investments with original maturities at the date of purchase greater than approximately three months but less than one year are classified as short-term investments, as they represent the investment of cash available for current operations.

As of June 30, 2026

Amortized cost Gross unrealized holding gains Gross unrealized holding losses Estimated fair value

7 unchanged sentences

$ 9,650 $ — $ — $ 9,650

The Company did no t hold any securities that were in an unrealized loss position for more than 12 months as of March 31, 2026.

There were no material realized gains or losses on these specific short-term investments during the three months ended March 31, 2026.

The Company did no t hold any securities that were in an unrealized loss position for more than 12 months as of June 30, 2026.

There were no material realized gains or losses on these specific short-term investments during the six months ended June 30, 2026.

PROPERTY AND EQUIPMENT, NET

5 unchanged sentences

Less – Accumulated depreciation ( 2,460 ) ( 2,358 )

Depreciation expense for the three months ended March 31, 2026 and 2025 amounted to $ 53 and $ 47 , respectively.

Depreciation expense for the six months ended June 30, 2026 and 2025 amounted to $ 102 and $ 95 , respectively.

Depreciation expense for the three months ended June 30, 2026 and 2025 amounted to $ 49 and $ 47 , respectively.

INTANGIBLE ASSETS, NET

The changes in the carrying amount of intangible assets, net for the three months ended March 31, 2026 were as follows:

The changes in the carrying amount of intangible assets, net for the six months ended June 30, 2026 were as follows:

Net balance at December 31, 2025 $ 2,077

Amortization expense ( 279 )

Net balance at March 31, 2026 $ 1,937

The following tables set forth the components of intangible assets as of March 31, 2026 and December 31, 2025:

As of March 31, 2026

Net balance at June 30, 2026 $ 1,798

The following tables set forth the components of intangible assets as of June 30, 2026 and December 31, 2025:

As of June 30, 2026

Life Adjusted

17 unchanged sentences

Three Months Ended

June 30, Six Months Ended

2026 2025 2026 2025

Cost of revenues $ 137 $ 121 $ 274 $ 225

Selling, general and administrative 2 2 5 5

The Company's estimated future amortization expense for intangible assets as of March 31, 2026 was as follows:

As of March 31, 2026 and December 31, 2025, the Company had no outstanding debt, borrowings, or credit facilities.

The Company has not entered into any credit agreements, revolving credit facilities, term loans, or other debt arrangements.

139 123 $ 279 $ 230

The Company's estimated future amortization expense for intangible assets as of June 30, 2026 was as follows:

As of June 30, 2026 and December 31, 2025, the Company had no outstanding debt, borrowings, or credit facilities.

As of June 30, 2026 and December 31, 2025, the Company had no revolving credit facility or term loan in place.

ACCRUED EXPENSES

8 unchanged sentences

Although the Company generated pretax income during the current quarter, no income tax expense has been recognized, as the tax effect of current‑period taxable income is fully offset by the valuation allowance.

The Company evaluates the realizability of its deferred tax assets each reporting period based on all available positive and negative evidence, including historical operating results and expectations of future taxable income.

Although the Company has returned to profitability, management has concluded that a full valuation allowance against its deferred tax assets continues to be appropriate as of June 30, 2026.

If the Company continues to generate sustained profitability and sufficient positive evidence becomes available, management may conclude in a future period that some or all of the valuation allowance is no longer necessary.

Any such release would result in the recognition of a non-cash income tax benefit that could be material to the Company's results of operations in the period of release.

Our available net operating loss (“NOL”) as of December 31, 2025 was approximately $ 30,520 , of which $ 10,892 expires between 2035 and 2037.

2 unchanged sentences

The Company had federal research and development tax credit carryforwards of approximately $ 682 as of December 31, 2025, which expire at various dates through 2041 if not utilized.

ASC 740 requires evaluation of uncertain tax positions and as of March 31, 2026, there were no material changes to the uncertain tax positions in the quarter.

ASC 740 requires evaluation of uncertain tax positions and as of June 30, 2026, there were no material changes to the uncertain tax positions .

STOCKHOLDERS' EQUITY

2 unchanged sentences

All the equity compensation plans prior to the Plan have been closed.

The Compensation Committee of the Board of Directors administers this Plan and determines the terms and conditions of

stock options granted, including the exercise price.

The Compensation Committee of the Board of Directors administers this Plan and determines the terms and conditions of stock options granted, including the exercise price.

The Plan generally provides that all stock options will expire within ten years of the date of grant.

2 unchanged sentences

The Company accounts for the issuance of stock-based awards to employees and non-employee directors in accordance with ASC Topic 718, Compensation - Stock Compensation , which requires that the cost resulting from all stock-based compensation payment transactions be recognized in the financial statements.

This pronouncement establishes fair value as the measurement objective in accounting for stock-based compensation payment arrangements and requires all companies to apply a fair value based measurement method in accounting for all stock-based compensation payment transactions with employees.

This pronouncement establishes fair value as the measurement objective in accounting for stock-based compensation payment arrangements and requires all

companies to apply a fair value based measurement method in accounting for all stock-based compensation payment transactions with employees.

All stock-based compensation is included in operating expenses as follows:

Three Months Ended

June 30, Six Months Ended

2026 2025 2026 2025

Compensation cost recognized:

1 unchanged sentence

Research and development 52 34 84 44

$ 289 $ 202 $ 489 $ 379

Stock Options

16 unchanged sentences

Exercised ( 1,667 ) 2.60 — —

Outstanding at March 31, 2026 1,658,944 $ 3.51 5.31 years $ 5,774

Exercisable at March 31, 2026 566,875 $ 2.44 2.68 years $ 2,580

The aggregate intrinsic value in the table above represents the total pretax intrinsic value (the difference between the Company’s closing stock price on the last trading day of the period and the exercise price, multiplied by the number of in-the-money options) that would have been received by the option holders had they all exercised their options on March 31, 2026.

Outstanding at June 30, 2026 1,655,277 $ 3.51 5.06 years $ 5,813

Exercisable at June 30, 2026 639,672 $ 2.46 3.57 years $ 1,572

This amount changes based upon the fair market value of the Company’s stock.

2 unchanged sentences

The Company issues RSUs to certain directors as compensation.

The vesting of all RSUs is contingent on continued board services.

The compensation expense incurred by the Company for RSUs is based on the closing market price of the Company’s common stock on the date of grant, is amortized on a straight-line basis over the requisite service period and charged to operating expenses with a corresponding increase to additional paid-in capital, reduced by forfeitures when they occur.

charged to operating expenses with a corresponding increase to additional paid-in capital, reduced by forfeitures when they occur.

RSU activity during the period indicated below is as follows:

3 unchanged sentences

Vested and settled in shares ( 25,898 ) 6.66

Outstanding at March 31, 2026 12,161 $ 6.99

As of March 31, 2026, there was approximately $ 2,755 of total unrecognized compensation costs, related to all unvested stock options and RSUs.

Outstanding at June 30, 2026 15,114 $ 3.97

As of June 30, 2026, there was approximately $ 2,520 of total unrecognized compensation costs, related to all unvested stock options and RSUs.

These costs are expected to be recognized as compensation expense over a weighted-average period of approximately 2.37 years.

The Company had 1,412,316 shares available for future grants under the Company's equity compensation plans at March 31, 2026.

The Company had 1,397,202 shares available for future grants under the Company's equity compensation plans at June 30, 2026.

COMMITMENTS AND CONTINGENCIES

The Company leases an office in Melville, New York, on a month-to-month basis.

Rent expense, which includes utilities, was $ 6 and $ 7 for the three months ended March 31, 2026 and 2025, respectively, and is included in selling, general and administrative expenses on the condensed Statements of Operations.

Rent expense, which includes utilities, was $ 4 and $ 7 for the three months ended June 30, 2026 and 2025, respectively, and $ 10 and $ 14 for the six months ended June 30, 2026 and 2025, respectively, and is included in selling, general and administrative expenses on the condensed Statements of Operations.

Loss Contingencies and Legal Costs

8 unchanged sentences

Litigation is inherently unpredictable.

If any unfavorable ruling was to occur in any specific period or if a loss becomes probable and estimable, there exists the possibility of a material adverse impact on the Company’s results of

operations, financial position or cash flows.

As of March 31, 2026, no material amounts are recorded related to legal proceedings on the balance sheets.

If any unfavorable ruling was to occur in any specific period or if a loss becomes probable and estimable, there exists the possibility of a material adverse impact on the Company’s results of operations, financial position or cash flows.

As of June 30, 2026, no material amounts are recorded related to legal proceedings on the balance sheets.

The Company received a class action complaint on January 8, 2026 alleging that the Company collected biometric information from users in Illinois in violation of the Illinois Biometric Information Privacy Act, 740 ILCS 14/1 et seq.

3 unchanged sentences

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