LifeMD, Inc. 10-Q

Item 1. Financial Statements LIFEMD, INC. CONSOLIDATED BALANCE SHEETS (Unaudited) March 31, 2026 December 31, 2025 ASSETS Current Assets Cash $ 34,478,137 $ 36,786,318 Accounts receivable 9,855,117 9,305,277 Product deposit 331,525 320,217 Inventory, net 3,177,136 2,773,576 Other current assets 3,855,131 2,646,077 Total Current Assets 51,697,046 51,831,465 Non-current Assets Equipment, net 2,260,437 2,444,717 Right of use assets, net 5,055,090 5,267,857 Capitalized software, net 10,881,678 10,604,946 Intangible assets, net 230,417 262,334 Total Non-current Assets 18,427,622 18,579,854 Total Assets $ 70,124,668 $ 70,411,319 LIABILITIES AND STOCKHOLDERS’ EQUITY Current Liabilities Accounts payable $ 21,653,122 $ 14,149,154 Accrued expenses 15,244,963 15,974,016 Current operating lease liabilities 670,825 642,422 Deferred revenue 12,016,840 10,807,773 Total Current Liabilities 49,585,750 41,573,365 Long-term Liabilities Noncurrent operating lease liabilities 5,502,072 5,681,374 Total Liabilities 55,087,822 47,254,739 Commitments and contingencies (Note 12) - - Stockholders’ Equity Series A Preferred Stock, $ 0.0001 par value; 1,610,000 shares authorized, 1,400,000 shares issued and outstanding, liquidation value approximately, $ 35.8 million as of March 31, 2026 and December 31, 2025 140 140 Common Stock, $ 0.01 par value; 100,000,000 shares authorized, 47,632,707 and 46,760,016 shares issued, 47,529,667 and 46,656,976 outstanding as of March 31, 2026 and December 31, 2025, respectively 476,327 467,600 Additional paid-in capital 252,976,314 251,455,616 Accumulated deficit ( 238,252,234 ) ( 228,603,075 ) Treasury stock, 103,040 , at cost, as of March 31, 2026 and December 31, 2025 ( 163,701 ) ( 163,701 ) Total Stockholders’ Equity 15,036,846 23,156,580 Total Liabilities and Stockholders’ Equity $ 70,124,668 $ 70,411,319 The accompanying notes are an integral part of these unaudited consolidated financial statements. 3 LIFEMD, INC. Consolidated STATEMENTS OF OPERATIONS (Unaudited) 2026 2025 Three Months Ended March 31, 2026 2025 Telehealth revenue, net $ 50,162,956 $ 50,887,899 Cost of telehealth revenue 5,925,499 8,136,462 Gross profit 44,237,457 42,751,437 Expenses Selling and marketing expenses 29,874,860 22,272,924 General and administrative expenses 15,176,355 14,340,151 Other operating expenses 3,179,946 2,389,536 Customer service expenses 3,139,305 3,071,494 Development costs 1,796,063 1,859,049 Total expenses 53,166,529 43,933,154 Operating loss from continuing operations ( 8,929,072 ) ( 1,181,717 ) Interest income (expense), net 56,476 ( 463,638 ) Loss from continuing operations before income taxes ( 8,872,596 ) ( 1,645,355 ) Income tax provision - - Net loss from continuing operations ( 8,872,596 ) ( 1,645,355 ) Net income from discontinued operations - 1,993,422 Net (loss) income ( 8,872,596 ) 348,067 Net income attributable to non-controlling interest of discontinued operations - 531,845 Net loss attributable to LifeMD, Inc. ( 8,872,596 ) ( 183,778 ) Preferred stock dividends ( 776,563 ) ( 776,563 ) Net loss attributable to LifeMD, Inc. common stockholders $ ( 9,649,159 ) $ ( 960,341 ) Basic (loss) earnings per share attributable to LifeMD, Inc. common stockholders: Continuing operations $ ( 0.20 ) $ ( 0.06 ) Discontinued operations - 0.03 Basic loss per share $ ( 0.20 ) $ ( 0.02 ) Diluted (loss) earnings per share attributable to LifeMD, Inc. common stockholders: Continuing operations $ ( 0.20 ) $ ( 0.06 ) Discontinued operations - 0.03 Diluted loss per share $ ( 0.20 ) $ ( 0.02 ) Weighted average number of common shares outstanding: Basic 47,336,060 43,135,778 Diluted 47,336,060 43,135,778 The accompanying notes are an integral part of these unaudited consolidated financial statements. 4 LIFEMD, INC. Consolidated STATEMENTS of CHANGES IN STOCKHOLDERS’ EQUITY (Deficit) (Unaudited) Shares Amount Shares Amount Capital Deficit Stock Total Operations Total LifeMD, Inc. Series A Preferred Stock Common Stock Additional Paid-in Accumulated Treasury Non-controlling Interest of Discontinued Shares Amount Shares Amount Capital Deficit Stock Total Operations Total Balance, January 1, 2025 1,400,000 $ 140 42,293,907 $ 422,939 $ 230,508,339 $ ( 239,850,931 ) $ ( 163,701 ) $ ( 9,083,214 ) $ 1,529,094 $ ( 7,554,120 ) Stock compensation expense - - 1,282,654 12,827 2,535,701 - - 2,548,528 - 2,548,528 Cashless exercise of stock options - - 56,139 561 ( 56 ) - - - - - Series A Preferred Stock Dividend - - - - - ( 776,563 ) - ( 776,563 ) - ( 776,563 ) Distribution to non-controlling interest of discontinued operations - - - - - - - - ( 36,000 ) ( 36,000 ) Net (loss) income - - - - - ( 183,778 ) - ( 183,778 ) 531,845 348,067 Balance, March 31, 2025 1,400,000 $ 140 43,632,700 $ 436,327 $ 233,043,479 $ ( 240,811,272 ) $ ( 163,701 ) $ ( 7,495,027 ) $ 2,024,939 $ ( 5,470,088 ) Shares Amount Shares Amount Capital Deficit Stock Total Series A Preferred Stock Common Stock Additional Paid-in Accumulated Treasury Shares Amount Shares Amount Capital Deficit Stock Total Balance, January 1, 2026 1,400,000 $ 140 46,760,016 $ 467,600 $ 251,455,616 $ ( 228,603,075 ) $ ( 163,701 ) $ 23,156,580 Balance 1,400,000 $ 140 46,760,016 $ 467,600 $ 251,455,616 $ ( 228,603,075 ) $ ( 163,701 ) $ 23,156,580 Stock compensation expense - - 819,691 8,197 1,440,708 - - 1,448,905 Exercise of stock options - - 53,000 530 79,990 - - 80,520 Series A Preferred Stock Dividend - - - - - ( 776,563 ) - ( 776,563 ) Net loss - - - - - ( 8,872,596 ) - ( 8,872,596 ) Net (loss) income - - - - - ( 8,872,596 ) - ( 8,872,596 ) Balance, March 31, 2026 1,400,000 $ 140 47,632,707 $ 476,327 $ 252,976,314 $ ( 238,252,234 ) $ ( 163,701 ) $ 15,036,846 Balance 1,400,000 $ 140 47,632,707 $ 476,327 $ 252,976,314 $ ( 238,252,234 ) $ ( 163,701 ) $ 15,036,846 The accompanying notes are an integral part of these unaudited consolidated financial statements. 5 LIFEMD, INC. Consolidated STATEMENTS OF CASH FLOWS (Unaudited) 2026 2025 Three Months Ended March 31, 2026 2025 CASH FLOWS FROM OPERATING ACTIVITIES Net (loss) income $ ( 8,872,596 ) $ 348,067 Less: Net income from discontinued operations - 1,993,422 Net loss from continuing operations ( 8,872,596 ) ( 1,645,355 ) Adjustments to reconcile net loss from continuing operations to net cash provided by operating activities: Amortization of debt discount - 100,444 Amortization of capitalized software 1,674,852 1,529,380 Amortization of intangibles 31,917 6,667 Depreciation of fixed assets 289,458 155,361 Noncash operating lease expense 212,767 269,888 Stock compensation expense 1,448,905 2,548,528 Changes in Assets and Liabilities Accounts receivable ( 549,840 ) ( 459,948 ) Product deposit ( 11,308 ) ( 151,077 ) Inventory ( 403,560 ) ( 170,339 ) Other current assets ( 1,209,054 ) 302,221 Operating lease liabilities ( 150,899 ) ( 79,799 ) Deferred revenue 1,209,067 197,334 Accounts payable 7,503,968 ( 85,373 ) Accrued expenses ( 729,053 ) ( 2,259,106 ) Net cash provided by operating activities of continuing operations 444,624 258,826 Net cash provided by operating activities of discontinued operations - 2,809,561 Net cash provided by operating activities 444,624 3,068,387 CASH FLOWS FROM INVESTING ACTIVITIES Cash paid for capitalized software costs (a) ( 1,951,584 ) ( 1,886,815 ) Purchase of equipment ( 105,178 ) ( 117,545 ) Net cash used in investing activities of continuing operations ( 2,056,762 ) ( 2,004,360 ) Net cash used in investing activities of discontinued operations (a) - ( 862,978 ) Net cash used in investing activities ( 2,056,762 ) ( 2,867,338 ) CASH FLOWS FROM FINANCING ACTIVITIES Preferred stock dividends ( 776,563 ) ( 776,563 ) Cash proceeds from exercise of options 80,520 - Net cash used in financing activities of continuing operations ( 696,043 ) ( 776,563 ) Net cash used in financing activities of discontinued operations - ( 36,000 ) Net cash used in financing activities ( 696,043 ) ( 812,563 ) Net decrease in cash ( 2,308,181 ) ( 611,514 ) Cash at beginning of period 36,786,318 35,004,924 Cash at end of period 34,478,137 34,393,410 Less: Cash of discontinued operations at end of period - 2,441,699 Cash of continuing operations at end of period $ 34,478,137 $ 31,951,711 Cash paid for interest and taxes Cash paid during the period for interest $ - $ 593,750 Cash paid during the period for taxes $ - $ 22,696 Non-cash investing and financing activities Cashless exercise of options $ - $ 561 (a) Approximately $ 878 thousand was paid to a related party for capitalized software costs during the three months ended March 31, 2025. See Note 13—Related Party Transactions. The accompanying notes are an integral part of these unaudited consolidated financial statements. 6 LIFEMD, INC. NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS NOTE 1 – NATURE OF THE ORGANIZATION AND BUSINESS Nature of Business LifeMD, Inc. is a patient-centric, direct-to-patient healthcare company providing a high-quality, cost-effective, and convenient way for patients to access virtual medical care and pharmacy services. Through the Company’s vertically integrated care model, it combines proprietary technology, affiliated clinical services, pharmacy infrastructure, and artificial intelligence (“AI”)-enabled operational systems to deliver longitudinal care at scale. The Company’s mission is to empower individuals to live healthier lives by expanding access to high-quality virtual and in-home healthcare services. The Company’s telehealth platform helps patients access their licensed providers for diagnoses, virtual care, and prescription medications, often delivered on a recurring basis. In addition to its telehealth prescription offerings, the Company sells over-the-counter (“OTC”) products. All products are available on a subscription or membership basis, where a patient can subscribe to receive regular shipments of prescribed medications or products. This creates convenience and often discounted pricing opportunities for patients and recurring revenue streams for the Company. With its first brand, ShapiroMD, the Company has built a full line of proprietary OTC products for male and female hair loss including Food and Drug Administration (“FDA”) approved OTC minoxidil and an FDA-cleared medical device and a personalized telehealth platform offering that gives consumers access to virtual medical treatment from their providers and, when appropriate, a full line of oral and topical prescription medications for hair loss. The Company’s men’s brand, RexMD, currently offers access to virtual medical treatment for a variety of men’s health needs, including erectile dysfunction, premature ejaculation and hair loss. In 2022, the Company launched our virtual primary care offering under the LifeMD brand, LifeMD Primary Care. This offering provides patients with access to affiliated high-quality providers for their urgent care and chronic care needs. In 2023, we launched our GLP-1 Weight Management Program providing primary care, metabolic coaching, lab work, and prescription services (as appropriate) to patients seeking to access a medically supported weight loss solution. In September 2024, we expanded our Weight Management Program with a personalized, non-GLP-1 treatment plan consisting of three oral medications – metformin, bupropion, and topiramate. In June 2018, the Company closed the strategic acquisition of 51 % of LegalSimpli Software, LLC, which operates a software as a service application for converting, editing, signing, and sharing PDF documents called PDFSimpli. On July 15, 2021, LegalSimpli Software, LLC, changed its name to WorkSimpli Software LLC, (“WorkSimpli”). As a result of a series of restructuring transactions, the Company’s ownership interest in WorkSimpli was 73.3 %. On November 4, 2025, LifeMD, Inc. sold its majority ownership interest in WorkSimpli to Lion Buyer, LLC. WorkSimpli is classified as discontinued operations for all periods presented in these unaudited consolidated financial statements. For a description of the transaction, see Note 4—Discontinued Operations. Unless otherwise indicated, the terms “LifeMD,” “Company,” “we,” “us,” and “our” refer to LifeMD, Inc. (formerly known as Conversion Labs, Inc.) and LifeMD Pharmacy Holdings LLC, an affiliated limited liability company (“LifeMD Pharmacy”). The affiliated network of medical Professional Corporations and medical Professional Associations administratively led by LifeMD Southern Patient Medical Care, P.C. (“LifeMD PC”) is the Company’s affiliated, variable interest entity in which we hold a controlling financial interest. Unless otherwise specified, all dollar amounts are expressed in United States dollars. Liquidity Evaluation As of March 31, 2026, the Company has an accumulated deficit of approximately $238.3 million and a positive working capital of approximately $ 2.1 million. The Company has incurred significant operating losses to date and has been funding operations primarily through the cash generated from operating activities, issuance of common and preferred stock, and through loans and advances. On January 2, 2026, the Company entered into a Credit Agreement (the “Credit Agreement”) with Citizens Bank, N.A. (“Citizens”), which provides for a senior secured revolving credit facility in an aggregate outstanding amount not exceeding $ 30 million (the “Credit Facility”) to support potential corporate development and/or shareholder value creation initiatives. The Credit Facility may be increased in the aggregate principal amount of up to $ 20 million on the terms and subject to the conditions described in the Credit Agreement. In connection with the Credit Agreement, among other things, the Company issued a revolving loan note to Citizens for any loans that may be made under the Credit Facility. Additionally, among other things, the Company and its subsidiaries entered into a pledge and security agreement and a guarantee agreement to provide credit support for the Credit Facility. The Credit Facility requires the Company to maintain (i) a Consolidated Leverage Ratio not to exceed 2.50 to 1.00 and (ii) a Consolidated Interest Coverage Ratio of at least 3.00 to 1.00 . As of March 31, 2026, the Company was in compliance with the Consolidated Leverage Ratio covenant and was out of compliance with the Consolidated Interest Coverage Ratio covenant contained in the Credit Facility, which is the ratio of (a) the Consolidated EBIT of the Company and its Subsidiaries for the most recently completed four consecutive fiscal quarters ended March 31, 2026, to (b) Consolidated Interest Expense of the Company and its Subsidiaries for the most recently completed four consecutive fiscal quarters ended March 31, 2026, as those capitalized terms are defined in the Credit Agreement. Compliance with the Consolidated Interest Coverage Ratio was adversely impacted by an increase of approximately $ 7.6 million, or 34%, in selling and marketing costs during the three months ended March 31, 2026, resulting from additional sales and marketing initiatives to drive the current and future periods’ sales growth. Among its remedies, Citizens could determine that there has been an Event of Default, deny access to funds under the Credit Facility, and/or it could terminate the Credit Facility. Discussions on the terms of an amendment to the Credit Agreement or waiver of compliance with the covenant are ongoing. As of March 31, 2026 and to date, the Company had not drawn any amounts under the Credit Facility. Refer to Note 8—Indebtedness for additional information. 7 The Company entered into an At Market Issuance Sales Agreement (the “ATM Sales Agreement”) with B. Riley Securities, Inc. and Cantor Fitzgerald & Co. relating to the sale of its common stock. In accordance with the terms of the ATM Sales Agreement, the Company may, but is not obligated to, offer and sell, from time to time, shares of common stock, through or to the Agents, acting as agent or principal. Sales of common stock, if any, will be made by any method permitted that is deemed an “at the market offering” as defined in Rule 415 under the Securities Act. On June 7, 2024, the Company filed a shelf registration statement on Form S-3 under the Securities Act, which was declared effective on July 18, 2024 (the “2024 Shelf”). Under the 2024 Shelf at the time of effectiveness, the Company had the ability to raise up to $ 150.0 million by selling common stock, preferred stock, debt securities, warrants, and units including $ 53.3 million of its common stock under the ATM Sales Agreement. As of March 31, 2026, the Company had $ 44.6 million available under the ATM Sales Agreement. The Company expects that its existing cash as of March 31, 2026 of $ 34.5 million and net proceeds from the sale of common stock under the ATM Sales Agreement will be sufficient to fund our planned operating expenses and capital expenditure requirements for at least the next 12 months from the issuance date of these unaudited consolidated financial statements. NOTE 2 – BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and in accordance with the instructions to Form 10-Q. Accordingly, they do not include all of the information and note disclosures required by accounting principles generally accepted in the United States (“U.S. GAAP”) for complete audited financial statements. The accompanying unaudited financial information should be read in conjunction with the audited consolidated financial statements, including the notes thereto, as of and for the year ended December 31, 2025, included in our 2025 Annual Report on Form 10-K filed with the SEC. The information furnished in this report reflects all adjustments (consisting of normal recurring adjustments), which are, in the opinion of management, necessary for the fair statement of our financial position, results of operations and cash flows for each period presented. The results of operations for the three months ended March 31, 2026 are not necessarily indicative of the results for the year ending December 31, 2026 or for any future period. Principles of Consolidation The Company evaluates the need to consolidate affiliates based on standards set forth in Accounting Standards Codification (“ASC”) 810, Consolidation . The unaudited consolidated financial statements include the accounts of the Company, LifeMD Pharmacy, and LifeMD PC, the Company’s affiliated, variable interest entity in which we hold a controlling financial interest. On November 4, 2025, the Company sold its interest in our majority-owned subsidiary WorkSimpli to Lion Buyer, LLC. WorkSimpli is classified as discontinued operations for all periods presented in these unaudited consolidated financial statements. All intercompany transactions and balances have been eliminated in consolidation. Cash The Company maintains deposits in financial institutions that may, at times, exceed amounts guaranteed by the Federal Deposit Insurance Corporation. These balances could be impacted if one or more of the financial institutions in which we deposit monies fails or is subject to other adverse conditions in the financial or credit markets. We have never experienced any losses related to these balances. Variable Interest Entities In accordance with ASC 810, Consolidation , the Company determines whether any legal entity in which the Company becomes involved is a variable interest entity (a “VIE”) and subject to consolidation. This determination is based on whether an entity has sufficient equity at risk to finance their activities without additional subordinated financial support from other parties or whose equity investors lack any of the characteristics of a controlling financial interest and whether the interest will absorb portions of a VIE’s expected losses or receive portions of its expected residual returns and are contractual, ownership, or pecuniary in nature and that change with changes in the fair value of the entity’s net assets. A reporting entity is the primary beneficiary of a VIE and must consolidate it when that party has a variable interest, or combination of variable interests, that provides it with a controlling financial interest. A party is deemed to have a controlling financial interest if it meets both of the power and losses/benefits criteria. The power criterion is the ability to direct the activities of the VIE that most significantly impact its economic performance. The losses/benefits criterion is the obligation to absorb losses from, or right to receive benefits from, the VIE that could potentially be significant to the VIE. 8 The Company determined that the LifeMD PC entity, the Company’s affiliated network of medical Professional Corporations and medical Professional Associations administratively led by LifeMD Southern Patient Medical Care, P.C., is a VIE and subject to consolidation. LifeMD PC and the Company do not have any stockholders in common. LifeMD PC is owned by licensed physicians, and the Company maintains a managed service agreement with LifeMD PC whereby we provide all non-clinical services to LifeMD PC. The Company determined that it is the primary beneficiary of LifeMD PC and must consolidate, as we have both the power to direct the activities of LifeMD PC that most significantly impact the economic performance of the entity and we have the obligation to absorb the losses. As a result, the Company presents the financial position, results of operations, and cash flows of LifeMD PC as part of the unaudited consolidated financial statements of the Company. There is no non-controlling interest upon consolidation of LifeMD PC. Total net loss for LifeMD PC was approximately $ 3.1 million and $ 3.3 million for the three months ended March 31, 2026 and 2025, respectively. Total assets and liabilities for the LifeMD PC were approximately $ 331 thousand and $ 528 thousand, respectively, as of March 31, 2026 and $ 43 thousand and $ 360 thousand, respectively, as of December 31, 2025. Use of Estimates The Company prepares its unaudited consolidated financial statements in conformity with accounting principles generally accepted in the United States of America which requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Revenue Recognition The Company recognizes revenue in accordance with ASC 606, Revenue from Contracts with Customers , when control of the promised goods or services is transferred to customers in an amount that reflects the consideration the Company expects to receive in exchange for those goods or services. The Company applies the following five-step model to recognize revenue from contracts with customers: 1. Identification of the contract with a customer; 2. Identification of the performance obligations in the contract; 3. Determination of the transaction price; 4. Allocation of the transaction price to the performance obligations in the contract; and 5. Recognition of revenue when, or as, the performance obligations are satisfied. Telehealth Subscription Revenue For the Company’s telehealth subscription arrangements, the Company provides both one-time and subscription-based access to its telehealth platform. The Company offers monthly and multi-month subscriptions dependent upon the subscriber’s enrollment selection. For one-time consultations, the Company has determined that there is one performance obligation that is delivered as of a point in time. For subscription-based access, the Company has determined that there is one performance obligation that is delivered over time, as the Company allows the subscriber continuous access to the telehealth platform for the time period of the subscription. The telehealth platform access is a stand-ready obligation that is satisfied over the subscription period. The Company also offers bundled arrangements in which a subscriber receives subscription-based access to the Company’s telehealth platform as well as prescribed medication. The Company has determined that there are two performance obligations related to these bundles: (i) one performance obligation for the subscription-based service that is a stand-ready obligation that is satisfied over the subscription period and (ii) one performance obligation for the prescribed medication that is delivered as of a point in time. For contracts with multiple performance obligations, the transaction price is allocated to each performance obligation based on their relative standalone selling prices, determined from the prices at which the Company separately sells these products and services. Revenue related to contracts with multiple performance obligations was approximately $ 4.1 million for both the three months ended March 31, 2026 and 2025. 9 Additionally, to fulfill its promise to customers for contracts that include the sale of prescription products, the Company maintains relationships with certain third-party pharmacies, which are licensed mail order pharmacies providing prescription fulfillment to the Company’s customers. The third-party pharmacies fill prescription orders for customers who have received a prescription from a LifeMD PC provider. The Company may account for prescription product revenue as the principal or agent in the arrangement with its customers depending on the agreement with the third-party pharmacy. The following factors are evaluated to determine if the Company acts as principal or agent in the arrangement: (i) whether the Company has sole discretion in determining which pharmacy fills a customer’s prescription; (ii) whether the Company obtains control of the product; (iii) whether the Company is primarily responsible to the customer for the satisfactory fulfillment and acceptability of the order; (iv) whether the Company is responsible for refunds of the prescription medication after transfer of control to the customer; and (v) whether the Company sets all listed prices for the prescription products. Based on evaluation of these factors, the Company accounts for prescription product revenue as either principal or agent in the arrangement depending on the specific agreement terms with the third-party pharmacy. Telehealth Product Revenue For the Company’s product-based arrangements, the Company has determined that there is a single performance obligation, which is the delivery of the product. Revenue is recognized at a point in time when control transfers to the customer, which occurs upon shipment. The Company also provides subscription-based arrangements involving recurring shipments of products. Revenue from these recurring product shipments is recognized at the time each shipment obligation is fulfilled. Provisions for discounts, returns, allowances, customer rebates, and similar adjustments are recorded as reductions to gross revenue in the same period in which related sales are recognized. Discounts and rebates are known at the time of sale, while estimates for returns and allowances are based on historical data and applied consistently across the Company’s product portfolio. Customer returns and rebates on telehealth revenues approximated $ 1.6 million and $ 776 thousand, during the three months ended March 31, 2026 and 2025, respectively. For the three months ended March 31, 2026 and 2025, the Company had the following disaggregated revenue: SCHEDULE OF DISAGGREGATED REVENUE Three Months Ended March 31, 2026 % 2025 % Telehealth subscription revenue $ 30,407,827 61 % $ 30,127,536 59 % Telehealth product revenue 19,755,129 39 % 20,760,363 41 % Total revenues, net $ 50,162,956 100 % $ 50,887,899 100 % Deferred Revenues The Company records deferred revenues when cash payments are received or unconditionally due in advance of its performance. As of March 31, 2026 and December 31, 2025, the Company has deferred revenue of approximately $ 12.0 million and $ 10.8 million, respectively, which have been recorded as accrued contract liabilities and represent the following: (1) $ 10.7 million and $ 9.2 million as of March 31, 2026 and December 31, 2025, respectively, related to obligations on telehealth in-process monthly or yearly contracts with customers and (2) $ 1.3 million and $ 1.6 million as of March 31, 2026 and December 31, 2025, respectively, related to obligations for telehealth products which the customer has not yet obtained control due to non-shipment of the product. The amount of revenue recognized during the three months ended March 31, 2026, that was included in the deferred revenue balance as of December 31, 2025, was $ 7.8 million. The Company expects to recognize all of the deferred revenue related to future performance obligations that are unsatisfied or partially unsatisfied as of March 31, 2026 as revenue by March 31, 2027. The following table summarizes deferred revenue activities for the periods presented: SCHEDULE OF CONTRACT WITH CUSTOMER LIABILITY 2026 2025 Three Months Ended March 31, 2026 2025 Beginning of period $ 10,807,773 $ 17,097,854 Additions 50,680,429 51,046,493 Revenue recognized ( 49,471,362 ) ( 50,849,157 ) End of period $ 12,016,840 $ 17,295,190 10 Leases The Company determines if an arrangement is a lease at inception. Operating lease right-of-use (“ROU”) assets are included in right-of-use assets on the unaudited consolidated balance sheets. The current and long-term components of operating lease liabilities are included in the current operating lease liabilities and noncurrent operating lease liabilities, respectively, on the unaudited consolidated balance sheets. Operating lease ROU assets and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term. As most of the Company’s leases do not provide an implicit rate, the Company uses an incremental borrowing rate based on the information available at the commencement date in determining the present value of future payments. Certain leases may include options to extend or terminate the lease. The Company only considers these options if the options to extend are reasonably certain of being exercised and options to terminate are not reasonably certain not to exercise. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. Leases with an initial term of 12 months or less are not recorded in the balance sheet. Accounts Receivable, net Accounts receivable principally consist of amounts due from third-party merchant processors, who process our subscription revenues; the merchant accounts balance receivable represents the charges processed by the merchants that have not yet been deposited with the Company. The unsettled merchant receivable amount normally represents processed sale transactions from the final one to three days of the month, with collections being made by the Company within the first week of the following month. Management determines the need, if any, for an allowance for future credits to be granted to customers, by regularly evaluating aggregate customer refund activity, coupled with the consideration and current economic conditions in its evaluation of an allowance for future refunds and chargebacks. As of March 31, 2026 and December 31, 2025, the reserve for sales returns and allowances was approximately $ 353 thousand. For all periods presented, the sales returns and allowances were recorded in accrued expenses on the unaudited consolidated balance sheets. Inventory As of March 31, 2026 and December 31, 2025, inventory primarily consisted of finished goods, raw materials and packaging related to the Company’s OTC products included in the telehealth product revenue section of the table above. Inventory is maintained at the Company’s third-party warehouse location in Wyoming and at various Amazon fulfillment centers. The Company also maintains inventory at a company managed warehouse in Pennsylvania. Inventory is valued at the lower of cost or net realizable value with cost determined on an average cost basis. Management compares the cost of inventory with the net realizable value and an allowance is made for writing down inventory to net realizable, if lower. As of both March 31, 2026 and December 31, 2025, the Company recorded an inventory reserve of approximately $ 153 thousand. As of March 31, 2026 and December 31, 2025, the Company’s inventory consisted of the following: SUMMARY OF INVENTORY March 31, December 31, 2026 2025 Finished goods $ 2,431,064 $ 2,071,988 Raw materials and packaging components 899,464 854,980 Inventory reserve ( 153,392 ) ( 153,392 ) Total inventory, net $ 3,177,136 $ 2,773,576 Equipment Equipment is stated at cost, net of accumulated depreciation. Depreciation expense is computed using the straight-line method over the estimated useful lives of the related assets. Estimated useful lives generally range from three to five years for computers, furniture, fixtures and office equipment. 11 As of March 31, 2026 and December 31, 2025, the Company has the following amounts related to depreciable assets: SUMMARY OF DEPRECIABLE ASSETS March 31, December 31, 2026 2025 Furniture, fixtures and office equipment $ 3,312,385 $ 3,272,857 Computers 945,336 879,686 Total equipment, at cost 4,257,721 4,152,543 Accumulated depreciation ( 1,997,284 ) ( 1,707,826 ) Total equipment, net $ 2,260,437 $ 2,444,717 Depreciation expense was $ 289 thousand and $ 155 thousand for the three months ended March 31, 2026 and 2025, respectively. Product Deposit Many of our vendors require deposits when a purchase order is placed for goods or fulfillment services. These deposits typically range from 10 % to 33 % of the total purchased amount. Our vendors include a credit memo within their final invoice, recognizing the deposit amount previously paid. As of March 31, 2026 and December 31, 2025, the Company has approximately $ 332 thousand and $ 320 thousand, respectively, of product deposits with multiple vendors for the purchase of raw materials or finished goods. The Company’s history of product deposits with its inventory vendors, creates an implicit purchase commitment equaling the total expected product acceptance cost in excess of the product deposit. As of March 31, 2026, the Company approximates its implicit purchase commitments to be $ 592 thousand, of which the majority are with two vendors that manufacture the Company’s finished goods inventory for its LifeMD brand. Capitalized Software Costs The Company capitalizes certain internal payroll costs and third-party costs related to internally developed software and amortizes these costs using the straight-line method over the estimated useful life of the software, generally three years. The Company does not sell internally developed software other than through the use of subscription service. Certain development costs not meeting the criteria for capitalization, in accordance with ASC 350-40 , Internal-Use Software , are expensed as incurred. As of March 31, 2026 and December 31, 2025, the Company capitalized a net amount of $ 10.9 million and $ 10.6 million, respectively, related to internally developed software costs which are amortized over the useful life and included in development costs on our unaudited consolidated statement of operations. Intangible Assets Intangible assets are comprised of: (1) a customer relationship asset, (2) the Cleared Technologies, PBC (“Cleared”) trade name, (3) Cleared developed technology, (4) a purchased license, and (5) the Optimal Human Health MD (“OHHMD”) brand. Intangible assets are amortized over their estimated lives using the straight-line method. Costs incurred to renew or extend the term of recognized intangible assets are capitalized and amortized over the useful life of the asset which typically range from one year to ten years . Impairment of Long-Lived Assets Long-lived assets include equipment and capitalized software. Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If such assets are considered to be impaired, an impairment is recognized as the amount by which the carrying amount of the assets exceeds the estimated fair values of the assets. As of March 31, 2026 and December 31, 2025, the Company determined that no events or changes in circumstances existed that would indicate any impairment of its long-lived assets. Advertising and Marketing Costs Advertising and marketing costs are expensed as incurred and are included in selling and marketing expenses within the unaudited consolidated statement of operations. Advertising costs that relate to future advertising periods are recorded as prepaid expenses and amortized to selling and marketing expenses over the period in which the related advertising occurs. Advertising and marketing expenses were $ 29.9 million and $ 22.3 million for the three months ended March 31, 2026 and 2025, respectively. 12 Income Taxes The Company files corporate federal, state, and local tax returns. WorkSimpli filed a tax return in Puerto Rico. The Company records current and deferred taxes in accordance with ASC 740, Accounting for Income Taxes . ASC 740 requires recognition of deferred tax assets and liabilities for temporary differences between tax basis of assets and liabilities and the amounts at which they are carried in the financial statements, based upon the enacted rates in effect for the year in which the differences are expected to reverse. The Company establishes a valuation allowance when necessary to reduce deferred tax assets to the amount expected to be realized. The Company periodically assesses the value of its deferred tax asset, a majority of which has been generated by a history of net operating losses. Management determines the necessity for a valuation allowance. In 2026 and 2025, the Company recorded a full valuation allowance for the deferred tax assets based on the historical loss and the uncertainty regarding the ability to project future taxable income. In future periods if the Company is able to generate income, the Company may reduce or eliminate the valuation allowance. ASC 740 also provides a recognition threshold and measurement attribute for the financial statement recognition of a tax position taken or expected to be taken in a tax return. Using this guidance, a company may recognize the tax benefit from an uncertain tax position in its financial statements only if it is more likely-than-not (i.e., a likelihood of more than 50%) that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. No reserve for uncertain tax positions has been recorded. The Company’s policy is to recognize interest and/or penalties related to income tax matters in income tax expense. The tax benefits recognized in the financial statements from such a position would be measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. The Company’s tax returns for all years since December 31, 2022, remain open to audit by all related taxing authorities. Stock-Based Compensation The Company follows the provisions of ASC 718, Share-Based Payment . Under this guidance compensation cost is recognized at fair value on the date of the grant and amortized over the respective vesting or service period. The fair value of options at the date of grant is estimated using the Black-Scholes option pricing model. The expected option life is derived from assumed exercise rates based upon historical exercise patterns and represents the period of time that options granted are expected to be outstanding. The expected volatility is based upon historical volatility of the Company’s common shares using daily price observations over an observation period that approximates the expected life of the options. The risk-free interest rate approximates the U.S. Treasury yield curve rate in effect at the time of grant for periods similar to the expected option life. Due to limited history of forfeitures, the Company has elected to account for forfeitures as they occur. The fair value of restricted stock is calculated using the quoted market price on the date of grant. Segments On November 4, 2025, we sold our majority ownership interest in WorkSimpli to Lion Buyer, LLC. WorkSimpli is classified as discontinued operations for the three months period ended March 31, 2025 presented in these unaudited consolidated financial statements. As a result, the Company’s portfolio of brands within continuing operations are managed as a single 1 operating segment on a consolidated basis. The Company’s Chief Executive Officer is the chief operating decision maker (“CODM”) and is responsible for reviewing segment operating results to make determinations about resources to be allocated and to assess performance. Fair Value of Financial Instruments The fair value of a financial instrument is based on the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Assets and liabilities subject to ongoing fair value measurement are categorized and disclosed into one of the three categories depending on observable or unobservable inputs employed in the measurement. Hierarchical levels, which are directly related to the amount of subjectivity associated with the inputs to the valuation of these assets or liabilities, are as follows: 1. Level 1: Inputs that are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date. 2. Level 2: Inputs (other than quoted prices included in Level 1) that are either directly or indirectly observable for the asset or liability through correlation with market data at the measurement date and for the duration of the instrument’s anticipated life. 3. Level 3: Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities and that reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. In some circumstances, the inputs used to measure fair value might be categorized within different levels of the fair value hierarchy. In those instances, the fair value measurement is categorized in its entirety in the fair value hierarchy based on the lowest level input that is significant to the fair value measurement. 13 The carrying value of the Company’s financial instruments, including cash, accounts receivable, accounts payable, and accrued expenses approximate fair value for all periods presented. The Company has no financial instruments that are valued using Level 3 inputs. Concentrations of Risk We are dependent on certain third-party manufacturers and pharmacies for fulfillment services, prescription medications, packaging, and finished goods. We believe that other contract manufacturers or third-party pharmacies could be quickly secured if any of our current manufacturers or pharmacies cease to perform adequately. As of March 31, 2026, three third-party pharmacies supplied 93 % of the Company’s total fulfillment services. As of December 31, 2025, one third-party pharmacy supplied 71 % of the Company’s total fulfillment services. Recent Accounting Pronouncements In November 2024, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40) to improve the disclosures about a public business entity’s expenses and provide more detailed information about the types of expenses included in certain expense captions in the unaudited consolidated financial statements. In January 2025, the FASB issued ASU 2025-01, which clarifies the effective date of ASU 2024-03 for interim reporting periods. The amendments in this update are effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. Early adoption is permitted and the amendments in this update should be applied either prospectively or retrospectively. The Company is currently evaluating the impact this guidance will have on the disclosures in the unaudited consolidated financial statements. In September 2025, the FASB issued ASU 2025-06, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software , to simplify and modernize the accounting for internal-use software costs. The amendments remove references to prescriptive software development stages and clarify that capitalization of eligible software development costs begins when management authorizes and commits to funding the project and it is probable the project will be completed, and the software will be used as intended. The amendments in this update are effective for annual reporting periods beginning after December 15, 2027, and interim reporting periods within those annual periods. Early adoption is permitted, and the guidance may be applied prospectively, retrospectively, or using a modified approach for in-process projects. The Company is evaluating the impact this guidance will have on the unaudited consolidated financial statements and related disclosures. All other accounting standards updates that have been issued or proposed by the FASB that do not require adoption until a future date are not expected to have a material impact on the unaudited consolidated financial statements upon adoption. NOTE 3 – REVISIONS TO PREVIOUSLY ISSUED FINANCIAL STATEMENTS The Company has revised its previously issued financial statements to correct for: (1) errors identified associated with the calculation of revenue, deferred revenue, accounts receivable and accrued expenses and (2) previously identified out-of-period adjustments. The Company has evaluated these errors in accordance with ASC 650-10-S99 and S55 (formerly Staff Accounting Bulletins (“SAB”) No. 99 and No. 108), Accounting Changes and Error Corrections. During the three months ended September 30, 2025, the Company identified errors related to the recording of net revenue as agent in certain arrangements with the Company’s third-party pharmacy providers, which resulted in the misstatement of revenue in its previously issued 2023, 2024 annual and interim financial statements and its previously issued 2025 interim financial statements. Although the Company has determined such errors to be immaterial to its previously issued financial statements, the Company has revised its previously issued financial statements to correct these errors. The cumulative impact of such errors for periods prior to 2025 of $ 3.6 million has been accounted for as an adjustment to retained earnings as of January 1, 2025. In addition, the Company previously identified various out-of-period amounts included in its previously issued financial statements that were deemed to be quantitatively and qualitatively immaterial, individually and in the aggregate, to the financial statements in the periods recorded or to the relevant prior periods. Accordingly, the Company corrected these errors in its financial statements in the periods that the errors were identified. The Company revised its previously issued financial statements to correct for these errors in the appropriate prior periods. The immaterial errors consist of: (1) a $1.0 million understatement of an insurance receivable and corresponding liability related to a pending legal matter previously recorded on a net basis, (2) a $1.0 million, $1.0 million and $1.5 million understatement of accounts receivable and corresponding liability related to deferred costs associated with one of the Company’s net revenue arrangements with a third-party pharmacy provider as of December 31, 2024, March 31, 2025 and June 30, 2025, respectively, (3) $1.5 million in voluntary disclosure sales tax expense that was overstated for the year ended December 31, 2024 and understated by $1.5 million for the years ended December 31, 2023, 2022 and 2021 for the Company’s WorkSimpli business and (4) $0.5 million in WorkSimpli distributions that understated non-controlling interest during the three months ended December 31, 2024 and overstated non-controlling interest for the first and second quarters of 2024. 14 The Company effected such revisions to its unaudited consolidated financial statements as of and for the three months ended March 31, 2025 in connection with this filing of our Quarterly Report on Form 10-Q. The following table presents the effect of the revisions on the unaudited consolidated financial statements previously issued as of and for the three months ended March 31, 2025, as a result of the error corrections described above. As discussed in Note 4—Discontinued Operations, WorkSimpli has been treated as discontinued operations for all periods presented. As a result, the “As Revised” amounts reflect both the correction of errors and the recast for discontinued operations, consistent with the “As Reported” amounts presented throughout these unaudited consolidated financial statements. SCHEDULE OF REVISION ON THE PREVIOUSLY ISSUED CONSOLIDATED FINANCIAL STATEMENTS As Previously Reported Adjustment As Revised Discontinued Operations As Reported As of and for the Three Months Ended March 31, 2025 As Previously Reported Adjustment As Revised Discontinued Operations As Reported Consolidated Statement of Operations: Telehealth revenue, net $ 52,456,481 $ ( 1,568,582 ) $ 50,887,899 $ - $ 50,887,899 Total revenues, net $ 65,697,756 $ ( 1,568,582 ) $ 64,129,174 $ 13,241,275 $ 50,887,899 Gross profit $ 57,054,040 $ ( 1,568,582 ) $ 55,485,458 $ 12,734,021 $ 42,751,437 Operating income (loss) $ 2,542,924 $ ( 1,568,582 ) $ 974,342 $ 2,156,059 $ ( 1,181,717 ) Net income $ 1,916,649 $ ( 1,568,582 ) $ 348,067 $ - $ 348,067 Net income (loss) attributable to LifeMD, Inc. $ 1,384,804 $ ( 1,568,582 ) $ ( 183,778 ) $ - $ ( 183,778 ) Net income (loss) attributable to LifeMD, Inc. common stockholders $ 608,241 $ ( 1,568,582 ) $ ( 960,341 ) $ - $ ( 960,341 ) Basic earnings (loss) per share attributable to LifeMD, Inc. common stockholders $ 0.01 $ ( 0.03 ) $ ( 0.02 ) $ - $ ( 0.02 ) Diluted earnings (loss) per share attributable to LifeMD, Inc. common stockholders $ 0.01 $ ( 0.03 ) $ ( 0.02 ) $ - $ ( 0.02 ) Consolidated Statement of Changes in Stockholders’ Equity (Deficit): Accumulated deficit $ 235,644,977 $ 5,166,295 $ 240,811,272 $ - $ 240,811,272 Non-controlling interest $ ( 1,935,978 ) $ ( 88,961 ) $ ( 2,024,939 ) $ - $ ( 2,024,939 ) Consolidated Statement of Cash Flows: Net income $ 1,916,649 $ ( 1,568,582 ) $ 348,067 $ - $ 348,067 Accounts receivable $ ( 1,974,961 ) $ 1,507,106 $ ( 467,855 ) $ ( 7,907 ) $ ( 459,948 ) Deferred revenue $ 144,985 $ 61,475 $ 206,460 $ 9,126 $ 197,334 Net cash provided by operating activities $ 3,068,387 $ - $ 3,068,387 $ - $ 3,068,387 These accompanying notes to the unaudited consolidated financial statements reflect the impact of this revision. NOTE 4 – DISCONTINUED OPERATIONS On November 4, 2025, the Company entered into and simultaneously consummated the closing of a Stock Purchase Agreement (the “Purchase Agreement”) by and among the Company, as a Seller and Seller Representative and the other seller parties thereto (collectively, the “Sellers”), WorkSimpli and Lion Buyer, LLC, a Delaware limited liability company (the “Purchaser”), for the sale by the Sellers of all of their right, title, and interest in WorkSimpli, representing 80 % of the outstanding units in WorkSimpli, to the Purchaser (the “Transaction”). The aggregate purchase price for the units is based on an enterprise value of approximately $ 65.0 million, with 46.2 %, or $ 24.0 million, paid at close as the base purchase price, subject to an adjustment holdback amount and post-closing adjustments for net working capital, cash, closing date indebtedness, and Company transaction expenses, and 53.8 %, or $ 28.0 million, subject to future performance targets, for an aggregate purchase consideration to the Sellers of up to $ 52.0 million. The Company received 91.6% of the base purchase price, or $22.0 million, based on its 73.3% ownership interest in the 80% units held that were sold by the Sellers. The Company may receive up to $25.6 million of the purchase price subject to future EBITDA and Adjusted EBITDA performance targets during a performance period commencing on January 1, 2026 and ending on January 1, 2029. The Company recorded a gain on sale of discontinued operations, net of tax, of $ 21.3 million during the year ended December 31, 2025. This transaction represented a key milestone in the Company’s strategic transformation, further positioning the Company as a pure-play healthcare company exclusively focused on expanding its virtual care and pharmacy offerings. 15 In the period a component of an entity is classified as a discontinued operation, the results of operations for the periods presented are reclassified into separate line items in the unaudited consolidated statements of operations and the unaudited consolidated statements of cash flows. For the three months ended March 31, 2025, the results of operations and cash flows of WorkSimpli are presented as discontinued operations. All amounts included in the notes to the unaudited consolidated financial statements relate to continuing operations unless otherwise noted. The following table presents the financial results of the discontinued operations prior to the sale of WorkSimpli: SCHEDULE OF FINANCIAL RESULTS OF DISCONTINUED OPERATIONS Three Months Ended March 31, 2025 Worksimpli revenue, net $ 13,241,275 Cost of WorkSimpli revenue 507,254 Gross profit 12,734,021 Expenses Selling and marketing expenses 6,921,139 General and administrative expenses 2,715,517 Other operating expenses 125,222 Development costs 816,084 Total expenses 10,577,962 Operating income from discontinued operations 2,156,059 Interest expense ( 162,637 ) Net income from discontinued operations 1,993,422 Net income attributable to non-controlling interest of discontinued operations 531,845 Net income from discontinued operations attributable to LifeMD, Inc. $ 1,461,577 NOTE 5 – ACQUISITIONS On April 24, 2025, the Company closed on the OHHMD Asset Purchase Agreement (the “OHHMD APA”) with OHHMD, PLLC, a North Carolina professional limited liability company, Doug Lucas, DO, the sole member of OHHMD, and the Company’s affiliate LifeMD Southern Patient Medical Care, P.C., a Florida professional corporation (the “PC Purchaser”), whereby the Company and the PC Purchaser acquired certain intangible assets of OHHMD, a nationwide virtual care provider focused on women’s health and hormone replacement therapies. The acquisition marked the launch of the Company’s official entry into the women’s health market and establishes a scalable clinical foundation for a comprehensive virtual health program under the LifeMD brand, focused on hormone health, bone density, metabolism, and long-term wellness. The Company accounted for the OHHMD APA as an acquisition of assets as it was determined that OHHMD did not have substantive processes at the acquisition date and, therefore, did not meet the definition of a business under ASC 805, Business Combinations . The purchase price consisted of 50,000 shares of the Company’s common stock, issued at closing and other nominal consideration. In April 2025, the Company issued 50,000 shares of common stock with a total fair value of $ 303 thousand in connection with the closing of the transaction and recorded an intangible asset related to the OHHMD APA of $ 303 thousand which was assigned a useful life of three years . The Company has elected to group the complementary intangible assets acquired as a single brand intangible asset. In addition, the Company agreed to make payments of up to 250,000 shares of the Company’s common stock to the sole member of OHHMD, Dr. Doug Lucas, as follows: (i) 50,000 shares of the Company’s common stock are to be issued on the first anniversary of closing, and (ii) 200,000 shares of the Company’s common stock are to be issued on the second anniversary of the closing date, subject to the achievement of certain operational milestones. The first 100,000 shares will be issued if the OHHMD brand reaches and maintains at least 2,500 active patients and quarterly revenue of $2.5 million for six full and consecutive calendar months on or prior to the 18-month anniversary of closing. The remaining 100,000 shares will be issued if the OHHMD brand reaches and maintains at least 5,000 active patients and quarterly revenue of $4.5 million for six full and consecutive calendar months on or prior to the second anniversary of closing. In connection with the OHHMD APA, LifeMD PC concurrently entered into a three-year employment agreement with Dr. Doug Lucas. Dr. Doug Lucas now serves as the Company’s Vice President, Female Health & Clinical Operations. The future unvested shares to be issued to Dr. Doug Lucas are equity classified share-based compensation to be recognized over-time and upon achievement of certain operational milestones in accordance with ASC 718, Share-Based Payment . 16 NOTE 6 – INTANGIBLE ASSETS As of March 31, 2026 and December 31, 2025, the Company has the following amounts related to amortizable intangible assets: SCHEDULE OF INTANGIBLE ASSETS March 31, December 31, Amortizable 2026 2025 Life Amortizable intangible assets Cleared trade name $ 133,339 $ 133,339 5 years Cleared developed technology 12,920 12,920 1 year Purchased licenses 200,000 200,000 10 years OHHMD brand 303,000 303,000 3 years Gross amount $ 649,259 $ 649,259 Less: accumulated amortization Cleared trade name $ ( 113,338 ) $ ( 106,671 ) Cleared developed technology ( 12,920 ) ( 12,920 ) Purchased licenses ( 200,000 ) ( 200,000 ) OHHMD brand ( 92,584 ) ( 67,334 ) Accumulated amortization $ ( 418,842 ) $ ( 386,925 ) Total net amortizable intangible assets $ 230,417 $ 262,334 The aggregate amortization expense of the Company’s intangible assets for the three months ended March 31, 2026 and 2025 was $ 32 thousand and approximately $ 7 thousand, respectively. NOTE 7 – ACCRUED EXPENSES As of March 31, 2026 and December 31, 2025, the Company has the following amounts related to accrued expenses: SCHEDULE OF ACCRUED EXPENSES March 31, December 31, 2026 2025 Accrued selling and marketing expenses $ 2,402,817 $ 6,260,992 Accrued compensation 3,755,133 2,414,547 Accrued legal and professional fees 1,830,832 1,943,824 Accrued deferred costs 2,119,507 2,100,000 Sales tax payable 1,467,447 1,467,447 Accrued dividends payable 776,563 776,563 Other accrued expenses 2,892,664 1,010,643 Total accrued expenses $ 15,244,963 $ 15,974,016 NOTE 8 – INDEBTEDNESS Avenue Capital Credit Facility On March 21, 2023, the Company entered into the Avenue Credit Agreement and the Avenue Supplement. The Avenue Credit Agreement provided for a convertible senior secured credit facility of up to an aggregate amount of $ 40 million, comprised of the following: (1) $ 15 million in term loans funded at closing, (2) $ 5 million of additional committed term loans received on September 26, 2023 in conjunction with the Avenue First Amendment and (3) $ 20 million of additional uncommitted term loans, collectively referred to as the “Avenue Facility”. The Company issued Avenue Warrants to purchase $ 1.2 million of the Company’s common stock at an exercise price of $ 1.24 , subject to adjustments, of which $ 660 thousand have been exercised. The Avenue Warrants have a term of five years. The relative fair value of the Avenue Warrants upon closing was $ 873 thousand. As of March 31, 2026, $ 540 thousand Avenue Warrants remain outstanding. Total interest expense on long-term debt, inclusive of amortization of debt discounts, amounted to approximately $ 632 thousand for the three months ended March 31, 2025. On August 5, 2025, the Company paid the remaining $ 14.0 million in outstanding principal payments on the Avenue Facility and the prepayment penalty as noted in the Avenue Credit Agreement. As of March 31, 2026, there is no outstanding balance on the Avenue Facility. The Company recorded a loss on debt extinguishment of approximately $ 1.2 million within its consolidated financial statements for the year ended December 31, 2025. 17 Citizens Bank Credit Agreement On January 2, 2026, the Company entered into a Credit Agreement (the “Credit Agreement”) with Citizens Bank, N.A. ( “Citizens”), which provides for a senior secured revolving credit facility in an aggregate principal amount of up to $ 30 million (the “Credit Facility”). The Credit Facility may be increased by up to an additional $ 20 million, subject to the terms and conditions set forth in the Credit Agreement. The Credit Facility matures on January 2, 2029 and bears interest at a variable rate based on a benchmark interest rate selected by the Company, plus an applicable margin. The applicable margin ranges from 1.50 % to 2.25 % for borrowings based on Term SOFR and from 0.50 % to 1.25 % for borrowings based on the Alternate Base Rate. The Company is also required to pay a commitment fee ranging from 0.225 % to 0.30 % on the unused portion of the Credit Facility, in each case depending on the Company’s Consolidated Leverage Ratio. The Credit Facility did not require an upfront fee. The Credit Agreement contains customary representations and warranties, affirmative and negative covenants, and events of default. It also includes financial covenants requiring the Company to maintain (i) a Consolidated Leverage Ratio not to exceed 2.50 to 1.00 and (ii) a Consolidated Interest Coverage Ratio of at least 3.00 to 1.00 , in each case measured as of the end of each fiscal quarter beginning with the quarter ending March 31, 2026. As of March 31, 2026, the Company was in compliance with the Consolidated Leverage Ratio covenant and was out of compliance with the Consolidated Interest Coverage Ratio covenant contained in the Credit Facility, which is the ratio of (a) the Consolidated EBIT of the Company and its Subsidiaries for the most recently completed four consecutive fiscal quarters ended March 31, 2026, to (b) Consolidated Interest Expense of the Company and its Subsidiaries for the most recently completed four consecutive fiscal quarters ended March 31, 2026, as those capitalized terms are defined in the Credit Agreement. Compliance with the Consolidated Interest Coverage Ratio was adversely impacted by an increase of approximately $ 7.6 million, or 34%, in selling and marketing costs during the three months ended March 31, 2026, resulting from additional sales and marketing initiatives to drive the current and future periods’ sales growth. Among its remedies, Citizens could determine that there has been an Event of Default, deny access to funds under the Credit Facility, and/or it could terminate the Credit Facility. Discussions on the terms of an amendment to the Credit Agreement or waiver of compliance with the covenant are ongoing. As of March 31, 2026 and to date, the Company had not drawn any amounts under the Credit Facility. NOTE 9 – STOCKHOLDERS’ EQUITY The Company has authorized the issuance of up to 100,000,000 shares of common stock, $ 0.01 par value, and 5,000,000 shares of preferred stock, $ 0.0001 par value, of which 5,000 shares are designated as Series B Convertible Preferred Stock, 1,610,000 are designated as Series A Preferred Stock and 3,385,000 shares of preferred stock remain undesignated. The Company entered into the ATM Sales Agreement whereby the Company may offer and sell, from time to time, shares of common stock. On June 7, 2024, the Company filed the 2024 Shelf. Under the 2024 Shelf at the time of effectiveness, the Company had the ability to raise up to $ 150.0 million by selling common stock, preferred stock, debt securities, warrants, and units including $ 53.3 million of its common stock under the ATM Sales Agreement. As of March 31, 2026, the Company had $ 44.6 million available under the ATM Sales Agreement. Options and Warrants During the three months ended March 31, 2026, the Company issued an aggregate of 53,000 shares of common stock related to the exercise of options for total proceeds of approximately $ 81 thousand. Common Stock During the three months ended March 31, 2026, the Company issued an aggregate of 819,691 shares of common stock for service, including vested restricted stock units (“RSUs”). Non-controlling Interest of Discontinued Operations Net income attributed to non-controlling interest of discontinued operations amounted to approximately $ 532 thousand for the three months ended March 31, 2025. During the three months ended March 31, 2025, the Company paid distributions to non-controlling interest holders of discontinued operations of approximately $ 36 thousand. Dividends The Company pays cumulative dividends on its Series A Preferred Stock, in the amount of $ 2.21875 per share each year, which is equivalent to 8.875 % of the $ 25.00 liquidation preference per share. Dividends on the Series A Preferred Stock are payable quarterly in arrears, on or about the 15th day of January, April, July, and October of each year. The dividends are included in the Company’s results of operations for the three months ended March 31, 2026 and 2025. Dividends declared and paid on the Series A Preferred Stock during the three months ended March 31, 2026 and 2025 are as follows: SCHEDULE OF DIVIDENDS DECLARED AND PAID ON THE SERIES A PREFERRED STOCK Declaration Date Record Date Payment Date March 24, 2026 April 3, 2026 April 15, 2026 March 25, 2025 April 4, 2025 April 15, 2025 18 Stock Options On January 8, 2021, the Company approved the Company’s 2020 Equity and Incentive Plan (the “2020 Plan”). Approval of the 2020 Plan was included as Proposal 1 in the Company’s definitive proxy statement for its Special Meeting of Stockholders filed with the Securities and Exchange Commission on December 7, 2020. The 2020 Plan is administered by the Compensation Committee of the Board of Directors (the “Board”) and initially provided for the issuance of up to 1,500,000 shares of Common Stock. The number of shares of Common Stock available for issuance under the 2020 Plan automatically increases by 150,000 shares of Common Stock on January 1st of each year, for a period of not more than ten years, commencing on January 1, 2021 and ending on (and including) January 1, 2030. Awards under the 2020 Plan can be granted in the form of stock options, non-qualified and incentive options, stock appreciation rights, restricted stock awards (“RSAs”), and restricted stock units (“RSUs”). On June 24, 2021, at the Annual Meeting of Stockholders, the stockholders of the Company approved the amendment and restatement to the 2020 Plan, which amended the 2020 Plan to increase the maximum number of shares of the Company’s common stock available for issuance under the 2020 Plan by 1,500,000 shares. On June 16, 2022, at the Annual Meeting of Stockholders, the stockholders of the Company approved the second amendment and restatement of the 2020 Plan, which amended the 2020 Plan to increase the maximum number of shares of the Company’s common stock available for issuance under the 2020 Plan by 1,500,000 shares. On June 14, 2024, at the Annual Meeting of Stockholders, the stockholders of the Company approved the third amendment and restatement to the 2020 Plan (the “Amended 2020 Plan”), which further amended the 2020 Plan by increasing the maximum number of shares of the Company’s common stock available for issuance under the Amended 2020 Plan by 3,000,000 shares. As of March 31, 2026, the Amended 2020 Plan provided for the issuance of up to 8,400,000 shares of Common Stock. Remaining authorization under the Amended 2020 Plan was 996,818 shares as of March 31, 2026. The forms of award agreements to be used in connection with awards made under the Amended 2020 Plan to the Company’s executive officers and non-employee directors are: ● Form of Non-Qualified Option Agreement (Non-Employee Director Awards) ● Form of Non-Qualified Option Agreement (Employee Awards); and ● Form of Restricted Stock Award Agreement. Previously, the Company had granted service-based stock options and performance-based stock options separate from the Amended 2020 Plan. The following is a summary of outstanding options activity under our Amended 2020 Plan for the three months ended March 31, 2026: SCHEDULE OF OPTION ACTIVITY Options Outstanding Number of Shares Exercise Price per Share Weighted Average Remaining Contractual Life Weighted Average Exercise Price per Share Balance at December 31, 2025 229,250 $ 1.84 – 13.74 2.43 years $ 7.94 Granted - - - - Exercised ( 3,000 ) 1.84 1.82 years 1.84 Cancelled/Forfeited/Expired - - - - Balance at March 31, 2026 226,250 $ 1.89 – 13.74 2.19 years $ 8.02 Exercisable at December 31, 2025 229,250 $ 1.84 – 13.74 2.43 years $ 7.94 Exercisable at March 31, 2026 226,250 $ 1.89 – 13.74 2.19 years $ 8.02 Total compensation expense for the Amended 2020 Plan options above was approximately $ 0 and $ 7 thousand for the three months ended March 31, 2026 and 2025, respectively, with no unamortized expense remaining as of March 31, 2026. During the three months ended March 31, 2026, 3,000 options were exercised and total proceeds received were approximately $ 6 thousand. As of March 31, 2026, aggregate intrinsic value of vested service-based options outstanding was $ 67 thousand. 19 The following is a summary of outstanding service-based options activity (prior to the establishment of our Amended 2020 Plan above) for the three months ended March 31, 2026: SCHEDULE OF OPTION ACTIVITY Options Outstanding Number of Shares Exercise Price per Share Weighted Average Remaining Contractual Life Weighted Average Exercise Price per Share Balance at December 31, 2025 390,333 $ 1.00 – 11.98 2.28 years $ 4.03 Granted - - - - Exercised - - - - Cancelled/Forfeited/Expired ( 2,500 ) 11.98 - 11.98 Balance at March 31, 2026 387,833 $ 1.00 – 11.56 2.05 years $ 3.97 Exercisable December 31, 2025 390,333 $ 1.00 – 11.98 2.28 years $ 4.03 Exercisable at March 31, 2026 387,833 $ 1.00 – 11.56 2.05 years $ 3.97 Total compensation expense under the above service-based option plan was $ 0 and $ 145 thousand for the three months ended March 31, 2026 and 2025, respectively, with no unamortized expense remaining as of March 31, 2026. As of March 31, 2026, aggregate intrinsic value of vested service-based options outstanding was $ 430 thousand. The following is a summary of outstanding performance-based options activity for the three months ended March 31, 2026: SCHEDULE OF OPTION ACTIVITY Options Outstanding Number of Shares Exercise Price per Share Weighted Average Remaining Contractual Life Weighted Average Exercise Price per Share Balance at December 31, 2025 80,000 $ 1.25 – 1.75 1.62 years $ 1.59 Granted - - - - Exercised ( 50,000 ) 1.25 – 1.75 1.38 years 1.50 Balance at March 31, 2026 30,000 $ 1.75 1.38 years $ 1.75 Exercisable December 31, 2025 65,000 $ 1.25 – 1.75 1.59 years $ 1.56 Exercisable at March 31, 2026 15,000 $ 1.75 1.25 years $ 1.75 Total compensation expense under the above performance-based options plan was $ 0 for both the three months ended March 31, 2026 and 2025. During the three months ended March 31, 2026, 50,000 options were exercised and total proceeds received were approximately $ 75 thousand. As of March 31, 2026, aggregate intrinsic value of vested performance options outstanding was $ 56 thousand. RSUs and RSAs (under our Amended 2020 Plan) The following is a summary of unvested RSUs and RSAs activity under our Amended 2020 Plan for the three months ended March 31, 2026: SCHEDULE OF RESTRICTED STOCK UNIT ACTIVITY RSUs and RSAs Unvested Number of Shares Balance at December 31, 2025 2,274,587 Granted 388,000 Vested ( 566,000 ) Cancelled/Forfeited ( 260,584 ) Balance at March 31, 2026 1,836,003 The total fair value of the 388,000 RSUs and RSAs granted was approximately $ 1.5 million which was determined using the fair value of the quoted market price on the date of grant. Total compensation expense under the Amended 2020 Plan RSUs and RSAs above was approximately $ 1.4 million and $ 2.4 million for the three months ended March 31, 2026 and 2025, respectively, with unamortized expense remaining of approximately $ 4.9 million as of March 31, 2026. During the three months ended March 31, 2026, a total of 819,691 shares of common stock were issued in connection with RSUs and RSAs, including: (i) 566,000 shares issued upon vesting of awards during the current period, and (ii) 253,691 shares issued upon settlement of awards that had vested in prior periods. 20 RSUs and RSAs (outside of our Amended 2020 Plan) The following is a summary of unvested RSUs and RSAs activity (outside of our Amended 2020 Plan) for the three months ended March 31, 2026: SCHEDULE OF RESTRICTED STOCK UNIT ACTIVITY RSUs and RSAs Unvested Number of Shares Balance at December 31, 2025 100,000 Granted - Vested - Balance at March 31, 2026 100,000 Total compensation expense for RSUs and RSAs outside of the Amended 2020 Plan was $ 0 for both the three months ended March 31, 2026 and 2025, with no unamortized expense remaining as of March 31, 2026. Warrants The following is a summary of outstanding and exercisable warrants activity during the three months ended March 31, 2026: SCHEDULE OF WARRANT OUTSTANDING AND EXERCISABLE Warrants Outstanding Number of Shares Exercise Price per Share Weighted Average Remaining Contractual Life Weighted Average Exercise Price per Share Balance at December 31, 2025 1,172,877 $ 1.24 – 12.00 1.67 years $ 5.88 Exercised - - - - Cancelled/Forfeited/Expired - - - - Balance at March 31, 2026 1,172,877 $ 1.24 – 12.00 1.42 years $ 5.88 Exercisable December 31, 2025 1,172,877 $ 1.24 – 12.00 1.67 years $ 5.88 Exercisable March 31, 2026 1,172,877 $ 1.24 – 12.00 1.42 years $ 5.88 Total compensation expense on the above warrants for services was $ 0 for both the three months ended March 31, 2026 and 2025, with no unamortized expense remaining as of March 31, 2026. Stock-based Compensation The total stock-based compensation expense related to common stock issued for services, service-based stock options, performance-based stock options, warrants and RSUs, and RSAs amounted to $ 1.4 million and $ 2.5 million for the three months ended March 31, 2026 and 2025, respectively. Such amounts are included in general and administrative expenses in the unaudited consolidated statements of operations. Unamortized expense remaining related to RSUs was $ 4.9 million as of March 31, 2026, which is expected to be recognized through 2029. NOTE 10 – EARNINGS (LOSS) PER SHARE Basic earnings (loss) per common share (“EPS”) is based on the weighted average number of common shares outstanding during each period presented. Shares of unissued vested RSUs and RSAs are included in our calculation of basic weighted average common shares outstanding. Unvested RSUs and RSAs, convertible securities, warrants and options to purchase common stock are included as common stock equivalents only when dilutive. Potential common stock equivalents are excluded from diluted earnings per share when the effects would be antidilutive. The Company follows the provisions of ASC 260, Diluted Earnings per Share . In computing diluted EPS, basic EPS is adjusted for the assumed issuance of all potentially dilutive securities. The dilutive effect of call options, warrants and share-based payment awards is calculated using the “treasury stock method,” which assumes that the “proceeds” from the exercise of these instruments are used to purchase common shares at the average market price for the period. The dilutive effect of traditional convertible debt and convertible preferred stock is calculated using the “if-converted method.” Under the if-converted method, securities are assumed to be converted at the beginning of the period, and the resulting common shares are included in the denominator of the diluted EPS calculation for the entire period being presented. 21 The following table reconciles net income attributable to LifeMD, Inc. common stockholders from continuing operations and discontinued operations to basic and diluted earnings per share: SCHEDULE OF BASIC AND DILUTED EARNINGS PER SHARE 2026 2025 March 31, 2026 2025 Net loss from continuing operations $ ( 8,872,596 ) $ ( 1,645,355 ) Less: Preferred stock dividends ( 776,563 ) ( 776,563 ) Net loss from continuing operations attributable to LifeMD, Inc. common stockholders ( 9,649,159 ) ( 2,421,918 ) Net income from discontinued operations - 1,993,422 Less: Net income attributable to noncontrolling interests of discontinued operations - 531,845 Net income from discontinued operations attributable to LifeMD, Inc. common stockholders - 1,461,577 Net loss attributable to LifeMD, Inc. common stockholders $ ( 9,649,159 ) $ ( 960,341 ) Basic loss per share is the same as diluted net loss per share attributable to common stockholders for the three months ended March 31, 2026 and 2025, because the inclusion of potential shares of common stock would have been anti-dilutive. The following table discloses the securities that were not included in the computation of diluted net earnings (loss) per share as their inclusion would have been anti-dilutive: SCHEDULE OF POTENTIALLY DILUTIVE SECURITIES 2026 2025 Three Months Ended March 31, 2026 2025 RSUs and RSAs 712,642 81,707 Stock options 168,399 354,052 Warrants 414,369 557,548 Convertible long-term debt - 671,141 Total 1,295,410 1,664,448 NOTE 11 – LEASES The Company leases office spaces domestically under operating leases including: (1) the Company’s headquarters in New York, New York for which the lease expires in 2028, (2) a marketing and sales center in Huntington Beach, California for which the lease expires in 2027, (3) a patient care center in Greenville, South Carolina for which the lease expires in 2032, with an additional five year option to extend, for which the Company expects to utilize, and (4) a warehouse and pharmacy operations center in Lancaster, Pennsylvania for which the lease expires in 2029, with an additional five year option to extend, for which the Company expects to utilize. The following is a summary of the Company’s operating right-of-use assets and operating lease liabilities as of March 31, 2026: SCHEDULE OF OPERATING RIGHT OF USE OF ASSETS Right-of-use assets $ 5,055,090 Current operating lease liabilities $ 670,825 Noncurrent operating lease liabilities $ 5,502,072 The table below reconciles the undiscounted future minimum lease payments under the above noted operating leases to the total operating lease liabilities recognized on the unaudited consolidated balance sheet as of March 31, 2026: SCHEDULE OF MATURITY OF OPERATING LEASE LIABILITIES Remaining portion of fiscal year 2026 $ 950,385 Fiscal year 2027 1,225,154 Fiscal year 2028 925,152 Fiscal year 2029 765,837 Fiscal year 2030 794,164 Thereafter 5,064,559 Less: imputed interest ( 3,552,354 ) Present value of operating lease liabilities $ 6,172,897 22 Operating lease expenses were approximately $ 372 thousand and $ 383 thousand for the three months ended March 31, 2026 and 2025, respectively, and were included in other operating expenses in our unaudited consolidated statement of operations. Supplemental cash flow information related to operating lease liabilities consisted of the following: SCHEDULE OF CASH FLOW AND BALANCE SHEET INFORMATION RELATED OF OPERATING LEASE LIABILITIES March 31, 2026 2025 Cash paid for operating lease liabilities $ 310,012 $ 188,818 Supplemental balance sheet information related to operating lease liabilities consisted of the following: March 31, 2026 December 31, 2025 Weighted average remaining lease term in years 10.14 10.26 Weighted average discount rate 10.90 % 10.93 % NOTE 12 - COMMITMENTS AND CONTINGENCIES Purchase Commitments Many of the Company’s vendors require product deposits when a purchase order is placed for goods or fulfillment services related to inventory requirements. The Company’s history of product deposits with its inventory vendors, creates an implicit purchase commitment equaling the total expected product acceptance cost in excess of the product deposit. As of March 31, 2026, the Company approximates its implicit purchase commitments to be $ 592 thousand. Legal Matters In the normal course of business operations, the Company may become involved in various legal matters. As of March 31, 2026, other than as set forth below, the Company’s management does not believe that there are any potential legal matters that could have a material adverse effect on the Company’s consolidated financial position. On August 27, 2025, a purported shareholder filed a putative class action complaint in the United States District Court for the Eastern District of New York (“EDNY”) against the Company, the Company’s Chief Executive Officer, Mr. Schreiber, and the Company’s former Chief Financial Officer, Mr. Benathen, (collectively, the “Defendants”), captioned Johnston v. LifeMD, Inc., et al. , Case No. 25-cv-04761, alleging: (i) violations of Section 10(b) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and Rule 10b-5 promulgated thereunder by the Defendants for making false and misleading statements; and (ii) violations of Section 20(a) of the Exchange Act by the individual officer defendants as alleged control persons. On October 24, 2025, the EDNY granted the joint motion to transfer the class action complaint from the EDNY to the United States District Court for the Southern District of New York (“SDNY”). On November 24, 2025, the SDNY appointed a Lead Plaintiff. On January 30, 2026, the Lead Plaintiff filed an amended complaint. Defendants filed a motion to dismiss the amended complaint on March 27, 2026; Lead Plaintiff’s opposition is due on May 15, 2026; and Defendants’ reply brief is due on June 12, 2026. In the months following filing of the class action complaint, four putative shareholder derivative complaints were filed, captioned: (i) Greenberg v. Schreiber et al ., Case No. 25-cv-5075 (EDNY), (ii) Poulos v. Schreiber et al ., Case No. 25-cv-5197 (EDNY), (iii) Shibata v. Schreiber et al. , Case No. 25-cv-5284-JMW (EDNY) and (iv) Ellis v. Schreiber, et al. 125-cv-09343 (SDNY). These complaints alleged violations of Section 14(a) of the Exchange Act, breach of fiduciary duties, aiding and abetting breaches of fiduciary duties, unjust enrichment, abuse of control, gross mismanagement, waste of corporate assets, and violations of Exchange Act Sections 10(b) and 21D by the Company’s officers and directors. The shareholder derivative complaints are based primarily on the same alleged conduct underlying the class action complaint described above, and seek damages in an unspecified amount and other relief. On December 11, 2025, the three derivative actions filed in the EDNY were consolidated and stayed pending a ruling on the motion to dismiss in the securities class action, including any related appeals. On December 17, 2025, the derivative action filed in the SDNY was stayed on the same terms. While the Company does not believe that any of the class action or shareholder derivative complaints will have a material adverse effect on the Company’s business, results of operations and financial condition, failure to obtain a favorable resolution of these complaints could have such a material adverse effect. NOTE 13 – RELATED PARTY TRANSACTIONS WorkSimpli Software During the three months ended March 31, 2025, the Company utilized CloudBoson Technologies Pvt. Ltd. (“CloudBoson”), formerly LegalSubmit Pvt. Ltd. (“LegalSubmit”), a company owned by WorkSimpli’s Chief Software Engineer, to provide software development services. CloudBoson ceased to be a related party of the Company on November 4, 2025. The Company paid CloudBoson a total of approximately $ 878 thousand during the three months ended March 31, 2025 for these services. The Company had no outstanding payables to CloudBoson as of November 4, 2025. 23 Consulting Agreements On May 30, 2023, Will Febbo, a member of the Board, entered into a consulting services agreement with the Company, pursuant to which he provides certain investor relations and strategic business development services, in consideration for 375,000 RSUs, which vested in quarterly installments from August 30, 2023 through November 30, 2024. The Company issued 62,500 RSUs, with a fair value of $ 131 thousand, related to this agreement during the three months ended March 31, 2025. The Company issued no RSUs related to this agreement during the three months ended March 31, 2026. On June 14, 2023, Naveen Bhatia, a former member of the Board, entered into a consulting services agreement with the Company, pursuant to which Mr. Bhatia provided certain investor relations and strategic business development services, in consideration for 225,000 RSUs, which vested in six-month installments from June 14, 2023 through December 31, 2024. The Company issued 56,250 RSUs, with a fair value of $ 168 thousand, related to this agreement during the three months ended March 31, 2025. On January 24, 2025, Mr. Bhatia entered into another consulting services agreement with the Company, pursuant to which Mr. Bhatia provides certain strategic business development services, in consideration for 100,000 RSUs, of which 50,000 RSUs vested on the execution of the agreement and 50,000 RSUs will vest on the one-year anniversary of the agreement. The Company issued 50,000 RSUs, with a fair value of $ 257 thousand, related to this agreement during the three months ended March 31, 2026. Employment Agreement Effective May 1, 2024, Brian Schreiber, Logistics & Fulfillment Advisor, and a relative of the Company’s Chief Executive Officer, entered into an amended employment agreement. Mr. Schreiber’s compensation package was adjusted to reflect the increased scope of his responsibilities. The compensation adjustment, approved by the Compensation Committee of the Board, included an annual base salary increase to $ 240 thousand. During the three months ended March 31, 2026 and 2025, the Company paid Mr. Schreiber approximately $ 63 thousand and $ 55 thousand, respectively, in connection with his employment. On July 15, 2025, the Company entered into an amendment to the bonus agreement with Mr. Schreiber dated August 16, 2017. The amendment modifies the performance-based vesting conditions of a previously granted stock option award for 50,000 common shares, by replacing pre-tax earnings targets with Adjusted EBITDA target, which is a performance measure used in other employee bonus agreements. All other material terms of the original agreement remain unchanged. The Company recorded stock-based compensation expense related to this amendment of $ 535 thousand during the year ended December 31, 2025, with no additional expense recognized during the three months ended March 31, 2026. NOTE 14 – INCOME TAXES The Company incurred a pre-tax loss for the three months ended March 31, 2026. As such, the Company recorded no provision for income taxes. Additionally, the Company expects to incur a pre-tax loss for the year ended December 31, 2026. The Company maintains a full valuation allowance against its deferred tax assets, as it is not more-likely-than-not that such assets will be realized. Accordingly, no current or deferred income tax expense or benefit was recorded for the three months ended March 31, 2026. The Company evaluates the realizability of its deferred tax assets on a quarterly basis. Management assessed the need for a valuation allowance as of March 31, 2026 and concluded that a full valuation allowance continues to be required based on cumulative losses and the forecasted loss for the year ended December 31, 2026. There were no discrete income tax items recorded during the three months ended March 31, 2026. NOTE 15 – SEGMENTS The Company’s portfolio of brands within continuing operations are managed as asingle 1 operating segment on a consolidated basis. Our CODM is our Chief Executive Officer. The CODM uses net income or loss to determine segment profitability in order to assess performance and allocate resources. 24 Relevant segment data for the three months ended March 31, 2026 and 2025 is as follows: SCHEDULE OF RELEVANT SEGMENT DATA 2026 2025 Three Months Ended March 31, 2026 2025 Telehealth revenue, net $ 50,162,956 $ 50,887,899 Significant Segment Expenses: Cost of telehealth revenue 5,925,499 8,136,462 Selling and marketing expenses 29,874,860 22,272,925 Payroll expenses 9,300,152 8,218,051 Merchant processing fees 2,064,814 2,011,449 Other general and administrative expenses 8,471,858 7,190,794 Other segment items (1) 3,454,845 4,239,936 Segment operating loss ( 8,929,072 ) ( 1,181,717 ) Interest income (expense), net 56,476 ( 463,638 ) Loss from continuing operations before income taxes ( 8,872,596 ) ( 1,645,355 ) Income tax provision - - Net loss from continuing operations $ ( 8,872,596 ) $ ( 1,645,355 ) (1) Other segment items include stock-based compensation and depreciation and amortization. Total expenditures for purchases of capitalized software and equipment, which are reported on the Company’s unaudited consolidated statements of cash flows totaled $ 2.0 million during both the three months ended March 31, 2026 and 2025. NOTE 16 – SUBSEQUENT EVENTS Stock Issued for Service In April 2026, the Company issued 70,000 shares of common stock related to vested restricted stock with a total fair value of $ 373 thousand. 25