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Item 1. Financial Statements

2025-05-13 compared with 2024-10-31 · 167 added, 234 removed, 371 unchanged (52% of the section changed)

2 unchanged sentences

AND SUBSIDIARIES

UNAUDITED CONSOLIDATED BALANCE SHEETS

CONSOLIDATED BALANCE SHEETS

($ in thousands, except par value and share data)

September 30,

Current assets:

3 unchanged sentences

Investments in debt securities- short term

11,696 13,292

Trade accounts receivable, net of allowance for doubtful accounts

Trade accounts receivable, net

Prepaid expenses and other current assets

9 unchanged sentences

Accrued liabilities

Deferred revenue

Other current liabilities

4 unchanged sentences

1,100,000,000 shares authorized;

917,285,149 shares issued and outstanding

917,285,149 and 917,285,149 shares issued and outstanding at March 31, 2025 and December 31, 2024, respectively

18,179 18,179

10 unchanged sentences

$ 29,963 $ 30,400

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

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

LIQUIDMETAL TECHNOLOGIES, INC.

AND SUBSIDIARIES

UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS

CONSOLIDATED STATEMENTS OF OPERATIONS

($ in thousands, except share and per share data)

Three Months Ended September 30,

Nine Months Ended September 30,

Three Months Ended March 31,

Licensing and royalties

6 unchanged sentences

Other income (expense):

Interest and investment income

Investment income

Interest income

Loss from operations

4 unchanged sentences

Number of weighted average shares - basic and diluted

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

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

LIQUIDMETAL TECHNOLOGIES, INC.

AND SUBSIDIARIES

UNAUDITED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

CONSOLIDATED STATEMENTS OF SHAREHOLDERS ’ EQUITY

($ in thousands, except share and per share data)

Three Months Ended

September 30,

Nine Months Ended

September 30,

Other comprehensive income (loss), net of tax

Net unrealized gains (losses) on available-for-sale securities

Other comprehensive income (loss), net of tax

Comprehensive loss

Comprehensive loss attributable to noncontrolling interests

Comprehensive loss attributable to Liquidmetal Technologies shareholders

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

LIQUIDMETAL TECHNOLOGIES, INC.

AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS ’ EQUITY

($ in thousands, except per share data)

comprehensive

3 unchanged sentences

Other comprehensive loss

Balance - September 30, 2024 (unaudited)

Balance - March 31, 2025

Balance - December 31, 2023

1 unchanged sentence

Other comprehensive loss

Balance - September 30, 2023 (unaudited)

comprehensive

Paid-in Capital

Balance - June 30, 2024

Stock-based compensation

Other comprehensive loss

Balance - September 30, 2024 (unaudited)

Balance - June 30, 2023

Stock-based compensation

Other comprehensive loss

Balance - September 30, 2023 (unaudited)

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

Balance - March 31, 2024

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

LIQUIDMETAL TECHNOLOGIES, INC.

AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

($ in thousands, except share and per share data)

Three months ended March 31,

Other comprehensive income, net of tax

Net unrealized gains on available-for-sale securities

Other comprehensive income, net of tax

Comprehensive loss

Comprehensive loss attributable to noncontrolling interests

Comprehensive loss attributable to Liquidmetal Technologies shareholders

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

LIQUIDMETAL TECHNOLOGIES, INC.

AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

($ in thousands, except per share data)

Nine Months Ended September 30,

Three Months Ended March 31,

Operating activities:

2 unchanged sentences

Realized investment gains (loss), net

Unrealized investment gain (loss), net

Unrealized investment gain, net

Stock-based compensation

15 unchanged sentences

Cash paid during the period for:

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

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

LIQUIDMETAL TECHNOLOGIES, INC.

AND SUBSIDIARIES

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

For the Nine and Three Months Ended September 30, 2024 and 2024

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

For the Three Months Ended March 31, 2025 and 2024

(numbers in thousands, except percentages, share and per share data)

3 unchanged sentences

The Company’s family of alloys consists of a variety of bulk alloys and composites that utilize the advantages offered by amorphous alloys technology.

The Company works with partners to design, develop, and sell products and custom parts from bulk amorphous alloys for sale in a wide range of industries.

The Company designs, develops, and sells products and custom parts from bulk amorphous alloys to customers in a wide range of industries.

The Company also partners with third -party manufacturers and licensees to develop and commercialize Liquidmetal alloy products.

7 unchanged sentences

Moreover, the Company believes these advantages could enable the introduction of entirely new products and applications that are not possible or commercially viable with other materials.

The Company’s bulk amorphous alloy technology is a relatively new technology as compared to many other material technologies, such as plastics and widely-used high-performance crystalline alloys.

Historically, the successful commercialization of a new material technology has required the persistent improvement and refining of the technology over a sometimes lengthy period of time.

Accordingly, the Company believes that its future success will be dependent on its ability to continue expanding and improving its technology platform by, among other things, constantly refining and improving its processes, optimizing its existing amorphous alloy compositions for various applications, and developing and improving new bulk amorphous alloy compositions.

The Company’s revenues are derived from i) selling bulk amorphous alloy custom products and parts for applications which include, but are not limited to, non-consumer electronic devices, medical products, automotive components, and sports and leisure goods; ii) selling tooling and prototype parts such as demonstration parts and test samples for customers with products in development; and iii) product licensing and royalty revenue.

The Company’s revenues are derived from i) selling bulk Liquidmetal alloy products to customers who produce medical devices, automotive assemblies, sports and leisure goods, and non-consumer electronic devices, ii) selling tooling and prototype parts such as demonstration parts and test samples for customers with products in development, iii) product licensing and royalty revenue, and iv) research and development revenue.

The Company expects that these sources of revenue will continue to significantly change the character of the Company’s revenue mix.

BASIS OF PRESENTATION AND RECENT ACCOUNTING PRONOUNCEMENTS

The accompanying unaudited interim consolidated financial statements as of and for the three and nine months ended September 30, 2024 and 2023 have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) for interim financial information and in accordance with the instructions to Form 10 -Q.

The accompanying unaudited interim consolidated financial statements as of and for the three months ended March 31, 2025 and 2024 have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) for interim financial information and in accordance with the instructions to Form 10 -Q.

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

1 unchanged sentence

All intercompany balances and transactions have been eliminated in consolidation.

Operating results for the three and nine months ended September 30, 2024 are not necessarily indicative of the results that may be expected for any future periods or the year ending December 31, 2024.

Operating results for the three months ended March 31, 2025 are not necessarily indicative of the results that may be expected for any future periods or the year ending December 31, 2025.

The accompanying unaudited consolidated financial statements should be read in conjunction with the Company's 2023 Annual Report on Form 10 -K filed with the Securities and Exchange Commission (“SEC”) on March 13, 2025.

5 unchanged sentences

The Company evaluates its debt securities with unrealized losses on a quarterly basis for potential other-than-temporary impairments in value.

As a result of this assessment, the Company did not recognize any other-than-temporary impairment losses considered to be credit related for the three and nine months ended September 30, 2024 and 2023.

As a result of this assessment, the Company did not recognize any other-than-temporary impairment losses considered to be credit related for the three months ended March 31, 2025 and 2024.

Investments in Debt Securities

The Company will invest excess funds to maximize investment yield, while maintaining liquidity and minimizing credit risk.

3 unchanged sentences

The Company evaluates its debt securities with unrealized losses on a quarterly basis for potential other-than-temporary impairments in value.

As a result of this assessment, the Company did not recognize any other-than-temporary impairment losses considered to be credit related for the three months ended March 31, 2025 and 2024.

The Company will invest excess funds to maximize investment yield, while maintaining liquidity and minimizing credit risk.

Debt securities are carried at fair value and consist primarily of investments in obligations of the United States Treasury, various U.S.

and foreign corporations, and certificates of deposits.

The Company classifies its investments in debt securities as available-for-sale with all unrealized gains or losses included as part of other comprehensive income.

The Company evaluates its debt securities with unrealized losses on a quarterly basis for potential other-than-temporary impairments in value.

As a result of this assessment, the Company did not recognize any other-than-temporary impairment losses considered to be credit related for the three months ended March 31, 2025 and 2024.

Fair Value Measurements

8 unchanged sentences

Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

As of September 30, 2024, the following table represents the Company’s fair value hierarchy for items that are required to be measured at fair value on a recurring basis:

As of March 31, 2025, the following table represents the Company’s fair value hierarchy for items that are required to be measured at fair value on a recurring basis:

Investments in debt securities (short-term)

9 unchanged sentences

The lease provides for a fixed base rent and variable payments comprised of reimbursements for property taxes, insurance, utilities, and common area maintenance.

The lease has a term of sixty-two months, exclusive of options to renew.

The lease has a term of 5 years ending on April 30, 2030.

In accordance with ASC 842, Leases, lease income, which includes escalating rents over the term of the lease, is recorded on a straight-line basis over the expected lease term.

4 unchanged sentences

SIGNIFICANT TRANSACTIONS

Amorphology License Agreement

On March 15, 2024, Liquidmetal Technologies, Inc.

(the “Company”) entered into a First Amendment to License Agreement (the “First Amendment”) with Amorphology Inc.

(“Amorphology”), which amended a License Agreement, dated November 22, 2019, previously entered into by the Company and Amorphology (the “Original License Agreement,” and together with the First Amendment, the “Amended License Agreement”).

The Company has determined that, as a result of the First Amendment, the Amended License Agreement has become a material definitive agreement of the Company.

The Amended License Agreement grants Amorphology a non-exclusive royalty bearing license under all patents, patent applications, and technical information of the Company in existence as of the date of the First Amendment to make, use, offer to sell, sell, export, and import products utilizing Engel injection molding machines in a field of use consisting of the worldwide industry for amorphous metal parts and components, excluding consumer electronic products, jewelry, certain luxury products, and other product categories and territories that are subject to a license grant to third parties.

The license bears a running royalty equal to a percentage of Amorphology’s sales of licensed products as well as for sales to customers referred to Amorphology by the Company.

The Company may also utilize Amorphology as a third -party contract manufacturer.

The Amended License Agreement is for a term of five ( 5 ) years, with automatic 1 -year extensions unless terminated by either party upon at least 6 months notice prior to the expiration of the then-current term.

Yihao Manufacturing Agreement

7 unchanged sentences

The purchase price for the Facility was $ 7,818 .

On January 23, 2020, 20321 Valencia, LLC, a Delaware limited liability company and wholly owned subsidiary of the Company, entered into a lease agreement (the “Facility Lease”) pursuant to which the Company leased to MatterHackers, Inc., a Delaware corporation (“Tenant”), an approximately 32,534 square foot portion of the Facility.

The lease term is for 5 years and 2 months and is scheduled to expire on April 30, 2025.

On January 23, 2020, 20321 Valencia, LLC, a Delaware limited liability company and wholly owned subsidiary of the Company, entered into a lease agreement pursuant to which the Company leased to MatterHackers, Inc., a Delaware corporation (“Tenant”), an approximately 32,534 square foot portion of the Facility.

The lease term was for 5 years and 2 months and expired on April 30, 2025.

On March 26, 2025, the Company entered into a new lease agreement (the “Facility Lease”) for a 5 year term commencing on May 1, 2025 and expanded the leased square footage to 40,090 square feet.

The base rent payable under the Facility Lease is $ 51,716 per month initially and is subject to periodic increases up to a maximum of approximately $ 58,000 per month.

Tenant will pay approximately 79 % of common operating expresses.

The Facility Lease has other customary provisions, including provisions relating to default and usage restrictions.

The Facility Lease grants to Tenant a right to extend the lease for one additional 60 -month period at market rental value.

Tenant will pay approximately 98 % of building operating expenses.

The Facility Lease grants the Company or Tenant the right to terminate the Facility Lease after two and a half years into the lease term and has other customary provisions, including provisions relating to default and usage restrictions.

2016 Purchase Agreement

4 unchanged sentences

The warrant will expire on the tenth anniversary of its issuance date.

The 2016 Purchase Agreement also provided that, with certain limited exceptions, if the Company issues any shares of common stock at any time through the fifth anniversary of the 2016 Purchase Agreement, the Investor will have a preemptive right to subscribe for and to purchase at the same price per share (or at market price, in the case of issuance of shares pursuant to stock options) the number of shares necessary to maintain its ownership percentage of Company-issued shares of common stock.

Eontec License Agreement

On March 10, 2016, in connection with the 2016 Purchase Agreement, the Company and DongGuan Eontec Co., Ltd., a Hong Kong corporation (“Eontec”), entered into a Parallel License Agreement (the “License Agreement”) pursuant to which the Company and Eontec agreed to cross-license their respective technologies.

The Company’s Chairman, Professor Li, is also the Chairman of Eontec.

The License Agreement provides for the cross-license of certain patents, technical information, and trademarks between the Company and Eontec.

5 unchanged sentences

Eutectix Business Development Agreement

On January 31, 2020, the Company entered into a Business Development Agreement (the “Agreement”) with Eutectix, LLC, a Delaware limited liability company (“Eutectix”), which provides for collaboration, joint development efforts, and the manufacturing of products based on the Company’s proprietary amorphous metal alloys.

Under the Agreement, the Company licensed to Eutectix specified equipment owned by the Company, including two injection molding machines, two diecasting machines, and other machines and equipment, all of which will be used to make product for Company customers and Eutectix customers.

The licensed machines and equipment represented substantially all of the machinery and equipment then held by the Company.

The Company has also licensed to Eutectix various patents and technical information related to the Company’s proprietary technology.

Under the Agreement, Eutectix agreed to pay the Company a royalty of six percent ( 6 %) of the net sales price of licensed products sold by Eutectix, and Eutectix will also manufacture for the Company product ordered by the Company.

The Agreement has a term of five years, subject to renewal provisions and the ability of either party to terminate earlier upon specified circumstances.

On January 31, 2020, the Company entered into a Business Development Agreement (the “Agreement”) with Eutectix, LLC, a Delaware limited liability company (“Eutectix”), which provided for collaboration, joint development efforts, and the manufacturing of products based on the Company’s proprietary amorphous metal alloys.

Under the Agreement, the Company licensed to Eutectix specified equipment owned by the Company and also licensed various patents and technical information related to the Company’s proprietary technology.

The Agreement expired on January 31, 2025.

Apple License Transaction

1 unchanged sentence

(“Apple”) pursuant to which (i) the Company contributed substantially all of its intellectual property assets to a newly organized special-purpose, wholly-owned subsidiary, called Crucible Intellectual Property, LLC (“CIP”), (ii) CIP granted to Apple a perpetual, worldwide, exclusive license to commercialize such intellectual property in the field of consumer electronic products, as defined in the license agreement, in exchange for a one -time, upfront license fee, and (iii) CIP granted back to the Company a perpetual, worldwide, fully-paid, exclusive license to commercialize such intellectual property in all other fields of use.

Under the agreements relating to the license transaction with Apple, the Company was obligated to contribute, to CIP, all intellectual property developed through February 2016.

The Company is also obligated to maintain certain limited liability company formalities with respect to CIP at all times after the closing of the license transaction.

Liquidmetal Golf Sublicense Agreement

7 unchanged sentences

Under the agreement, LMG granted ATJ a nonexclusive worldwide sublicense to the Company’s amorphous alloy technology and related trademarks to manufacture and sell golf clubs and golf related products.

The LMG Sublicense Agreement has a term of three years and provides for the payment of a running royalty to LMG of 3 % of the net sales price of licensed products.

The original term of three years was extended to have automatic, annual renewals and provided for the payment of a running royalty to LMG of 3 % of the net sales price of licensed products.

Swatch Group License

13 unchanged sentences

$ 17,077 $ 16,235 $ 17,205 $ 16,330

Income from these investments totaled $ 258 and $ 775 during the three and nine months ended September 30, 2024, respectively, and $ 157 and $ 400 during the three and nine months ended September 30, 2023, respectively.

Income from these investments totaled $ 251 and $ 236 during the three months ended March, 2024 and 2023, respectively.

Such amounts are included as a portion of interest and investment income on the Company’s consolidated statements of operations.

Based on the Company’s review of its debt securities that are individually in an unrealized loss position at September 30, 2024, it was determined that the losses were primarily the result of current economic factors, impacting all global debt and equity markets, that are the result of global macro events.

Based on the Company’s review of its debt securities that are individually in an unrealized loss position at March 31, 2025, it was determined that the losses were primarily the result current economic factors, impacting all global debt and equity markets, that are the result of global macro events.

The impact of the Company’s investment portfolio is considered to be temporary, rather than a deterioration of overall credit quality.

As of September 30, 2024, all investments are current on their scheduled interest and dividend payments.

As of March 31, 2025, all investments are current on their scheduled interest and dividend payments.

The Company does not intend to sell and it is not likely that the Company will be required to sell these securities prior to recovering their amortized cost.

As such, the Company does not consider these securities to be other-than-temporarily impaired as of September 30, 2024.

Trade Accounts Receivable

Trade accounts receivable consisted of the following:

September 30,

As such, the Company does not consider these securities to be other-than-temporarily impaired as of March 31, 2025.

Investment in debt securities activities consisted of the following:

Three months ended March 31,

Investment in debt securities – beginning balance

$ 16,330 $ 14,390

Sales at cost

( 3,809 ) ( 3,923 )

Realized gain from sale of investment in debt securities

Interest and dividend income

Unrealized gain

Professional management fees and other fees

( 14 ) ( 13 )

Withdrawals from debt securities

( 338 ) ( 248 )

Investment in debt securities – ending balance

17,205 13,685

Less – current portion

( 8,097 ) ( 13,292 )

Investment in debt securities – non-current

$ 9,108 $ 393

TRADE ACCOUNTS RECEIVABLE

Allowance for doubtful accounts

Total trade accounts receivable, net

Trade accounts receivable were comprised of the following:

Accounts receivables

PREPAID EXPENSES AND OTHER CURRENT ASSETS

Prepaid expenses and other current assets consisted of the following:

September 30,

Prepaid expenses and other current assets were comprised of the following:

Prepaid service invoices

2 unchanged sentences

Interest and other receivables

Inventories consisted of the following:

September 30,

Inventories were comprised of the following:

Work in progress

Finished goods

Property and Equipment, net

Property and equipment consist of the following:

September 30,

PROPERTY AND EQUIPMENT

Property and equipment were comprised of the following:

Land, building, and improvements

$ 9,610 $ 9,610

Machinery and equipment

1 unchanged sentence

Office equipment, furnishings, and improvements

11,237 11,237

Accumulated depreciation

Total property and equipment, net

Depreciation expense for three and nine months ended September 30, 2024 was $ 78 and $ 233 , respectively.

Depreciation expense for three and nine months ended September 30, 2023 was $ 78 and $ 234 , respectively.

Such amounts were included in selling, marketing, general, and administrative expenses within the Company’s consolidated statements of operations.

( 3,958 ) ( 3,880 )

$ 7,279 $ 7,357

Depreciation expense for three months ended March 31, 2025 and 2024 were $ 78 and $ 78 , respectively.

Such amounts were included in selling, marketing, general, and administrative expenses within Company’s consolidated statements of operations.

PATENTS AND TRADEMARKS, NET

Patents and trademarks consisted of the following:

September 30,

Patents and trademarks were comprised of the following:

Purchased and licensed patent rights

Internally developed patents

Total intangible assets

Accumulated amortization

Accumulated depreciation

( 2,368 ) ( 2,365 )

Total intangible assets, net

Purchased patent rights represent the exclusive right to commercialize the bulk amorphous alloy and other amorphous alloy technology acquired from California Institute of Technology (“Caltech”), through a license agreement with Caltech and other institutions.

4 unchanged sentences

The Company amortizes capitalized patents and trademarks over an average of 10 -to- 17 -year periods.

Amortization expense for patents and trademarks was $ 4 and $ 13 for the three and nine months ended September 30, 2024, respectively, and $ 4 and $ 16 for the three and nine months ended September 30, 2023, respectively.

Other assets consisted of the following:

September 30,

Amortization expense for patents and trademarks was $ 4 and $ 4 for the three months ended March 31, 2025 and 2024, respectively.

Other assets were comprised of the following:

Utility deposits

1 unchanged sentence

ACCRUED LIABILITIES

Accrued liabilities consisted of the following:

September 30,

Accrued liabilities were comprised of the following:

Accrued payroll, vacation, and bonuses

Other accrued liabilities

Accrued audit fees

OTHER CURRENT LIABILITIES

Other current liabilities consisted of the following:

September 30,

Aged payables to vendors, individuals, and other third parties

Tenant deposits

Aged payables to vendors, individuals, and other third parties consisted of payables that have been outstanding for more than 5 years.

Other long-term liabilities was $ 902 as of March 31, 2025 and December 31, 2024, and consisted of $ 859 of long-term, aged payables to vendors, individuals, and other third parties that have been outstanding for more than 5 years.

Also included in the balance is $ 43 in tenant deposits under the Facility Lease.

STOCK COMPENSATION PLANS

On June 28, 2012, the Company adopted the 2012 Equity Incentive Plan ( “2012 Plan”), with the approval of the shareholders, which provided for the grant of stock options to officers, employees, consultants and directors of the Company and its subsidiaries.

The 2012 Plan provides for the granting to employees of incentive stock options within the meaning of Section 422 of the Internal Revenue Code of 1986, as amended, and for the granting to employees and consultants of non-statutory stock options.

In addition, the Plan permits the granting of stock appreciation rights, or SARs, with or independently of options, as well as stock bonuses and rights to purchase restricted stock.

A total of 30,000,000 shares of the Company’s common stock may be granted under the 2012 Equity Incentive Plan, and all options granted under this plan had exercise prices that were equal to the fair market value on the date of grant.

On December 16, 2021, the Company granted option grants under the Company’s 2012 Equity Incentive Plan, as approved to by the Board, for employees up to 1,400,000 shares of the Company’s common stock in total.

Under this plan, the Company had outstanding grants of options to purchase 3,073,000 and 2,993,000 shares of the Company’s common stock as of September 30, 2024 and December 31, 2023, respectively.

Under this plan, the Company had outstanding grants of options to purchase 3,048,000 and 3,073,000 shares of the Company’s common stock as of March 31, 2025 and December 31, 2024, respectively.

The 2012 Plan expired in June 2022.

On January 27, 2015, the Company adopted its 2015 Equity Incentive Plan ( “2015 Plan”), which provided for the grant of stock options to officers, employees, consultants and directors of the Company and its subsidiaries.

A total of 40,000,000 shares of the Company’s common stock are available for issuance under the 2015 Plan.

A total of 40,000,000 shares of the Company’s common stock were available for issuance under the 2015 Plan.

All options granted under the 2015 Plan had exercise prices that were equal to the fair market value on the dates of grant.

Under the 2015 Plan, the Company granted options on July 7, 2021 to purchase 7,500,000 shares of Company common stock to Mr.

Chung, options on December 16, 2021 to purchase 600,000 shares of Company’s common stock to directors, and options on March 12, 2024 to purchase 9,250,000 shares of Company’s common stock to employees and director.

Under this plan, the Company had outstanding grants of options to purchase 37,844,992 and 23,511,667 as of March 31, 2025 and December 31, 2024, respectively.

The 2015 Plan expired in January 2025.

FASB ASC 718, Compensation – Stock Compensation, requires all share-based payments to employees, including grants of employee stock options, to be recognized in the financial statements based on their fair values.

Under ASC 718, the Company is required to measure the cost of employee services received in exchange for stock options and similar awards based on the grant-date fair value of the award and recognize this cost in the income statement over the period during which an employee is required to provide service in exchange for the award.

Stock based compensation expense attributable to these plans was $ 42 and $ 105 for the three and nine months ended September 30, 2024, respectively, and $ 17 and $ 89 for the three and nine months ended September 30, 2023, respectively.

Stock based compensation expense attributable to these plans was $ 54 and $ 25 for the three months ended March 31, 2025 and 2024, respectively.

Expected volatilities are based on historical volatility expected over the expected life of the options.

4 unchanged sentences

Treasury rates in effect at the time of grant.

Facility Lease

FACILITY LEASES

Amounts collected under the Facility Lease are comprised of base rents and reimbursements for direct facility expenses (property taxes and insurance), common area maintenance, and utilities.

Amounts recorded to lease income are comprised of base rents and direct facility expenses, recorded on a straight-line basis over the lease term.

Reimbursements for common area maintenance and utility expenses are recorded as reductions to like expenses within sales, general, and administrative costs.

Reimbursements for common area maintenance and utility expense are recorded as reductions to like expenses within sales, general, and administrative costs.

The future minimum rents due to the Company under the Facility Lease are as follows:

2024 (remaining three months)

2025 (remaining nine months)

Loss Per Common Share

1 unchanged sentence

Diluted EPS reflects the potential dilution of securities that could share in the earnings.

Options to purchase 26,584,667 shares of common stock at prices ranging from $ 0.05 to $ 0.38 per share were outstanding at September 30, 2024, but were not included in the computation of diluted EPS for the same period as the inclusion would have been antidilutive, given the Company’s net loss.

Options to purchase 19,101,167 shares of common stock at prices ranging from $ 0.07 to $ 0.38 per share were outstanding as of September 30, 2023, but were not included in the computation of diluted EPS for the same period as the inclusion would have been antidilutive, given the Company’s net loss.

Warrants to purchase 10,066,809 shares of common stock, priced at $ 0.07 per share, outstanding at each of September 30, 2024 and September 30, 2023 were not included in the computation of diluted EPS for the same period as the inclusion would have been antidilutive, given the Company’s net loss.

Options to purchase 40,892,992 shares of common stock at prices ranging from $ 0.05 to $ 0.38 per share were outstanding at March 31, 2025, but were not included in the computation of diluted EPS for the same period as the inclusion would have been antidilutive, given the Company’s net loss.

Options to purchase 26,724,667 shares of common stock at prices ranging from $ 0.05 to $ 0.38 per share were outstanding at March 31, 2024, but were not included in the computation of diluted EPS for the same period as the inclusion would have been antidilutive, given the Company’s net loss.

Warrants to purchase 10,066,809 shares of common stock, priced at $ 0.07 per share, outstanding at each of March 31, 2025 and March 31, 2024 were not included in the computation of diluted EPS for the same period as the inclusion would have been antidilutive, given the Company’s net loss.

Related Party Transactions

On March 10, 2016, the Company entered into the 2016 Purchase Agreement with Liquidmetal Technology Limited, providing for the purchase of 405,000,000 shares of the Company’s common stock for an aggregate purchase price of $ 63,400 .

Liquidmetal Technology Limited was a newly formed company owned by our Chairman, Professor Li.

In connection with the 2016 Purchase Agreement and also on March 10, 2016, the Company and Eontec entered into a license agreement, pursuant to which the Company and Eontec entered into a cross-license of their respective technologies.

Eontec is a publicly held Hong Kong corporation of which Professor Li is the Chairman.

Eontec is also an affiliate of Yihao.

Yihao is currently the Company’s primary contract manufacturer.

As of September 30, 2024 and December 31, 2023, Professor Li is a greater-than 5 % beneficial owner of the Company and serves as the Company’s Chairman.

Equipment and services procured from Eontec, and their affiliates, were $ 143 and $ 258 during the three and nine months ended September 30, 2024, respectively, and $ 43 and $ 78 during the three and nine months ended September 30, 2023, respectively.

As of September 30, 2024 and December 31, 2023, the Company has outstanding payables to Eontec, and their affiliates of $ 96 and $ 30 , respectively.

Eontec is an affiliate of Yihao which is currently the Company’s primary contract manufacturer.

As of March 31, 2025 and December 31, 2024, Professor Li is a greater-than 5 % beneficial owner of the Company and serves as the Company’s Chairman.

Equipment and services procured from Yihao were $ 117 and $ 115 during the three months ended March 31, 2025 and 2024, respectively.

As of March 31, 2025 and December 31, 2024, the Company has outstanding payables to Yihao of $ 59 and $ 70 , respectively.

On May 10, 2022, Mr.

27 unchanged sentences

Our Liquidmetal® family of alloys consists of a variety of proprietary bulk alloys and composites that utilize the advantages offered by amorphous alloy technology.

We work with partners to design, develop, and sell custom products and parts from bulk amorphous alloys for sale in various industries.

We design, develop, and sell custom products and parts from bulk amorphous alloys to customers in various industries.

We also partner with third-party manufacturers and licensees to develop and commercialize Liquidmetal alloy products.

6 unchanged sentences

Moreover, we believe these advantages could enable the introduction of entirely new products and applications that are not possible or commercially viable with other materials.

Our bulk amorphous alloy technology is a relatively new technology as compared to many other material technologies, such as plastics and widely-used high-performance crystalline alloys.

Historically, the successful commercialization of a new material technology has required the persistent improvement and refining of the technology over a sometimes lengthy period of time.

Accordingly, we believe that our Company’s future success will be dependent on our ability to continue expanding and improving our technology platform by, among other things, constantly refining and improving our processes, optimizing our existing amorphous alloy compositions for various applications, and developing and improving new bulk amorphous alloy compositions.

Our revenues are derived from i) selling our bulk amorphous alloy custom products and parts for applications which include, but are not limited to, non-consumer electronic devices, medical products, automotive components, and sports and leisure goods; ii) selling tooling and prototype parts such as demonstration parts and test samples for customers with products in development; and iii) product licensing and royalty revenue.

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SIGNIFICANT TRANSACTIONS

Amorphology License Agreement

On March 15, 2024, Liquidmetal Technologies, Inc.

(the “Company”) entered into a First Amendment to License Agreement (the “First Amendment”) with Amorphology Inc.

The Company has determined that, as a result of the First Amendment, the Amended License Agreement has become a material definitive agreement of the Company.

The following is a description of the material terms and conditions of the Amended License Agreement:

The license bears a running royalty equal to a percentage of Amorphology’s sales of licensed products as well as for sales to customers referred to Amorphology by the Company.

The Company may also utilize Amorphology as a third-party contract manufacturer.

The Amended License Agreement is for a term of five (5) years, with automatic 1-year extensions unless terminated by either party upon at least 6 months notice prior to the expiration of the then-current term.

Yihao Manufacturing Agreement

On January 12, 2022, Liquidmetal Technologies entered into a manufacturing agreement (“Manufacturing Agreement”) with Dongguan Yihao Metal Materials Technology Co.

(“Yihao”) to become the primary outsourced manufacturer of the Company’s products.

Under the Manufacturing Agreement, which has a term of five years, Yihao has agreed to serve as a non-exclusive contract manufacturer for amorphous alloy parts offered and sold by the Company at prices determined on a “cost-plus” basis.

(“Yihao”) to become the primary outsourced manufacturer of our products.

Under the Manufacturing Agreement, which has a term of five years, Yihao has agreed to serve as a non-exclusive contract manufacturer for amorphous alloy parts offered and sold by the us at prices determined on a “cost-plus” basis.

Yihao is an affiliate of Dongguan Eontec Co.

and Professor Lugee Li, our Chairman and largest beneficial owner of the Company’s capital stock.

and Professor Lugee Li, our Chairman and largest beneficial owner of our capital stock.

Liquidmetal Golf License

On January 13, 2022, our Liquidmetal Golf subsidiary entered into a sublicense agreement (“LMG Sublicense Agreement”) with Amorphous Technologies Japan, Inc.

On January 13, 2022, our Liquidmetal Golf subsidiary (“Liquidmetal Golf” or “LMG”) entered into a sublicense agreement (“LMG Sublicense Agreement”) with Amorphous Technologies Japan, Inc.

(“ATJ”), a newly formed Japanese entity that was established by Twins Corporation, a sporting goods company operating in Japan.

The LMG Sublicense Agreement has a term of three years and provides for the payment of a running royalty to LMG of 3% of the net sales price of licensed products.

Under the agreement, LMG granted ATJ a nonexclusive worldwide sublicense to our amorphous alloy technology and related trademarks to manufacture and sell golf clubs and golf related products.

The original term of three years as extended to have automatic, annual renewals and provided for the payment of a running royalty to LMG of 3% of the net sales price of licensed products.

Corporate Facility Purchase and Lease

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The purchase price for the Facility was $7,818.

On January 23, 2020, 20321 Valencia, LLC, a Delaware limited liability company and our wholly owned subsidiary, entered into a lease agreement (the “Facility Lease”) pursuant to which we leased to MatterHackers, Inc., a Delaware corporation (“Tenant”), an approximately 32,534 square foot portion of the Facility.

The lease term is for 5 years and 2 months and is scheduled to expire on April 30, 2025.

On January 23, 2020, 20321 Valencia, LLC, a Delaware limited liability company and our wholly owned subsidiary, entered into a lease agreement pursuant to which we leased to MatterHackers, Inc., a Delaware corporation (“Tenant”), an approximately 32,534 square foot portion of the Facility.

The lease term was for 5 years and 2 months and is scheduled to expire on April 30, 2025.

On March 26, 2025, we entered into a new lease agreement (the “Facility Lease”) for a 5 year term commencing on May 1, 2025 and expanded the leased square footage to 40,090 square feet.

The base rent payable under the Facility Lease is $51,716 per month initially and is subject to periodic increases up to a maximum of approximately $58,000 per month.

Tenant will pay approximately 79% of common operating expresses.

The Facility Lease has other customary provisions, including provisions relating to default and usage restrictions.

The Facility Lease grants to Tenant a right to extend the lease for one additional 60-month period at market rental value.

Tenant will pay approximately 98% of building operating expenses.

The Facility Lease grants us or Tenant the right to terminate the Facility Lease after two and a half years into the lease term and has other customary provisions, including provisions relating to default and usage restrictions.

2016 Purchase Agreement

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The transaction occurred in multiple closings, with the Investor having purchased 105,000,000 shares at a purchase price of $8,400 (or $0.08 per share) at the initial closing on March 10, 2016, and the remaining 200,000,000 shares at $0.15 per share and 100,000,000 shares at $0.25 per share for an aggregate purchase price of $55,000 on October 26, 2016.

On October 10, 2024, the Investor sold 179,787,888 to various buyers leaving 225,212,112 shares of our common stock owned by the Investor as of December 31, 2024.

In addition to the shares issuable under the 2016 Purchase Agreement, we issued to the Investor a warrant to acquire 10,066,809 shares of common stock (of which the right to exercise 2,609,913 of the warrant shares vested on March 10, 2016 and the right to exercise the remaining 7,456,896 warrant shares vested on October 26, 2016, all at an exercise price of $0.07 per share).

The warrant will expire on the tenth anniversary of its issuance date.

The 2016 Purchase Agreement also provided that, with certain limited exceptions, if we issue any shares of common stock at any time through the fifth anniversary of the 2016 Purchase Agreement, the Investor will have a preemptive right to subscribe for and to purchase at the same price per share (or at market price, in the case of issuance of shares pursuant to stock options) the number of shares necessary to maintain its ownership percentage of our issued shares of common stock.

Eontec License Agreement

On March 10, 2016, in connection with the 2016 Purchase Agreement, we entered into a Parallel License Agreement (the “License Agreement”) with DongGuan Eontec Co., Ltd., a Hong Kong corporation (“Eontec”) pursuant to which we each entered into a cross-license of our respective technologies.

Our Chairman, Professor Li, is also the Chairman of Eontec.

On March 10, 2016, in connection with the 2016 Purchase Agreement, we entered into a Parallel License Agreement (the “License Agreement”) with DongGuan Eontec Co., Ltd., a Hong Kong corporation (“Eontec”) pursuant to which we agreed to perpetually cross-license our respective technologies.

The License Agreement provides for the cross-license of certain patents, technical information, and trademarks between us and Eontec.

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Eutectix Business Development Agreement

On January 31, 2020, the Company entered into a Business Development Agreement (the “Agreement”) with Eutectix LLC, a Delaware limited liability company (“Eutectix”), which provides for collaboration, joint development efforts, and the manufacturing of products based on the Company’s proprietary amorphous metal alloys.

Under the Agreement, the Company has licensed to Eutectix specified equipment owned by the Company, including two injection molding machines, two diecasting machines, and other machines and equipment, all of which will be used to make product for Company customers and Eutectix customers.

The licensed machines and equipment represent substantially all of the machinery and equipment then held by the Company.

The Company has also licensed to Eutectix various patents and technical information related to the Company’s proprietary technology.

Under the Agreement, Eutectix will pay the Company a royalty of six percent (6%) of the net sales price of licensed products sold by Eutectix, and Eutectix will also manufacture for the Company product ordered by the Company.

The Agreement has a term of five years, subject to renewal provisions and the ability of either party to terminate earlier upon specified circumstances.

On January 31, 2020, we entered into a Business Development Agreement (the “Agreement”) with Eutectix LLC, a Delaware limited liability company (“Eutectix”), which provided for collaboration, joint development efforts, and the manufacturing of products based on the Company’s proprietary amorphous metal alloys.

Under the Agreement, we licensed to Eutectix specified equipment owned by us and also licensed to Eutectix various patents and technical information related to our proprietary technology.

The Agreement expired in January 2025.

Apple License Transaction

On August 5, 2010, we entered into a license transaction with Apple pursuant to which (i) we contributed substantially all of our intellectual property assets to a newly organized special-purpose, wholly-owned subsidiary, Crucible Intellectual Property, LLC (“CIP”), (ii) CIP granted to Apple a perpetual, worldwide, fully-paid, exclusive license to commercialize such intellectual property in the field of consumer electronic products, as defined in the license agreement, in exchange for a license fee, and (iii) CIP granted back to us a perpetual, worldwide, fully-paid, exclusive license to commercialize such intellectual property in all other fields of use.

Under the agreements relating to the license transaction with Apple, we were obligated to contribute to CIP all intellectual property that we developed through February 2016.

We are also obligated to maintain certain limited liability company formalities with respect to CIP at all times after the closing of the license transaction.

Swatch Group License

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RESULTS OF OPERATIONS

Comparison of the three months ended September 30, 2024 and 2023

Three Months Ended September 30,

Comparison of the three months ended March 31, 2025 and 2024

Three Months Ended March 31,

Licensing and royalties

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Other income (expense):

Interest and investment income

Investment income

Interest income

Loss from operations

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Net loss attributable to Liquidmetal Technologies shareholders

Revenue – Total revenue increased to $316 for the three months ended September 30, 2024 from $127 for the three months ended September 30, 2023.

The increase was attributable to increase in product shipments primarily related to the launch of health monitoring rings utilizing our technology.

Cost of sales – Cost of sales was $239, or 75.6% of total revenue, for the three months ended September 30, 2024, as compared to $89, or 70.1% of total revenue, for the three months ended September 30, 2023.

The increase in our cost of sales was primarily driven by lower product revenues during Q3 2023 compared to Q3 2024.

Once we are able to sustain and increase shipments of routine, commercial products and parts through our contract manufacturers, we expect our cost of sales percentages to decrease, stabilize, and be more predictable.

Gross profit – Our gross profit increased by $39 from $38 for the three months ended September 30, 2023 to $77 for the three months ended September 30, 2024.

Our gross margin percentage decreased slightly from Q3 2023 to Q3 2024.

Our gross profit percentages have fluctuated and may continue to fluctuate based on production volumes and quoted production prices per unit and may not be representative of our future business.

If we are able to sustain and increase shipments of routine, commercial products and parts through future orders to third party contract manufacturers, we expect our gross profit percentages to stabilize, increase, and be more predictable.

Selling, marketing, general and administrative – Selling, marketing, general, and administrative expenses increased by $157 to $903, or 285.8% of revenue, for the three months ended September 30, 2024 from $746, or 587.4% of revenue, for the three months ended September 30, 2023.

The increase in expenses was primarily attributable to an increase in operating expenses year over year.

Research and development – Research and development expenses stayed similar in Q3 2024 compared to Q3 2023.

Going forward, we will continue to perform research and development of new Liquidmetal alloys and related processing capabilities, albeit on a reduced basis.

We continue to invest in our technology infrastructure to expedite the adoption of our technology, but we have experienced long sales lead times for customer adoption of our technology.

Until that time when we can either (i) increase our revenues with shipments of routine, commercial products and parts through third party contract manufacturers or (ii) obtain significant licensing revenues, we expect to continue to have operating losses for the foreseeable future.

Interest and Investment Income – Interest and investment income relates to interest earned from our cash deposits and investments in debt securities for the respective periods.

Interest and investment income was $258 and $157 for the three months ended September 30, 2024 and 2023, respectively.

The increase was primarily due to higher overall yields on debt securities as a result of interest rate increases by the government in Q3 2024 compared to Q3 2023.

Lease income – Lease income relates to straight-line rental income received under the Facility Lease.

Such amounts were $89 and $89 for the three months ended September 30, 2024 and 2023, respectively.

Other income – Other income relates to employee retention tax credits for the three months ended September 30, 2024.

We did not have any in the prior year in the same period.

Comparison of the nine months ended September 30, 2024 and 2023

Nine Months Ended September 30,

Licensing and royalties

Total revenue

Revenue and operating expenses

Total revenue increased by $109 to $282 for the three months ended March 31, 2025 from $173 for the three months ended March 31, 2024.

The increase was attributable to increase in product shipments primarily related to recurring customer orders and medical device orders.

Cost of Sales .

Operating expenses:

Selling, marketing, general and administrative

Research and development

Operating loss

Other income (expense):

Interest and investment income

Loss from operations

Net loss attributable to non-controlling interest

Net loss attributable to Liquidmetal Technologies shareholders

Revenue – Total revenue increased to $731 for the nine months ended September 30, 2024 from $224 for the nine months ended September 30, 2023.

The increase was attributable to increase in product shipments primarily related to the launch of health monitoring rings utilizing our technology.

Cost of sales – Cost of sales was $560, or 76.6% of total revenue, for the nine months ended September 30, 2024, as compared to $164, or 73.2% of total revenue, for the nine months ended September 30, 2023.

The increase in our cost of sales was primarily driven by lower product revenues during nine months ended September 30, 2023 compared to nine months ended September 30, 2024.

Cost of sales was $204, or 72.3% of total revenue, for the three months ended March 31, 2025, as compared to $134, or 77.5% of total revenue, for the three months ended March 31, 2024.

The increase in our cost of sales was primarily driven by lower product revenues during Q1 2024 compared to Q1 2025.

Gross profit – Our gross profit increased by $111 from $60 for the nine months ended September 30, 2023 to $171 for the nine months ended September 30, 2024.

Gross Profit .

Our gross profit increased by $39 from $39 for the three months ended March 31, 2024 to $78 for the three months ended March 31, 2025.

Our gross margin percentage increased slightly from Q1 2024 to Q1 2025.

Our gross profit percentages have fluctuated and may continue to fluctuate based on production volumes and quoted production prices per unit and may not be representative of our future business.

Selling, marketing, general and administrative – Selling, marketing, general, and administrative expenses increased by $20 to $2,524, or 345.3% of revenue, for the nine months ended September 30, 2024 from $2,504, or 1117.9% of revenue, for the nine months ended September 30, 2023.

The increase in expenses was primarily attributable to increase in operating expenses during the nine months ended September 30, 2024 compared to the same comparative period in the prior year.

Research and development – Research and development expenses stayed similar during the nine months ended September 30, 2024 compared to the same period in the prior year.

Going forward, we will continue to perform research and development of new Liquidmetal alloys and related processing capabilities, albeit on a reduced basis.

Selling, marketing, general, and administrative expenses .

Selling, marketing, general, and administrative expenses increased by $212 to $975, or 345.7% of revenue, for the three months ended March 31, 2025 from $763, or 441.0% of revenue, for the three months ended March 31, 2024.

The increase in expenses was primarily attributable to increase in payroll expenses, a one-time severance payment to an administrative staff, and stock compensation in Q1 2025 compared to Q1 2024.

Research and development expenses .

Research and development expenses remained unchanged at $4, or 1.4% of revenue, for the three months ended March 31, 2025, and $4, or 2.3% of revenue, for the three months ended March 31, 2024.

This was primarily due to continuing efforts to perform research and development on new Liquidmetal alloys and related processing capabilities, albeit on a reduced basis.

We continue to invest in our technology infrastructure to expedite the adoption of our technology, but we have experienced long sales lead times for customer adoption of our technology.

Interest and Investment Income – Interest and investment income relates to interest earned from our cash deposits and investments in debt securities for the respective periods.

Interest and investment income was $775 and $400 for the nine months ended September 30, 2024 and 2023, respectively.

The increase was primarily due to higher overall yields on debt securities as a result of higher overall interest rates by the government during the nine months ended September 30, 2024 compared to same comparative period in the prior year.

Lease income – Lease income relates to straight-line rental income received under the Facility Lease.

Such amounts were $267 and $296 for the nine months ended September 30, 2024 and 2023, respectively.

Other income – Other income relates to collections from previously written off accounts receivables that were deemed uncollectable and employee retention tax credits for the nine months ended September 30, 2024.

We did not have any in the prior year in the same period.

Non-operational income and expenses

Investment income .

Investment income relates to realized gains earned from our investments in debt securities for the respective periods.

Investment income was $63 and $54 for the three months ended March 31, 2025 and 2024, respectively.

The increase during the three months ended March 31, 2025 is primarily due to higher overall yields on debt securities as a result of an increase in overall interest rate increases by the government and holding onto debt securities until maturity.

Interest income .

Interest income relates to interest earned from our cash deposits and investments in debt securities for the respective periods.

Interest income was $179 and $189 for the years ended December 31, 2024 and 2023, respectively.

The decrease during the three months ended March 31, 2025 is primarily due to lower overall yields on debt securities as a result of an increase in overall interest rate decreases by the government during the three months ended March 31, 2025.

Lease income .

Lease income relates to straight-line rental income received under the Facility Lease.

Such amounts were $89 and $89 for the three months ended March 31, 2025 and 2024, respectively.

Our annual net losses of $568 for the three months ended March 31, 2025 and $314 for the three months ended March 31, 2024 are primarily reflective of operating expenses associated with our on-going business as well as non-operational income, discussed above.

LIQUIDITY AND CAPITAL RESOURCES

Cash used in operating activities

Cash used in operating activities totaled $619 135 and $1,200 for the nine months ended September 30, 2024 and 2023, respectively.

Cash used in operating activities totaled $299 and $196 for the three months ended March 31, 2025 and 2024, respectively.

The cash was primarily used to fund operating expenses related to our business and product development efforts.

Cash provided by (used in) investing activities

Cash provided by (used in) investing activities totaled ($3,812) and $8,414, for the nine months ended September 30, 2024 and 2023, respectively.

Cash used in investing activities totaled $812 and cash provided by $757 for the three months ended March 31, 2025 and 2024, respectively.

Investing inflows primarily consist of proceeds from the sale of debt securities.

Investing outflows primarily consist of purchases of debt securities.

Cash provided by financing activities

The Company did not have any financing activities during the nine months ended September 30, 2024 and 2023.

Financing arrangements and outlook

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These factors have previously required that we engage in equity sales under various stock purchase agreements to support its operations and strategic initiatives.

However, as of September 30, 2024, we had $4,895 in cash and restricted cash, as well as $18,064 in investments in debt securities.

However, as of March 31, 2025, we had $4,900 in cash and restricted cash, as well as $17,205 in investments in debt securities.

We view this total of $22,105 as readily available sources of liquidity in the event needed to advance our existing strategy, and/or pursue an alternative strategy.

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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