MultiSensor AI Holdings, Inc. 10-Q

Item 1. Financial Statements. MultiSensor AI Holdings, Inc. Index to the Condensed Consolidated Financial Statements ​ ​ ​ Pages Condensed Consolidated Balance Sheets (unaudited) ​ 3 Condensed Consolidated Statements of Operations (unaudited) ​ 4 Condensed Consolidated Statements of Changes in Shareholders’ Equity (unaudited) ​ 5 Condensed Consolidated Statements of Cash Flows (unaudited) ​ 6 Notes to Condensed Consolidated Financial Statements (unaudited) ​ 7 ​ ​ ​ 2 ​ MultiSensor AI Holdings, Inc. Condensed Consolidated Balance Sheets (unaudited) (Amounts in thousands of U.S. dollars, except share and per share data) ​ ​ ​ ​ ​ ​ ​ ​ ​ June 30, 2026 ​ December 31, 2025 Assets ​ ​ ​ ​ ​ ​ ​ ​ Current assets ​ ​ ​ ​ ​ Cash and cash equivalents ​ $ 21,005 ​ $ 24,365 Trade accounts receivable, net of allowance for credit losses of $ 2 and $ 17 , respectively ​ 3,624 ​ 1,670 Inventories, current ​ 3,332 ​ 4,020 Other current assets ​ 1,142 ​ 826 Total current assets ​ $ 29,103 ​ $ 30,881 Property, plant and equipment, net ​ 3,759 ​ 4,085 Inventories, noncurrent ​ 306 ​ 379 Other noncurrent assets ​ 181 ​ 129 Total assets ​ $ 33,349 ​ $ 35,474 Liabilities and shareholders’ equity ​ ​ ​ ​ Current liabilities ​ ​ ​ ​ Accounts payable ​ $ 258 ​ $ 291 Income taxes payable ​ 7 ​ — Accrued expense ​ 772 ​ 981 Contract liabilities ​ 2,950 ​ 1,255 Other current liabilities ​ 59 ​ 121 Total current liabilities ​ $ 4,046 ​ $ 2,648 Contract liabilities, noncurrent ​ 768 ​ 751 Warrants ​ ​ — ​ ​ 10 Deferred tax liabilities, net ​ 43 ​ 33 Total liabilities ​ $ 4,857 ​ $ 3,442 Commitments and contingencies (Note 13) ​ ​ ​ ​ Shareholders’ equity ​ ​ ​ ​ Common stock, $ 0.0001 par value; 300,000,000 shares authorized as of June 30, 2026 and December 31, 2025, and 2,205,648 and 2,007,613 shares issued and outstanding as of June 30, 2026 and December 31, 2025, respectively ​ — ​ — Preferred stock, $ 0.0001 par value; 10,000,000 shares authorized as of June 30, 2026 and December 31, 2025, respectively and no shares issued or outstanding as of June 30, 2026 and December 31, 2025, respectively ​ ​ — ​ ​ — Additional paid-in capital ​ 99,762 ​ 98,371 Accumulated deficit ​ ( 71,270 ) ​ ( 66,339 ) Total shareholders’ equity ​ $ 28,492 ​ $ 32,032 Total liabilities and shareholders’ equity ​ $ 33,349 ​ $ 35,474 ​ The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. ​ 3 ​ MultiSensor AI Holdings, Inc. Condensed Consolidated Statements of Operations (unaudited) (Amounts in thousands of U.S. dollars, except share and per share data) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended June 30, ​ Six Months Ended June 30, ​ ​ 2026 ​ 2025 ​ 2026 ​ 2025 Revenue, net ​ ​ ​ $ 1,695 ​ ​ ​ $ 1,419 ​ ​ ​ $ 3,309 ​ ​ ​ $ 2,589 Cost of goods sold (exclusive of depreciation) ​ ​ 919 ​ ​ 1,084 ​ ​ 1,619 ​ ​ 1,560 Operating expenses: ​ ​ ​ ​ ​ ​ ​ ​ Selling, general and administrative ​ 2,833 ​ 2,909 ​ 5,822 ​ 7,048 Share-based compensation expense ​ ​ 187 ​ ​ 423 ​ ​ 369 ​ ​ 1,330 Depreciation ​ 360 ​ 330 ​ 712 ​ 610 Loss (gain) on asset disposal ​ ​ ( 3 ) ​ ​ ( 9 ) ​ ​ ( 18 ) ​ ​ ( 24 ) Total operating expenses ​ 3,377 ​ 3,653 ​ ​ 6,885 ​ ​ 8,964 Operating loss ​ ​ ( 2,601 ) ​ ​ ( 3,318 ) ​ ​ ( 5,195 ) ​ ​ ( 7,935 ) Interest expense (income), net ​ ( 142 ) ​ ( 11 ) ​ ( 297 ) ​ ( 15 ) Other expense (income), net ​ 15 ​ 5 ​ 14 ​ ( 180 ) Loss before income taxes ​ ​ ( 2,474 ) ​ ​ ( 3,312 ) ​ ​ ( 4,912 ) ​ ​ ( 7,740 ) Income tax expense (benefit) ​ ​ ( 14 ) ​ ​ 10 ​ ​ 19 ​ ​ 18 Net loss ​ $ ( 2,460 ) ​ $ ( 3,322 ) ​ $ ( 4,931 ) ​ $ ( 7,758 ) Weighted-average shares outstanding, basic and diluted ​ ​ ​ ​ ​ ​ ​ ​ Basic ​ 2,069,434 ​ 838,785 ​ 2,040,995 ​ 826,894 Diluted ​ 2,069,434 ​ 838,785 ​ 2,040,995 ​ 826,894 Net loss per share, basic and diluted ​ ​ ​ ​ ​ ​ ​ ​ Basic ​ $ ( 1.19 ) ​ $ ( 3.96 ) ​ $ ( 2.42 ) ​ $ ( 9.38 ) Diluted ​ ( 1.19 ) ​ ( 3.96 ) ​ ( 2.42 ) ​ ( 9.38 ) ​ The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. ​ 4 ​ MultiSensor AI Holdings, Inc. Condensed Consolidated Statements of Changes in Shareholders’ Equity (unaudited) (Amounts in thousands of U.S. dollars, except share data) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Additional ​ ​ ​ Total ​ ​ Common Stock ​ Paid- In ​ Accumulated ​ Shareholders' ​ ​ ​ ​ Shares ​ ​ ​ Amount ​ ​ ​ Capital ​ ​ ​ Deficit ​ ​ ​ Equity Balance at January 1, 2025 763,151 ​ $ — ​ $ 66,914 ​ $ ( 54,626 ) ​ $ 12,288 Net loss — ​ — ​ — ​ ( 4,436 ) ​ ( 4,436 ) Equity-based compensation transactions, net 15,996 ​ — ​ 407 ​ — ​ 407 Issuance of common stock ​ 44,793 ​ ​ — ​ ​ 4,657 ​ ​ — ​ ​ 4,657 Balance at March 31, 2025 823,940 ​ $ — ​ $ 71,978 ​ $ ( 59,062 ) ​ $ 12,916 Net loss — ​ — ​ — ​ ( 3,322 ) ​ ( 3,322 ) Equity-based compensation transactions, net 25,171 ​ — ​ 75 ​ — ​ 75 Issuance of common stock ​ 2,735 ​ ​ — ​ ​ 82 ​ ​ — ​ ​ 82 Balance at June 30, 2025 851,846 ​ $ — ​ $ 72,135 ​ $ ( 62,384 ) ​ $ 9,751 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance at January 1, 2026 2,007,613 ​ $ — ​ $ 98,371 ​ $ ( 66,339 ) ​ $ 32,032 Net loss — ​ — ​ — ​ ( 2,471 ) ​ ( 2,471 ) Equity-based compensation transactions, net ​ 4,680 ​ ​ — ​ ​ 158 ​ ​ — ​ ​ 158 Balance at March 31, 2026 2,012,293 ​ $ — ​ $ 98,529 ​ $ ( 68,810 ) ​ $ 29,719 Net loss — ​ — ​ — ​ ( 2,460 ) ​ ( 2,460 ) Equity-based compensation transactions, net ​ 18,355 ​ ​ — ​ ​ 187 ​ ​ — ​ ​ 187 Issuance of common stock ​ 175,000 ​ ​ — ​ ​ 1,046 ​ ​ — ​ ​ 1,046 Balance at June 30, 2026 2,205,648 ​ $ — ​ $ 99,762 ​ $ ( 71,270 ) ​ $ 28,492 ​ ​ The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. ​ 5 ​ MultiSensor AI Holdings, Inc. Condensed Consolidated Statements of Cash Flows (unaudited) (Amounts in thousands of U.S. dollars ) ​ ​ ​ ​ ​ ​ ​ ​ ​ Six Months Ended June 30, ​ ​ 2026 ​ 2025 Operating Activities: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net loss ​ $ ( 4,931 ) ​ $ ( 7,758 ) Adjustments to reconcile net loss to net cash provided by (used in) operating activities: ​ ​ ​ ​ Depreciation ​ 712 ​ 610 Non-cash lease activity ​ — ​ 77 Bad debt expenses (recoveries) ​ ​ 22 ​ ​ ( 1 ) Deferred income tax (income) expense ​ 10 ​ 9 Share-based compensation ​ 369 ​ 1,330 Loss (gain) on disposal of equipment ​ ​ ( 18 ) ​ ​ ( 24 ) Other (income) expenses, net ​ ​ ( 25 ) ​ ​ — Increase (decrease) in cash resulting from changes in: ​ ​ ​ ​ Trade accounts receivable ​ ( 1,976 ) ​ ( 52 ) Inventories ​ 761 ​ ( 14 ) Other current assets ​ ( 366 ) ​ 204 Other noncurrent assets ​ ​ ( 52 ) ​ ​ ( 14 ) Trade accounts payable ​ ( 49 ) ​ 245 Income taxes payable ​ 7 ​ ( 59 ) Contract liabilities ​ 1,695 ​ 1,732 Other current liabilities ​ ( 62 ) ​ ( 121 ) Right of use liabilities ​ — ​ ( 78 ) Accrued expenses ​ ( 194 ) ​ ( 46 ) Contract liabilities, noncurrent ​ ​ 17 ​ ​ ( 20 ) Net cash provided by (used in) operating activities ​ $ ( 4,080 ) ​ $ ( 3,980 ) Investing Activities: ​ ​ ​ ​ Capital expenditures ​ ( 372 ) ​ ( 929 ) Proceeds from sale of equipment ​ ​ 20 ​ ​ 24 Net cash provided by (used in) investing activities ​ $ ( 352 ) ​ $ ( 905 ) Financing Activities: ​ ​ ​ ​ Proceeds from issuances of common stock ​ ​ 1,046 ​ ​ 4,739 Tax payments associated with equity-based compensation transactions ​ ​ ( 24 ) ​ ​ ( 848 ) Repayment of Legacy SMAP promissory note ​ ​ — ​ ​ ( 172 ) Net cash provided by (used in) financing activities ​ $ 1,022 ​ $ 3,719 Net increase/(decrease) in cash, cash equivalents, and restricted cash equivalents ​ ( 3,410 ) ​ ( 1,166 ) Cash, cash equivalents, and restricted cash equivalents beginning of period ​ 24,465 ​ 4,508 Cash, cash equivalents, and restricted cash equivalents end of the period ​ $ 21,055 ​ $ 3,342 ​ ​ ​ ​ ​ ​ ​ Reconciliation of cash, cash equivalents and restricted cash equivalents at end of period: ​ ​ ​ ​ ​ ​ Cash and cash equivalents ​ $ 21,005 ​ $ 3,192 Restricted cash equivalents included in other current assets ​ ​ 50 ​ ​ 150 Cash, cash equivalents, and restricted cash equivalents end of the period ​ $ 21,055 ​ $ 3,342 ​ ​ ​ ​ ​ ​ ​ Supplemental cash flow information: ​ ​ ​ ​ Interest paid ​ $ — ​ $ — Income tax paid, net of refunds received ​ 10 ​ 110 ​ ​ ​ ​ ​ ​ ​ ​ The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. ​ 6 ​ MultiSensor AI Holdings, Inc. Notes to Condensed Consolidated Financial Statements (Unaudited; Amounts in thousands of U.S. dollars, except share data) Note 1 — Organization and Business Operations MultiSensor AI Holdings, Inc. (“MSAI,” “the Company,” “we,” “us” or “our”) together with its wholly owned subsidiaries build and deploy integrated condition monitoring and early threat detection solutions that connect multiple sensor types through a unified edge-to-cloud software architecture. Our condition intelligence platform integrates multiple sensing modalities such as thermal, visual and acoustic, among others. Customers deploy the MSAI Connect platform to continuously monitor critical assets and identify early degradation patterns (such as elevated operating temperatures) across electrical, mechanical, and environmental systems. This allows teams to intervene early and convert potential failures into planned maintenance before downtime, safety incidents, or operational disruption occur. We focus on commercial environments where operational continuity is vital and automation intensity is high, including distribution and parcel logistics networks, data centers, and select manufacturing and industrial facilities. We believe our solutions offer a compelling combination of performance, scalability, and cost efficiency relative to traditional inspection and monitoring approaches. Our digital, multi-sensor software platform is designed to support the transition from intermittent, manual asset inspections towards continuous intelligent condition monitoring. By streaming and analyzing radiometric thermal data in combination with other deployed sensor inputs, our MSAI Connect software platform can surface early anomaly signals that may not be visible or detected during periodic inspections. Our system architecture is intentionally modular and extensible, allowing for the integration of additional sensing modalities and analytics capabilities over time. While our current commercial deployments are centered primarily on thermal-based monitoring enhanced by software-driven analytics and expert review, we believe MSAI Connect’s multi-sensor foundation positions us to expand into broader predictive and prescriptive use cases. Through collaboration with several blue-chip multinational customers during development and deployment, we have validated high-value, mission-critical use cases across our target markets: distribution and logistics, manufacturing and data centers. These engagements have informed our product evolution and reinforced our belief that integrated, AI-enabled multi-sensor monitoring represents a structural shift in how industrial reliability and asset protection are managed. ​ Note 2 — Reverse Stock Split On April 13, 2026, we effected a 1 -for-40 reverse stock split (the “Reverse Stock Split”) of our common stock, par value $ 0.0001 per share (the “Common Stock”). As a result of the Reverse Stock Split, our outstanding Common Stock was reduced from 80,491,720 shares to 2,012,293 shares, and proportionate adjustments were made to the number of shares underlying our outstanding equity awards and equity incentive plans, including corresponding adjustments to exercise prices and performance thresholds, as applicable. The total number of authorized shares, the par value per share and other terms of our Common Stock were not affected by the Reverse Stock Split. Warrants Pursuant to the terms of the Warrant Agreement, dated October 18, 2021, by and between us and Continental Stock Transfer & Trust Company, and as a result of the Reverse Stock Split, the exercise price of our public warrants to purchase 8,625,000 shares of Common Stock at an exercise price of $ 11.50 per share (the “Public Warrants”), and private placement warrants to purchase up to 506,250 shares of Common Stock at an exercise price of $ 11.50 per share (the “Private Placement Warrants” and together with the Public Warrants, the “SPAC Warrants”), each issued in connection with our initial public offering, was adjusted from $ 11.50 to $ 460.00 . Additionally, the number of shares of Common Stock issuable upon exercise of the Public Warrants and Private Placement Warrants was proportionally reduced to 215,625 shares and 12,657 shares, respectively. Except as provided herein, all other terms and provisions of the SPAC Warrants remain in full force and effect. Pursuant to the terms of the Subscription Agreement, dated December 1, 2023, by and among us and certain investors signatory thereto, we issued warrants to purchase 340,250 shares of Common Stock at an exercise price of $ 11.50 per share (the “Financing Warrants”), in connection with our business combination. Under the terms of the Financing Warrants, and as a result of the Reverse Stock Split, the exercise price of the Financing Warrants was adjusted from $ 11.50 to $ 460.00 and the number of shares of Common Stock issuable upon exercise of the Financing Warrants was proportionally reduced to 8,507 shares. Except as provided herein, all other terms and provisions of the Financing Warrants remain in full force and effect. 7 ​ On October 24, 2025, we entered into that certain Securities Purchase Agreement with 325 Capital, LLC (“325 Capital”) and certain other accredited investors signatory thereto (collectively with 325 Capital, the “Investors”) , pursuant to which we sold to the Investors warrants to purchase up to 68,459,652 shares of Common Stock (the “2025 Warrants”) and such private placement, the “2025 Private Placement”). Pursuant to the terms of the 2025 Warrants, and as a result of the Reverse Stock Split, the exercise price of the 2025 Warrants was adjusted from $ 0.409 to $ 5.98 per share, and the number of shares of Common Stock issuable upon exercise of the 2025 Warrants was proportionately increased to 4,682,273.85 shares. Except as provided herein, all other terms and provisions of the 2025 Warrants remain in full force and effect. All share and per share amounts, including exercise prices and aggregate par values, conversion rates, and conversion prices presented herein that relate to periods prior to the Reverse Stock Split have been adjusted retroactively to reflect the Reverse Stock Split. Note 3 — Summary of Significant Accounting Policies Basis of Presentation The accompanying condensed consolidated financial statements of the Company and its wholly owned subsidiaries are prepared in conformity with United States (“U.S.”) generally accepted accounting principles (“GAAP”). The interim financial information is unaudited but reflects all normal adjustments that are necessary to provide a fair statement of results for the interim periods presented. This interim information should be read in conjunction with the consolidated financial statements in the 2025 Annual Report. The Condensed Consolidated Balance Sheet as of December 31, 2025 was derived from our audited consolidated financial statements. Principles of Consolidation The Company’s condensed consolidated financial statements include the accounts of the Company and its subsidiaries. All intercompany balances and transactions have been eliminated. Use of Estimates The preparation of condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in our condensed consolidated financial statements and accompanying notes. Actual results may differ materially from those estimates. Customer Concentration For the three months ended June 30, 2026, one customer accounted for 66 % or $ 1,119 of total net revenue, which was recorded under the entity’s one operating segment. For the six months ended June 30, 2026, two customers accounted for 55 % and 11 % or $ 1,821 and $ 374 of total net revenue, which was recorded under the entity’s one operating segment. New Accounting Pronouncements Recently Issued Accounting Standards Not Yet Adopted In November 2024, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2024-03 which requires disaggregation of specific expense categories in disclosures within the footnotes to the consolidated financial statements on an annual and interim basis. ASU 2024-03 is effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. Prospective or retrospective application is allowed, and early adoption is permitted. We are currently evaluating the potential effect that the updated standard may have on our consolidated financial statement disclosures. In September 2025, the FASB issued ASU 2025-06, which amends certain aspects of the accounting for and disclosure of software costs under Accounting Standards Codification 350-40. The new standard is effective for annual reporting periods and interim reporting periods beginning after December 15, 2027. Early adoption is permitted. The new standard may be applied prospectively, retrospectively, or via a modified prospective transition method. We are currently evaluating the impact of this new standard on our consolidated financial statements and related disclosures. 8 ​ Note 4 — Revenue The following tables summarize the Company’s revenue, net disaggregated by type of product and service: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended June 30, ​ Six Months Ended June 30, ​ ​ 2026 ​ ​ ​ 2025 ​ ​ ​ 2026 ​ ​ ​ 2025 Hardware ​ $ 930 ​ $ 874 ​ $ 1,843 ​ $ 1,627 Software ​ 739 ​ 400 ​ 1,414 ​ 651 Services ​ 26 ​ 145 ​ 52 ​ 311 Total revenue, net ​ $ 1,695 ​ $ 1,419 ​ $ 3,309 ​ $ 2,589 ​ The Company’s sales policy is not to accept returns of hardware once sold. As a result, there was no sales return reserve as of June 30, 2026 and December 31, 2025. Contract Liabilities ​ Contract liabilities consist of sales of software subscriptions, where in most cases, the Company receives up-front payment and recognizes revenue over the term of 12 - 48 months. The Company classifies these contract liabilities as either current or non-current liabilities based on the expected timing of recognition of related revenue. Current contract liabilities were $ 2,950 and $ 1,255 and non-current contract liabilities were $ 768 and $ 751 as of June 30, 2026 and December 31, 2025, respectively. Note 5 — Property, Plant and Equipment The following table summarizes our property, plant and equipment, net: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ June 30, ​ December 31, ​ ​ 2026 ​ 2025 Machinery, equipment and demo ​ $ 318 ​ $ 306 Internal-use software ​ 7,169 ​ 6,800 Property, plant and equipment, gross ​ $ 7,487 ​ $ 7,106 Less: accumulated depreciation ​ ( 3,728 ) ​ ( 3,021 ) Property, plant and equipment, net ​ $ 3,759 ​ $ 4,085 ​ Depreciation expense was $ 360 and $ 330 for the three months ended June 30, 2026, and 2025, respectively. Depreciation expense was $ 712 and $ 610 for the six months ended June 30, 2026, and 2025, respectively. Note 6 — Other Current Assets The following table summarizes other current assets: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ June 30, ​ December 31, ​ ​ 2026 ​ 2025 Prepaid expenses ​ $ 343 ​ $ 399 Restricted cash equivalents ​ ​ 50 ​ ​ 100 Prepaid inventory purchases and deposits ​ ​ ​ ​ 462 ​ ​ ​ ​ — Other receivables ​ 287 ​ 327 Total other current assets ​ $ 1,142 ​ $ 826 ​ During the three months ended June 30, 2026, the Company renegotiated its contract with the Company’s corporate credit card provider. As a result of this renegotiation, as of June 30, 2026, the Company is required to maintain $ 50 to collateralize the Company’s corporate credit cards. These funds are held in a money market fund invested in government-backed securities. Although the investment qualifies as a cash equivalent, the funds are not available for general use. As a result, these funds are classified as restricted cash equivalents under the caption Other current assets on the Condensed Consolidated Balance Sheets. ​ 9 ​ Note 7 — Inventories The following table summarizes inventories: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ June 30, ​ December 31, ​ ​ 2026 ​ ​ ​ 2025 Hardware ​ $ 2,379 ​ $ 2,846 Parts and supplies ​ 953 ​ 1,174 Inventories, current ​ $ 3,332 ​ $ 4,020 Hardware ​ ​ 32 ​ ​ 32 Parts and supplies ​ 274 ​ 347 Inventories, noncurrent ​ $ 306 ​ $ 379 Total inventories ​ $ 3,638 ​ $ 4,399 ​ ​ Note 8 — Accrued Expense The following table summarizes accrued expense: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ June 30, ​ December 31, ​ ​ ​ ​ 2026 ​ ​ ​ 2025 Salaries, wages, and payroll taxes payable ​ $ 416 ​ $ 683 Professional fees ​ ​ 161 ​ ​ 181 Other ​ 195 ​ 117 Total accrued expense ​ $ 772 ​ $ 981 ​ ​ ​ ​ ​ ​ ​ Note 9 — Share-Based Compensation ​ Stock Options ​ During the three months ended June 30, 2026, no option awards were granted and 4,628 option awards were forfeited. During the six months ended June 30, 2026, no option awards were granted and 4,628 option awards were forfeited. As of June 30, 2026, 3,006 option awards remained outstanding with a weighted average exercise price of $ 258.10 . During the three months ended June 30, 2025, no option awards were granted and 3,481 option awards were forfeited. During the six months ended June 30, 2025, no option awards were granted and 4,200 option awards were forfeited. As of June 30, 2025, 19,254 option awards remained outstanding with a weighted average exercise price of $ 261.88 . Restricted Stock Units ​ During the three months ended June 30, 2026 and 2025, the Company granted 5,875 and 4,360 restricted stock units subject to time-based vesting conditions (“RSUs”) at a weighted average price of $ 6.45 and $ 20.80 , respectively. During the six months ended June 30, 2026 and 2025, the Company granted 5,875 and 44,376 RSUs at a weighted average price of $ 6.45 and $ 63.20 , respectively. The grant price for all RSU awards was based on the fair value of the Company’s Common Stock on the day immediately prior to the grant. RSUs granted in the first quarter of 2025 primarily vested one-fourth of the award value on the date of grant, with the remaining restricted shares vesting in equal installments annually, while those granted in the second and third quarters of 2025 vest in equal installments annually on January 1 of each year beginning January 1, 2027. The Company recognized share-based compensation expense related to RSUs of $ 126 and $ 220 for the three-month periods ended June 30, 2026 and 2025, respectively, and $ 249 and $ 1,048 for the six-month periods ended June 30, 2026 and 2025, respectively under Share-based compensation expense on the Condensed Consolidated Statements of Operations. During the three-month period ended June 30, 2026, 1,063 unvested RSUs were forfeited, resulting in reversal of $ 4 of share-based compensation expense previously recognized on the Condensed Consolidated Statements of Operations. During the six-month period ended June 30, 2026, 1,063 unvested 10 ​ RSUs were forfeited, resulting in reversal of $ 4 of share-based compensation expense previously recognized on the Condensed Consolidated Statements of Operations. During the three-month periods ended June 30, 2026 and 2025, the Company’s non-employee directors earned $ 60 and $ 90 , respectively, in compensation for their service on the board, which was paid in the form of RSUs. During the six-month periods ended June 30, 2026 and 2025, the Company’s non-employee directors earned $ 120 and $ 170 , respectively, in compensation for their service on the board, which was paid in the form of RSUs. These grants are recognized as share-based compensation expense on the Condensed Consolidated Statements of Operations. During the three months ended June 30, 2025, the Company agreed to settle $ 113 of commissions owed to the Company’s sales force for second quarter performance in RSUs. These grants are recognized as Share-based compensation expense on the Condensed Consolidated Statement of Operations. Incentive Award Plan Reserve ​ At our annual shareholders meeting held on June 12, 2026, our shareholders approved an amendment to the Infrared Cameras Holdings, Inc. 2023 Incentive Award Plan (the “2023 Incentive Award Plan”) to increase the number of shares of Common Stock by 500,000 , to a total of 661,012 shares of Common Stock issuable pursuant to the 2023 Incentive Award Plan. At our annual shareholders meeting held on June 4, 2025, our shareholders approved an amendment to the 2023 Incentive Award Plan to increase the number of shares of Common Stock by 85,000 , to a total of 161,012 shares of Common Stock issuable pursuant to the 2023 Incentive Award Plan. Executive Officer Grants ​ Effective July 16, 2026, the Company’s board of directors approved grants of RSUs and performance stock units (“PSUs”) to Asim Akram, the Company’s Chief Executive Officer and President, and Robert Nadolny, the Company’s Chief Financial Officer and Secretary. Pursuant to the grant to Mr. Akram, Mr. Akram received 20,841 RSUs and 83,364 PSUs at target. Pursuant to the grant to Mr. Nadolny, Mr. Nadolny received 17,935 RSUs and 23,774 PSUs at target. Pursuant to Mr. Akram and Mr. Nadolny’s respective employment agreements, each of Mr. Akram and Mr. Nadolny is entitled to an additional grant of RSUs and PSUs in January 2027. The first tranche of RSUs granted will vest, if at all, in four equal installments on each of January 1, 2027, January 1, 2028, January 1, 2029 and January 1, 2030. The first tranche of PSUs granted is subject to revenue achievement levels by the Company for the year ending December 31, 2029, which were set by the Company’s board of directors, for a performance period beginning on January 1, 2026 and ending on December 31, 2029. The PSUs vest, if at all, after the end of the performance period. The payout percentages are interpolated for performance between threshold achievement of $ 31,500 in annual revenue recognized resulting in 50 % of the awards vesting and target of $ 45,000 in annual revenue recognized resulting in 100 % of the awards vesting. To the extent the Company’s revenue exceeds the target performance level, the Company’s board of directors will consider additional compensation to be payable in such form and in such amounts, if any, as the Company’s board of directors may determine to be appropriate at that time. Effective July 16, 2026, the Company’s board of directors also finalized the grants of 17,440 PSUs at target to Mr. Akram and 5,000 PSUs at target to Mr. Nadolny for the 2025 tranche that Mr. Akram and Mr. Nadolny were each entitled to pursuant to each of their respective employment agreements. The Company’s board of directors determined that the performance metric and levels for this first half of the PSUs granted pursuant to Mr. Akram and Mr. Nadolny’s employment agreements are the same as the performance metric and levels disclosed above. Each of the foregoing grants was made pursuant to the 2023 Incentive Award Plan. ​ Note 10 — Shareholders’ Equity Total authorized capital stock of the Company as of June 30, 2026, is 300,000,000 shares of Common Stock and 10,000,000 shares of preferred stock, par value of $ 0.0001 per share. As of June 30, 2026 and December 31, 2025, there were 2,205,648 and 2,007,613 shares of Common Stock issued and outstanding and no shares of preferred stock issued or outstanding, respectively. 11 ​ Equity Line of Credit (“ELOC”) On April 16, 2024, we entered into that certain common stock purchase agreement (the “Purchase Agreement”) with B. Riley Principal Capital II, LLC (“B. Riley”). Pursuant to the Purchase Agreement, we had the right, but not the obligation, to sell to B. Riley up to $ 25,000 worth of Common Stock (the “Purchase Shares”) over the term of the Purchase Agreement. In accordance with the Purchase Agreement, on April 16, 2024, we issued 4,296 shares of our Common Stock to B. Riley as consideration for its commitment to purchase the Purchase Shares under the Purchase Agreement (the “Commitment Shares”). Under the terms of the Purchase Agreement, if the aggregate amount of cash proceeds received by B. Riley from the resale of the Commitment Shares was less than $ 500 , then, upon notice by B. Riley, the Company was required to pay the difference between $ 500 and the aggregate cash proceeds received by B. Riley from its resale. On January 8, 2025, B. Riley notified the Company that it had sold the Commitment Shares, which resolved the liability. Accordingly, $ 185 was recorded in “Other expense (income), net” in the Condensed Consolidated Statements of Operations for the six months ended June 30, 2025. Effective February 2, 2026, the Company terminated the Purchase Agreement. During the three and six months ended June 30, 2026, the Company did not utilize the ELOC. During the three months ended June 30, 2025, the Company did not utilize the ELOC. During the six months ended June 30, 2025, the Company sold 44,793 shares of Common Stock under the facility for cash proceeds of $ 4,657 . At the Market Sales Agreements On March 13, 2026, the Company entered into an at market issuance sales agreement (the “2026 Sales Agreement”) with Roth Capital Partners, LLC and H.C. Wainwright & Co., LLC, as sales agents or principals (the “Agents”), under which the Company may offer and sell shares of the Company’s Common Stock having an aggregate market value of up to $ 60,000 from time to time through the Agents. The Agents are entitled to compensation at a fixed commission rate based on the gross sales price of shares sold pursuant to the 2026 Sales Agreement. During the three and six months ended June 30, 2026, the Company did not sell any shares under the 2026 Sales Agreement. On March 28, 2025, the Company entered into an at market issuance sales agreement (the “2025 Sales Agreement”) with B. Riley Securities, Inc. (“B. Riley Securities”), as sales agent or principal, pursuant to which the Company could offer and sell shares of its Common Stock having an aggregate offering price of up to $ 8,625 from time to time through B. Riley Securities. B. Riley Securities was entitled to compensation at a fixed commission rate based on the gross sales price of shares sold pursuant to the 2025 Sales Agreement. The Company terminated the 2025 Sales Agreement effective February 2, 2026. During the three and six months ended June 30, 2026, the Company did no t sell any shares under the 2025 Sales Agreement. During the three and six months ended June 30, 2025, the Company sold 2,735 shares of Common Stock under the 2025 Sales Agreement for cash proceeds totaling $ 82 . 2025 Warrants In October 2025, the Company completed the 2025 Private Placement pursuant to which it issued shares of Common Stock and the 2025 Warrants to the Investors. The 2025 Warrants have an exercise price of $ 5.98 per share (as adjusted for the Reverse Stock Split) and expire seven years from issuance. For a complete description of the 2025 Private Placement, see Note 11 to the consolidated financial statements in the 2025 Annual Report. During the three and six months ended June 30, 2026, certain Investors exercised 2025 Warrants for 175,000 shares of Common Stock at an exercise price of $ 5.98 per share, resulting in proceeds to the Company of $ 1,046 . The proceeds were recorded as an increase to Common Stock and additional paid-in capital. As of June 30, 2026, 2025 Warrants to purchase up to 4,507,273.85 shares of Common Stock (as adjusted for the Reverse Stock Split) remained outstanding. 12 ​ Note 11 — Earnings per Share The following table summarizes the computation of basic and diluted earnings per share: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended June 30, ​ ​ ​ Six Months Ended June 30, ​ ​ ​ ​ 2026 ​ ​ ​ 2025 ​ ​ ​ 2026 ​ ​ ​ 2025 Numerator: ​ ​ ​ ​ ​ ​ ​ ​ ​ Basic and diluted net loss attributable to common shareholders ​ $ ( 2,460 ) ​ $ ( 3,322 ) ​ $ ( 4,931 ) ​ $ ( 7,758 ) Denominator: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted average number of shares: ​ ​ ​ ​ ​ ​ ​ ​ Basic - common stock ​ ​ 2,069,434 ​ 838,785 ​ 2,040,995 ​ 826,894 Diluted - common stock ​ 2,069,434 ​ 838,785 ​ 2,040,995 ​ 826,894 Basic net loss per share attributable to common shareholders ​ $ ( 1.19 ) ​ $ ( 3.96 ) ​ $ ( 2.42 ) ​ $ ( 9.38 ) Diluted net loss per share attributable to common shareholders ​ $ ( 1.19 ) ​ $ ( 3.96 ) ​ $ ( 2.42 ) ​ $ ( 9.38 ) ​ The table above does not include the following potential anti-dilutive shares: (i) up to 215,625 shares of Common Stock upon exercise of the Company’s outstanding Public Warrants at an exercise price of $ 460.00 per share for cash, (ii) up to 12,657 shares of Common Stock issuable upon exercise of the Company’s outstanding Private Placement Warrants at an exercise price of $ 460.00 per share for cash, (iii) up to 8,507 shares of Common Stock upon exercise of the Financing Warrants at an exercise price of $ 460.00 per share for cash, (iv) up to 3,006 shares of Common Stock upon the exercise of Company’s options, (v) 31,456 RSU awards issued yet unvested under the 2023 Incentive Award Plan as of June 30, 2026, (vi) up to 4,507,273.85 shares of Common Stock issuable upon exercise of the Company’s outstanding 2025 Warrants at an exercise price of $ 5.98 , and (vii) up to 44,800 PSUs committed via employment agreements but unissued as of June 30, 2026. Note 12 — Related Party Transactions Leases The Company previously leased its corporate office and currently leases its production facility from a former related party. As of July 29, 2025, the lessor no longer qualified as a related party under the applicable accounting guidance, and payments made after that date did not constitute related party transactions. Total related party cash payments for the leases were $ 27 and $ 54 for the three and six-month periods ended June 30, 2025, respectively. ​ Note 13 — Commitments and Contingencies Liabilities for loss contingencies arising from claims, assessments, litigation, fines, and penalties and other sources are recorded when it is probable that a liability has been incurred and the amount can be reasonably estimated. Legal costs incurred in connection with loss contingencies are expensed as incurred. In the ordinary course of the business, the Company is subject to periodic legal or administrative proceedings. As of June 30, 2026, the Company was not involved in any material claims or legal actions which, in the opinion of management, the ultimate disposition would have a material adverse effect on the Company’s condensed consolidated financial position, results of operations, or liquidity. ​ Note 14 — Income Taxes The Company has determined that a discrete year-to-date method of reporting would provide more reliable results for the six months ended June 30, 2026, and June 30, 2025, due to the difficulty in projecting future results. The Company recorded income tax benefit of $ 14 and income tax expense of $ 10 for the three months ended June 30, 2026 and 2025, respectively. The Company recorded income tax expense for the six months ended June 30, 2026 of $ 19 and income tax expense for the six months ended June 30, 2025 of $ 18 . The Company maintains a valuation allowance on its deferred tax assets and intends to do so until there is sufficient evidence to support the reversal of all or some portion of this allowance. For the three months ended June 30, 2026, and 2025, the Company’s effective income tax rates were 0.57 % and ( 0.30 )%, respectively. For the six months ended June 30, 2026, and 2025, the Company’s effective income tax rates were ( 0.39 )% and ( 0.23 )%, respectively. The effective tax rates for the three and six months ended June 30, 2026 and June 30, 2025 were below the U.S. statutory 13 ​ tax rate of 21 % primarily due to losses generated by the Company and the Company’s valuation allowance. During 2024 and 2025, the Company determined that it experienced an ownership change as defined under Internal Revenue Code Section 382. The result of the ownership change is subjecting tax attributes to an annual limitation which includes the utilization of the Company’s net operating losses. The Company will continue to monitor ownership changes throughout future periods. Note 15 — Segments and Geographical Information The Company has one reportable and operating segment, the manufacturing and distributing of sensor-based systems, software, and services. The Company holds 99 % of its assets within the United States. The Company derives revenue primarily in the United States, Canada, European Union member states and the United Kingdom and manages the business activities on a consolidated basis. The following table summarizes revenue based upon the customers’ shipping addresses: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended June 30, ​ ​ ​ Six Months Ended June 30, ​ ​ 2026 ​ ​ ​ 2025 ​ 2026 ​ ​ ​ 2025 United States ​ $ 488 ​ $ 1,157 ​ $ 985 ​ $ 2,201 International ​ 1,207 ​ 262 ​ 2,324 ​ 388 Total revenue, net ​ $ 1,695 ​ $ 1,419 ​ $ 3,309 ​ $ 2,589 ​ The Company’s chief operating decision maker (“CODM”) is its Chief Executive Officer. The CODM uses consolidated net income to evaluate income generated from segment assets (return on assets) in deciding whether to reinvest profits into the segment or into other parts of the entity, such as for acquisitions. Net income is used to monitor budget versus actual results and to perform competitive analysis through benchmarking to competitors. The competitive analysis along with the monitoring of budgeted versus actual results are used in assessing performance of the segment and in establishing management’s compensation. The table below summarizes the significant expense categories regularly reviewed by the CODM for the three- and six-month periods ended June 30, 2026, and 2025: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended June 30, ​ Six Months Ended June 30, ​ ​ ​ ​ 2026 ​ ​ ​ 2025 ​ ​ ​ 2026 ​ ​ ​ 2025 Revenue, net ​ $ 1,695 $ 1,419 ​ $ 3,309 $ 2,589 Cost of goods sold (exclusive of depreciation) ​ 919 ​ 1,084 ​ 1,619 ​ 1,560 Operating expenses: ​ ​ ​ ​ ​ ​ ​ ​ Selling, general and administrative ​ 2,833 ​ ​ 2,909 ​ 5,822 ​ ​ 7,048 Payroll Expenses (including bonus) ​ 1,514 ​ 1,413 ​ 3,057 ​ 3,199 Professional Fees ​ 483 ​ 823 ​ 1,390 ​ 2,474 Other selling, general and administrative ​ 836 ​ 673 ​ 1,375 ​ 1,375 Other operating expenses ​ 544 ​ 744 ​ 1,063 ​ 1,916 Non-operating (income) expenses, net ​ ( 127 ) ​ ( 6 ) ​ ( 283 ) ​ ( 195 ) Provision for income taxes ​ ( 14 ) ​ 10 ​ 19 ​ 18 Net loss ​ $ ( 2,460 ) $ ( 3,322 ) ​ $ ( 4,931 ) $ ( 7,758 ) ​ See the condensed consolidated financial statements for other financial information regarding the Company’s operating segment. ​ 14 ​