Precipio, Inc. 10-Q

PRECIPIO, INC._June 30, 2026 Table of Contents ​ UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q (Mark One) ​ ​ ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 ​ For the quarterly period ended June 30, 2026 ​ ​ ​ OR ​ ​ ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 ​ For the transition period from _____ to _____ ​ Commission File Number: 001-36439 PRECIPIO, INC. (Exact name of registrant as specified in its charter) ​ ​ Delaware 91-1789357 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) ​ ​ 4 Science Park , New Haven , CT 06511 (Address of principal executive offices) (Zip Code) ​ ( 203 ) 787-7888 (Registrant’s telephone number, including area code) a Securities registered pursuant to Section 12(b) of the Act: Title of each class Trading Symbol(s) Name of each exchange on which registered Common Stock, $0.01 par value per share PRPO The Nasdaq Capital Market ​ Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ◻ Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ◻ Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act. Large accelerated filer ◻ Accelerated filer ◻ Non-accelerated filer ☒ Smaller reporting company ☒ Emerging growth company ☐ ​ ​ ​ If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act ◻ Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒ ​ As of August 10, 2026, the number of shares of common stock outstanding was 1,790,188 . ​ ​ ​ Table of Contents PRECIPIO, INC. AND SUBSIDIARIES INDEX ​ ​ ​ ​ ​ Page No. ​ ​ ​ ​ PART I. Financial Information ​ 3 ​ ​ ​ ​ Item 1. Condensed Consolidated Financial Statements ​ 3 ​ ​ ​ ​ ​ Condensed Consolidated Balance Sheets at June 30, 2026 (unaudited) and December 31, 2025 ​ 3 ​ ​ ​ ​ ​ Condensed Consolidated Statements of Operations for the Three and Six Months Ended June 30, 2026 and 2025 (unaudited) ​ 4 ​ ​ ​ ​ ​ Condensed Consolidated Statements of Stockholders’ Equity for the Three and Six Months Ended June 30, 2026 and 2025 (unaudited) ​ 5 ​ ​ ​ ​ ​ Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2026 and 2025 (unaudited) ​ 6 ​ ​ ​ ​ ​ Notes to Unaudited Condensed Consolidated Financial Statements ​ 8 ​ ​ ​ ​ Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations ​ 25 ​ ​ ​ ​ Item 3. Quantitative and Qualitative Disclosures About Market Risk ​ 31 ​ ​ ​ ​ Item 4. Controls and Procedures ​ 31 ​ ​ ​ ​ PART II. Other Information ​ 32 ​ ​ ​ ​ Item 1. Legal Proceedings ​ 32 ​ ​ ​ ​ Item 1A. Risk Factors ​ 32 ​ ​ ​ ​ Item 2 . Unregistered Sales of Equity Securities and Use of Proceeds ​ 34 ​ ​ ​ ​ Item 3 . Defaults Upon Senior Securities ​ 34 ​ ​ ​ ​ Item 4 . Mine Safety Disclosures ​ 34 ​ ​ ​ ​ Item 5 . Other Information ​ 34 ​ ​ ​ ​ Item 6. Exhibits ​ 35 ​ ​ ​ ​ Signatures ​ ​ 36 ​ ​ ​ 2 Table of Contents PART 1. FINANCIAL INFORMATION Item 1. Condensed Consolidated Financial Statements PRECIPIO, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (Dollars in thousands, except share data) ​ ​ ​ ​ ​ ​ ​ ​ ​ (unaudited) ​ ​ ​ ​ ​ ​ June 30, 2026 ​ ​ ​ December 31, 2025 ASSETS ​ ​ ​ ​ ​ ​ CURRENT ASSETS: ​ ​ ​ ​ ​ ​ Cash ​ $ 3,075 ​ $ 2,651 Accounts receivable (net of allowance for credit losses of $ 1,295 and $ 1,045 , respectively) ​ 2,279 ​ ​ 1,984 Inventories ​ 776 ​ ​ 935 Other current assets ​ 407 ​ ​ 469 Total current assets ​ 6,537 ​ ​ 6,039 ​ ​ ​ ​ ​ ​ ​ PROPERTY AND EQUIPMENT, NET ​ 1,077 ​ ​ 729 ​ ​ ​ ​ ​ ​ ​ OTHER ASSETS: ​ ​ ​ ​ ​ ​ Finance lease right-of-use assets, net ​ ​ 875 ​ ​ 998 Operating lease right-of-use assets, net ​ ​ 2,334 ​ ​ 2,565 Intangibles, net ​ 10,444 ​ ​ 10,919 Other assets ​ 54 ​ ​ 67 Total assets ​ $ 21,321 ​ $ 21,317 LIABILITIES AND STOCKHOLDERS’ EQUITY ​ ​ ​ ​ ​ ​ CURRENT LIABILITIES: ​ ​ ​ ​ ​ ​ Current maturities of long-term debt, less debt issuance costs ​ $ 73 ​ $ 30 Current maturities of finance lease liabilities ​ 195 ​ ​ 209 Current maturities of operating lease liabilities ​ 458 ​ ​ 410 Accounts payable ​ 972 ​ ​ 1,131 Accrued expenses ​ 1,639 ​ ​ 1,690 Deferred revenue ​ 364 ​ ​ 282 Total current liabilities ​ 3,701 ​ ​ 3,752 LONG TERM LIABILITIES: ​ ​ ​ ​ ​ ​ Long-term debt, less current maturities and debt issuance costs ​ 252 ​ ​ 47 Finance lease liabilities, less current maturities ​ 651 ​ ​ 751 Operating lease liabilities, less current maturities ​ 1,959 ​ ​ 2,206 Total liabilities ​ 6,563 ​ ​ 6,756 COMMITMENTS AND CONTINGENCIES (Note 5) ​ ​ ​ ​ ​ ​ STOCKHOLDERS’ EQUITY: ​ ​ ​ ​ ​ ​ Preferred stock - $ 0.01 par value, 15,000,000 shares authorized at June 30, 2026 and December 31, 2025, 47 shares issued and outstanding at June 30, 2026 and December 31, 2025, liquidation preference of $ 145 at June 30, 2026 ​ — ​ ​ — Common stock, $ 0.01 par value, 150,000,000 shares authorized at June 30, 2026 and December 31, 2025, 1,790,118 and 1,780,899 issued at June 30, 2026 and December 31, 2025, respectively, and 1,789,144 and 1,780,899 shares outstanding at June 30, 2026 and December 31, 2025, respectively ​ 18 ​ ​ 18 Additional paid-in capital ​ 119,234 ​ ​ 117,346 Treasury stock, 974 and zero shares as of June 30, 2026 and December 31, 2025, respectively ​ ​ ( 29 ) ​ ​ — Accumulated deficit ​ ( 104,465 ) ​ ​ ( 102,803 ) Total stockholders’ equity ​ ​ 14,758 ​ ​ 14,561 Total liabilities and stockholders’ equity ​ $ 21,321 ​ $ 21,317 ​ ​ ​ See notes to unaudited condensed consolidated financial statements. ​ 3 Table of Contents PRECIPIO, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Dollars in thousands, except per share data) (unaudited) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended June 30, ​ Six Months Ended June 30, ​ ​ ​ ​ ​ 2026 ​ ​ ​ 2025 ​ ​ ​ 2026 ​ ​ ​ 2025 ​ SALES: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Service revenue, net ​ $ 6,115 ​ $ 5,005 ​ $ 12,417 ​ $ 9,262 ​ Product revenue ​ 906 ​ 624 ​ 1,565 ​ 1,278 ​ Revenue, net of contractual allowances and adjustments ​ 7,021 ​ 5,629 ​ 13,982 ​ 10,540 ​ Adjustment for allowance for credit losses ​ – ​ 25 ​ ( 250 ) ​ 43 ​ Net sales ​ 7,021 ​ 5,654 ​ 13,732 ​ 10,583 ​ COST OF SALES: ​ ​ ​ ​ ​ ​ ​ ​ ​ Cost of service revenue ​ 3,454 ​ 2,873 ​ 7,159 ​ 5,339 ​ Cost of product revenue ​ 431 ​ 352 ​ 712 ​ 675 ​ Total cost of sales ​ 3,885 ​ 3,225 ​ 7,871 ​ 6,014 ​ Gross profit ​ 3,136 ​ 2,429 ​ 5,861 ​ 4,569 ​ OPERATING EXPENSES: ​ ​ ​ ​ ​ ​ ​ ​ ​ Operating expenses ​ 3,735 ​ 3,253 ​ 7,888 ​ 6,252 ​ OPERATING LOSS ​ ( 599 ) ​ ( 824 ) ​ ( 2,027 ) ​ ( 1,683 ) ​ OTHER INCOME (EXPENSE): ​ ​ ​ ​ ​ ​ ​ ​ ​ Interest expense, net ​ ( 9 ) ​ ( 23 ) ​ ( 24 ) ​ ( 48 ) ​ Gain on settlement of liability ​ – ​ 143 ​ – ​ 143 ​ Employee Retention Credit ​ ​ 389 ​ ​ 789 ​ ​ 389 ​ ​ 789 ​ Other expense ​ – ​ ( 11 ) ​ – ​ ( 11 ) ​ Total other income (expense) ​ 380 ​ 898 ​ 365 ​ 873 ​ (LOSS) INCOME BEFORE INCOME TAXES ​ ( 219 ) ​ 74 ​ ( 1,662 ) ​ ( 810 ) ​ INCOME TAX EXPENSE ​ – ​ – ​ – ​ – ​ NET (LOSS) INCOME ​ ( 219 ) ​ 74 ​ $ ( 1,662 ) ​ $ ( 810 ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net (loss) income per common share: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ BASIC (LOSS) INCOME PER COMMON SHARE ​ $ ( 0.12 ) ​ $ 0.05 ​ $ ( 0.93 ) ​ $ ( 0.54 ) ​ BASIC WEIGHTED-AVERAGE SHARES OF COMMON STOCK OUTSTANDING ​ 1,787,294 ​ 1,514,452 ​ 1,785,199 ​ 1,508,585 ​ DILUTED LOSS PER COMMON SHARE ​ $ ( 0.12 ) ​ $ 0.05 ​ $ ( 0.93 ) ​ $ ( 0.54 ) ​ DILUTED WEIGHTED-AVERAGE SHARES OF COMMON STOCK OUTSTANDING ​ 1,787,294 ​ 1,602,438 ​ 1,785,199 ​ 1,508,585 ​ ​ ​ See notes to unaudited condensed consolidated financial statements. ​ 4 Table of Contents PRECIPIO, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (Dollars in thousands) (unaudited) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Three Months Ended June 30, 2026 ​ ​ Preferred Stock ​ Common Stock ​ Additional ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Outstanding ​ Par ​ ​ ​ Issued ​ ​ ​ Par ​ Paid-in ​ Treasury ​ Accumulated ​ ​ ​ ​ ​ ​ Shares ​ ​ ​ Value ​ ​ ​ Shares ​ ​ ​ Value ​ ​ ​ Capital ​ ​ ​ Stock ​ ​ ​ Deficit ​ ​ ​ Total Balance, April 1, 2026 47 ​ $ — 1,783,682 ​ $ 18 ​ $ 118,395 ​ $ — ​ $ ( 104,246 ) ​ $ 14,167 Net loss ​ — ​ ​ — ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ ( 219 ) ​ ​ ( 219 ) Proceeds upon issuance of common stock from exercise of stock options ​ — ​ ​ — ​ 5,288 ​ ​ — ​ ​ 38 ​ ​ — ​ ​ — ​ ​ 38 Issuance of common stock for Board fees and consulting services ​ — ​ ​ — ​ 1,148 ​ ​ — ​ ​ 34 ​ ​ — ​ ​ — ​ ​ 34 Stock repurchases ​ — ​ ​ — ​ — ​ ​ — ​ ​ — ​ ​ ( 29 ) ​ ​ — ​ ​ ( 29 ) Stock-based compensation ​ — ​ — — ​ — ​ 767 ​ — ​ — ​ 767 Balance, June 30, 2026 ​ 47 ​ $ — ​ 1,790,118 ​ $ 18 ​ $ 119,234 ​ $ ( 29 ) ​ $ ( 104,465 ) ​ $ 14,758 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Six Months Ended June 30, 2026 ​ ​ Preferred Stock ​ Common Stock ​ Additional ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Outstanding ​ Par ​ ​ ​ Issued ​ ​ ​ Par ​ Paid-in ​ Treasury ​ Accumulated ​ ​ ​ ​ Shares ​ ​ ​ Value ​ ​ ​ Shares ​ ​ ​ Value ​ ​ ​ Capital ​ ​ ​ Stock ​ ​ ​ Deficit ​ ​ ​ Total Balance, January 1, 2026 ​ 47 ​ $ — 1,780,899 ​ $ 18 ​ $ 117,346 ​ $ — ​ $ ( 102,803 ) ​ $ 14,561 Net loss — ​ — — ​ — ​ — ​ — ​ ( 1,662 ) ​ ( 1,662 ) Proceeds upon issuance of common stock from exercise of stock options ​ — ​ ​ — ​ 5,850 ​ ​ — ​ ​ 41 ​ ​ — ​ ​ — ​ ​ 41 Issuance of common stock for Board fees and consulting services ​ — ​ ​ — ​ 3,369 ​ ​ — ​ ​ 87 ​ ​ — ​ ​ — ​ ​ 87 Stock repurchases ​ — ​ ​ — ​ — ​ ​ — ​ ​ — ​ ​ ( 29 ) ​ ​ — ​ ​ ( 29 ) Stock-based compensation — ​ — — ​ — ​ 1,760 ​ — ​ — ​ 1,760 Balance, June 30, 2026 47 ​ $ — ​ 1,790,118 ​ $ 18 ​ $ 119,234 ​ $ ( 29 ) ​ $ ( 104,465 ) ​ $ 14,758 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Three Months Ended June 30, 2025 ​ ​ Preferred Stock ​ Common Stock ​ Additional ​ ​ ​ ​ ​ ​ ​ ​ Outstanding ​ Par ​ ​ ​ Outstanding ​ ​ ​ Par ​ Paid-in ​ Accumulated ​ ​ ​ ​ ​ ​ Shares ​ ​ ​ Value ​ ​ ​ Shares ​ ​ ​ Value ​ ​ ​ Capital ​ ​ ​ Deficit ​ ​ ​ Total Balance, April 1, 2025 ​ 47 ​ $ — ​ 1,504,312 ​ $ 15 ​ $ 115,007 ​ $ ( 103,324 ) ​ $ 11,698 Net income — ​ — — ​ — ​ — ​ 74 ​ 74 Issuance of common stock for Board fees and consulting services ​ — ​ ​ — ​ 11,984 ​ ​ — ​ ​ 67 ​ ​ — ​ ​ 67 Stock-based compensation — ​ — — ​ — ​ 449 ​ — ​ 449 Balance, June 30, 2025 47 ​ $ — 1,516,296 ​ $ 15 ​ $ 115,523 ​ $ ( 103,250 ) ​ $ 12,288 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Six Months Ended June 30, 2025 ​ ​ Preferred Stock ​ Common Stock ​ Additional ​ ​ ​ ​ ​ ​ ​ ​ Outstanding ​ Par ​ ​ ​ Outstanding ​ ​ ​ Par ​ Paid-in ​ Accumulated ​ ​ ​ ​ Shares ​ ​ ​ Value ​ ​ ​ Shares ​ ​ ​ Value ​ ​ ​ Capital ​ ​ ​ Deficit ​ ​ ​ Total Balance, January 1, 2025 ​ 47 ​ $ — ​ 1,493,639 ​ $ 15 ​ $ 114,519 ​ $ ( 102,440 ) ​ $ 12,094 Net loss — ​ — — ​ — ​ — ​ ( 810 ) ​ ( 810 ) Issuance of common stock for Board fees and consulting services — ​ — 22,657 ​ — ​ 132 ​ — ​ 132 Stock-based compensation — ​ — — ​ — ​ 872 ​ — ​ 872 Balance, June 30, 2025 47 ​ $ — 1,516,296 ​ $ 15 ​ $ 115,523 ​ $ ( 103,250 ) ​ $ 12,288 ​ See notes to unaudited condensed consolidated financial statements. ​ 5 Table of Contents PRECIPIO, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Dollars in thousands) (unaudited) ​ ​ ​ ​ ​ ​ ​ ​ ​ Six Months Ended June 30, ​ ​ ​ ​ 2026 ​ ​ ​ 2025 CASH FLOWS FROM OPERATING ACTIVITIES: ​ ​ ​ ​ ​ ​ Net loss ​ $ ( 1,662 ) ​ $ ( 810 ) ​ ​ ​ ​ ​ ​ ​ Adjustments to reconcile net loss to net cash flows provided by operating activities: ​ ​ ​ ​ Depreciation and amortization ​ 572 ​ 631 Amortization of operating lease right-of-use asset ​ ​ 231 ​ ​ 128 Amortization of finance lease right-of-use asset ​ ​ 123 ​ ​ 80 Amortization of deferred financing costs, debt discounts and debt premiums ​ 1 ​ 1 Gain on settlement of liability ​ — ​ ( 143 ) Stock-based compensation ​ 1,760 ​ 872 Value of stock issued in payment of Board fees and consulting services ​ 87 ​ 132 Provision for credit losses ​ 250 ​ ( 63 ) Derecognition of finance lease right-of-use asset and liability ​ ​ — ​ ​ ( 4 ) Derecognition of operating lease right-of-use asset and liability ​ ​ — ​ ​ ( 11 ) Loss on disposal of asset ​ ​ — ​ ​ 11 Changes in operating assets and liabilities: ​ ​ ​ ​ Accounts receivable ​ ( 545 ) ​ ( 626 ) Inventories ​ 159 ​ ( 335 ) Other assets ​ 75 ​ 148 Accounts payable ​ ( 159 ) ​ 539 Operating lease liabilities ​ ​ ( 199 ) ​ ​ ( 106 ) Deferred revenue ​ ​ 82 ​ ​ 46 Accrued expenses ​ ( 51 ) ​ ( 181 ) Net cash provided by operating activities ​ 724 ​ 309 CASH FLOWS FROM INVESTING ACTIVITIES: ​ ​ ​ ​ Purchase of property and equipment ​ ( 182 ) ​ ( 197 ) Net cash used in investing activities ​ ( 182 ) ​ ( 197 ) CASH FLOWS FROM FINANCING ACTIVITIES: ​ ​ ​ ​ Principal payments on finance lease obligations ​ ( 114 ) ​ ( 68 ) Deposits on finance lease right-of-use assets ​ ​ — ​ ​ ( 20 ) Payments to repurchase common stock ​ ​ ( 29 ) ​ ​ — Proceeds from exercise of stock options ​ ​ 41 ​ ​ — Principal payments on long-term debt ​ ( 16 ) ​ ( 283 ) Net cash flows used in financing activities ​ ( 118 ) ​ ( 371 ) NET CHANGE IN CASH ​ 424 ​ ( 259 ) CASH AT BEGINNING OF PERIOD ​ 2,651 ​ 1,389 CASH AT END OF PERIOD ​ $ 3,075 ​ $ 1,130 ​ See notes to unaudited condensed consolidated financial statements. ​ 6 Table of Contents PRECIPIO, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS- CONTINUED (Dollars in thousands) (unaudited) ​ ​ ​ ​ ​ ​ ​ ​ ​ Six Months Ended June 30, ​ ​ 2026 ​ ​ ​ 2025 SUPPLEMENTAL CASH FLOW INFORMATION ​ ​ ​ ​ ​ ​ Cash paid during the period for interest ​ $ 50 ​ $ 54 ​ ​ ​ ​ ​ ​ ​ SUPPLEMENTAL DISCLOSURE OF CONSULTING SERVICES OR ANY OTHER NON-CASH COMMON STOCK RELATED ACTIVITY ​ ​ ​ ​ Purchases of equipment financed through accounts payable ​ ​ — ​ ​ 7 Equipment financed through long-term debt ​ ​ 263 ​ ​ — Operating lease right-of-use assets obtained in exchange for operating lease obligations ​ ​ — ​ ​ 1,490 Finance lease right-of-use assets obtained in exchange for finance lease obligations ​ ​ — ​ ​ 340 ​ See notes to unaudited condensed consolidated financial statements . 7 Table of Contents PRECIPIO, INC. AND SUBSIDIARIES NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS For the Three and Six Months Ended June 30, 2026 and 2025 1. BUSINESS DESCRIPTION Business Description. Precipio, Inc., and its subsidiaries, (collectively, “we”, “us”, “our”, the “Company” or “Precipio”) is a healthcare biotechnology company focused on improving cancer diagnostics. Our objective is to enhance diagnostic accuracy and accessibility while building a sustainable business model that supports ongoing innovation . We seek to achieve these objectives through a combination of clinical laboratory services and proprietary diagnostic product development. By integrating diagnostic services with product development, our service business doubles as a self-funded research and development (“R&D”) unit, enabling us to achieve rapid and cost-efficient innovation rather than being a major cost center of the Company. ​ This unique integrated operating structure is the foundation of our approach to research, development, and product commercialization. Unlike companies that rely primarily on stand-alone research facilities or external clinical validation programs, our clinical laboratory operations enables our R&D team to evaluate, refine, and validate diagnostic products in the course of routine clinical testing activities, and at minimal incremental cost. Through these activities, we generate clinical data, operational experience, and specimen access that support ongoing assay development and product improvement. While these activities are initially conducted to provide diagnostic services to patients and their healthcare providers, they also contribute to product development and validation processes. ​ Precipio operates under a single segment that encompasses two business divisions that are complementary to each other. Our pathology services division provides specialized cancer diagnostic testing services to physicians, hospitals, and laboratories. This division generates revenue and supports the development of our expertise in oncology diagnostics. The pathology services division delivers specialized diagnostic testing focused primarily on hematologic cancers and operates a full laboratory that includes all the equipment, personnel, and work processes required to receive patient samples daily, and deliver clinical results to the physicians under the proper compliance umbrella, while also generating profitable revenue to us. While reimbursement levels and testing volumes may vary, we view the pathology services division as an important foundation for both current operations and future product development. ​ Our product division focuses on the development and commercialization of proprietary diagnostic assay kits designed for use by clinical laboratories. These products allow us to expand our reach by enabling other laboratories to benefit from the diagnostic products developed by us, while building scalable diagnostic solutions. We believe this dual structure provides a unique model for R&D development of clinically applicable products, while delivering operational stability and supporting innovation and future growth. Furthermore, it provides us with competitive advantages in terms of the economics of product development, and time to market. These products are designed to improve testing accessibility and laboratory workflow efficiency while enabling broader market reach without requiring us to perform all testing internally. Product revenues may offer greater scalability than traditional laboratory services, although adoption depends on regulatory, reimbursement, and market factors. ​ To deliver our strategy, we have structured our organization to develop diagnostic products, including our laboratory and R&D facilities located in New Haven, Connecticut and Omaha, Nebraska, respectively, which house teams that collaborate on the development of new products and services. We operate Clinical Laboratory Improvement Amendment (“CLIA”) laboratories in both New Haven, Connecticut and Omaha, Nebraska where we provide essential blood cancer diagnostics to office-based oncologists in many states nationwide. To deliver on our strategy of mitigating misdiagnoses we rely heavily on our CLIA laboratories to support R&D beta-testing of the products we develop, in a clinical environment. ​ Our operating structure promotes the harnessing of our proprietary technology and genetic diagnostic expertise to bring to market our robust pipeline of innovative solutions designed to address the root causes of misdiagnoses . 8 Table of Contents Going Concern. The condensed consolidated financial statements have been prepared using accounting principles generally accepted in the United States of America (“GAAP”) applicable for a going concern, which assume that the Company will realize its assets and discharge its liabilities in the ordinary course of business and do not include any adjustments that might result should the Company be unable to continue as a going concern. The Company has incurred substantial operating losses for the past several years and while it has shown cash provided by its operating activities over the past 18 months, this was largely aided by $ 1.2 million in payments received related to non-recurring Employee Retention Credits. See Note 12 Employee Retention Credit. For the six months ended June 30, 2026, the Company had an operating loss of $ 2.0 million and net cash provided by operating activities of $ 0.7 million. As of June 30, 2026, the Company had an accumulated deficit of $104.5 million and working capital of $ 2.8 million. The Company’s ability to continue as a going concern over the next twelve months from the date of issuance of these condensed consolidated financial statements in this Quarterly Report on Form 10-Q is dependent upon a combination of achieving its business plan, including generating additional revenue and avoiding potential business disruption due to the macroeconomic environment and geopolitical instability, and raising additional financing, if needed, to meet its debt obligations and paying liabilities arising from normal business operations when they come due. Notwithstanding the aforementioned circumstances, there remains substantial doubt about the Company’s ability to continue as a going concern for the next twelve months from the date these condensed consolidated financial statements were issued. There can be no assurance that the Company will be able to successfully achieve its initiatives summarized above in order to continue as a going concern over the next twelve months from the date of issuance of this Quarterly Report on Form 10-Q. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation. The accompanying condensed consolidated financial statements are presented in conformity with GAAP and, as of June 30, 2026 and for the three and six months ended June 30, 2026 and 2025, are unaudited and reflect all adjustments (consisting of only normal recurring adjustments) that are necessary for a fair presentation of the financial position and operating results for the interim periods. These unaudited condensed consolidated financial statements and notes should be read in conjunction with the audited financial statements and notes thereto for the year ended December 31, 2025 contained in our Annual Report on Form 10-K, filed with the SEC on March 30, 2026. The results of operations for the interim periods presented are not necessarily indicative of the results for fiscal year 2026. 9 Table of Contents Recently Adopted Accounting Pronouncements In July 2025, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2025-05, Financial Instruments — Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets , which provides a practical expedient related to the estimation of expected credit losses for current accounts receivable and current contract assets arising from transactions accounted for under Topic 606, including those assets acquired in a business combination. The practical expedient permits all entities to assume that current conditions as of the balance sheet date do not change for the remaining life of the asset. This ASU is effective for fiscal years beginning after December 15, 2025, and interim reporting periods within those annual reporting periods. The Company has adopted this standard. The standard did not impact our financial position, results of operations or cash flows. Recent Accounting Pronouncements Not Yet Adopted. In December 2025, the FASB issued ASU 2025-12 , Codification Improvements. ASU 2025-12 contains amendments to the Codification that affect a wide variety of Topics in the Codification and applies to all reporting entities within the scope of the affected accounting guidance. The amendments in this update represent changes to the Codification that clarify, correct errors or make minor improvements, making the Codification easier to understand and apply. The amendments in this update are effective for public entities for fiscal years beginning after December 15, 2026, and interim reporting periods within those annual reporting periods. Early adoption of the amendments in this update are permitted for any fiscal year or interim period for which financial statements have not yet been issued or made available for issuance. If adopted in an interim period, the amendment must be adopted as of the beginning of the fiscal years that includes the interim period. An entity should apply the amendments in this update (except for amendments to Topic 260, Earnings per Share, related to Issue 4) using one of the following transition methods: (1) prospectively to all new transactions recognized on or after the date that the entity first applies the amendments, or (2) retrospectively to the beginning of the earliest comparative period presented in which the amendments were first applied, by adjusting the opening balance of retained earnings, or other appropriate components of equity or net assets, as of the beginning of the earliest comparative period presented. For amendments to Topic 260, Issue 4, an entity shall apply the amendments retrospectively to each prior reporting period presented in the period of adoption. The Company is currently evaluating the impact of adopting this standard on its consolidated financial statements and disclosures. In November 2025, the FASB issued ASU 2025-11, Interim Reporting (Topic 270) - Narrow-Scope Improvements . This update is intended to improve the navigability of the required interim disclosures under Topic 270 and clarify when the guidance is applicable. The amendments also provide a comprehensive list of disclosures required by Topic 270 that should be provided in interim reporting periods. The amendments add to Topic 270 a principle that requires entities to disclose since the end of the last annual reporting period that have a material impact on the entity. The amendments clarify the applicability of Topic 270, the types of interim reporting, and the form and content of the interim financial statements in accordance with GAAP. The amendments in this update apply to all entities that provide interim financial statements and notes in accordance with GAAP and include guidance on the definition of interim financial statements and notes in accordance with GAAP, including referencing the U.S. Securities and Exchange Commission requirements for entities to which those requirements apply. The amendments are effective for interim reporting periods beginning after December 15, 2027, for public entities. Early adoption is permitted. The amendments can be applied either prospectively or retrospectively to any and all prior periods presented in the financial statements. The Company is currently evaluating the impact of adopting this standard on its consolidated financial statements and disclosures. 10 Table of Contents In September 2025, the FASB issued ASU 2025-06, Intangibles — Goodwill and Other — Internal-use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software , which eliminates the previous stage-based model for capitalizing software costs and replaces it with a principles-based framework. This new guidance is designed to be more adaptable to modern, agile software development methods, clarifying when an entity should capitalize software costs based on a “probable-to-complete” threshold. This ASU is effective for fiscal years beginning after December 15, 2027, and interim reporting periods within those annual reporting periods, and may be applied using a prospective, modified, or retrospective transition approach. The Company is currently evaluating the impact of adopting this standard on its consolidated financial statements and disclosures. In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income (Topic 220): Expense Disaggregation Disclosures (“ASU 2024-03”). This update requires entities to disaggregate operating expenses into specific categories, such as purchases of inventory, compensation, depreciation, and amortization, to provide enhanced transparency into the nature and function of expenses. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, with early adoption permitted. ASU 2024-03 may be applied retrospectively or prospectively. The Company is currently evaluating the impact of this standard on its financial statement presentation and disclosures. (Loss) Income Per Share. Basic net (loss) income loss per share is calculated based on the weighted-average number of common shares outstanding during each period. Diluted net (loss) income per share includes shares issuable upon exercise of outstanding stock options, warrants or conversion rights that have exercise or conversion prices below the market value of our common stock. Options, warrants and conversion rights pertaining to 467,316 and 492,075 shares of our common stock have been excluded from the computation of diluted loss per share at June 30, 2026 and 2025, respectively, because the effect is anti-dilutive due to the net loss. The following table summarizes the outstanding securities not included in the computation of diluted net loss per share: ​ ​ ​ ​ ​ ​ ​ ​ June 30, ​ ​ ​ ​ 2026 ​ ​ ​ 2025 Stock options 451,441 47,631 Warrants 10,000 444,444 Preferred stock 5,875 — Total 467,316 492,075 ​ Basic and diluted weighted average shares outstanding were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Three Months Ended June 30, ​ For the Six Months Ended June 30, ​ 2026 ​ ​ ​ 2025 ​ ​ ​ 2026 ​ ​ ​ 2025 Basic weighted average shares outstanding 1,787,294 1,514,452 1,785,199 1,508,585 Dilutive effect of outstanding stock options — 82,111 — — Dilutive effect of outstanding warrants — — — — Dilutive effect of preferred stock — 5,875 — — Diluted weighted average shares outstanding 1,787,294 1,602,438 1,785,199 1,508,585 11 Table of Contents ​ ​ ​ ​ ​ 3. LONG-TERM DEBT Long-term debt consists of the following: ​ ​ ​ ​ ​ ​ ​ ​ ​ Dollars in Thousands ​ ​ ​ ​ June 30, 2026 ​ ​ ​ December 31, 2025 Connecticut Department of Economic and Community Development (DECD) ​ $ 67 ​ $ 83 DECD debt issuance costs ​ ( 5 ) ​ ( 6 ) Financed equipment loan ​ ​ 263 ​ ​ — Total long-term debt ​ 325 ​ 77 Current portion of long-term debt ​ ( 73 ) ​ ( 30 ) Long-term debt, net of current maturities ​ $ 252 ​ $ 47 ​ Department of Economic and Community Development. On January 8, 2018, the Company entered into an agreement with the Connecticut Department of Economic and Community Development (“DECD”) by which the Company received a loan of $ 300,000 secured by substantially all of the Company’s assets (the “DECD 2018 Loan”). The DECD 2018 Loan is a ten-year loan due on December 31, 2027 and includes interest paid monthly at 3.25 %. The maturity date of the DECD 2018 Loan was extended to May 31, 2028 and the modification did not have a material impact on the Company’s cash flows. Amortization of the debt issuance costs were less than $ 1 thousand for the three months ended June 30, 2026 and 2025, respectively, and $ 1 thousand for the six months ended June 30, 2026 and 2025, respectively. Financed equipment loan. In May 2026, the Company entered into a loan agreement to finance some laboratory equipment (the “Equipment Loan Agreement”). The total amount of the loan was $ 0.3 million and is secured by the equipment. The loan is a five-year loan and includes interest paid monthly at 8.9 %. As of June 30, 2026 and December 31, 2025, the outstanding balance under the Equipment Loan Agreement was $ 0.3 million and zero , respectively, and was included in current maturities of long-term debt and long-term debt in the Company’s condensed consolidated balance sheets. ​ ​ 4 . ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES Accrued expenses at June 30, 2026 and December 31, 2025 are as follows: ​ ​ ​ ​ ​ ​ ​ (dollars in thousands) ​ ​ ​ June 30, 2026 ​ ​ ​ December 31, 2025 Accrued expenses ​ $ 373 ​ $ 402 Accrued compensation ​ 1,049 ​ 977 Accrued franchise, property and sales and use taxes ​ ​ 198 ​ ​ 209 CHC temporary funding assistance ​ ​ — ​ ​ 83 Accrued interest ​ 19 ​ 19 ​ ​ $ 1,639 ​ $ 1,690 ​ 12 Table of Contents The Company uses Change Healthcare (“CHC”), a healthcare technology company owned by UnitedHealth Group, to process some of its patient claims billings. In February 2024, CHC announced that it had experienced a cyberattack and as a result had to temporarily shut down some of its information technology systems. This system shut down caused delays in billing and reimbursement processes to CHC’s customers and, as a result, CHC established a Temporary Funding Assistance Program to help bridge the gap in short-term cash flow needs for customers affected by the disruption of its services due to the cyberattack. Funding distributed through this program is interest free and has no other fees or costs associated with it. During the year ended December 31, 2024, the Company received approximately $ 1.1 million through CHC’s Temporary Assistance Program and began repayments during 2025. During the three and six months ended June 30, 2026, the Company made repayments to CHC of approximately zero and $ 0.1 million, respectively. As of June 30, 2026 and December 31, 2025 the amount due to CHC was zero and $ 0.1 million, respectively. 5 . COMMITMENTS AND CONTINGENCIES The Company is involved in legal proceedings related to matters, which are incidental to its business. Also, the Company is delinquent on the payment of outstanding accounts payable for certain vendors and suppliers who have taken or have threatened to take legal action to collect such outstanding amounts. See below for a discussion on these matters. PURCHASE COMMITMENTS The Company has entered into purchase commitments for reagents from suppliers. Some of these agreements run through 2031. The Company and the suppliers will true up the amounts on an annual basis. The future minimum purchase commitments under these and other purchase agreements are approximately $ 2.8 million at June 30, 2026. LEGAL PROCEEDINGS CPA Global provides us with certain patent management services. On February 6, 2017, CPA Global claimed that we owed approximately $ 0.2 million for certain patent maintenance services rendered. CPA Global has not filed claims against us in connection with this allegation. A liability of less than $ 0.1 million has been recorded and is reflected in accounts payable within the accompanying condensed consolidated balance sheets at June 30, 2026 and December 31, 2025. Data Security Litigation On April 28, 2026, Karen Ballard filed a putative class action complaint against Precipio, Inc. in the United States District Court for the District Court of Connecticut, Case No.3:26-cv-00656. On May 5, 2026, Rebecca McKinney filed a separate putative class action complaint against the Company in the United States District Court for the District Court of Connecticut, Case No.3:26-cv-00687. The complaints arise from the data security incident previously disclosed by the Company on December 5, 2025, and purport to be brought on behalf of individuals whose personally identifiable information or protected health information allegedly was affected by the incident. The complaints generally allege that the Company failed to implement reasonable safeguards to protect patients’ personally identifiable information and protected health information, including names, dates of birth, contact information, medical record numbers and medical information, in connection with the data security incident. The plaintiffs seek, among other relief, certification of the proposed classes, monetary damages, restitution, injunctive relief, attorneys’ fees, costs, and such other relief as the courts may determine appropriate. The actions are at a preliminary stage. On June 8, 2026, the Court entered an order consolidating Ballard v. Precipio, Inc . and McKinney v. Precipio, Inc . into a single proceeding captioned In re Precipio, Inc. Data Security Litigation , Case No. 3:26-cv-00656-VDO (D. Conn). The order further provides that subsequently filed putative class actions alleging the same or substantially similar allegations are subject to the consolidation procedures established by the 13 Table of Contents Court. The Court subsequently granted plaintiffs’ request for an extension of time to file a consolidated complaint through approximately August 6, 2026. As of the date of this Quarterly Report, no consolidated complaint has been filed, no class has been certified, and the Company has not yet been required to respond substantively to the allegations. The Company intends to defend the litigation vigorously. Because the litigation remains at an early stage, the operative allegations and claims have not yet been established through a consolidated complaint, no class has been certified, and the amount of damages sought has not been specified. Accordingly, the Company is currently unable to predict the outcome of the litigation or reasonably estimate the amount or range of any potential loss. The Company has not recorded a liability in connection with these matters LEGAL AND REGULATORY ENVIRONMENT The healthcare industry is subject to numerous laws and regulations of federal, state and local governments. These laws and regulations include, but are not limited to, matters such as licensure, accreditation, government healthcare program participation requirement, reimbursement for patient services and Medicare and Medicaid fraud and abuse. Government activity has increased with respect to investigations and allegations concerning possible violations of fraud and abuse statutes and regulations by healthcare providers. Violations of these laws and regulations could result in expulsion from government healthcare programs together with the imposition of significant fines and penalties, as well as significant repayments for patient services previously billed. Management believes that the Company is in compliance with fraud and abuse regulations, as well as other applicable government laws and regulations. While no material regulatory inquiries have been made, compliance with such laws and regulations can be subject to future government review and interpretation, as well as regulatory actions unknown or unasserted at this time. 6 . LEASES The Company leases administrative facilities and laboratory equipment through operating lease agreements. In addition, we rent various equipment used in our diagnostic lab and in our administrative offices through finance lease arrangements. Our operating leases include both lease (e.g., fixed payments including rent) and non-lease components (e.g., common area or other maintenance costs). The facility leases include one or more options to renew, from 1 to 5 years or more. The exercise of lease renewal options is typically at our sole discretion, therefore, the renewals to extend the lease terms are not included in our right-of-use (“ROU”) assets and lease liabilities as they are not reasonably certain of exercise. We regularly evaluate the renewal options and, when they are reasonably certain of exercise, we include the renewal period in our lease term. As our leases do not provide an implicit rate, we use our collateralized incremental borrowing rate based on the information available at the lease commencement date in determining the present value of the lease payments. Operating leases result in the recognition of ROU assets and lease liabilities on the balance sheet. ROU assets represent our right to use the leased asset for the lease term and lease liabilities represent our obligation to make lease payments. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. Lease expense is recognized on a straight-line basis over the lease term. Leases with an initial term of 12 months or less are not recorded on the balance sheet. The primary leases we enter into with initial terms of 12 months or less are for equipment. The Company also recognizes ROU assets from finance leases in connection with its HemeScreen Reagent Rental (“HSRR”) program and from finance leases for laboratory equipment. For certain customers in the HSRR program, the Company leases diagnostic testing equipment and then subleases the equipment to the customer. Finance lease ROU assets and finance lease liabilities are recognized at the lease commencement date, and at the sublease commencement date the finance lease ROU asset is derecognized and is recorded as cost of sales in the condensed consolidated statements of operations. There were no derecognized finance lease ROU assets for the three and six months ended June 30, 2026, respectively. Derecognized finance lease ROU assets for the three and six months ended June 30, 2025 were $ 4 thousand, respectively 14 Table of Contents The balance sheet presentation of our operating and finance leases is as follows: ​ ​ ​ ​ ​ ​ ​ ​ (dollars in thousands) ​ ​ ​ ​ ​ ​ Classification on the Consolidated Balance Sheet ​ June 30, 2026 ​ December 31, 2025 Assets: ​ ​ ​ ​ ​ ​ Operating lease right-of-use assets, net ​ $ 2,334 ​ $ 2,565 Finance lease right-of-use assets, net ​ ​ 875 ​ ​ 998 Total lease assets ​ $ 3,209 ​ $ 3,563 ​ ​ ​ ​ ​ ​ ​ Liabilities: ​ ​ ​ ​ ​ ​ Current: ​ ​ ​ ​ ​ ​ Current maturities of operating lease liabilities ​ $ 458 ​ $ 410 Current maturities of finance lease liabilities ​ ​ 195 ​ ​ 209 Noncurrent: ​ ​ ​ ​ ​ ​ Operating lease liabilities, less current maturities ​ ​ 1,959 ​ ​ 2,206 Finance lease liabilities, less current maturities ​ ​ 651 ​ ​ 751 Total lease liabilities ​ $ 3,263 ​ $ 3,576 ​ As of June 30, 2026, the estimated future minimum lease payments, excluding non-lease components, are as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (dollars in thousands) ​ ​ ​ Operating Leases ​ Finance Leases ​ Total 2026 (remaining) ​ $ 324 ​ $ 137 ​ $ 461 2027 ​ 701 ​ 274 ​ 975 2028 ​ 745 ​ 234 ​ 979 2029 ​ 787 ​ ​ 186 ​ 973 2030 ​ ​ 299 ​ ​ 129 ​ ​ 428 Thereafter ​ 93 ​ 78 ​ 171 Total lease obligations ​ 2,949 ​ 1,038 ​ 3,987 Less: Amount representing interest ​ ( 532 ) ​ ( 192 ) ​ ( 724 ) Present value of net minimum lease obligations ​ 2,417 ​ 846 ​ 3,263 Less, current portion ​ ( 458 ) ​ ( 195 ) ​ ( 653 ) Long term portion ​ $ 1,959 ​ $ 651 ​ $ 2,610 ​ Other information as of June 30, 2026 and December 31, 2025 is as follows: ​ ​ ​ ​ ​ ​ June 30, ​ December 31, ​ 2026 ​ 2025 Weighted-average remaining lease term (years): ​ ​ ​ Operating leases 4.1 ​ 4.6 Finance leases 4.2 ​ 4.5 Weighted-average discount rate: ​ ​ ​ Operating leases 10.00 % ​ 10.00 % Finance leases 10.60 % ​ 10.70 % ​ During the six months ended June 30, 2026 and 2025, operating cash flows from operating leases were $ 0.2 million and $ 0.1 million, respectively, and operating lease ROU assets obtained in exchange for operating lease liabilities were zero and $ 1.5 million, respectively. During the six months ended June 30, 2026 and 2025, finance lease ROU assets obtained in exchange for finance lease liabilities were zero and $ 0.3 million, respectively. 15 Table of Contents Operating Lease Costs Operating lease costs were approximately $ 0.2 million and $ 0.3 million during the three and six months ended June 30, 2026, respectively. Operating lease costs were approximately $ 0.1 million and $ 0.1 million during the three and six months ended June 30, 2025, respectively. These costs are primarily related to long-term operating leases for the Company’s facilities and laboratory equipment. Short-term and variable lease costs were less than $ 0.1 million for the three and six months ended June 30, 2026 and 2025, respectively. Finance Lease Costs Finance lease amortization and interest expenses are $ 0.1 million and $ 0.2 million for the three and six months ended June 30, 2026. Finance lease amortization and interest expenses are $ 0.1 million for the three and six months ended June 30, 2025, respectively. The balances within these accounts are included in the condensed consolidated statements of operations. ​ ​ 7 . STOCKHOLDERS’ EQUITY Common Stock. Pursuant to our Third Amended and Restated Certificate of Incorporation, as amended, we currently have 150,000,000 shares of common stock authorized for issuance. On December 20, 2018, the Company’s shareholders approved the proposal to authorize the Company’s Board of Directors (the “Board”) to, in its discretion, amend the Company’s Third Amended and Restated Certificate of Incorporation to increase the total number of authorized shares of common stock from 150,000,000 shares to 250,000,000 shares. The Company has not yet implemented this increase. During the three and six months ended June 30, 2026, the Company issued 5,288 and 5,850 shares of its common stock in connection with the exercise of 5,288 and 5,850 stock options. The stock option exercises resulted in net cash proceeds to the Company of $ 38 thousand and $ 41 thousand, respectively. There were no stock option exercises during the three and six months ended June 30, 2025. During the three months ended June 30, 2026 and 2025, the Company issued 1,148 and 11,984 shares of its common stock, respectively, in connection with Board fees of less than $ 0.1 million and $ 0.1 million, respectively. During the six months ended June 30, 2026 and 2025, the Company issued 3,369 and 22,657 shares of its common stock, respectively, in connection with Board fees of $ 0.1 million and $ 0.1 million, respectively. Preferred Stock. The Board is authorized to issue up to 15,000,000 shares of preferred stock in one or more series, from time to time, with such designations, powers, preferences and rights and such qualifications, limitations and restrictions as may be provided in a resolution or resolutions adopted by the Board. Series B Preferred Stock. The Company filed a Certificate of Designation of Preferences, Rights and Limitations of Series B Convertible Preferred Stock (“Series B Preferred Stock”) with the State of Delaware, which designates 6,900 shares of our preferred stock as Series B Preferred Stock. The Series B Preferred Stock has a stated value of $ 1 thousand per share and a par value of $ 0.01 per share. The Series B Preferred Stock includes a beneficial ownership blocker but has no dividend rights (except to the extent dividends are also paid on the common stock). On August 28, 2017, the Company completed an underwritten public offering consisting of the Company’s Series B Preferred Stock and warrants. The conversion price of the Series B Preferred Stock contains a down round feature. The Company will recognize the effect of the down round feature when it is triggered. At that time, the effect would be treated as a deemed dividend and as a reduction of income available to common shareholders in our basic earnings per share calculation. 16 Table of Contents There were no conversions of Series B Preferred Stock during the three and six months ended June 30, 2026 and 2025, respectively. At June 30, 2026 and December 31, 2025, the Company had 6,900 shares of Series B Preferred Stock designated and issued and 47 shares of Series B Preferred Stock outstanding. Based on the stated value of $ 1 thousand per share and a conversion price of $ 8.00 per share, the outstanding shares of Series B Preferred Stock at June 30, 2026 were convertible into 5,875 shares of common stock. Treasury Stock. During the three and six months ended June 30, 2026, the company recorded repurchases of 974 shares of common stock, respectively, with a value of $ 29 thousand, respectively. The repurchases were the result of stock option exercises processed as net exercises, whereby shares of the Company’s common stock otherwise issuable upon exercise were withheld to fund the aggregate exercise price. The repurchased shares are recorded as treasury stock within the accompanying condensed consolidated balance sheets at June 30, 2026 and December 31, 2025. There were 974 and zero shares of treasury stock as of June 30, 2026 and December 31, 2025, respectively Common Stock Warrants. The following represents a summary of the warrants outstanding as of June 30, 2026: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Underlying ​ ​ ​ Exercise ​ ​ Issue Year ​ Expiration ​ Shares ​ Price Warrants ​ ​ ​ ​ ​ ​ ​ ​ ​ (1) ​ 2025 ​ February 2027 ​ 10,000 ​ $ 60.00 (1) These warrants were issued to a consultant in connection with services performed. ​ 8 . FAIR VALUE FASB guidance on fair value measurements, which defines fair value, establishes a framework for measuring fair value and expands disclosures about fair value measurements for our financial assets and liabilities, as well as for other assets and liabilities that are carried at fair value on a recurring basis in our condensed consolidated financial statements. FASB guidance establishes a three-level fair value hierarchy based upon the assumptions (inputs) used to price assets or liabilities. The three levels of inputs used to measure fair value are as follows: Level 1—Unadjusted quoted prices in active markets for identical assets or liabilities; Level 2—Observable inputs other than those included in Level 1, such as quoted prices for similar assets and liabilities in active markets or quoted prices for identical assets or liabilities in inactive markets; and Level 3—Unobservable inputs reflecting our own assumptions and best estimate of what inputs market participants would use in pricing the asset or liability. ​ ​ ​ 9 . EQUITY INCENTIVE PLAN The Company currently issues stock awards under its 2017 Stock Option and Incentive Plan, as amended (the “2017 Plan”) which will expire on June 5, 2027 . The shares authorized for issuance under the 2017 Plan were 484,425 at June 30, 2026, of which 9,294 were available for future grant. The shares authorized under the 2017 Plan are subject to annual increases on January 1 by 5 % of the number of shares of common stock issued and outstanding on the immediately 17 Table of Contents preceding December 31, or such lessor number of shares determined by the Board or Compensation Committee of the Board. During the six months ended June 30, 2026, the shares authorized for issuance increased by 89,045 shares. Stock Options. The Company accounts for all stock-based compensation payments to employees and directors, including grants of employee stock options, at fair value at the date of grant and expenses the benefit in operating expense in the condensed consolidated statements of operations over the service period of the awards. The Company records the expense for stock-based compensation awards subject to performance-based milestone vesting over the remaining service period when management determines that achievement of the milestone is probable based on the expected satisfaction of the performance conditions as of the reporting date. The Company records the expense for stock-based compensation awards subject to market-condition vesting over a derived service period which is calculated at the grant date. The fair value of each stock option granted is estimated on the date of grant using the Black-Scholes or other option pricing models, which requires various assumptions including estimating stock price volatility, expected life of the stock option, risk free interest rate and estimated forfeiture rate. During the six months ended June 30, 2026, the Company granted stock options to purchase up to 100,000 shares of common stock at a weighted average exercise price of $ 23.94 per share. The stock options granted have either time-based or market-condition vesting. The awards with time-based vesting have vesting periods of up to four years and had grant date fair values between $ 16.32 and $ 26.08 . The fair value was calculated using the Black-Scholes option pricing model and used the following assumptions: risk free interest rate of 3.77 % to 4.17 %, based on the U.S. Treasury yield in effect at the time of grant; expected life of five to six years ; and volatility of 82 % to 121 % based on historical volatility of the Company’s common stock over a time that is consistent with the expected life of the option. The awards with market-condition vesting have a derived service period of 0.4 years and had a grant date fair value of $ 20.61 . The fair value was calculated using a Monte Carlo Simulation and used the following assumptions: risk free interest rate of 4.15 %; remaining term of ten years ; and volatility of 122 %. The following table summarizes stock option activity under our plans during the six months ended June 30, 2026: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Number of ​ ​ ​ Weighted-Average ​ ​ Options ​ Exercise Price Outstanding at January 1, 2026 359,306 ​ $ 7.13 Granted 100,000 ​ 23.94 Exercised ​ ( 5,850 ) ​ ​ 7.07 Forfeited ( 2,015 ) ​ 6.16 Outstanding at June 30, 2026 451,441 ​ $ 10.86 Exercisable at June 30, 2026 289,808 ​ $ 7.57 ​ As of June 30, 2026, there were 431,089 options that were vested or expected to vest with aggregate intrinsic value of $ 6.0 million and a remaining weighted average contractual life of 6.8 years. Restricted Stock Awards. Restricted stock awards are subject to vesting restrictions. If a grantee’s service with the Company is terminated prior to vesting of the restricted stock, all unvested shares shall be forfeited and returned to the Company. Upon vesting, the restricted stock award shall no longer be deemed restricted. As of June 30, 2026 and December 31, 2025, there were no restricted stock awards that were unvested. There were no restricted stock awards granted during the three and six months ended June 30, 2026 and 2025, respectively. 18 Table of Contents Stock Compensation. For the three and six months ended June 30, 2026, we recorded non-cash stock-based compensation expense for all stock awards of approximately $ 0.8 million and $ 1.8 million, respectively, within operating expense in the accompanying statements of operations. For the three and six months ended June 30, 2025, we recorded non-cash stock-based compensation expense for all stock awards of $ 0.4 million and $ 0.9 million, respectively. As of June 30, 2026, the unrecognized compensation expense related to unvested stock awards was $ 0.8 million, which is expected to be recognized over a weighted-average period of 2.3 years. 10. SALES SERVICE REVENUE, NET AND ACCOUNTS RECEIVABLE ASC Topic 606, “Revenue from contracts with customers” The Company follows the guidance of ASC 606 for the recognition of revenue from contracts with customers to transfer goods and services. The Company performed a comprehensive review of its existing revenue arrangements following the five-step model: ​ Step 1: Identification of the contract with the customer. Sub-steps include determining the customer in a contract, initial contract identification and determining if multiple contracts should be combined and accounted for as a single transaction. Step 2: Identify the performance obligation in the contract. Sub-steps include identifying the promised goods and services in the contract and identifying which performance obligations within the contract are distinct. Step 3: Determine the transaction price. Sub-steps include variable consideration, constraining estimates of variable consideration, the existence of a significant financing component in the contract, noncash consideration and consideration payable to a customer. Step 4: Allocate transaction price. Sub-steps include assessing the amount of consideration to which the Company expects to be entitled in exchange for transferring the promised goods or services to the customer. Step 5: Satisfaction of performance obligations. Sub-steps include ascertaining the point in time when an asset is transferred to the customer and when the customer obtains control of the asset upon which time the Company recognizes revenue. ​ Nature of Contracts and Customers The Company’s contracts and related performance obligations are similar for its customers and the sales process for all customers starts upon the receipt of requisition forms from the customers for patient diagnostic testing and the execution of contracts for laboratory interpretation services, billing services and for biomarker testing and clinical research. Payment terms for the services provided are 30 days, unless separately negotiated. ​ Diagnostic testing ​ Control of the laboratory testing services is transferred to the customer at a point in time. As such, the Company recognizes revenue for laboratory testing services at a point in time based on the delivery method (web-portal access or fax) for the patient’s laboratory report, per the contract. Control of billing and laboratory interpretation services are transferred to the customer at a point in time and, as such, the Company recognizes these revenues at a point in time based on the delivery method. ​ Clinical research grants ​ Control of the clinical research services are transferred to the customer over time. The Company will recognize revenue utilizing the “effort based” method, measuring its progress toward complete satisfaction of the performance obligation. ​ 19 Table of Contents Biomarker testing and clinical project services Control of the biomarker testing and clinical project services are transferred to the customer over time. The Company utilizes an “effort based” method of assessing performance and measures progress towards satisfaction of the performance obligation based upon the delivery of results. The Company generates revenue from the provision of diagnostic testing provided to patients, biomarker testing provided to bio-pharma customers and clinical research grants funded by both bio-pharma customers and government health programs. Reagents and other diagnostic products Control of reagents and other diagnostic products are transferred to the customer at a point in time and, as such, the Company recognizes these revenues at a point in time based on the delivery method. These revenues include revenues from reagent sets for our HSRR program and other product sales and are included in product revenue in our condensed consolidated statements of operations. Disaggregation of Revenues by Transaction Type We operate in one business segment and, therefore, the results of our operations are reported on a consolidated basis for purposes of segment reporting, consistent with internal management reporting. Service revenue, net for the three and six months ended June 30, 2026 and 2025 was as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Three Months Ended June 30, (dollars in thousands) ​ Diagnostic Testing ​ ​ ​ ​ 2026 ​ ​ ​ 2025 Medicaid ​ $ 31 ​ $ 8 Medicare ​ 2,662 ​ 2,285 Self-pay ​ 6 ​ 5 Third party payers ​ 3,351 ​ 2,684 Contract diagnostics and other ​ 65 ​ 23 Service revenue, net ​ $ 6,115 ​ $ 5,005 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Six Months Ended June 30, (dollars in thousands) ​ Diagnostic Testing ​ ​ ​ ​ 2026 ​ ​ ​ 2025 Medicaid ​ $ 56 ​ $ 13 Medicare ​ 5,612 ​ 4,189 Self-pay ​ 11 ​ 10 Third party payers ​ 6,618 ​ 5,009 Contract diagnostics and other ​ 120 ​ 41 Service revenue, net ​ $ 12,417 ​ $ 9,262 ​ Revenue from the Medicare and Medicaid programs account for a portion of the Company’s patient diagnostic service revenue. Laws and regulations governing those programs are extremely complex and subject to interpretation. As a result, there is at least a reasonable possibility that recorded estimates will change by a material amount in the near term. Revenue Recognition Revenue is recognized when a customer obtains control of promised goods or services, in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services. To the extent the transaction price includes variable consideration, the Company estimates the amount of variable consideration that should be included in the transaction price using the expected value method based on historical experience. The Company does not typically 20 Table of Contents enter arrangements where multiple contracts can be combined as the terms regarding services are generally found within a single agreement/requisition form. The Company derives its revenues from the following types of transactions: diagnostic testing (“Diagnostic”), revenues from the Company’s ICP technology and bio-pharma projects encompassing genetic diagnostics (collectively “Biomarker”), revenues from clinical research grants from state and federal research programs and diagnostic product sales, including revenues from equipment leases and reagent sales associated with our HSRR program. Deferred revenue Deferred revenue, or unearned revenue, refers to advance payments for products or services that are to be delivered in the future. The Company records such prepayment of unearned revenue as a liability, as revenue that has not yet been earned, but represents products or services that are owed to a customer. As the product or service is delivered over time, the Company recognizes the appropriate amount of revenue from deferred revenue. For the periods ended June 30, 2026 and December 31, 2025, the deferred revenue was $ 0.4 million and $ 0.3 million, respectively. Contractual Allowances and Adjustments We are reimbursed by payers for services we provide. Payments for services covered by payers average less than billed charges. We monitor revenue and receivables from payers and record an estimated contractual allowance for certain revenue and receivable balances as of the revenue recognition date to properly account for anticipated differences between amounts estimated in our billing system and amounts ultimately reimbursed by payers. Accordingly, the total revenue and receivables reported in our condensed consolidated financial statements are recorded at the amounts expected to be received from these payers. For service revenue, the contractual allowance is estimated based on several criteria, including unbilled claims, historical trends based on actual claims paid, current contract and reimbursement terms and changes in customer base and payer/product mix. The billing functions for the remaining portion of our revenue are contracted and fixed fees for specific services and are recorded without an allowance for contractual discounts . The following table presents our revenues initially recognized for each associated payer class during the three and six months ended June 30, 2026 and 2025 . ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Three Months Ended June 30, (dollars in thousands) ​ ​ ​ Contractual Allowances and ​ Revenues, net of Contractual ​ ​ Gross Revenues ​ adjustments ​ Allowances and adjustments ​ ​ ​ ​ 2026 ​ ​ ​ 2025 ​ ​ ​ 2026 ​ ​ ​ 2025 ​ ​ ​ 2026 ​ ​ ​ 2025 Medicaid ​ $ 31 ​ $ 8 ​ $ — ​ $ — ​ $ 31 ​ $ 8 Medicare ​ 2,662 ​ 2,284 ​ — ​ — ​ 2,662 ​ 2,284 Self-pay ​ 6 ​ 5 ​ — ​ — ​ 6 ​ 5 Third party payers ​ 11,366 ​ 9,392 ​ ( 8,015 ) ​ ( 6,707 ) ​ 3,351 ​ 2,685 Contract diagnostics and other ​ 65 ​ 23 ​ — ​ — ​ 65 ​ 23 ​ ​ 14,130 ​ 11,712 ​ ( 8,015 ) ​ ( 6,707 ) ​ 6,115 ​ 5,005 Product ​ 906 ​ 624 ​ — ​ — ​ 906 ​ 624 ​ ​ $ 15,036 ​ $ 12,336 ​ $ ( 8,015 ) ​ $ ( 6,707 ) ​ $ 7,021 ​ $ 5,629 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Six Months Ended June 30, (dollars in thousands) ​ ​ ​ Contractual Allowances and ​ Revenues, net of Contractual ​ ​ Gross Revenues ​ adjustments ​ Allowances and adjustments ​ ​ ​ ​ 2026 ​ ​ ​ 2025 ​ ​ ​ 2026 ​ ​ ​ 2025 ​ ​ ​ 2026 ​ ​ ​ 2025 Medicaid ​ $ 56 ​ $ 13 ​ $ — ​ $ — ​ $ 56 ​ $ 13 Medicare ​ 5,612 ​ 4,188 ​ — ​ — ​ 5,612 ​ 4,188 Self-pay ​ 11 ​ 10 ​ — ​ — ​ 11 ​ 10 Third party payers ​ 23,039 ​ 17,530 ​ ( 16,421 ) ​ ( 12,520 ) ​ 6,618 ​ 5,010 Contract diagnostics and other ​ 120 ​ 41 ​ — ​ — ​ 120 ​ 41 ​ ​ 28,838 ​ 21,782 ​ ( 16,421 ) ​ ( 12,520 ) ​ 12,417 ​ 9,262 Product ​ 1,565 ​ 1,278 ​ — ​ — ​ 1,565 ​ 1,278 ​ ​ $ 30,403 ​ $ 23,060 ​ $ ( 16,421 ) ​ $ ( 12,520 ) ​ $ 13,982 ​ $ 10,540 ​ 21 Table of Contents Allowance for Credit Losses The Company provides for a general allowance for collectability of services when recording net sales. The Company has adopted the policy of recognizing net sales to the extent it expects to collect that amount. Reference is made to FASB ASC 954-605-45-5 and ASU 2011-07, Health Care Entities: Presentation and Disclosure of Patient Service Revenue, Provision for Credit Loss, and the Allowance for Credit Losses. The change in the allowance for credit losses is directly related to the increase in patient service revenues. The following table presents our reported revenues net of the collection allowance and adjustments for the three and six months ended June 30, 2026 and 2025. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Three Months Ended June 30, ​ ​ Revenues, net of ​ ​ ​ (dollars in thousands) ​ Contractual Allowances ​ Allowances for credit ​ ​ ​ and adjustments ​ losses ​ Total ​ ​ ​ ​ 2026 ​ ​ ​ 2025 ​ ​ ​ 2026 ​ ​ ​ 2025 ​ ​ ​ 2026 ​ ​ ​ 2025 Medicaid ​ $ 31 ​ $ 8 ​ $ — ​ $ 15 ​ $ 31 ​ $ 23 Medicare ​ 2,662 ​ 2,284 ​ — ​ 9 ​ 2,662 ​ 2,293 Self-pay ​ 6 ​ 5 ​ — ​ — ​ 6 ​ 5 Third party payers ​ 3,351 ​ 2,685 ​ — ​ 1 ​ 3,351 ​ 2,686 Contract diagnostics and other ​ 65 ​ 23 ​ — ​ — ​ 65 ​ 23 ​ ​ 6,115 ​ 5,005 ​ — ​ 25 ​ 6,115 ​ 5,030 Product ​ 906 ​ 624 ​ — ​ — ​ 906 ​ 624 ​ ​ $ 7,021 ​ $ 5,629 ​ $ — ​ $ 25 ​ $ 7,021 ​ $ 5,654 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Six Months Ended June 30, ​ ​ Revenues, net of ​ ​ ​ (dollars in thousands) ​ Contractual Allowances ​ Allowances for credit ​ ​ ​ and adjustments ​ losses ​ Total ​ ​ ​ ​ 2026 ​ ​ ​ 2025 ​ ​ ​ 2026 ​ ​ ​ 2025 ​ ​ ​ 2026 ​ ​ ​ 2025 Medicaid ​ $ 56 ​ $ 13 ​ $ ( 1 ) ​ $ 33 ​ $ 55 ​ $ 46 Medicare ​ 5,612 ​ 4,188 ​ ( 182 ) ​ 9 ​ 5,430 ​ 4,197 Self-pay ​ 11 ​ 10 ​ — ​ — ​ 11 ​ 10 Third party payers ​ 6,618 ​ 5,010 ​ ( 67 ) ​ 1 ​ 6,551 ​ 5,011 Contract diagnostics and other ​ 120 ​ 41 ​ — ​ — ​ 120 ​ 41 ​ ​ 12,417 ​ 9,262 ​ ( 250 ) ​ 43 ​ 12,167 ​ 9,305 Product ​ 1,565 ​ 1,278 ​ — ​ — ​ 1,565 ​ 1,278 ​ ​ $ 13,982 ​ $ 10,540 ​ $ ( 250 ) ​ $ 43 ​ $ 13,732 ​ $ 10,583 ​ ​ Costs to Obtain or Fulfill a Customer Contract Sales commissions are expensed when incurred because the amortization period would have been one year or less. These costs are recorded in operating expenses in the condensed consolidated statements of operations. Shipping and handling costs are comprised of inbound and outbound freight and associated labor. The Company accounts for shipping and handling activities related to contracts with customers as fulfillment costs which are included in cost of sales in the condensed consolidated statements of operations. Accounts Receivable The Company has provided an allowance for potential credit losses, which has been determined based on management’s industry experience. The Company grants credit without collateral to its patients, most of who are insured under third party payer agreements. 22 Table of Contents The following summarizes the mix of receivables outstanding related to payer categories: ​ ​ ​ ​ ​ ​ ​ ​ (dollars in thousands) ​ ​ ​ June 30, 2026 ​ ​ ​ December 31, 2025 Medicaid ​ $ 30 ​ $ 19 Medicare ​ 2,495 ​ 1,838 Self-pay ​ 18 ​ 16 Third party payers ​ 137 ​ 859 Contract diagnostic services, product and other ​ 894 ​ 297 ​ ​ $ 3,574 ​ $ 3,029 Less allowance for credit losses ​ ( 1,295 ) ​ ( 1,045 ) Accounts receivable, net ​ $ 2,279 ​ $ 1,984 ​ The following table presents the roll-forward of the allowance for credit losses for the six months ended June 30, 2026 and 2025. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Six Months Ended June 30, (dollars in thousands) ​ ​ 2026 ​ 2025 Balance, January 1 $ ( 1,045 ) ​ $ ( 995 ) Provision for credit losses: ​ ​ ​ ​ ​ Medicaid ​ ​ ( 1 ) ​ ​ 33 Medicare ​ ( 182 ) ​ 9 Self-pay ​ ​ — ​ ​ — Third party payers ​ ( 67 ) ​ 1 ​ ​ ( 250 ) ​ 43 Credit loss income ​ ​ — ​ ​ 20 Total charges ​ ( 250 ) ​ 63 Balance, June 30 ​ $ ( 1,295 ) ​ $ ( 932 ) ​ Customer Revenue and Accounts Receivable Concentration Our customers are oncologists, hospitals, reference laboratories, physician-office laboratories, and pharma and biotech companies. Customers that accounted for 10% or greater of our net sales or accounts receivable for the identified periods is as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net sales ​ ​ Net sales ​ ​ Accounts receivable, as of ​ ​ ​ Three Months Ended ​ ​ Six Months Ended ​ ​ ​ ​ ​ ​ June 30, ​ ​ June 30, ​ ​ June 30, ​ December 31, ​ ​ ​ 2026 ​ 2025 ​ ​ 2026 ​ 2025 ​ ​ 2026 ​ 2025 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Customer A ​ 30 % 27 % ​ 29 % 27 % ​ 37 % 34 % Customer B ​ * ​ * ​ ​ * ​ * ​ ​ * ​ 12 % Customer C ​ * ​ * ​ ​ * ​ * ​ ​ * ​ 10 % Customer D ​ * ​ * ​ ​ * ​ * ​ ​ 17 % * ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ * represents less than 10% ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 23 Table of Contents 11. SEGMENT REPORTING The Company’s chief operating decision maker (the “CODM”) is its Chief Executive Officer. The Company has no segment managers who are held accountable by the CODM for operations, operating results, and planning for levels or components below the consolidated unit level. Accordingly, the Company has determined it has a single operating segment. The CODM uses consolidated net loss for purposes of allocating resources and assessing segment performance, including monitoring actual results versus historical periods. Cost of revenue and operating expenses are considered significant segment expenses that are regularly provided to the CODM and included within consolidated net loss. The measure of segment assets is the total assets on the Company’s condensed consolidated balance sheets. Capital expenditures are reported on a consolidated basis on the Company’s condensed consolidated statements of cash flows. The following table includes the Company's segment revenue, significant segment expenses, and other segment items to reconcile to net loss. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Dollars in Thousands ​ Dollars in Thousands ​ Three Months Ended ​ Six Months Ended ​ June 30, ​ June 30, ​ 2026 ​ ​ ​ 2025 ​ ​ ​ 2026 ​ ​ ​ 2025 Net sales $ 7,021 ​ $ 5,654 ​ $ 13,732 ​ $ 10,583 Less expense: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cost of sales 3,885 ​ 3,225 ​ 7,871 ​ 6,014 Operating expenses (1) ​ 3,735 ​ ​ 3,253 ​ ​ 7,888 ​ ​ 6,252 Other segment expense (2) ( 380 ) ​ ( 898 ) ​ ( 365 ) ​ ( 873 ) Net loss $ ( 219 ) ​ $ 74 ​ $ ( 1,662 ) ​ $ ( 810 ) ​ (1) Operating expenses include sales and marketing expenses, general and administrative expenses, research and development expenses and stock-based compensation. (2) Other segment items include interest income, interest expense, gain on write-off of liability and other income, including Employee Retention Credits received. 12. EMPLOYEE RETENTION CREDIT On March 27, 2020, the U.S. government enacted the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”). Under the provisions of the CARES Act, and the subsequent extensions, the Company became eligible to apply for a refundable Employee Retention Credit (the “ERC”) subject to certain criteria, which could be used to offset payroll tax liabilities. ​ In November 2022, the Company submitted an ERC claim totaling approximately $ 1.5 million. During the three and six months ended June 30, 2026, the Company received payments for part of the ERC claim totaling approximately $ 0.4 million, respectively. During the three and six months ended June 30, 2025, the Company received payments totaling approximately $ 0.8 million, respectively. ​ The Company retains all rights to pursue and receive the remaining balance of approximately $ 0.3 million and is actively evaluating the likelihood and timing of any additional disbursements. The Company has not waived any claims to the unpaid portion of the ERC and is taking reasonable steps to secure the remaining balance. However, there can be no assurance as to the timing, amount, or certainty of receipt of additional funds, and the Company will continue to assess the collectability of the remaining claim in accordance with applicable accounting standards. 24 Table of Contents 13. SUBSEQUENT EVENTS The Company has evaluated events and transactions subsequent to June 30, 2026 through the date of this Quarterly Report on Form 10-Q, and there are no other events to report other than what has been disclosed in the condensed consolidated financial statements. ​ Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations Forward-Looking Information This Quarterly Report on Form 10-Q or the information incorporated herein by reference, including this Management’s Discussion and Analysis, contains forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995, which statements involve substantial risks and uncertainties. These statements are based on management’s current views, assumptions or beliefs of future events and financial performance and are subject to uncertainty and changes in circumstances. Readers of this report should understand that these statements are not guarantees of performance or results. Many factors could affect our actual financial results and cause them to vary materially from the expectations contained in the forward-looking statements. These factors include, among other things: our expected revenue, income (loss), receivables, operating expenses, the effects of a cyberattack on us or our operations, supplier pricing, availability and prices of raw materials, insurance reimbursements, product pricing, foreign currency exchange rates, sources of funding operations and acquisitions, our ability to raise funds, sufficiency of available liquidity, future interest and inflation costs, future economic circumstances, business strategy, industry conditions and key trends, our ability to execute our operating plans, the success of our cost savings initiatives, competitive environment and related market conditions, our ability to comply with the listing requirements of the Nasdaq Capital Market, expected financial and other benefits from our organizational restructuring activities, geopolitical uncertainties including the ongoing Russia and Ukraine conflict and the Israel-Hamas war , actions of governments and regulatory factors affecting our business, projections of future earnings, revenues, synergies, accretion or other financial items, any statements of the plans, strategies and objectives of management for future operations, retaining key employees and other risks as described in our reports filed with the SEC. In some cases these statements are identifiable through the use of words such as “anticipate,” “believe,” “estimate,” “expect,” “intend,” “plan,” “project,” “target,” “can,” “could,” “may,” “should,” “will,” “would” or the negative of such terms and other similar expressions. You are cautioned not to place undue reliance on these forward-looking statements. The forward-looking statements we make are not guarantees of future performance and are subject to various assumptions, risks and other factors that could cause actual results to differ materially from those suggested by these forward-looking statements. Actual results may differ materially from those suggested by the forward-looking statements that we make for a number of reasons, including those described in Part II, Item 1A, “Risk Factors,” of this Quarterly Report on Form 10-Q and our prior filings with the Securities and Exchange Commission. We expressly disclaim any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. The following discussion should be read together with our condensed consolidated financial statements and related notes contained in this Quarterly Report on Form 10-Q and with the audited financial statements, related notes and Management’s Discussion and Analysis included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025, which we filed with the Securities and Exchange Commission on March 30, 2026. Results for the three and six months ended June 30, 2026 are not necessarily indicative of results that may be attained in the future. Overview We are a healthcare biotechnology company focused on improving cancer diagnostics. Our objective is to enhance diagnostic accuracy and accessibility while building a sustainable business model that supports ongoing innovation . We seek to achieve these objectives through a combination of clinical laboratory services and proprietary diagnostic product development. By integrating diagnostic services with product development, our service business 25 Table of Contents doubles as a self-funded research and development (“R&D”) unit, enabling us to achieve rapid and cost-efficient innovation, rather than being a major cost center of the Company. ​ This unique integrated operating structure is the foundation of our approach to research, development, and product commercialization. Unlike companies that rely primarily on stand-alone research facilities or external clinical validation programs, our clinical laboratory operations enables its R&D team to evaluate, refine, and validate diagnostic products in the course of routine clinical testing activities, and at minimal incremental cost. Through these activities, we generate clinical data, operational experience, and specimen access that support ongoing assay development and product improvement. While these activities are initially conducted to provide diagnostic services to patients and their healthcare providers, they also contribute to product development and validation processes. ​ Precipio operates under a single segment that encompasses two business divisions that are complementary to each other. Our pathology services division provides specialized cancer diagnostic testing services to physicians, hospitals, and laboratories. This division generates revenue and supports the development of our expertise in oncology diagnostics. The pathology services division delivers specialized diagnostic testing focused primarily on hematologic cancers and operates a full laboratory that includes all the equipment, personnel, and work processes required to receive patient samples daily, and deliver clinical results to the physicians under the proper compliance umbrella, while also generating profitable revenue to us. While reimbursement levels and testing volumes may vary, we view the pathology services division as an important foundation for both current operations and future product development. ​ Our product division focuses on the development and commercialization of proprietary diagnostic assay kits designed for use by clinical laboratories. These products allow us to expand our reach by enabling other laboratories to benefit from the diagnostic products developed by us, while building scalable diagnostic solutions. We believe this dual structure provides a unique model for R&D development of clinically applicable products, while delivering operational stability and supporting innovation and future growth. Furthermore, it provides us with competitive advantages in terms of the economics of product development, and time to market. These products are designed to improve testing accessibility and laboratory workflow efficiency while enabling broader market reach without requiring us to perform all testing internally. Product revenues may offer greater scalability than traditional laboratory services, although adoption depends on regulatory, reimbursement, and market factors. ​ To deliver our strategy, we have structured our organization to develop diagnostic products, including our laboratory and R&D facilities located in New Haven, Connecticut and Omaha, Nebraska, respectively, which house teams that collaborate on the development of new products and services. We operate clinical laboratory improvement amendment (“CLIA”) laboratories in both New Haven, Connecticut and Omaha, Nebraska where we provide essential blood cancer diagnostics to office-based oncologists in many states nationwide. To deliver on our strategy of mitigating misdiagnoses we rely heavily on our CLIA laboratories to support R&D beta-testing of the products we develop, in a clinical environment. ​ Our operating structure promotes the harnessing of our proprietary technology and genetic diagnostic expertise to bring to market our robust pipeline of innovative solutions designed to address the root causes of misdiagnoses . ​ Going Concern The condensed consolidated financial statements have been prepared using accounting principles generally accepted in the United States of America (“GAAP”) applicable for a going concern, which assume that we will realize our assets and discharge our liabilities in the ordinary course of business and do not include any adjustments that might result should we be unable to continue as a going concern. We have incurred substantial operating losses for the past several years and while we have shown cash provided by our operating activities over the past 18 months, this was largely aided by $1.2 million in payments received related to non-recurring Employee Retention Credits. See Note 12 Employee Retention Credit. For the six months ended June 30, 2026, we had an operating loss of $2.0 million and net cash provided by operating activities of $0.7 million. As of June 30, 2026, we had an accumulated deficit of $104.5 million and working capital of $2.8 million. Our ability to continue as a going concern over the next twelve months from the date the condensed consolidated financial statements were issued is dependent upon a combination of achieving our business plan, including 26 Table of Contents generating additional revenue, and raising additional financing to meet our debt obligations and paying liabilities arising from normal business operations when they come due. Notwithstanding the aforementioned circumstances, there remains substantial doubt about our ability to continue as a going concern over the next twelve months from the date of issuance of this Quarterly Report on Form 10-Q. There can be no assurance that we will be able to successfully achieve our initiatives summarized above in order to continue as a going concern. One Big Beautiful Bill Act of 2025 On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted in the United States. The OBBBA includes significant changes to federal tax law and other regulatory provisions that may impact us. The legislation has various effective dates between 2025 and 2027 and we will continue to evaluate any changes needed when additional guidance becomes available. Results of Operations for the Three Months Ended June 30, 2026 and 2025 Net Sales. Net sales were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Dollars in Thousands ​ ​ Three Months Ended ​ ​ ​ ​ ​ June 30, ​ Change ​ ​ ​ ​ 2026 ​ ​ ​ 2025 ​ ​ ​ $ ​ ​ ​ % Service revenue, net, less allowance for credit loss ​ $ 6,115 ​ $ 5,030 ​ $ 1,085 ​ 22 % Product revenue ​ 906 ​ 624 ​ ​ 282 ​ 45 % Net Sales ​ $ 7,021 ​ $ 5,654 ​ $ 1,367 ​ 24 % ​ Net sales for the three months ended June 30, 2026 were approximately $7.0 million, an increase of $1.4 million as compared to the same period in 2025. During the three months ended June 30, 2026, patient diagnostic service revenue increased $1.1 million as compared to the same period in 2025. This increase was due to a greater number of cases processed in the current year period. We processed 4,652 cases during the three months ended June 30, 2026 as compared to 3,692 cases during the same period in 2025, or a 26% increase in cases. Product revenue for the three months ended June 30, 2026 increased $0.3 million as compared to the prior year second quarter. Cost of Sales. Cost of sales includes material and supply costs for the patient tests performed, costs related to products and other direct costs (primarily personnel costs, p athologist interpretation costs and rent) associated with the operations of our laboratory. Cost of sales increased by $0.7 million for the three months ended June 30, 2026 as compared to the same period in 2025. The increase is primarily attributable to increases in reagents, operating supplies, personnel costs and pathologist interpretation costs all due to the higher number of cases processed, as discussed above. Gross Profit and Gross Margins. Gross profit and gross margins were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Dollars in Thousands ​ ​ Three Months Ended ​ ​ ​ ​ ​ June 30, ​ Change ​ ​ ​ ​ 2026 ​ ​ ​ 2025 ​ ​ ​ $ ​ ​ ​ % Gross Profit ​ $ 3,136 ​ $ 2,429 ​ 707 ​ 30 ​ Gross Margin ​ ​ 45% ​ ​ 43% ​ ​ ​ ​ ​ ​ Gross profit was approximately $3.1 million and $2.4 million during the three months ended June 30, 2026 and 2025, respectively. The gross profit increased $0.7 million during the three months ended June 30, 2026, as compared to the prior year period, as a result of increases in case volume and revenue. The gross margin was 45% and 43% for the three months ended June 30, 2026 and 2025, respectively. We operate a fully staffed CLIA and College of American Pathologists (“CAP”) certified clinical pathology and molecular laboratory. As such, it is necessary to maintain appropriate 27 Table of Contents staffing levels to provide industry standard laboratory processing and reporting to ordering physicians. An increase in case volume or average price per case will enable our laboratory to yield economies of scale and to leverage fixed expenses. ​ Operating Expenses. Operating expenses primarily consist of personnel costs, professional fees, travel costs, facility costs, stock-based compensation costs and depreciation and amortization. Our operating expenses increased by $0.5 million for the three months ended June 30, 2026 as compared to the same period in 2025. For the three months ended June 30, 2026: (1) general and administrative expenses increased by $0.1 million primarily due to increased legal and professional fees, (2) sales and marketing expenses increased by $0.1 million due to increase personnel costs, specifically related to new hires in our product division sales force, (3) research and development expenses remained relatively flat as compared to the prior year period, and (4) stock-based compensation, which is a non-cash expense, increased by $0.3 million. ​ Other Expense. We recorded net other income of $0.4 million for the three months ended June 30, 2026, which included income of $0.4 million from the receipt of Employee Retention Credits partially offset by net interest expense of $9 thousand. We recorded net other income of $0.9 million for the three months ended June 30, 2025 which included income of $0.1 million from the gain on settlement of liabilities, income of $0.8 million from the receipt of Employee Retention Credits, and net interest expense of $23 thousand. Results of Operations for the Six Months Ended June 30, 2026 and 2025 Net Sales. Net sales were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Dollars in Thousands ​ ​ ​ Six Months Ended ​ ​ ​ ​ ​ June 30, ​ Change ​ ​ ​ ​ ​ 2026 ​ ​ ​ 2025 ​ ​ ​ $ ​ ​ ​ % Service revenue, net, less allowance for credit loss ​ $ 12,167 ​ $ 9,305 ​ $ 2,862 ​ 31 % Product revenue ​ 1,565 ​ 1,278 ​ ​ 287 ​ 22 % Net Sales ​ $ 13,732 ​ $ 10,583 ​ $ 3,149 ​ 30 % ​ Net sales for the six months ended June 30, 2026 were approximately $13.7 million, an increase of $3.1 million as compared to the same period in 2025. During the six months ended June 30, 2026, patient diagnostic service revenue increased $2.9 million as compared to the same period in 2025. This increase was due to a greater number of cases processed in the current year period. We processed 9,564 cases during the six months ended June 30, 2026 as compared to 6,713 cases during the same period in 2025, or a 42% increase in cases. The benefit of the increase in cases billed during the six months ended June 30, 2026 as compared to the same period of 2025 was partially offset by a lower average price per case during the current year as a result of a different product mix. Product revenue for the six months ended June 30, 2026 increased by $0.3 million. Cost of Sales. Cost of sales includes material and supply costs for the patient tests performed, costs related to products and other direct costs (primarily personnel costs, p athologist interpretation costs and rent) associated with the operations of our laboratory. Cost of sales increased by $1.9 million for the six months ended June 30, 2026 as compared to the same period in 2025. The increase is primarily attributable to increases in reagents, operating supplies, personnel costs and pathologist interpretation costs all due to the higher number of cases processed, as discussed above. Gross Profit and Gross Margins. Gross profit and gross margins were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Dollars in Thousands ​ ​ ​ Six Months Ended ​ ​ ​ ​ June 30, ​ Change ​ ​ ​ ​ ​ 2026 ​ ​ ​ 2025 ​ ​ ​ $ ​ ​ ​ % ​ Gross Profit ​ $ 5,861 ​ ​ 4,569 ​ 1,292 ​ 29 ​ Gross Margin ​ ​ 43% ​ ​ 43% ​ ​ ​ ​ 28 Table of Contents ​ Gross profit was approximately $5.9 million and $4.6 million during the six months ended June 30, 2026 and 2025, respectively. The gross profit increased $1.3 million during the six months ended June 30, 2026, as compared to the prior year period, as a result of increases in case volume and revenue. The gross margin was 43% for the six months ended June 30, 2026 and 2025. We operate a fully staffed CLIA and College of American Pathologists (“CAP”) certified clinical pathology and molecular laboratory. As such, it is necessary to maintain appropriate staffing levels to provide industry standard laboratory processing and reporting to ordering physicians. An increase in case volume or average price per case will enable our laboratory to yield economies of scale and to leverage fixed expenses. ​ Operating Expenses. Operating expenses primarily consist of personnel costs, professional fees, travel costs, facility costs, stock-based compensation costs and depreciation and amortization. Our operating expenses increased by $1.6 million for the six months ended June 30, 2026 as compared to the same period in 2025. For the six months ended June 30, 2026: (1) general and administrative expenses increased by $0.2 million primarily due to increased legal and professional fees, (2) sales and marketing expenses increased by $0.4 million due to increased personnel and recruiting costs, specifically related to new hires in our product division sales force, (3) research and development expenses increased by $0.1 million due to increased personnel costs, and (4) stock-based compensation, which is a non-cash expense, increased by $0.9 million. ​ Other Expense. We recorded net other income of $0.4 million for the six months ended June 30, 2026, which included income of $0.4 million from the receipt of Employee Retention Credits partially offset by net interest expense of $24 thousand. We recorded net other income of $0.9 million for the six months ended June 30, 2025 which included income of $0.1 million from the gain on settlement of liabilities, income of $0.8 million from the receipt of Employee Retention Credits, and net interest expense of $48 thousand . Liquidity and Capital Resources Our working capital positions were as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ June 30, 2026 ​ ​ ​ December 31, 2025 ​ ​ ​ Change Current assets (including cash of $3,075 and $2,651 respectively) ​ $ 6,537 ​ $ 6,039 ​ $ 498 Current liabilities ​ 3,701 ​ 3,752 ​ (51) Working capital ​ $ 2,836 ​ $ 2,287 ​ $ 549 ​ ​ Analysis of Cash Flows – Six Months Ended June 30, 2026 and 2025 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Dollars in Thousands ​ ​ Three Months Ended June 30, ​ ​ ​ ​ 2026 ​ ​ ​ 2025 ​ ​ ​ Change Net cash provided by operating activities ​ $ 724 ​ $ 309 ​ $ 415 Net cash used in investing activities ​ ​ (182) ​ ​ (197) ​ ​ 15 Net cash used in financing activities ​ (118) ​ (371) ​ 253 Net change in cash ​ $ 424 ​ $ (259) ​ $ 683 ​ Cash Flows Provided by Operating Activities. The cash flows provided by operating activities of $0.7 million during the six months ended June 30, 2026 included an increase in deferred revenue of $0.1 million, a decrease in inventories and other assets of $0.2 million, and non-cash adjustments of $3.0 million. These were partially offset by a net loss of $1.7 million, an increase in accounts receivables of $0.5 million, a decrease in operating lease liabilities of $0.2 million, and a decrease in accounts payable and accrued expenses of $0.2 million. The non-cash adjustments included $0.3 million for the change in provision for credit losses. We routinely provide a reserve for credit losses as a result of having limited in-network payer contracts. The other non-cash adjustments to net loss of approximately $2.7 million include, among other things, depreciation and amortization, and stock-based compensation. The cash flows provided by operating 29 Table of Contents activities of $0.3 million during the six months ended June 30, 2025 included a decrease in other assets of $0.1 million, an increase in accounts payable of $0.5 million, an increase in deferred revenues of $0.1 million, and non-cash adjustments of $1.6 million. These were partially offset by a net loss of $0.8 million, an increase in accounts receivables of $0.6 million, an increase in inventories of $0.3 million, a decrease in operating lease liabilities of $0.1 million and a decrease in accrued expenses of $0.2 million. . Cash Flows Used In Investing Activities. Cash flows used in investing activities were approximately $0.2 million for the six months ended June 30, 2026 and 2025 resulting from purchases of property and equipment. Cash Flows Used in Financing Activities. Cash flows used in financing activities totaled $0.1 million for the six months ended June 30, 2026, which included payments on our long-term debt and finance lease obligations. Cash flows used in financing activities totaled $0.4 million for the six months ended June 30, 2025, which included $0.4 million in payments on our long-term debt and finance lease obligations . For further information regarding our future funding requirements, see the Going Concern disclosure in Note 1 of the notes to the unaudited condensed consolidated financial statements included with this Quarterly Report on Form 10-Q. Off-Balance Sheet Arrangements At each of June 30, 2026 and December 31, 2025, other than certain purchase commitments of approximately $2.8 million and $3.1 million, respectively, we did not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources. The purchase commitments are mostly for laboratory reagents used in our normal operating business. Contractual Obligations and Commitments No significant changes to contractual obligations and commitments occurred during the three months ended June 30, 2026, as compared to those disclosed in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025, filed with the Securities and Exchange Commission on March 30, 2026. Critical Accounting Estimates The preparation of financial statements in conformity with U.S. generally accepted accounting principles (“GAAP”) requires our management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statement and the reported amounts of revenues and expenses during the reporting period. Actual financial results based on judgments or estimates may vary under different assumptions or circumstances. Our critical accounting estimates are discussed in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025, filed with the Securities and Exchange Commission on March 30, 2026. Recently Issued Accounting Pronouncements See the accompanying unaudited condensed consolidated financial statements and Note 2 - “Summary of Significant Accounting Policies” in the notes to unaudited condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q, for additional information regarding recently issued accounting pronouncements. Impact of Inflation Inflationary factors, such as increases in our cost of goods, labor, or other operating expenses, may adversely affect our operating results. While it is difficult to accurately measure the impact of inflation due to the imprecise nature of the estimates required, we do not believe inflation had a material effect on our financial condition or results of operations during the three and six months ended June 30, 2026 and 2025. We cannot assure you, however, that we will be able to 30 Table of Contents increase the prices of our products or reduce our operating expenses in an amount sufficient to offset the effects future inflationary pressures may have on our gross margin. Accordingly, we cannot assure you that our financial condition and results of operations will not be materially impacted by inflation in the future . Item 3. Quantitative and Qualitative Disclosures About Market Risk We are a smaller reporting company, as defined by Rule 12b-2 of the Securities Exchange Act of 1934, as amended, and are not required to provide the information required under this item. Item 4. Controls and Procedures Evaluation of Disclosure Controls and Procedures As of the end of the period covered by this Quarterly Report on Form 10-Q, management performed, with the participation of our Chief Executive Officer and Chief Financial Officer, an evaluation of the effectiveness of our disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Our disclosure controls and procedures are designed to provide reasonable assurance that information required to be disclosed in the reports we file or submit under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the rules and forms of the SEC, and that such information is accumulated and communicated to management including our Chief Executive Officer and our Chief Financial Officer, to allow timely decisions regarding required disclosures. In designing and evaluating the disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and no evaluation of controls and procedures can provide absolute assurance that all control issues and instances of fraud, if any, within a company have been detected. Management is required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Based on the evaluation, the Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective at a reasonable assurance level as of June 30, 2026. Changes in Internal Control over Financial Reporting There have been no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the quarter ended June 30, 2026 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. ​ ​ 31 Table of Contents PART II. OTHER INFORMATION Item 1. Legal Proceedings The healthcare industry is subject to numerous laws and regulations of federal, state and local governments. These laws and regulations include, but are not limited to, matters such as licensure, accreditation, government healthcare program participation requirement, reimbursement for patient services and Medicare and Medicaid fraud and abuse. Government activity has increased with respect to investigations and allegations concerning possible violations of fraud and abuse statutes and regulations by healthcare providers. Violations of these laws and regulations could result in expulsion from government healthcare programs together with the imposition of significant fines and penalties, as well as significant repayments for patient services previously billed. Management believes that we are in compliance with fraud and abuse regulations, as well as other applicable government laws and regulations. While no material regulatory inquiries have been made, compliance with such laws and regulations can be subject to future government review and interpretation, as well as regulatory actions unknown or unasserted at this time. The outcome of legal proceedings and claims brought against us are subject to significant uncertainty. If one or more of these legal matters were resolved against us in the same reporting period for amounts in excess of management’s expectations, our financial statements for such reporting period could be materially and adversely affected. In general, the resolution of a legal matter resolved against us, could also prevent us from offering our services or products to others, could be material to our financial condition or cash flows, or both, or could otherwise adversely affect our operating results. From time to time, we are involved in legal proceedings related to matters, which are incidental to our business. Although the results of litigation and claims cannot be predicted with certainty, we currently believe that the final outcome of these ordinary course matters will not have a material adverse effect on our business, but, regardless of the outcome, litigation can have an adverse impact on us because of defense and settlement costs, diversion of management resources and other factors. For further information regarding our ongoing legal proceedings, see the Data Security Litigation disclosure in Note 5 of the notes to the unaudited condensed consolidated financial statements included with this Quarterly Report on Form 10-Q. Item 1A. Risk Factors As disclosed in “Item 1A. Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2025, there are a number of risks and uncertainties that may have a material effect on the operating results of our business and our financial condition. The following information updates, and should be read in conjunction with, the factors discussed in Part I, Item 1A, “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2025, and other filings we make with the Securities and Exchange Commission, which could materially affect our business, financial condition or future results. The risks described in this Quarterly Report on Form 10-Q and our Annual Report on Form 10-K are not the only risks we face. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially and adversely affect our business, financial condition or operating results. Except as set forth below, there have been no material changes from the risk factors disclosed in “Part I, Item 1A—Risk Factors” of our most recent Annual Report. ​ Cybersecurity risks could compromise our information and expose us to liability, which may harm our ability to operate effectively and may cause our business and reputation to suffer. Cybersecurity refers to the combination of technologies, processes and procedures established to protect information technology systems and data from unauthorized access, misuse, attack, or damage. We rely on our information systems to provide security for processing, transmission and storage of confidential information and personal information about our patients, customers and personnel and rely on our third-party providers to implement effective security measures and identify and correct for any such failures, deficiencies, data breaches or cybersecurity incidents. We also rely on our 32 Table of Contents employees and consultants to safeguard their security credentials and follow our policies and procedures regarding use and access of computers and other devices that may contain our sensitive information. If we or our third-party providers fail to maintain or protect our information technology systems and data integrity effectively or fail to anticipate, plan for or manage significant disruptions to our information technology systems, we or our third-party providers could have difficulty preventing, detecting and controlling such cyberattacks and any such attacks could result in losses described above, as well as disputes with physicians, patients and our partners, regulatory sanctions or penalties, increases in operating expenses, expenses or lost revenues or other adverse consequences, any of which could have a material adverse effect on our business, results of operations, financial condition, prospects and cash flows. Any failure by such third-parties to prevent or mitigate cybersecurity incidents, data breaches or improper access to, misuse of, or disclosure of such information could have similarly adverse consequences for us. If we are unable to prevent or mitigate the impact of such cybersecurity incidents, data breaches or other adverse events, we could be exposed to litigation and governmental investigations, which could lead to a potential disruption to our business. ​ Cyberattacks are increasing in their frequency, sophistication and intensity, and have become increasingly difficult to detect. Cyberattacks could include wrongful conduct by hostile foreign governments, intentional or inadvertent wrongful conduct by insider employees or vendors, industrial espionage, wire fraud and other forms of cyber fraud, the deployment of harmful ransomware, malware, denial-of-service attacks, social engineering fraud (including phishing attacks) or other means to threaten data security, confidentiality, integrity and availability. A successful cyberattack could cause serious negative consequences for us, including, without limitation, the disruption of operations, the misappropriation of confidential business information, including financial information, trade secrets, financial loss and the disclosure of corporate strategic plans. The regulatory environment surrounding information security and privacy is increasingly demanding, with the frequent imposition of new and changing requirements. Compliance with changes in privacy and information security laws and with rapidly evolving industry standards may result in our incurring significant expense due to increased investment in technology and the development of new operational processes. ​ We maintain our information technology systems with safeguards designed to protect against cyberattacks including passive intrusion protection, firewalls and virus detection software. However, these safeguards do not ensure that a significant cyberattack could not occur. Although we have taken steps to protect the security of our information systems and the data maintained in those systems, it is possible that our safety and security measures will not prevent the systems’ improper functioning or damage or the improper access or disclosure of personally identifiable information such as in the event of cyberattacks. Security incidents, including physical or electronic break-ins, computer viruses, attacks by hackers and similar cybersecurity incidents, and data breaches, can create system disruptions or shutdowns or the unauthorized disclosure of, access to, or misuse of confidential information. If personal information or protected health information is improperly accessed, tampered with, misused or disclosed as a result of a cybersecurity incident or data breach, we may incur significant costs to notify impacted stakeholders (including affected individuals, investors and regulators) and mitigate potential harm to affected individuals, and we may be subject to sanctions and civil or criminal penalties if we are found to be in violation of the privacy or security rules under HIPAA or other similar federal or state laws protecting confidential personal information. In addition, a cybersecurity incident, data breach of or other adverse event affecting our information systems could damage our reputation, subject us to liability claims or regulatory penalties for compromised personal information and could have a material adverse effect on our business, financial condition and results of operations. Our contracts may not contain limitations of liability, and even where they do, there can be no assurance that limitations of liability in our contracts are sufficient to protect us from liabilities, damages, or claims related to our privacy and data security obligations. Further, although we maintain cyber liability insurance, this insurance may not provide adequate coverage against potential liabilities related to any experienced cybersecurity incident or data breach. Cybersecurity incidents could result in operational disruption, regulatory investigations, required notifications and remediation, litigation, fines, reputational harm, or financial costs that could materially adversely affect our business, financial condition, results of operations, or prospects. ​ On December 4, 2025, we reported that we experienced a cybersecurity incident involving unauthorized access to an employee’s cloud-based storage account that resulted in unauthorized access to certain personally identifiable information and protected health information of individuals. In response, we initiated an investigation, engaged third-party 33 Table of Contents cybersecurity specialists, secured the impacted account, notified law enforcement authorities, and undertook a review of the affected files, which was preliminarily completed in March 2026. We began providing notice to potentially affected individuals in April 2026. We continue to assess the potential impacts of the incident, including any regulatory, legal, or financial implications. In April and May 2026, two putative class action complaints were filed against us in the United States District Court for the District of Connecticut on behalf of individuals whose information was allegedly affected by the incident. Those actions have been consolidated. We intend to defend the actions vigorously, but we are unable to predict their outcome or estimate the amount or range of any potential loss. We may become subject to additional litigation, regulatory inquiries or enforcement actions arising from the incident, and the costs of defending these matters and any resulting liability could be significant and may exceed our available insurance coverage. While we have taken mitigation steps, there can be no assurance that similar incidents will not occur in the future or that additional impacts from this or related incidents will not be identified. ​ Item 2. Unregistered Sales of Equity Securities and Use of Proceeds During the three months ended June 30, 2026, we did not have any sales of unregistered securities. Item 3. Defaults Upon Senior Securities None. Item 4. Mine Safety Disclosures Not applicable. Item 5. Other Information (a) No ne (b) None (c) None of our directors or “officers,” as defined in Rule 16a-1(f) under the Securities Exchange Act of 1934, adopted or terminated a Rule 10b5-1 trading plan or arrangement or a non-Rule 10b5-1 trading plan or arrangement, as defined in Item 408(c) of Regulation S-K, during the fiscal quarter covered by this Quarterly Report on Form 10-Q . 34 Table of Contents Item 6. Exhibits (a) Exhibits ​ ​ ​ ​ ​ ​ ​ 3.1 ​ Third Amended and Restated Certificate of Incorporation, as amended (incorporated by reference to Exhibit 3.1 of the Company’s 8-K filed on June 30, 2017). ​ ​ ​ 3.2 ​ Amended and Restated Bylaws (incorporated by reference to Exhibit 3.2 of the Company’s Form 8-K filed on June 30, 2017). ​ ​ ​ 31.1 ​ Certification of Principal Executive Officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, as amended. ​ ​ ​ 31.2 ​ Certification of Principal Financial Officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, as amended. ​ ​ ​ 32.1* ​ Certification of Principal Executive Officer, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, as amended. ​ ​ ​ 32.2* ​ Certification of Principal Financial Officer, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, as amended. ​ ​ ​ 101.INS ​ Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document. ​ ​ ​ 101.SCH ​ Inline XBRL Taxonomy Extension Schema Document ​ ​ ​ 101.CAL ​ Inline XBRL Taxonomy Extension Calculation Linkbase Document ​ ​ ​ 101.DEF ​ Inline XBRL Taxonomy Extension Definition Linkbase Document ​ ​ ​ 101.LAB ​ Inline XBRL Taxonomy Extension Label Linkbase Document ​ ​ ​ 101.PRE ​ Inline XBRL Taxonomy Extension Presentation Linkbase Document ​ ​ ​ 104 ​ Cover Page Interactive Data File – formatted as inline XBRL with applicable taxonomy extension information contained in Exhibits 101. ​ ​ ​ * This certification is not deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, or otherwise subject to the liability of that section. Such certification will not be deemed to be incorporated by reference into any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, except to the extent that the Registrant specifically incorporates it by reference. ​ 35 Table of Contents SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. ​ PRECIPIO, INC. ​ ​ ​ Date: August 14, 2026 By: /S/ ILAN DANIELI ​ ​ Ilan Danieli ​ ​ Chief Executive Officer (Principal Executive Officer) ​ ​ ​ ​ ​ ​ Date: August 14, 2026 By: /S/ MATTHEW GAGE ​ ​ Matthew Gage ​ ​ Chief Financial Officer (Principal Financial and Accounting Officer) ​ ​ ​ 36