What changed in this filing

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Item 1. Financial Statements

2026-08-12 compared with 2026-05-15 · 251 added, 113 removed, 178 unchanged (67% of the section changed)

FINANCIAL STATEMENTS

BALANCE SHEETS

AS OF MARCH 31, 2026 AND AUDITED AS OF SEPTEMBER 30, 2025)

As of March 31,

CONSOLIDATED BALANCE SHEETS

AS OF JUNE 30, 2026 AND AUDITED AS OF SEPTEMBER 30, 2025)

As of June 30,

As of September 30,

Current assets:

Restricted cash

Prepaid expenses

Prepaid expenses and other current assets

Total current assets

Property and equipment, net

LIABILITIES AND EQUITY

LIABILITIES AND EQUITY (DEFICIT)

Current liabilities:

Accrued liabilities

Accounts payable

Accrued expenses

Contract liability

Insurance premium financing payable

Other current liabilities

Total current liabilities

Total liabilities

Equity (deficit):

Common stock, $ 0.0001 par value, 100,000,000 shares authorized;

12,093,741 and 41,193,052 shares issued and outstanding at

March 31, 2026 and September 30, 2025, respectively.

13,637,824 and 41,193,052 shares

issued and outstanding at June 30, 2026 and September 30, 2025, respectively.

Additional paid in capital

Accumulated other comprehensive income

Accumulated deficit

1 unchanged sentence

( 4,170,677 )

Total equity (deficit)

Total liabilities and equity

accompanying notes are an integral part of these financial statements.

CONSOLIDATED STATEMENT OF OPERATIONS

Three Months Ended March 31,

Six Months Ended March 31,

Cost of goods sold

Total Vertical Data Inc.

(deficit) equity

Non-controlling interests

Total stockholders’ equity

Total liabilities and equity (deficit)

accompanying notes are an integral part of these unaudited financial statements.

CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS AND COMPREHENSIVE LOSS

Three Months Ended June 30,

Nine Months Ended June 30,

Cost of sales

Operating expenses:

8 unchanged sentences

( 3,040,539 )

Net loss attributable to non-controlling interest

Net loss attributable to Vertical Data Inc.

$ ( 1,237,970 )

$ ( 798,085 )

Net loss per common share:

$ ( 3,220,606 )

$ ( 3,040,539 )

Net loss per common share attributable to Vertical Data Inc.:

Basic and diluted

1 unchanged sentence

Basic and diluted

accompanying notes are an integral part of these financial statements.

CONSOLIDATED STATEMENT OF SHAREHOLDERS’ EQUITY

Comprehensive loss:

( 1,245,075 )

( 3,227,711 )

( 3,040,539 )

Foreign currency translation

Comprehensive loss

( 1,243,179 )

( 3,225,815 )

( 3,040,539 )

Comprehensive loss attributable to non-controlling interest

Comprehensive loss attributable to Vertical Data Inc.

$ ( 1,236,358 )

$ ( 798,085 )

$ ( 3,218,994 )

$ ( 3,040,539 )

accompanying notes are an integral part of these unaudited financial statements.

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

Accumulated Other Comprehensive

Total Vertical Data Inc.

Stockholders’

Non-controlling

September 30, 2024

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( 2,593,053 )

Stock-based compensation

June 30, 2025

( 3,391,138 )

September 30, 2025

3 unchanged sentences

( 31,752,690 )

Stock-based compensation

Employee stock-based compensation

December 31, 2025

( 4,823,312 )

Issuance of common stock

5 unchanged sentences

( 6,153,313 )

Issuance of common stock

Employee stock-based compensation

Non-employee stock-based compensation

Foreign currency translation

( 1,237,970 )

( 1,245,075 )

June 30, 2026

( 7,391,283 )

accompanying notes are an integral part of these unaudited financial statements.

CONSOLIDATED STATEMENT OF CASH FLOWS

Six Months Ended March 31,

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Nine Months Ended June 30,

Cash flows from operating activities:

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Other current assets

Accrued liabilities

Accounts payable

Accrued expenses

Contract liability

9 unchanged sentences

Net cash provided by financing activities

Net change in cash, cash equivalents and restricted cash

Cash, cash equivalents and restricted cash, beginning of period

Cash, cash equivalents and restricted cash, end of period

Cash, cash equivalents and restricted cash reconciliation:

Cash and cash equivalents

Restricted cash

Total cash, cash equivalents and restricted cash

Effect of foreign currency translation on cash

Net change in cash and cash equivalents

Cash and cash equivalents, beginning of

Cash and cash equivalents, end of

Supplemental disclosures of cash flow information:

Cash paid for interest

Cash paid for taxes

Supplemental disclosures of non-cash investing and financing activities:

1 unchanged sentence

accompanying notes are an integral part of these unaudited financial statements.

TO CONSOLIDATED FINANCIAL STATEMENTS

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NATURE OF OPERATIONS

(the “Company”) was incorporated in Nevada on May 3, 2024 and has a fiscal year-end of September 30.

The Company’s

current service to its customers is comprised solely of the sale of artificial intelligence related hardware.

The Company plans to expand

its service offerings in the future to include technology consulting, design and engineering, project management, systems integration,

system installation and facilities management.

is primarily focused on the sale of artificial intelligence related hardware.

The Company hopes to expand its service offerings in the

future to include technology consulting, design and engineering, project management, systems integration, system installation and facilities

The Company’s corporate office is located in Las Vegas, Nevada.

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of Presentation

accompanying financial statements have been prepared using the accrual basis of accounting in accordance with generally accepted

accounting principles (“GAAP”) promulgated in the United States of America.

The financial statements include Vertical

and its subsidiaries Vertical Data Nordic and VDCA Inc.

as of March 31, 2026.

Vertical Data Nordic and VDCA Inc.

recently established in Sweden and Canada, respectively, for the purpose of conducting business operations in those countries.

entities did not commence principal operations as of March 31, 2026.

The accompanying financial statements have been

prepared using the accrual basis of accounting in accordance with generally accepted accounting principles (“GAAP”) promulgated

in the United States of America.

The financial statements include Vertical Data Inc.

and its subsidiaries Vertical Data Nordica (“VD

Nordica”) and VDCA Inc.

as of June 30, 2026.

VD Nordica and VDCA Inc.

were established in Sweden and Canada, respectively, for the

purpose of conducting business operations in those countries.

To that extent, the company owns 85% of the outstanding shares of VD Nordica

with the remaining 15% ownership presented as non-controlling interest on the face of our financial statements.

Further, VDCA Inc.

not commence principal operations as of June 30, 2026.

The Company’s fiscal year-end is September 30.

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5-Recognize revenue when (or as) the Company satisfies a performance obligation

Company’s contracts with its customers currently only contain a single performance obligation comprised solely of the sale of IT

To that extent, the Company does not provide any installation or customization services at this time that might be considered

a separate performance obligation.

Further, as noted above, revenue is recognized at a point in time upon delivery of the equipment to

the customer at the agreed upon location.

The Company does not currently extend any form of payment terms to its customers and, as such,

full payment for the equipment is received from the customer (via wire payment) immediately upon delivery of the equipment.

The Company will recognize a contract liability to the extent it receives consideration from a customer prior to

providing the equipment.

During the interim period ended March

31, 2026, the Company received an $ 11.2 million customer prepayment primarily related to the future sale of computer equipment to the

The Company expects to recognize the amount to revenue during its interim period ended June 30, 2026.

Restricted Cash

Company presents cash and cash items that are restricted as to withdrawal and usage as restricted cash on its consolidated balance sheet.

As of March 31, 2026, the Company classified $ 1.2 .

million in cash as restricted cash as the Company was legally obligated to use the

amount to purchase computer equipment from a vendor for an existing customer.

Equipment Sales

Company’s IT equipment sales contracts with its customers currently contain a single performance obligation comprised solely of

the sale of IT equipment.

To that extent, the Company does not provide any installation or customization services at this time that might

be considered a separate performance obligation.

Further, as noted above, revenue is recognized at a point in time upon delivery of the

equipment to the customer at the agreed upon location.

The Company does not extend payment terms to its customers;

equipment is received via wire transfer at or before delivery.

When the Company receives consideration from a customer in advance of transferring

the equipment, the amount received is recorded as a contract liability and recognized as revenue upon delivery of the equipment to the

customer at the agreed-upon location, which is the point at which control transfers.

the interim period ended June 30, 2026, the Company recognized a $ 9.0 million customer prepayment primarily related to the future sale

of computer equipment to the customer.

The Company expects to recognize the amount to revenue during the period ended December 31,

Service Revenue

Company enters into arrangements under which it provides billing services on behalf of third-party vendors to end customers.

arrangements, the Company bills the end customer for the full amount of goods or services provided by the vendor, retains a portion of

the amount billed as consideration for its billing services, and remits the remainder to the vendor.

In accordance with ASC 606, the

Company determined that it was the agent in these transactions and therefore recognized revenue on a net basis.

Company’s revenue for the three and nine months ended June 30, 2026 disaggregated by service type was as follows:

OF REVENUE DISAGGREGATED BY SERVICE

Three Months Ended June 30,

Nine Months Ended June 30,

IT hardware sales

Billing service revenue

Total revenue

Translation of Foreign Operations

The financial results and position of foreign

operations whose functional currency is different from the Company’s presentation currency are translated as follows:

● assets and liabilities are translated at period-end exchange rates prevailing at that reporting date;

● equity is translated at historical exchange rates;

● income and expenses are translated at average exchange rates for the period.

Exchange differences arising on translation of

foreign operations are recognized in accumulated other comprehensive loss in the consolidated financial statements.

During the nine months

ended June 30, 2026, the Company had one operating subsidiary with a functional currency other than the U.S.

The relevant translation rates are as follows:

SCHEDULE OF RELEVANT TANSLATION RATES

June 30, 2026

Swedish Krona

Foreign Currency Transactions

Transactions denominated in currencies other than

the functional currency of the applicable entity are initially recorded using the exchange rate in effect on the transaction date.

assets and liabilities denominated in foreign currencies are remeasured at the applicable exchange rate at each reporting date.

currency transaction gains and losses resulting from settlement of such transactions and from remeasurement of monetary assets and liabilities

are recognized in the consolidated statements of operations in the period in which they arise.

Non-Controlling Interest

In accordance with ASC 810, Consolidation, the Company consolidates entities in which it has a controlling

financial interest.

Further, for less than wholly owned subsidiaries, the Company will present on the face of its consolidated financial

statements i) the amounts of consolidated net income and consolidated comprehensive income and ii) the related amounts of each attributable

to the parent and the noncontrolling interest.

The Company accounts for its

stock-based compensation awards in accordance with ASC Topic 718, Compensation—Stock Compensation (“ASC 718”).

requires all stock-based payments, including grants of employee stock options, to be recognized in the statements of operations by measuring

the fair value of the award on the date of grant and recognizing this fair value as stock-based compensation over the requisite service

period, generally the vesting period.

The Company estimates the grant

date fair value of stock option awards using the Black-Scholes option-pricing model.

The use of the Black-Scholes option-pricing model

requires management to make assumptions with respect to the fair value of our underlying shares, the expected term of the option, the

expected volatility of our Common Stock, the risk-free interest rates and expected dividend yield of our Common Stock.

Company currently reports under a single operating segment, which constitutes all of the consolidated entity.

3 unchanged sentences

is net loss as presented in our consolidated statement of operations.

Concentrations of Credit Risk, Customers and Vendors

Financial instruments that potentially subject the Company to concentrations

of credit risk consist primarily of cash and accounts receivable.

The Company maintains its cash balances with financial institutions

which, at times, may exceed federally insured limits.

The Company has not experienced any losses on such accounts and believes it is not

exposed to significant credit risk related to its cash balances.

The Company’s revenues are concentrated among

a limited number of customers.

For the three months ended June 30, 2026, one customer accounted for approximately 100% of total revenue.

For the nine months ended June 30, 2026, customers representing 10% or more of revenue accounted for 100% of total revenue.

a significant customer or a material reduction in business with such customer could adversely affect the Company’s results of operations.

The Company also purchases equipment and services

from a limited number of vendors.

As of June 30, 2026, 100% of the Company’s vendor deposits were associated with one vendor.

Company’s operations may therefore be affected by its ability to obtain equipment and services from these vendors on acceptable

terms and within required delivery timelines.

The Company operates primarily in the United States

and, through its majority-owned subsidiary VD Nordica, has commenced operations in Sweden.

For the three and nine months ended June 30,

2026, substantially all of the Company’s revenue was generated from customers located in United States.

The Company’s foreign

operations expose it to risks associated with foreign currency movements and operating in foreign jurisdictions.

Accounting Pronouncements

19 unchanged sentences

the impact of the new ASU to its financial statements.

PREPAID EXPENSES

PREPAID EXPENSES AND OTHER CURRENT ASSETS

expenses consisted of the following:

SCHEDULE OF PREPAID EXPENSES

OF PREPAID EXPENSES AND OTHER CURRENT ASSETS

June 30, 2026

September 30, 2025

2 unchanged sentences

Prepaid insurance

Prepaid expenses

of March 31, 2026 and September 30, 2025, prepaid expenses totaled $ 6,468,024

and $ 144,994 ,

respectively.

Prepaid expenses and other current assets

of June 30, 2026 and September 30, 2025, prepaid expenses totaled $ 4,332,653 and $ 144,994 , respectively.

Vendor deposits of $ 3,999,990

as of March 31, 2026 represent payments made to the Company’s equipment vendor for the settlement of contract liabilities related

to future purchase of equipment for its customers.

The Company did not receive the equipment as of the March 31, 2026 balance sheet date.

as of June 30, 2026 represent payments made to the Company’s equipment vendor for the purchase of equipment on behalf of its customers.

The Company did not receive the equipment as of the June 30, 2026 balance sheet date.

PROPERTY AND EQUIPMENT

1 unchanged sentence

SCHEDULE OF PROPERTY AND EQUIPMENT

September 30,

Tools, machinery, and equipment

1 unchanged sentence

Total property and equipment, net

depreciation expense was $ 91 and $ 181 for three and six months ended March 31, 2026, respectively, and $ 83 and $ 150 for the three and

six months ended March 31, 2025, respectively.

ACCRUED LIABILITIES

depreciation expense was $ 91 and $ 272 for three and nine months ended June 30, 2026, respectively, and $ 90 and $ 240 for the three and

nine months ended June 30, 2025, respectively.

ACCRUED EXPENSES

liabilities consisted of the following:

SCHEDULE OF ACCRUED LIABILITIES

September 30,

Wages accrual

Expenses accrual

Credit card accrual

Total accrued liabilities

OTHER CURRENT LIABILITIES

OF OTHER CURRENT LIABILITIES

June 30, 2026

September 30, 2025

Payable to counterparty

Insurance premium financing payable

On January 30, 2026, the Company entered into a premium financing agreement

to fund an annual Director and Officer (D&O) insurance policy.

The agreement provided for a total financed amount of $ 112,500 , representing

the premium balance after a down payment of $ 37,500 .

The note carries a finance charge of $ 4,667 , resulting in total obligation of $ 117,167 .

The note is payable in 9 equal monthly installments of $ 13,019 , maturing

on October 30, 2026.

The total finance charge of $ 4,667 is amortized as interest expense over the term of the agreement within general

and administrative in the statement of operations.

As of March 31, 2026, the outstanding principal balance of this note, net of unamortized

discount, was $ 87,500 .

Total other current liabilities

to Counterparty

the three months ended June 30, 2026, the Company provided billing services on behalf of a third-party counterparty, which resulted in

cash receipts from the end customer of $ 1,867,824 .

Of this amount, $ 247,212 was recognized as billing service revenue, $ 535,248 was remitted

to the counterparty during the period, and the remaining $ 1,085,364 was recorded as a payable to the counterparty as of June 30, 2026.

The Company remitted this payable balance to the counterparty during July 2026.

Premium Financing Payable

January 30, 2026, the Company entered into a premium financing agreement to fund an annual Director and Officer (D&O) insurance

The agreement provided for a total financed amount of $ 112,500 ,

representing the premium balance after a down payment of $ 37,500 .

The note carries a finance charge of $ 4,667 ,

resulting in an initial total obligation of $ 117,167 .

note is payable in 9 equal monthly installments of $ 13,019 ,

maturing on October 30, 2026 .

The total finance charge of $ 4,667

is amortized as interest expense over the term of the agreement

within general and administrative in the statement of operations.

As of June 30, 2026, the outstanding principal balance of this note,

net of unamortized discount, was $ 50,000 and

was included in other current liabilities in our consolidated interim balance sheet.

STOCKHOLDERS’ EQUITY

1 unchanged sentence

Company’s common shares do not include any dividend or liquidation preferences, participation rights, call prices or unusual voting

Stock Issuances

the three months ended March 31, 2026, the Company sold 280,000 shares of Company stock in an unregistered offering for net proceeds

of $ 40,000 .

the six months ended March 31, 2026, the Company sold 644,000 shares of Company stock in an unregistered offering for net proceeds of

the three months ended June 30, 2026, the Company sold 85,000

shares of Company stock for net proceeds of $ 255,000 .

The 85,000 shares of common stock were not issued as of the date of this filing.

During the three months ended the Company collected $ 100,000 for prior quarter common stock sales and issuances.

the nine months ended June 30, 2026, the Company sold 729,000

shares of Company stock for net proceeds of $ 577,000 .

Of these 729,000 shares of common stock, 85,000 shares of common stock were not issued as of the date of this filing.

October of 2025, certain founders and other Company shareholders voluntarily surrendered an aggregate of 31,752,690 shares of Common

7 unchanged sentences

Option Exercises

January of 2026, a total of 1,300,000 stock options were exercised at a weighted average exercise price of $ 0.05 , resulting in proceeds

of $ 65,000 .

January of 2026, a total of 788,199 stock options were exercised.

These stock options were exercised as a cashless exercise whereby the

consideration provided for exercise was forfeiture of 78,820 shares, resulting in net shares issued of 709,379 .

Stock to be Issued for Services Provided

the three months ended March 31, 2026, the Company entered into agreements with various service providers to settle existing obligations through the future

issuance of 864,900 shares resulting in the settlement of liabilities totaling $ 432,450 .

No gain or loss was recognized from recognition

of the transaction.

the three months ended March 31, 2026, the Company entered into a agreements with two employees for the payment of bonuses through the

future issuance of 360,000 shares resulting in the settlement of liabilities totaling $ 180,000 .

the nine months ended June 30, 2026, 2,016,097 stock options were exercised at a weighted average exercise price of $ 0.03 , resulting

in proceeds of $ 65,000 .

Common Stock Issued for Services

During the three months ended March 31, 2026,

the Company entered into an agreement with a service provider for to settle an existing obligation through the future issuance of 103,065 shares

resulting in the settlement of liabilities totaling $ 51,533 .

No gain or loss was recognized from recognition of the transaction.

103,065 shares of common stock were issued during the three months ended June 30, 2026.

During the three months ended March 31, 2026,

the Company entered into agreements with various service providers to settle existing obligations through the future issuance of 864,900 shares

resulting in the settlement of liabilities totaling $ 432,450 .

No gain or loss was recognized from recognition of the transaction.

864,900 shares were issued during the three months ended June 30, 2026.

During the three months ended March 31, 2026,

the Company entered into agreements with two employees for the payment of bonuses through the future issuance of 360,000 shares

resulting in the settlement of liabilities totaling $ 180,000 .

No gain or loss was recognized from the transaction.

the three months ended March 31, 2026, the Company entered into an agreement with a service provider for to settle an existing obligation through the future

issuance of 103,065 shares resulting in the settlement of liabilities totaling $ 51,533 .

No gain or loss was recognized from recognition

of the transaction.

These 360,000 shares

were issued during the three months ended June 30, 2026.

During the three months ended June 30, 2026, the

Company entered into agreements with various service providers to settle existing obligations through the issuance of 59,400 shares

resulting in the settlement of liabilities totaling $ 190,080 .

No gain or loss was recognized from recognition of the transaction.

During the three months ended June 30, 2026,

the Company issued 150,000

shares of common stock in the form of a restricted stock awards to a service provider.

award vests over a period of twenty-four months in eight equal quarterly installments.

The total grant date fair value of the

award was $ 249,000

and is being expensed on a ratable basis over the vesting period.

SUBSEQUENT EVENTS

accordance with ASC 855 Subsequent Events , the Company has evaluated events and transactions subsequent to March 31, 2026 through

accordance with ASC 855 Subsequent Events , the Company has evaluated events and transactions subsequent to June 30, 2026 through

the date these financial statements were issued.

Management did not identify any subsequent events that

would require disclosure in these consolidated financial statements.

Management did not identify any subsequent events that would require disclosure in these

consolidated financial statements, other than the item described below.

Sale of Common Stock

Subsequent to June 30, 2026, the Company sold 762,802 shares of common stock for total proceeds of $ 2,313,372 .

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements