What changed in this filing

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Item 2. Management’s Discussion and Analysis

2025-11-13 compared with 2025-07-31 · 118 added, 114 removed, 165 unchanged (58% of the section changed)

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expectations for revenues, liquidity, cash flows and financial performance;

expectations regarding repayment of our Term Loan (defined below);

and expectations regarding the release of additional wireless power-enabled products.

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We undertake no obligation to publicly update any of our forward-looking statements, whether as a result of new information, future developments or otherwise.

We have developed scalable, over-the-air Wireless Power Network (“WPN”) technology that integrates advanced semiconductor chipsets, software controls, hardware designs, and antenna systems to enable radio frequency (“RF”)-based charging for Internet of Things (“IoT”) devices.

Our WPN technology provides a comprehensive suite of capabilities designed to power the next generation of wireless energy networks, seamlessly delivering power and data across diverse, battery-free device ecosystems.

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With a patent portfolio exceeding 250 patents, our solutions support both near-field and at-a-distance wireless charging, supplying power at multiple levels across varying distances, as well as expertise in advanced receiver technology.

By enabling continuous wireless power transmission, our transmitter and receiver technologies facilitate the use of battery-free IoT devices, transforming asset and inventory tracking across multiple industries.

By enabling continuous wireless power transmission, our transmitter and receiver technologies facilitate the use of battery-free ambient IoT devices, transforming asset and inventory tracking across multiple industries.

Key applications include retail sensors, electronic shelf labels, asset trackers, air quality monitors, motion detectors, and other smart monitoring solutions.

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Cold Chain, Asset Tracking, Medical IoT

Ambient IoT Sensors

Cold Chain, Logistics, Asset Tracking

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As we continue to innovate our technology applications, we anticipate the release of additional wireless power-enabled products.

Nasdaq Market Compliance

As previously reported.

on August 29, 2024, we received a notification letter from the Listing Qualifications Department (the “Staff”) of The Nasdaq Stock Market LLC (“Nasdaq”) advising that for 30 consecutive trading days preceding the date of the notice, the bid price of our common stock had closed below the $1.00 per share minimum required for continued listing on the Nasdaq Capital Market pursuant to Nasdaq Marketplace Rule 5550(a)(2) (the “Bid Price Rule”).

We were provided an initial 180 calendar days, or until February 25, 2025, to regain compliance with the Bid Price Rule.

On February 27, 2025, we received a letter from the Staff granting an additional 180 calendar days, or until August 25, 2025, to regain compliance with Bid Price Rule.

The Nasdaq determination to grant the second compliance period was based on our compliance with the continued listing requirement for market value of publicly held shares and all other applicable requirements for initial listing on the Nasdaq Capital Market, with the exception of the Bid Price Rule, and written notice of our intention to cure the deficiency during the second compliance period by effecting a reverse stock split, if necessary.

To regain compliance with the Big Price Rule, our common stock must close at or above $1.00 per share for a minimum of ten consecutive business days at any time during the second 180-day compliance period, or August 25, 2025.

At our 2025 Annual Meeting of Stockholders held on June 11, 2025, our stockholders approved a proposal for an amendment to the our second amended and restated certificate of incorporation, as amended, to effect a reverse stock split of our common stock at a ratio ranging from any whole number between 1-for-5 and 1-for-50, as determined by the Board of Directors in its discretion.

Subject to market conditions, our Board of Directors may need to implement a reverse stock split prior to August 25, 2025 in order to regain compliance with the Bid Price Rule.

In the second quarter of 2025, the Company introduced its battery-free e-Sense tag and e-Compass software platform, establishing the first end-to-end wireless power platform for the ambient IoT.

Recent Developments

On September 11, 2025, we raised net proceeds of $4.5 million from a registered direct offering and concurrent exercise of our 2023 and 2024 warrants where we issued 120,000 shares of common stock, 465,347 pre-funded warrants and 585,347 warrants.

Critical Accounting Policies and Estimates

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Some of these judgments can be subjective and complex, and, consequently, actual results may differ from these estimates.

Although we believe that its estimates and assumptions are reasonable, they are based upon information available at the time the estimates and assumptions were made.

Although we believe that management’s estimates and assumptions are reasonable, they are based upon information available at the time the estimates and assumptions were made.

Actual results could differ from those estimates.

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The wireless charging system revenue consists of revenue from product development projects and production-level systems.

We record revenue associated the sales of products, such as PowerBridge transmitter systems, and with product development projects that we enter into with certain customers.

For the sales of products, we generally records revenue upon shipment of the products.

For product development projects that are complex, and we do not have certainty about our ability to achieve the project milestones.

We record revenue associated with the sales of products, such as PowerBridge transmitter systems, and with product development projects that we enter into with certain customers.

For the sales of products, we generally record revenue upon shipment of the products.

In general, product development projects are complex, and we do not have certainty about our ability to achieve the project milestones.

The achievement of a milestone is dependent on our performance obligation and requires acceptance by the customer.

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Any deferred revenue is recognized upon achievement of the performance obligation or expiration of a support agreement.

During the three months ended June 30, 2025, management believes there have been no significant changes to the items that we disclosed within our critical accounting policies and estimates in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2024.

During the three months ended September 30, 2025, management believes there have been no significant changes to the items that we disclosed within our critical accounting policies and estimates in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2024.

Results of Operations

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Research and development expenses include costs associated with our efforts to develop our technology, including personnel compensation, consulting, engineering supplies and components, regulatory expense and general office expenses specifically related to the research and development department.

Sales and marketing expenses include costs associated with selling and marketing our technology to our customers, including personnel compensation, public relations, graphic design, tradeshow, engineering supplies utilized by the sales team and general office expenses specifically related to the sale and marketing department.

General and administrative expenses include costs for general and corporate functions, including personnel compensation, facility fees, travel, telecommunications, insurance, professional fees, consulting fees, general office expenses, and other overhead.

Comparison of Three Months Ended June 30, 2025 and 2024

Comparison of Three Months Ended September 30, 2025 and 2024

The following table sets forth selected Condensed Statements of Operations data (in thousands):

For the three months ended June 30,

For the three months ended September 30,

Cost of revenue

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Severance expense

Expenses from abandoned financing transaction

Total operating expenses

Loss from operations

Other income (expense), net:

Other income, net:

Change in fair value of warrant liability

Interest income (expense), net

Loss on retirement of property and equipment

Total other income (expense), net

During the three months ended June 30, 2025 and 2024, we recorded revenue of $1.0 million and $46,000, respectively.

The 2,020% year over year increase is primarily due to the expansion of commercial applications with multinational enterprise retailers deploying our WPN technology in connection with their infrastructure modernization initiatives.

Interest income, net

Total other income, net

During the three months ended September 30, 2025 and 2024, we recorded revenue of $1.3 million and $0.2 million, respectively.

The 453% year over year increase is primarily due to the expansion of commercial applications with multinational enterprise retailers, including two Fortune 10 companies, deploying our WPN technology in connection with their infrastructure modernization initiatives as well as a proof-of-concept deployment with a Fortune 500 customer referred through the Company’s participation in the Amazon Web Services (“AWS”) Partner Network.

Costs and Expenses and Loss from Operations.

Costs and expenses are made up of cost of revenue, research and development, sales and marketing, general and administrative, severance expense and expenses from the abandoned financing transaction.

Loss from operations for the three months ended June 30, 2025 and 2024 were $2.8 million and $4.7 million, respectively.

Costs and expenses are made up of cost of revenue, research and development, sales and marketing, general and administrative and severance expenses.

Loss from operations for the three months ended September 30, 2025 and 2024 was $2.2 million and $3.6 million, respectively.

Cost of Revenue:

For the three months ended June 30,

For the three months ended September 30,

Cost of revenue

Percent of total revenue

Cost of revenue was $0.6 million and $0.1 million, respectively, for the three months ended June 30, 2025 and 2024.

The increase is primarily due to higher sales volume of PowerBridge Pro transmitters that were shipped during the second quarter of 2025.

With the ramp up of our volume manufacturing during the first and second quarters of 2025 and other strategic efforts made to optimize operations, product margins improved significantly, transitioning from a gross loss in 2024 of $76,000 to a gross profit in 2025 of approximately $0.3 million, representing a 545% year over year improvement in gross profit for the same quarter last year.

Cost of revenue was $0.8 million and $0.3 million, respectively, for the three months ended September 30, 2025 and 2024.

The increase is primarily due to higher sales volume of PowerBridge Pro transmitters that were shipped during the third quarter of 2025.

With the ramp up of our volume manufacturing during 2025 and other strategic efforts made to optimize operations, product margins improved significantly, transitioning from a gross loss in 2024 of $76,000 to a gross profit in 2025 of approximately $0.5 million, representing a 703% year over year improvement in gross profit for the same quarter last year.

Research and Development Costs:

For the three months ended June 30,

For the three months ended September 30,

Research and development

Percent of total revenue

Research and development costs were $1.1 million and $2.3 million, respectively, for the three months ended June 30, 2025 and 2024.

The decrease of $1.2 million is primarily due to a $0.6 million decrease in engineering components, circuit boards and software, a $0.4 million decrease in payroll costs and a $42,000 decrease in stock-based compensation.

Research and development (“R&D”) costs were $0.9 million and $1.5 million, respectively, for the three months ended September 30, 2025 and 2024.

The decrease of $0.6 million is primarily due to a $0.5 million decrease in payroll costs from a lower headcount within the R&D department.

Sales and Marketing Costs:

For the three months ended June 30,

For the three months ended September 30,

Sales and marketing

Percent of total revenue

Sales and marketing costs for the three months ended June 30, 2025 and 2024 were $0.7 million and $0.8 million, respectively.

The decrease of $0.1 million is primarily due to a $0.2 million decrease in public relations and consulting fees, partially offset by a $0.1 million increase in payroll costs.

Sales and marketing costs for the three months ended September 30, 2025 and 2024 were $0.5 million and $0.7 million, respectively.

The decrease of $0.2 million is primarily due to a $0.1 million decrease in stock-based compensation and a $0.1 million decrease in consulting fees.

General and Administrative Expenses:

For the three months ended June 30,

For the three months ended September 30,

General and administrative

Percent of total revenue

General and administrative costs for the three months ended June 30, 2025 and 2024 were $1.3 million and $1.7 million, respectively.

The decrease of $0.4 million is primarily due to a $0.2 million decrease in legal fees and a $0.2 million decrease in annual meeting-related expenses, partially offset by a $0.1 million increase in payroll costs accrued as a result of key milestones achieved in the second quarter of 2025 under the 2025 Bonus Plan.

General and administrative costs for the three months ended September 30, 2025 and 2024 were $1.2 million and $1.3 million, respectively.

The overall change was relatively flat.

A $0.1 million increase in compensation and a $0.1 million increase in stock registration and transfer expenses were offset by a $0.2 million decrease in legal fees for patent and general corporate matters.

Severance Expense:

For the three months ended June 30,

For the three months ended September 30,

Severance expense

Percent of total revenue

Severance expense for the three months ended June 30, 2025 and 2024 was $23,000 and $(0.3) million, respectively.

Severance expense for the three months ended June 30, 2025 was related to separation with certain non-executive employees.

The credit during the three months ended June 30, 2024 was a result of the finalization of the negotiated settlement and payroll taxes for our former CEO.

Expenses from Abandoned Financing Transaction:

For the three months ended June 30,

Expenses from abandoned financing transaction

Percent of total revenue

Expenses related to our abandoned financing transaction were $5,000 for the three months ended June 30, 2025, primarily attributable to our decision to terminate the previously announced convertible preferred equity offering under Regulation A.

There was no such expense during the three months ended June 30, 2024.

Other income (expense), net:

For the three months ended June 30,

Severance expense for the three months ended September 30, 2025 and 2024 was $8,000 and $0.1 million, respectively.

Severance expense for both the three months ended September 30, 2025 and 2024 was related to separation with certain non-executive employees.

Other income, net:

For the three months ended September 30,

Change in fair value of warrant liability

Interest income (expense), net

Loss on retirement of fixed asset

Total other income (expense), net

Other income resulting from the change in fair value of the warrant liability was $0 for the three months ended June 30, 2025, compared to $0.3 million in income for the three months ended June 30, 2024.

The change during the three months ended June 30, 2024 is due to a lower market value of our common stock.

Net interest expense for the three months ended June 30, 2025 was $7,000, as we incurred $97,000 in interest expense from a short-term loan, partially offset by $89,000 in interest earned from our money market account.

Interest income for the three months ended June 30, 2024 was $62,000 from interest earned on our money market account, and we had approximately $5,000 in interest expense from a short-term loan.

As a result of the above, net loss for the three months ended June 30, 2025 was $2.8 million as compared to $4.3 million for the three months ended June 30, 2024.

Comparison of Six Months Ended June 30, 2025 and 2024

Interest income, net

Total other income, net

Other expense resulting from the change in fair value of the warrant liability was $10,000 for the three months ended September 30, 2025, compared to $0.2 million in income for the three months ended September 30, 2024.

As of September 30, 2025, the 2023 Warrants were fully exercised, eliminating the related warrant liability.

Net interest income for the three months ended September 30, 2025 was $88,000, as we earned approximately $99,000 in interest from our money market account, partially offset by approximately $11,000 in interest expense from a short-term loan that was paid off on July 7, 2025.

Interest income for the three months ended September 30, 2024 was $10,000 from interest earned on our money market account.

As a result of the above, net loss for the three months ended September 30, 2025 was $2.1 million as compared to $3.4 million for the three months ended September 30, 2024.

Comparison of Nine Months Ended September 30, 2025 and 2024

The following table sets forth selected Condensed Statements of Operations data (in thousands):

For the six months ended June 30,

For the nine months ended September 30,

Cost of revenue

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Loss from operations

Other income (expense), net:

Other income, net:

Change in fair value of warrant liability

Interest income (expense), net

Interest income, net

Loss on retirement of property and equipment

Total other income, net

During the six months ended June 30, 2025 and 2024, we recorded revenue of $1.3 million and $0.1 million, respectively.

The 1,098% year over year increase is primarily due to the expansion of commercial applications with multinational enterprise retailers deploying our WPN technology in connection with their infrastructure modernization initiatives.

During the nine months ended September 30, 2025 and 2024, we recorded revenue of $2.6 million and $0.3 million, respectively.

The 662% year over year increase is primarily due to the expansion of commercial applications with multinational enterprise retailers, including two Fortune 10 companies, deploying our WPN technology in connection with their infrastructure modernization initiatives as well as a proof-of-concept deployment with a Fortune 500 customer referred through the Company’s participation in the AWS Partner Network.

Costs and Expenses and Loss from Operations.

Costs and expenses are made up of cost of revenue, research and development, sales and marketing, general and administrative, severance expense and expenses from the abandoned financing transaction.

Loss from operations for the six months ended June 30, 2025 and 2024 were $6.4 million and $11.3 million, respectively.

Loss from operations for the nine months ended September 30, 2025 and 2024 was $8.6 million and $14.9 million, respectively.

Cost of Revenue:

For the six months ended June 30,

For the nine months ended September 30,

Cost of revenue

Percent of total revenue

Cost of revenue was $0.9 million and $0.2 million, respectively, for the six months ended June 30, 2025 and 2024.

The increase is primarily due to higher sales volume of PowerBridge Pro transmitters that were shipped during the first and second quarters of 2025.

With the ramp up of our volume manufacturing during the first and second quarters of 2025 and other strategic efforts made to optimize operations, product margins improved significantly, transitioning from a gross loss in 2025 of $0.1 million to a gross profit in 2025 of approximately $0.4 million, representing a 456% year over year improvement in gross profit.

Cost of revenue was $1.7 million and $0.5 million, respectively, for the nine months ended September 30, 2025 and 2024.

The increase is primarily due to higher sales volume of PowerBridge Pro transmitters that were shipped during 2025.

With the continued ramp up of our volume manufacturing during the first nine months of 2025 and other strategic efforts made to optimize operations, product margins improved significantly, transitioning from a gross loss in 2024 of $0.2 million to a gross profit in 2025 of approximately $0.9 million, representing a 551% year over year improvement in gross profit.

Research and Development Costs:

For the six months ended June 30,

For the nine months ended September 30,

Research and development

Percent of total revenue

Research and development costs were $2.3 million and $4.5 million, respectively, for the six months ended June 30, 2025 and 2024.

The decrease of $2.2 million is primarily due to a $1.1 million in payroll costs from a lower headcount within the department, a $0.9 million decrease in engineering components, circuit boards and software and a $0.1 million decrease in stock-based compensation.

Research and development costs were $3.2 million and $6.0 million, respectively, for the nine months ended September 30, 2025 and 2024.

The decrease of $2.8 million is primarily due to a $1.7 million decrease in compensation, consisting of a $1.5 million decrease in payroll costs from a lower headcount within the R&D department and a $0.2 million decrease in stock-based compensation, a $0.8 million decrease in engineering components, circuit boards and third-party software and a $0.1 million decrease in software maintenance.

Sales and Marketing Costs:

For the six months ended June 30,

For the nine months ended September 30,

Sales and marketing

Percent of total revenue

Sales and marketing costs for the six months ended June 30, 2025 and 2024 were $1.3 million and $1.7 million, respectively.

The decrease of $0.4 million is primarily due to a $0.3 million decrease in public relations, consulting and recruiting fees and a $0.1 million decrease in marketing, promotional and tradeshow expenses.

Sales and marketing costs for the nine months ended September 30, 2025 and 2024 were $1.8 million and $2.4 million, respectively.

The decrease of $0.6 million is primarily due to a $0.4 million decrease in public relations, consulting and recruiting fees, a $0.1 million decrease in marketing, promotional and tradeshow expenses and a $0.1 million decrease in stock-based compensation.

General and Administrative Expenses:

For the six months ended June 30,

For the nine months ended September 30,

General and administrative

Percent of total revenue

General and administrative costs for the six months ended June 30, 2025 and 2024 were $2.2 million and $3.7 million, respectively.

The decrease of $1.5 million is primarily due to a $0.7 million decrease in legal fees, a $0.3 million decrease in annual meeting-related expenses, a $0.3 million decrease in consulting, investor relations, recruiting and third-party services, a $0.1 million decrease in insurance premiums and a $0.1 million decrease in stock-based compensation, partially offset by a $0.1 million increase in payroll costs accrued as a result of key milestones achieved in the second quarter of 2025 under the 2025 Bonus Plan.

General and administrative costs for the nine months ended September 30, 2025 and 2024 were $3.4 million and $5.0 million, respectively.

The decrease of $1.6 million is primarily due to a $0.9 million decrease in legal fees, a $0.3 million decrease in annual meeting-related expenses, a $0.3 million decrease in consulting, investor relations, recruiting and third-party services, a $0.2 million decrease in insurance premiums and a $0.1 million decrease in stock-based compensation, partially offset by a $0.2 million increase in payroll costs accrued as a result of key milestones achieved during 2025 under the 2025 Bonus Plan and higher employee benefit costs.

Severance Expense:

For the six months ended June 30,

For the nine months ended September 30,

Severance expense

Percent of total revenue

Severance expense for the six months ended June 30, 2025 and 2024 was $0.4 million and $1.3 million, respectively.

Severance expense for the six months ended June 30, 2025 was related to separation with certain non-executive employees.

The severance expense for the six months ended June 30, 2024 was primarily due to the departure of our former CEO during 2024 for which $1.2 million in severance expense was recorded.

Severance expense for the nine months ended September 30, 2025 and 2024 was $0.4 million and $1.4 million, respectively.

Severance expense for the nine months ended September 30, 2025 was related to separation with certain non-executive employees.

The severance expense for the nine months ended September 30, 2024 was primarily due to the departure of our former CEO during 2024 for which $1.2 million in severance expense was recorded.

Expenses from Abandoned Financing Transaction:

For the six months ended June 30,

For the nine months ended September 30,

Expenses from abandoned financing transaction

Percent of total revenue

Expenses related to our abandoned financing transaction were $0.7 million for the six months ended June 30, 2025, primarily attributable to our decision to terminate the previously announced convertible preferred equity offering under Regulation A.

There was no such expense during the six months ended June 30, 2024.

Other income (expense), net:

For the six months ended June 30,

Expenses related to our abandoned financing transaction were $0.7 million for the nine months ended September 30, 2025, primarily attributable to our decision to terminate the previously announced convertible preferred equity offering under Regulation A.

There was no such expense during the nine months ended September 30, 2024.

Other income, net:

For the nine months ended September 30,

Change in fair value of warrant liability

Interest income (expense), net

Loss on retirement of fixed asset

Interest income, net

Loss on retirement of property and equipment

Total other income, net

Other income resulting from the change in fair value of the warrant liability was $0.3 million for the six months ended June 30, 2025, consistent with $0.3 million for the six months ended June 30, 2024.

Net interest expense for the six months ended June 30, 2025 was $29,000, as we incurred $284,000 in interest expense from a short-term loan, partially offset by $255,000 in interest earned from our money market account.

Interest income for the six months ended June 30, 2024 was $209,000 from interest earned on our money market account, offset by $4,000 in interest expense.

As a result of the above, net loss for the six months ended June 30, 2025 was $6.2 million as compared to $10.9 million for the six months ended June 30, 2024.

Other income resulting from the change in fair value of the warrant liability was $0.3 million for the nine months ended September 30, 2025, consistent with $0.4 million for the nine months ended September 30, 2024.

As of September 30, 2025, the 2023 Warrants were fully exercised, eliminating the related warrant liability.

Net interest income for the nine months ended September 30, 2025 was $59,000, as we earned $353,000 in interest income from our money market account, partially offset by $294,000 in interest expense from a short-term loan.

Interest income for the nine months ended September 30, 2024 was $219,000 from interest earned on our money market account, offset by $4,000 in interest expense.

As a result of the above, net loss for the nine months ended September 30, 2025 was $8.3 million as compared to $14.3 million for the nine months ended September 30, 2024.

ATM Offering Program

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During the year ended December 31, 2024, we sold 228,392 shares of our common stock under the ATM Program for net proceeds of approximately $3.1 million (net of commissions and other related offering expenses of approximately $0.3 million).

During the three months ended June 30, 2025, we sold 6,793,371 shares of our common stock under the ATM Program for net proceeds of approximately $2.0 million (net of commissions and other related offering expenses of approximately $0.1 million).

During the six months ended June 30, 2025, we sold 25,496,676 shares of our common stock under the ATM Program for net proceeds of approximately $15.8 million (net of commissions and other related offering expenses of approximately $1.0 million).

As of June 30, 2025, approximately $77.2 million in shares of common stock remained available for issuance under the ATM Program, subject to availability of authorized shares.

From July 1, 2025 through July 28, 2025, we settled sales of 4,400,469 shares of common stock for net proceeds of approximately $1.7 million under the ATM Program.

Among other adjustments since June 2024, on February 13, 2025, the Company filed a prospectus supplement for the issuance and sale of an additional $80.0 million in shares of common stock under the ATM Program, which ATM capacity was subsequently reduced to up to $70.0 million in shares of common stock on September 10, 2025.

During the three months ended September 30, 2025, we sold 232,989 shares of our common stock under the ATM Program for net proceeds of approximately $2.4 million (net of commissions and other related offering expenses of approximately $0.1 million).

During the nine months ended September 30, 2025, we sold 1,082,875 shares of our common stock under the ATM Program for net proceeds of approximately $18.2 million (net of commissions and other related offering expenses of approximately $1.2 million).

As of September 30, 2025, approximately $64.7 million in shares of common stock remained available for issuance under the ATM Program, subject to availability of authorized shares.

2025 Offering

On September 10, 2025, we entered into a securities purchase agreement with an institutional investor (the “Investor”), providing for the issuance and sale, in a registered direct offering (the “2025 Offering”), of (i) 120,000 shares of our common stock, (ii) pre-funded warrants to purchase up to 465,347 shares of common stock (the “2025 Pre-Funded Warrants”), and (iii) warrants to purchase up to an aggregate of 585,347 shares of common stock (the “2025 Warrants”).

Each share of common stock and 2025 Pre-Funded Warrant is being offered and sold together with an accompanying 2025 Warrant at a combined price of $7.92 per share of common stock or 2025 Pre-Funded Warrant and accompanying Warrant, as applicable.

Each 2025 Pre-Funded Warrant and 2025 Warrant is exercisable at any time on or after the date of issuance to purchase one share of common stock at a price of either $0.00001 per share, in the case of the 2025 Pre-Funded Warrants, or $7.79 per share, in the case of the 2025 Warrants.

The 2025 Pre-Funded Warrants expire when they are exercised in full and the 2025 Warrants expire five years from the date of issuance.

The 2025 Offering closed on September 11, 2025.

We received net proceeds of approximately $4.1 million from the 2025 Offering, after deducting placement agent fees and estimated offering expenses.

Additionally, pursuant to the Engagement Letter, dated as of July 9, 2024, as amended on December 20, 2024 and August 20, 2025 (the “Original Engagement Letter”), between the Company and H.C.

Wainwright & Co., LLC (“Wainwright”), and the Engagement Letter Joinder Agreement, dated as of September 10, 2025 (the “Joinder Agreement” and, together with the Original Engagement Letter, the “Engagement Letter”), by and among Energous, Wainwright and Rodman & Renshaw LLC (“Rodman & Renshaw” and, together with Wainwright, the “Placement Agents”), Energous, in connection with the closing of the 2025 Offering, agreed to issue to the Placement Agents or their respective designees warrants (the “Registered Direct Offering Placement Agent Warrants”) to purchase up to an aggregate of 40,974 shares of common stock.

The Registered Direct Offering Placement Agent Warrants have substantially the same terms as the 2025 Warrants, except the Registered Direct Offering Placement Agent Warrants are exercisable at any time on or after the date of issuance to purchase one share of common stock at a price of $9.90 per share and the Registered Direct Offering Placement Agent Warrants expire on September 10, 2030.

On September 10, 2025, in connection with the 2025 Offering, we entered into a letter agreement (the “Letter Agreement”) with the Investor for the immediate exercise of certain of our 2023 Warrants and 2024 Warrants to purchase an aggregate of 47,764 shares of common stock and having exercise prices of $6.7595 and $55.20 per share, respectively (the “Concurrent Warrant Exercise Transaction”).

The 2023 Warrants were exercised at the exercise price of $6.8845 and the 2024 Warrants were exercised at a reduced exercise price of $7.92 per share for aggregate gross proceeds to the Company of approximately $364,000.

As consideration for the exercise of the 2023 Warrants and 2024 Warrants for cash, we issued new unregistered warrants (the “New Warrants”) to purchase up to an aggregate of 47,764 shares of common stock at an exercise price of $7.79 per share (the “New Warrant Shares”).

The New Warrants are exercisable immediately upon issuance and will expire five years following the initial issuance date.

Except as described herein, the New Warrants are substantially similar to the Original Warrants.

The closing of the Concurrent Warrant Exercise Transaction occurred on September 11, 2025.

Also pursuant to the Engagement Letter, Energous, in connection with the closing of the Concurrent Warrant Exercise Transaction, agreed to issue to the Placement Agents or their respective designees warrants (the “Concurrent Warrant Exercise Transaction Placement Agent Warrants”) to purchase up to an aggregate of 3,343 shares of Common Stock.

The Concurrent Warrant Exercise Transaction Placement Agent Warrants have substantially the same terms as the New Warrants, except the Concurrent Warrant Exercise Transaction Placement Agent Warrants are immediately exercisable to purchase one share of common stock at a price of $9.90 per share and the Concurrent Warrant Exercise Transaction Placement Agent Warrants expire on September 10, 2030.

Agile Subordinated Loan Agreement

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The New Term Loan was expressly subordinated to our obligations on certain senior indebtedness of the Company as provided in the Amended Loan Agreement.

As of June 30, 2025, we owed approximately $0.1 million on the “Amended Loan Agreement.”

On July 7, 2025, we paid off all outstanding amounts owed to the Lender.

There are no further obligations under the Amended Loan Agreement.

As of September 30, 2025, no balance was owed under the “Amended Loan Agreement.”

Liquidity and Capital Resources

During the six months ended June 30, 2025 and 2024, we recorded revenue of $1.3 million and $0.1 million, respectively.

We incurred net losses of $6.2 million and $10.9 million for the six months ended June 30, 2025 and 2024, respectively.

Net cash used in operating activities was $7.5 million and $10.8 million for the six months ended June 30, 2025 and 2024, respectively.

As of June 30, 2025, the Company had cash and cash equivalents of $8.7 million.

We are currently meeting our liquidity requirements through the proceeds of the ATM Program (as defined above) that raised net proceeds of $15.8 million during the six months ended June 30, 2025.

During the nine months ended September 30, 2025 and 2024, we recorded revenue of $2.6 million and $0.3 million, respectively.

We incurred net losses of $8.3 million and $14.3 million for the nine months ended September 30, 2025 and 2024, respectively.

Net cash used in operating activities was $10.0 million and $14.9 million for the nine months ended September 30, 2025 and 2024, respectively.

As of September 30, 2025, we had cash and cash equivalents of $12.9 million.

We are currently meeting our liquidity requirements through the proceeds of the ATM Program (as defined above) that raised net proceeds of $18.2 million during the nine months ended September 30, 2025, a sale of stock, pre-funded warrants and warrants that raised net proceeds of $4.1 million during the nine months ended September 30, 2025 and the exercises of 2023 Warrants and 2024 warrants that raised net proceeds of $0.4 million during the nine months ended September 30, 2025.

As we gain traction in the market with our new technology and continue to invest capital in transitioning and scaling the business from research and development of new technologies to commercial production, there can be no assurance that our available resources and revenue generated from our business operations will be sufficient to sustain our operations.

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There is no assurance that such financing will be available on terms that we would find acceptable, or at all.

If we are unsuccessful in implementing this plan, we will be required to make further cost and expense reductions or modifications to our on-going and strategic plans.

Based on current operating levels and further cost reductions implemented during the first half of 2025, the Company believes it has sufficient cash on hand and access to capital to fund operations for the next 12 months.

Operating Activities - During the six months ended June 30, 2025, cash flows used in operating activities were $7.5 million, consisting of a net loss of $6.2 million, less adjustments to reconcile net loss to net cash used in operating activities aggregating $0.1 million (principally stock-based compensation of $0.2 million and depreciation and amortization and amortization of short-term loan fees totaling approximately $0.1 million, partially offset by a change in fair value of warrant liability of $0.3 million), a $1.1 million decrease in accounts payable, a $0.6 million increase in accounts receivable, a $0.3 million decrease in operating lease liabilities and a $0.2 million increase in inventory, partially offset by a $0.4 million decrease in operating lease right-of-use assets and a $0.3 million decrease in prepaid expenses and other current assets.

During the six months ended June 30, 2024, cash flows used in operating activities were $10.8 million, consisting of a net loss of $10.9 million, less adjustments to reconcile net loss to net cash used in operating activities aggregating $0.4 million (principally stock-based compensation of $0.5 million, depreciation and amortization of $0.1 million, partially offset by a change in fair value of warrant liability of $0.3 million), a $0.3 million decrease in accrued expenses, a $0.1 million increase in inventory and a $0.1 million decrease in accounts payable, partially offset by a $0.1 million decrease in prepaid expenses and other current assets.

Investing Activities - During the six months ended June 30, 2025 and 2024, cash flows used in investing activities were $37,000 and $58,000, respectively.

If we are unsuccessful in implementing this plan, we will be required to make further cost and expense reductions or modifications to our on-going operations and strategic plans.

Based on current operating levels and further cost reductions implemented during the first nine months of 2025, the Company believes it has sufficient cash on hand and access to capital to fund operations for the next 12 months.

Operating Activities - During the nine months ended September 30, 2025, cash flows used in operating activities were $10.0 million, consisting of a net loss of $8.3 million, less adjustments to reconcile net loss to net cash used in operating activities aggregating $0.2 million (principally stock-based compensation of $0.2 million, depreciation and amortization of $0.1 million and accrued interest and amortization of short-term loan financing fees of approximately $0.1 million, partially offset by a change in fair value of warrant liability of $0.3 million), a $1.2 million increase in accounts receivable, a $0.7 million increase in inventory, a $0.6 million decrease in accounts payable and a $0.4 million decrease in operating lease liabilities, partially offset by a $0.5 million decrease in right-of-use assets, a $0.4 million increase in accrued expenses and a $0.1 million decrease in prepaid expenses and other current assets.

During the nine months ended September 30, 2024, cash flows used in operating activities were $14.9 million, consisting of a net loss of $14.3 million, less adjustments to reconcile net loss to net cash used in operating activities aggregating $0.4 million (principally stock-based compensation of $0.7 million and depreciation and amortization of $0.1 million, partially offset by a change in fair value of warrant liability of $0.4 million), a $0.3 million decrease in accounts payable, a $0.3 million decrease in accrued expenses, a $0.3 million increase in inventory and a $0.1 million decrease in accrued severance.

Investing Activities - During the nine months ended September 30, 2025 and 2024, cash flows used in investing activities were $43,000 and $0.1 million, respectively.

A small amount of hardware and equipment was purchased during each period.

Financing Activities - During the six months ended June 30, 2025, cash flows provided by financing activities were $14.9 million, which primarily consisted of $15.8 million in net proceeds from the sale of shares of our common stock under the ATM Program, partially offset by $0.8 million in repayments of a short-term loan and $0.1 million in repayments of financed insurance.

During the six months ended June 30, 2024, cash flows provided by financing activities were $1.8 million, which primarily consisted of $1.8 million in net proceeds from a registered direct offering that included the sale of common stock, pre-funded warrants and warrants.

Financing Activities - During the nine months ended September 30, 2025, cash flows provided by financing activities were $21.6 million, which primarily consisted of $18.2 million in net proceeds from the sale of shares of our common stock under the ATM Program, $4.1 million in net proceeds from the sale of stock, pre-funded warrants and warrants and $0.4 million in proceeds from warrant exercises, partially offset by $0.9 million in repayments of a short-term loan and $0.2 million in repayments of financed insurance.

During the nine months ended September 30, 2024, cash flows provided by financing activities were $2.5 million, which primarily consisted of $1.8 million in net proceeds from a registered direct offering that included the sale of common stock, pre-funded warrants and warrants and $0.8 million in net proceeds from the sale of shares of our common stock under the ATM Program.

Quantitative and Qualitative Disclosure About Market Risk

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Item 2. Management’s Discussion and Analysis