v3.26.1
Segment Information
 3 Months Ended
Mar. 31, 2026
Segment Reporting [Abstract]  
Segment Information

13. Segment Information

 

The Company evaluates the following factors to identify its reportable segments: (i) nature of products and services, (ii) type of customer for the products and services, (iii) sales, production and distribution methods of the products and services and (iv) the nature of the regulatory environment, if applicable. Based on an evaluation of these factors, management concluded that the Company’s operations are managed through one reportable segment, IB-STIM, that derives its revenues in the United States from a PENFS device that is used to treat patients 8-21 years of age with functional abdominal pain associated with irritable bowel syndrome and in patients 8 years and older with functional abdominal pain associated with functional dyspepsia and related nausea symptoms. The accounting policies of the IB-STIM segment are the same as those described in the Summary of Significant Accounting Policies (see Footnote 2). The Chief Operating Decision Maker (“CODM”) regularly evaluates the performance of the IB-STIM segment for the purpose of allocating resources based on net sales and operating loss, both of which are reported in the Condensed Statements of Operations. The CODM uses net sales to evaluate IB-STIM’s adoption and utilization by insurance carriers and physicians. As Neuraxis is an emerging growth company, operating loss is used to monitor the Company’s cost structure in order to achieve future segment profitability. Both net sales and operating loss are measured against the budget on a periodic basis to assess achievement toward annual compensation incentive targets. The Company’s CODM is its Chief Executive Officer.

 

 

The following reconciles the reportable segment net sales and operating loss to the Company’s reported net loss:

  

   2026   2025 
   Three months ended March 31, 
   2026   2025 
Net Revenue  $1,607,883   $895,655 
COGS   218,366    139,475 
Gross Profit   1,389,517    756,180 
Selling Expenses (a)   824,336    500,119 
Research & Development (a)   99,567    117,867 
Compensation and Benefits (a)   1,412,665    1,075,244 
Professional Services (a)   436,303    406,716 
Legal Settlement   -    619,097 
Depreciation   8,034    3,735 
Amortization   8,284    2,621 
Other Operating Expenses (a) (b)   341,007    325,879 
Segment Operating Loss   (1,740,679)   (2,295,098)
Interest Expense   (26,189)   (2,237)
Change in Fair Value of Warrant Liability   (31,506)   1,831 
Other Income   36,942    16,820 
Total Other (Expense) Income, Net   (20,753)   16,414 
Net Loss  $(1,761,432)  $(2,278,684)

 

  (a) The significant expense categories and amounts align with the segment-level information provided on a regular basis to the CODM.
  (b) Other operating expenses include rent and utilities, insurance, travel, software subscription fees, board fees and bad debt expense.

 

Total segment assets for IB-STIM amounted to $8,745,706 and $6,404,036 as of March 31, 2026 and December 31, 2025, respectively. Total segment capital expenditures for IB-STIM amounted to $0 and $18,000 for the three months ended March 31, 2026 and 2025, respectively. Total segment depreciation and amortization amounted to $16,317 and $6,356 for the three months ended March 31, 2026 and 2025, respectively.

 

Significant segment non-cash charges settled in common stock include (i) consulting and advisory fees totaling $399,995 and $112,493 for the three months ended March 31, 2026 and 2025, respectively, and (ii) hiring grants totaling $5,534 and $0 for the three months ended March 31, 2026 and 2025, respectively.