Summary of Significant Accounting Policies (Policies)

6 Months Ended

Jun. 30, 2026

Summary of Significant Accounting Policies [Abstract]

The accompanying unaudited condensed consolidated financial statements were prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and with instructions to Form 10-Q and Article 10 of Regulation S-X under the Securities Exchange Act of 1934, as amended. These interim condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and accompanying notes for the year ended December 31, 2025, included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 31, 2026.

The condensed consolidated balance sheet as of December 31, 2025 included herein was derived from the audited consolidated financial statements as of that date. In the opinion of management, the Company has made all necessary adjustments, which include normal recurring adjustments necessary for a fair presentation of the Company’s condensed consolidated balance sheet at June 30, 2026, the statements of operations, statements of cash flows, and statements of stockholders’ equity (deficit) for the interim periods ended June 30, 2026 and 2025. Certain information and disclosures normally included in the annual consolidated financial statements prepared in accordance with U.S. GAAP have been condensed or omitted.

The results for the interim periods ended June 30, 2026, are not necessarily indicative of the results to be expected for a full year, any other interim periods or any future year or period.

On January 8, 2026, the Company effected a stock split of the Company’s issued and outstanding Common Shares, by a ratio of 167-to-1 (the “Forward Stock Split”). Accordingly, all Common Shares, stock options, warrants, as well as per share information, for all periods presented in the consolidated financial statements and notes thereto have been adjusted retrospectively to reflect this Stock Split.

Principles of Consolidation

The accompanying condensed consolidated financial statements include the accounts of Rank One Computing Corporation and its wholly owned subsidiary, ROC Federal LLC. All intercompany accounts and transactions have been eliminated in consolidation.

Recently Issued and Newly Adopted Accounting Pronouncements

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which requires disclosure of specific categories meeting a quantitative threshold within the income tax rate reconciliation, as well as disaggregation of income taxes paid by jurisdiction. As an emerging growth company that has elected the extended transition period under the JOBS Act, the Company will adopt this standard for its annual period beginning January 1, 2026 (the effective date applicable to entities other than public business entities). The Company expects the adoption will result in expanded qualitative and quantitative disclosures, including additional rate reconciliation categories and disaggregated income tax payment information, but does not expect the standard to have a material impact on its consolidated financial position, results of operations, or cash flows.

In November 2024, the FASB issued Accounting Standards Update (ASU) No. 2024-03, Income Statement (Topic 220): Reporting Comprehensive Income - Expense Disaggregation Disclosures, Disaggregation of Income Statement Expenses, which requires public companies to disclose, in interim and annual reporting periods, additional information about certain expenses in the financial statements. The amendments in this pronouncement will be effective for annual periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. Early adoption is permitted and is effective on either a prospective basis or retrospective basis. The Company is currently assessing the potential impacts of adoption on its financial statements and related disclosures.

Effective January 1, 2026, the Company adopted ASU 2025-05, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets. The standard provides a practical expedient that permits entities to assume that current economic conditions as of the balance sheet date remain unchanged for the remaining life of current accounts receivable and current contract assets when estimating expected credit losses. The Company elected to apply this practical expedient. The adoption of ASU 2025-05 did not have a material impact on the Company's consolidated financial statements, results of operations, cash flows, or related disclosures.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires 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 statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from these estimates.

Reclassifications

Certain amounts in the prior year’s condensed consolidated financial statements have been reclassified to conform to the current year’s presentation. These reclassifications were immaterial to the financial statements and had no impact on previously reported net loss, total assets, total liabilities, stockholders’ equity, or the previously reported net decrease in cash and cash equivalents.

Estimated Fair Value of Financial Instruments

The Company had no assets or liabilities measured at fair value on a recurring or nonrecurring basis as of June 30, 2026 or December 31, 2025. Management believes the carrying amounts of cash, accounts receivable, and accounts payable approximate fair value due to their short-term nature.

Concentration of Credit Risk and Other Risks and Uncertainties

At times, cash balances may exceed the Federal Deposit Insurance Corporation (“FDIC”) insurable limits. The Company has not previously experienced any losses related to these balances. The uninsured cash balance as of June 30, 2026, and December 31, 2025, was approximately $11.7 and $0.0 million, respectively. The Company does not believe it is exposed to significant credit risk on cash and cash equivalents.

The Company’s customers are primarily concentrated in the United States. The table below details (1) the percentage of overall accounts receivable for customers that represented 10% or more of the total as of the end of each period and (2) the percentage of overall Revenue for customers that represented 10% or more of the total during each period.


	% of Total Accounts Receivable						% of Total Revenue
	As of						For the three months ended June 30,						For the six months ended June 30,
	June 30, 2026			December 31, 2025			2026			2025			2026			2025
Customer A		47	%		15	%		53	%		36	%		35	%		27	%
Customer B		—			11	%		—			—			—			—
Customer C		—			16	%		—			31	%		—			19	%

Prior-year customer concentration information has been reclassified to include unbilled accounts receivable to conform to the current-year presentation. This reclassification had no impact on the Company’s condensed consolidated balance sheets, statements of operations, or cash flows.

Accounts Receivable and Allowance for Credit Losses

The Company sells its services to customers on an open credit basis. Accounts receivable are uncollateralized, non-interest-bearing customer obligations and are typically due within 30 days. ASC 326 requires the recognition of lifetime estimated credit losses expected to occur for trade accounts receivable. The guidance also requires the Company to pool assets with similar risk characteristics and consider current economic conditions when estimating losses. Allowance for credit losses is based on the Company’s best estimate of probable losses inherent in its accounts receivable portfolio and is determined based on expectations of the customer’s ability to pay by considering factors such as customer type (commercial or government), historical experience, financial position of the customer, age of the accounts receivable, current economic conditions, and reasonable and supportable forward-looking factors about its portfolio and future economic conditions.

Changes in the allowance for expected credit losses for trade accounts receivable are presented in the table below:


	Six months ended June 30, 2026			Year ended December 31, 2025
Beginning balance	$	161,723		$	60,040
Provision		25,200			101,683
Write-offs(1)		(65,000	)		—
Ending Balance	$	121,923		$	161,723

(1)

Amounts written off as of June 30, 2026 were fully reserved as of December 31, 2025.

Property and Equipment

Property and equipment are recorded at cost and depreciated over their estimated useful lives or the term of the lease using the straight-line method for financial statement purposes. Estimated useful lives for property and equipment are five to seven years. Additions, betterments and replacements are capitalized, while expenditures for repairs and maintenance are charged to operations when incurred. As units of property are sold or retired, the related cost and accumulated depreciation are removed from the accounts, and any resulting gain or loss is recognized in other income or expense in the consolidated statements of income.

Loss Contingencies

The Company accrues for loss contingencies when it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. When the reasonably possible loss or range of loss can be estimated, the Company discloses the estimate; otherwise, the Company discloses that an estimate cannot be made. Legal costs incurred in connection with loss contingencies are expensed as incurred.

Insurance recoveries of losses that have been incurred and recognized are recorded when realization of the claim is determined to be probable and the amount is reasonably estimable, measured at an amount not exceeding the related loss recognized. Recoveries in excess of losses recognized are accounted for as gain contingencies and are not recognized until realized. Insurance recovery receivables are presented separately from, and are not offset against, any related accrued liability.

Revenue Recognition

The Company’s revenue primarily consists of sales of software licenses for our products (ROC SDK, ROC Watch, ROC ABIS, ROC Enroll, and ROC Evidence), which generally include post-contract customer support, sales of bundled security solutions that combine our software with cameras, hardware devices, and installation services, and research and development services performed under U.S. government and commercial contracts.

In accordance with Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers, the Company recognizes revenue upon the transfer of promised goods or services to customers in an amount that reflects the consideration to which the Company expects to be entitled in exchange for promised goods or services. The Company applies the following five-step revenue recognition model in accounting for its revenue arrangements:

•

Identification of the contract(s) with the customer, including whether collectability of the consideration is probable by considering the customers’ ability and intention to pay;

•

Identification of the performance obligations in the contract;

•

Determination of the transaction price;

•

Allocation of the transaction price to the performance obligations in the contract; and

•

Recognition of revenue when, or as, the Company satisfies a performance obligation.

The Company generates revenue from several offerings. ROC SDK consists of software development kits that allow customers to integrate the Company’s biometric and computer vision technologies into their own applications. ROC Watch is a software platform that provides real-time monitoring, threat detection, and analytics for video and camera feeds. ROC ABIS is an automated biometric identification system designed for large-scale identity matching, verification, and forensic investigation. ROC Enroll is a remote identity verification solution used to capture, manage and evaluate biometric and identity document data for use with the Company’s platform and with customers' platforms. ROC Evidence is a cloud-native digital evidence management system (DEMS) used for investigation and litigation support. In addition, the Company performs work under R&D contracts, primarily with U.S. government agencies, which may include software licenses and professional services.

In the following tables, revenue is disaggregated by major product line, geographic area based on customer location, and the timing of revenue recognition for the three and six months ended June 30, 2026, and 2025.


	Three Months Ended June 30,				Six Months Ended June 30,
	2026		2025		2026		2025
ROC SDK	$	1,590,311	$	864,635	$	2,912,612	$	2,542,140
ROC Watch		248,121		1,924,583		1,137,601		2,427,230
ROC ABIS		163,646		19,885		233,467		39,554
ROC Enroll		82,697		36,815		124,593		274,460
ROC Evidence		17,500		—		17,500		—
Total Product Revenue		2,102,275		2,845,918		4,425,773		5,283,384
R&D Contracts		2,990,707		2,123,004		3,215,851		2,859,060
Total Revenue	$	5,092,982	$	4,968,922	$	7,641,624	$	8,142,444


	2026		2025		2026		2025
United States	$	4,713,203	$	4,690,348	$	6,987,965	$	7,386,070
International		379,779		278,574		653,659		756,374
	$	5,092,982	$	4,968,922	$	7,641,624	$	8,142,444


	2026		2025		2026		2025
Timing of revenue recognition
Products transferred at a point in time	$	3,541,856	$	2,048,215	$	5,321,608	$	3,944,579
Products and services transferred over time		1,551,126		2,920,707		2,320,016		4,197,865
Total Revenue	$	5,092,982	$	4,968,922	$	7,641,624	$	8,142,444

Each of the Company’s significant performance obligations and the Company’s application of ASC 606 to its revenue arrangements is discussed in further detail below.

Standalone Software License and Support

The Company sells software licenses that include post-contract support (“PCS”) to customers for its Vision AI products, including ROC SDK, ROC Watch, ROC ABIS, ROC Enroll, and ROC Evidence. The Company’s software license arrangements are sold as perpetual or time-based, and in both cases software license revenue is recognized at a point in time when the license key is provided to the end user. Certain license arrangements include consumption-based pricing under which the customer pays a fixed minimum license fee, recognized at a point in time upon delivery of the license key, with incremental fees for usage above the minimum (typically measured on a per-identity-match or per-scan basis). These usage-based overages represent a sales- or usage-based royalty promised in exchange for a license of intellectual property and are recognized in the period in which the underlying usage occurs.

Perpetual software license sales include PCS for an initial 12-month period following license delivery, with customers able to renew PCS annually thereafter. Time-based licenses include PCS for the duration of the license term. PCS is recognized on a straight-line basis over the contract term, once the related Software license has been recognized.

PCS is accounted for as a distinct performance obligation because it provides ongoing updates, maintenance, and technical support services that are separately identifiable from the functional intellectual property conveyed in the software licenses. Accordingly, the Company allocates the transaction price between the license and PCS based on their respective standalone selling prices.

Software-as-a-Service (SaaS) Subscription Arrangements

The Company offers certain Vision AI products on a hosted basis, in which the Company hosts the software in its or a third-party provider’s cloud environment and provides the customer with continuous access over a stated subscription term. When the customer does not have the contractual right to take possession of the software at any time during the hosting period without significant penalty, or when it is not feasible for the customer to run the software on its own hardware or to contract with an unrelated third party to host the software, the arrangement is accounted for as a service rather than a software license. For the Company’s hosted arrangements, access to the hosted software, the related ongoing technical support and software updates, and the underlying hosting infrastructure are not capable of being distinct from one another and are accounted for as a single combined performance obligation satisfied over time. Revenue is recognized ratably over the subscription term beginning on the date the customer is granted access to the hosted environment. Implementation and other professional services that do not significantly modify or customize the hosted functionality are accounted for as separate performance obligations and recognized as the services are performed.

Bundled Security Solutions

The Company sells bundled security solutions consisting of hardware (including cameras and computing devices), software licenses, installation services, and post-contract support (“PCS”), which are deployed at customer locations to monitor activity and identify people, vehicles, and other objects. Hardware and software license revenue is recognized at a point in time upon delivery to the customer site, installation services revenue is recognized over time as the services are performed, and PCS revenue is recognized ratably over the support period.

R&D Contracts

The Company enters into research and development ("R&D") contracts with customers (predominantly U.S. Government agencies and prime contractors, along with select commercial customers) under which the Company provides a license to use the software as part of a stated project, together with professional services to perform custom development, simulations, integration, testing, or other applications of the software in support of the customer’s research or development objectives. Most R&D Contracts are priced on a fixed-fee basis, with certain contracts billed on a usage or “time-and-materials” basis. Hardware and software license revenue is recognized at a point in time upon delivery to the customer site, and professional services revenue is recognized over time, as the services are performed over the contract period.

Contract Assets

The Company records a receivable when its right to consideration is unconditional, that is, when only the passage of time is required before payment is due. The Company records a contract asset when it has transferred goods or services to a customer but its right to consideration is conditional on something other than the passage of time, such as the satisfaction of other performance obligations within the same contract. Contract assets are assessed for expected credit losses using the methodology described under Accounts Receivable and Allowance for Credit Losses above.

Contract assets were $3.8 million as of June 30, 2026 and $1.2 million as of December 31, 2025, and are included in accounts receivable, net on the condensed consolidated balance sheets. The increase in contract assets during the six months ended June 30, 2026 was primarily attributable to R&D contracts. Refer to Contract Liabilities below for information regarding the Company's contract liability balances.

Costs to Obtain Contracts

The Company accounts for incremental costs of obtaining customer contracts (sales commissions) in accordance with ASC 340-40, Other Assets and Deferred Costs — Contracts with Customers. Under the practical expedient permitted by ASC 340-40-25-4, the Company expenses such costs as incurred for contracts with an expected amortization period of one year or less. For contracts with an expected amortization period greater than one year, the Company capitalizes eligible incremental costs if recovery is expected and amortizes the resulting asset on a straight-line basis over the expected period of benefit. The portion of the asset expected to be amortized within twelve months of the balance sheet date is presented within Prepaid expenses and other current assets, with the remainder presented within Other assets on the condensed consolidated balance sheets. As of June 30, 2026 and December 31, 2025, total capitalized commission costs were $47,146 and $32,940, respectively, of which $11,503 and $2,745 are classified as current and $35,643 and $30,195 are classified as long-term. The long-term balances have remaining amortization periods extending through 2030.

Contract Liabilities

Sales are generally recorded in the month the service is provided. For customers who are billed on an annual basis, deferred revenue is recorded and amortized over the life of the contract in accordance with the prescribed revenue recognition method. The Company recognized $413,394 and $346,250 of revenue during the three months ended June 30, 2026, and 2025, respectively, and $922,674 and $984,735 of revenue during the six months ended June 30, 2026 and 2025, respectively, which was included in the contract liability balance at the beginning of each such period.

Deferred revenue for customer contracts represents amounts collected from, or invoiced to, customers in advance of revenue recognition. The balance of deferred revenue will increase or decrease based on the timing of invoices and recognition of revenue.

Determining the Standalone Selling Price (SSP) for Post Contract Support (PCS) Services

Contracts with customers often include multiple performance obligations that are distinct and accounted for separately. These typically include licensed software and post-contract support (“PCS”) services, such as maintenance, technical support, and software updates.

The Company allocates the transaction price to each distinct performance obligation based on its relative standalone selling price. Standalone selling price is estimated at contract inception using all reasonably available information, including observable renewal rates, historical pricing relationships, market conditions, and industry data. Judgment is required when standalone selling price is not directly observable.

For license contracts with a term of one year or less, PCS services are bundled with the licensed software and provided throughout the contract term. For longer duration license contracts, PCS services are included for the initial twelve-month period following licensed software delivery. Customers may subsequently purchase extended PCS services annually as outlined in the contracts, typically priced at a percentage of the original license fee (the "Extended PCS Percentage") up to a designated maximum term.

Based on the results of the Company's standalone selling price analysis, the transaction price is allocated between the software license and PCS using the observable annual PCS renewal rate as the basis for the standalone selling price of PCS. Where PCS is provided for a one-year period, this results in an allocation to PCS of an amount equal to the applicable Extended PCS Percentage multiplied by the transaction price, with the remainder allocated to the software license. Where PCS is committed over a longer period, the allocation is determined by reference to the aggregate PCS value implied by the annual renewal rate over the committed PCS period relative to the combined value of the license and that implied PCS value, which results in a greater proportion of the transaction price being allocated to PCS as the committed PCS period lengthens. In each case, the allocation reflects the pricing relationship between the license and PCS and maximizes the use of observable inputs. The transaction price is allocated at contract inception and is not subsequently reallocated for changes in estimated standalone selling prices.

Effective for arrangements with a contract inception date on or after June 1, 2026 that include committed PCS over more than one year, the Company refined the method used to estimate the relationship between the standalone selling prices of the software license and PCS to more faithfully reflect that relationship over longer committed PCS periods. The refinement was accounted for as a change in accounting estimate and applied prospectively. Arrangements entered into prior to that date, and arrangements with PCS committed for one year or less, were not affected. The effect of the change was not material to the three and six months ended June 30, 2026.

Revenue is recognized in accordance with the timing of satisfaction of each performance obligation. For time-based license contracts, the portion allocated to the software license is recognized at the time of delivery, while the PCS portion is recognized ratably over the contract term. For perpetual license contracts, the software license portion is recognized upon delivery, and the PCS portion is recognized ratably over the initial 12-month coverage period. Revenue from extended PCS services is recognized ratably over the applicable renewal term, consistent with the period of service delivery.

Determining the SSP for Bundled Security Solutions and R&D Contracts

The Company’s contracts for bundled solutions and R&D contracts can contain multiple performance obligations, including a combination of software licenses and related PCS, hardware, installation services, and professional services. The Company determines the SSP for each performance obligation using observable inputs, as follows:


	-	Hardware is generally purchased from third parties and resold to customers, with SSP established using a cost-plus-margin approach.

	-	Installation and professional services are priced based on hourly rates that approximate market rates for similar services. Where the Company engages third parties to perform such tasks, SSP is approximated using cost-plus-margin.

	-	Software licenses and related PCS are allocated consistent with the methodology described above. For annual license contracts, PCS services are bundled with the licensed software and provided throughout the contract term. For multi-year software licenses bundled with one-year of PCS, an amount equal to the applicable Extended PCS Percentage multiplied by the transaction price is assigned to PCS, and the remainder of the transaction price is assigned to the software license.

Contract and Payment Terms

The typical terms of software license contracts range from 12 to 36 months, with auto-renew options extending the contract for an additional term. Payment amounts are generally due within 30 days of invoice and can range from 30 to 90-day terms.

Significant Judgment

The Company applies judgment in identifying performance obligations in contracts that include multiple promised goods and services, such as software licenses, hosting arrangements, implementation services, customer support, and other related offerings. In accordance with ASC 606, promised goods or services are evaluated to determine whether they are distinct and therefore accounted for as separate performance obligations, considering the nature of the promise and how the offerings are bundled and delivered to the customer.

When contracts include multiple performance obligations, the Company exercises judgment in determining the standalone selling price of each performance obligation. Standalone prices are established by evaluating market data for comparable services and considering the Company’s historical pricing practices. The aggregate standalone price of all performance obligations is calculated, and each individual obligation’s proportionate share of the total is determined. This ratio is then applied to the overall contract price to allocate the transaction price among the performance obligations accordingly.

Significant Financing Component

The Company has elected the practical expedient in ASC 606-10-32-18 and does not adjust the transaction price for the effects of a significant financing component if the period between transfer of goods or services and customer payment is one year or less. The Company evaluated whether any of its contracts contain a significant financing component and concluded that no significant financing component exists in its contracts.

Impairment of Long-Lived Assets

The Company reviews its long-lived assets for impairment whenever events and circumstances indicate that the carrying value of an asset might not be recoverable. An impairment loss, measured as the amount by which the carrying value exceeds the fair value, is recognized if the carrying amount exceeds estimated un-discounted future cash flows. During the three and six months ended June 30, 2026, and 2025, the Company recognized no impairment charges on long-lived assets.

Advertising Costs

The Company expenses the costs associated with advertising as they are incurred. The Company incurred $90,700 and $19,648 for advertising costs for the three months ended June 30, 2026, and 2025, respectively and $134,509 and $44,645 for advertising costs for the six months ended June 30, 2026, and 2025, respectively. Advertising costs are included within selling, general and administrative expenses in the unaudited condensed consolidated statements of operations.

Research and Development Costs

Research and development costs primarily include salaries, stock-based compensation expense, and benefits for personnel involved in performing the activities to develop and refine the Company’s platforms and products services and other IT-related costs, travel costs, and allocated overhead. Research and development costs are expensed as incurred. During the three months ended June 30, 2026 and 2025, the Company recorded approximately $2.1 million and $1.3 million, respectively, in research and development expense on the unaudited condensed consolidated statements of income. During the six months ended June 30, 2026 and 2025, the Company recorded approximately $4.2 million and $2.9 million, respectively.

Intangible Assets - Software Development Costs

Costs incurred prior to establishing technological feasibility for a component are expensed as research and development costs as incurred. Beginning in 2025, the Company commenced development of a new software project comprising multiple modular components, each with its own development cycle, for which technological feasibility was established prior to general release. For this project, eligible development costs incurred subsequent to the establishment of technological feasibility for specific modules and enhancements are being capitalized in accordance with ASC 985-20. Capitalized amounts are presented as capitalized software within the condensed consolidated balance sheets and are amortized to cost of sales over the estimated economic life of the related product once available for general release. Amortization is determined for each software component as the greater of (i) the ratio of current gross revenues for the component to the total of current and anticipated future gross revenues for that component, or (ii) the straight-line amount over the remaining estimated economic life of the component, which the Company estimates to be three years. For the periods presented, the straight-line method produced the greater amount.

Capitalization of development costs for a component ceases, and amortization of that component begins, when the component is available for general release to customers. The first components became available for general release during the second quarter of 2026. Refer to Note 5 – Intangible Assets for the components of capitalized software and the related amortization expense.

Stock-Based Compensation

The Company follows the requirements of FASB ASC 718-10-10, Share-Based Payments with regards to stock-based compensation issued to employees and non-employees. The Company has agreements and arrangements that call for stock to be awarded to employees and consultants at various times as compensation and periodic bonuses. The expense for this stock-based compensation is equal to the fair value of the stock price on the day the stock was awarded multiplied by the number of shares awarded. The Company utilized a 409A valuation to determine the value of the Company’s common stock on the date of issuance. The Company has a relatively low forfeiture rate of stock-based compensation, and forfeitures are recognized as they occur.

The valuation methodology used to determine the fair value of options issued during the period granted is the Black-Scholes option-pricing model. The Black-Scholes model requires the use of a number of assumptions including the volatility of the stock price, the average risk-free interest rate, and the weighted average expected life of the options. Due to the Company’s limited historical data related to employee share option exercise behavior, the Company has elected to use the “simplified” method as permitted by Staff Accounting Bulletin No. 110 for its “plain vanilla” stock option grants. Risk-free interest rates are calculated based on continuously compounded risk-free rates for the appropriate term. The dividend yield is assumed to be zero as the Company has never paid or declared any cash dividends on its Common Stock. The expected forfeiture rate is estimated based on management’s best assessment.

Estimated volatility is a measure of the amount by which the Company’s asset price is expected to fluctuate each year during the expected life of the award. ROC does not yet have sufficient history of public trading and therefore utilizes the volatility of peer companies.

Segment Information

Operating segments are defined as components of an enterprise about which separate discrete information is available for evaluation by the chief operating decision-maker, or decision-making group, in deciding how to allocate resources and in assessing performance. The Company views its operations and manages its business as one operating segment.

Benefit Plans

We sponsor a defined contribution retirement savings plan for employees who meet certain eligibility requirements. Under the plan, the Company makes a non-elective contribution equal to 3% of each eligible employee’s compensation, regardless of whether the employee elects to contribute. There is no matching component. Employer contributions vest immediately. Total employer contributions were $88,765 and $78,648 for the three months ended June 30, 2026 and 2025, respectively, and $185,296 and $146,721 for the six months ended June 30, 2026 and 2025, respectively.

Net Loss Per Common Share

Basic earnings (loss) per share (“EPS”) is computed by dividing net income (loss) attributable to common stockholders by the weighted average number of common shares outstanding during the period. Diluted earnings (loss) per share (“Diluted EPS”) reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted. Diluted EPS includes the effect of stock options and warrants using the treasury stock method, and convertible instruments using the if converted method, when dilutive. Potential common shares are excluded from the calculation if their effect would be antidilutive.

The following table sets forth the number of potential shares of common stock that have been excluded from diluted net income per share because their effect was anti-dilutive:


	Three Months Ended June 30,				Six Months Ended June 30,
	2026		2025		2026		2025
Options		9,151,961		—		9,151,961		8,929,991
Warrants		284,093		—		284,093		—
Total		9,436,054		—		9,436,054		8,929,991