Business Description, Basis of Presentation and Significant Accounting Policies	6 Months Ended
Jun. 30, 2026
Business Description, Basis of Presentation and Significant Accounting Policies
Business Description, Basis of Presentation and Significant Accounting Policies	1. Business Description, Basis of Presentation and Significant Accounting Policies Business Description: ClearOne, Inc., together with its subsidiaries (collectively, “ClearOne” or the “Company”), was a global market competitor providing conferencing, collaboration, and AV streaming solutions supporting voice and visual communications. Following the October 24, 2025 disposition of substantially all operating assets and intellectual property to Biamp Systems, LLC, the Company no longer sells products. The Company’s continuing operations are now limited to (i) fulfilling warranty and technical support obligations for legacy products, (ii) maintaining public-company compliance and governance, (iii) collecting accounts receivable and recovering prepaid assets and (iv) and pursuing strategic alternatives to maximize stockholder value. On July 1, 2026, the Company entered into an Agreement and Plan of Merger by and among the Company, CLRO Merger Sub, Inc., Cortigent, Inc. and Vivani Medical, Inc. See Note 14 — Subsequent Events. See also the discussion of going concern below and Note 2 — Discontinued Operations and Assets Held for Sale. Going Concern: The accompanying condensed consolidated financial statements have been prepared assuming the Company will continue as a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. Following the Asset Sale (as described below) completed on October 24, 2025, the Company has no revenue-generating operations. The Company has incurred recurring losses and negative cash flows from operations, and its continuing operations are not expected to generate revenue at levels sufficient to fund its ongoing costs, which consist primarily of public-company reporting and compliance, professional and advisory fees, and residual warranty support for legacy products. As of June 30, 2026, the Company had cash and cash equivalents of $75, restricted cash of $447, and a note payable to a related party of $500. Disbursement of the restricted loan proceeds is subject to the approval of the related-party lender. On June 30, 2026, the Company entered into a Loan Agreement with First Finance Ltd. (“First Finance”) providing for advances of up to $1,000, of which $500 was received on June 29, 2026 and the remaining $500 was received on July 16, 2026. All amounts outstanding under the Loan Agreement bear interest at 11% per annum and mature on the earlier of December 30, 2026, which is within twelve months after the date these condensed consolidated financial statements are issued, or such date as the parties may mutually agree in writing. See Note 4 — Notes Payable. These conditions raise substantial doubt about the Company's ability to continue as a going concern within one year after the date these condensed consolidated financial statements are issued. Management's plans to address these conditions consist principally of the transactions contemplated by the Merger Agreement entered into on July 1, 2026, including the concurrent registered offering of a minimum of $10,000 and a maximum of $15,000 described in Note 14 — Subsequent Events. Consummation of those transactions is subject to conditions that are not within the Company's control, including effectiveness of a registration statement on Form S-1, completion of the offering, approval by Nasdaq of the initial listing application required as a result of the Change of Control determination described in Note 14, and satisfaction of the remaining closing conditions under the Merger Agreement. Because the execution and ultimate success of these plans depend on the occurrence of significant events that are outside the Company's control, management cannot conclude that the plans will be effectively implemented in a manner that alleviates the conditions giving rise to substantial doubt. Accordingly, substantial doubt about the Company's ability to continue as a going concern is not alleviated as of the date these condensed consolidated financial statements are issued. The condensed consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amount and classification of liabilities that might result from the outcome of this uncertainty. Basis of Presentation: The fiscal year for ClearOne is the twelve months ending on December 31. The condensed consolidated financial statements include the accounts of ClearOne and its subsidiaries. All significant inter-company accounts and transactions have been eliminated. On October 24, 2025, the Company completed the sale of certain intellectual property, product inventory, and non-exclusive rights to customer data (the “Asset Sale”). The disposal represented a strategic shift that has had a major effect on the Company’s operations and financial results. Accordingly, the related operating results are presented as discontinued operations in accordance with ASC 205-20 for all periods presented. Prior-period amounts in the unaudited condensed consolidated statements of operations and cash flows have been recast to conform to this presentation. See Note 2 — Discontinued Operations and Assets Held for Sale for additional information. These accompanying interim unaudited condensed consolidated financial statements have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) and are not audited. Certain information and footnote disclosures that are usually included in financial statements prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) have been either condensed or omitted in accordance with SEC rules and regulations. The accompanying condensed consolidated financial statements contain all adjustments, consisting of normal recurring accruals, necessary for a fair presentation of our financial position as of June 30, 2026 and December 31, 2025, the results of operations for the three and six months ended June 30, 2026 and 2025, and the cash flows for the six months ended June 30, 2026 and 2025. The results of operations for the three and six months ended June 30, 2026 and 2025 are not necessarily indicative of the results for a full-year period. These interim unaudited condensed consolidated financial statements should be read in conjunction with the financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2025 filed with the SEC. On April 22, 2026 the Company completed its reincorporation from Delaware to Nevada by conversion pursuant to the Plan of Conversion approved by stockholders on March 12, 2026. The Company is now a Nevada corporation, and all references to the Company's governing law and stockholder rights in these financial statements should be read in light of Nevada law. The conversion was a change in legal domicile only; the Company's assets and liabilities were carried forward at their historical carrying amounts, and the conversion had no effect on the Company's financial position, results of operations, or cash flows. See Note 10 — Shareholders' Equity. *Reverse Stock Split* The Company completed a 1-for-15 reverse stock split of the Company's issued and outstanding common stock, par value $0.001 per share, effective at 5:00 p.m. Eastern Time on June 9, 2025. The common stock began trading on a split-adjusted basis on the Nasdaq Capital Market on June 10, 2025, under the symbol "CLRO" and a new CUSIP number of 18506U203. The reverse stock split was primarily intended to increase the per share market price of the common stock in order to regain compliance with the minimum bid price requirement for continued listing on the Nasdaq Capital Market. As a result of the reverse stock split, every 15 shares of issued and outstanding common stock were automatically combined into one share, with no fractional shares issued (any fractional interests were rounded up to the next whole share). The reverse stock split did not change the par value of the common stock or the authorized number of shares but reduced the number of issued and outstanding shares from approximately 26.0 million to approximately 1.7 million, with proportional adjustments to outstanding stock options, warrants, and shares reserved under equity incentive plans. For additional details, refer to the Company's Current Report on Form 8-K filed with the SEC on June 2, 2025, including the press release attached as Exhibit 99.1 thereto. All share and per-share amounts in these condensed consolidated financial statements and related notes have been retroactively adjusted to reflect the reverse stock split for all periods presented. *Restricted Cash* The Company includes restricted cash with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the condensed consolidated statements of cash flows, in accordance with ASU 2016-18. Restricted cash was $447 as of June 30, 2026 and $519 as of December 31, 2025. As of December 31, 2025, restricted cash consisted of the remaining proceeds of the $3,000 convertible note issued to First Finance on June 20, 2025, which were subject to contractual disbursement restrictions under the related Note Purchase Agreement, and were fully disbursed during the six months ended June 30, 2026. As of June 30, 2026, restricted cash consisted of proceeds of the Loan Agreement entered into with First Finance on June 30, 2026. Under the terms of the Loan Agreement, disbursement of the loan proceeds is subject to review and approval by the lender. See Note 4 — Notes Payable. *Product Warranties* The Company provides assurance-type warranties on previously sold products and records a liability for the estimated cost to repair or replace products under warranty at the time of sale in accordance with ASC 460. The liability is based on historical claim experience, the nature of the underlying products, current information on repair costs and expected failure rates. The Company reviews warranty estimates each period and records adjustments to the liability when facts and circumstances indicate changes in expected claims or costs. Significant Accounting Policies The significant accounting policies were described in Note 1 to the audited consolidated financial statements included in the Company’s annual report on Form 10-K for the year ended December 31, 2025. There have been no changes to these policies during the quarter ended June 30, 2026 that are of significance or potential significance to the Company, other than presentation of discontinued operations as described above and in Note 2, and the addition of the Company's accounting for the related party note payable described in Note 4, which is recorded at amortized cost with interest expense recognized as incurred . Recent Accounting Pronouncements ASU 2024-03, Income Statement—Reporting Comprehensive Income (Topic 220): Disaggregation of Income Statement Expenses In November 2024, the FASB issued ASU No. 2024-03, Income Statement—Reporting Comprehensive Income (Topic 220): Disaggregation of Income Statement Expenses, which requires disaggregated disclosure of specified natural expense categories underlying certain income statement expense captions. The standard is effective for annual periods beginning after December 15, 2026 and interim periods beginning after December 15, 2027, with early adoption permitted, and may be applied prospectively or retrospectively. The Company is evaluating the impact of the standard and does not expect adoption to have a material effect on its financial position or results of operations. The Company has determined that recently issued accounting standards, other than the above discussed, will not have a material impact on its consolidated financial position, results of operations or cash flows.

1. Business Description, Basis of Presentation and Significant Accounting Policies

ClearOne, Inc., together with its subsidiaries (collectively, “ClearOne” or the “Company”), was a global market competitor providing conferencing, collaboration, and AV streaming solutions supporting voice and visual communications. Following the October 24, 2025 disposition of substantially all operating assets and intellectual property to Biamp Systems, LLC, the Company no longer sells products. The Company’s continuing operations are now limited to (i) fulfilling warranty and technical support obligations for legacy products, (ii) maintaining public-company compliance and governance, (iii) collecting accounts receivable and recovering prepaid assets and (iv) and pursuing strategic alternatives to maximize stockholder value. On July 1, 2026, the Company entered into an Agreement and Plan of Merger by and among the Company, CLRO Merger Sub, Inc., Cortigent, Inc. and Vivani Medical, Inc. See Note 14 — Subsequent Events. See also the discussion of going concern below and Note 2 — Discontinued Operations and Assets Held for Sale.

Going Concern:

The accompanying condensed consolidated financial statements have been prepared assuming the Company will continue as a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.

Following the Asset Sale (as described below) completed on October 24, 2025, the Company has no revenue-generating operations. The Company has incurred recurring losses and negative cash flows from operations, and its continuing operations are not expected to generate revenue at levels sufficient to fund its ongoing costs, which consist primarily of public-company reporting and compliance, professional and advisory fees, and residual warranty support for legacy products. As of June 30, 2026, the Company had cash and cash equivalents of $75, restricted cash of $447, and a note payable to a related party of $500. Disbursement of the restricted loan proceeds is subject to the approval of the related-party lender. On June 30, 2026, the Company entered into a Loan Agreement with First Finance Ltd. (“First Finance”) providing for advances of up to $1,000, of which $500 was received on June 29, 2026 and the remaining $500 was received on July 16, 2026. All amounts outstanding under the Loan Agreement bear interest at 11% per annum and mature on the earlier of December 30, 2026, which is within twelve months after the date these condensed consolidated financial statements are issued, or such date as the parties may mutually agree in writing. See Note 4 — Notes Payable.

These conditions raise substantial doubt about the Company's ability to continue as a going concern within one year after the date these condensed consolidated financial statements are issued.

Management's plans to address these conditions consist principally of the transactions contemplated by the Merger Agreement entered into on July 1, 2026, including the concurrent registered offering of a minimum of $10,000 and a maximum of $15,000 described in Note 14 — Subsequent Events. Consummation of those transactions is subject to conditions that are not within the Company's control, including effectiveness of a registration statement on Form S-1, completion of the offering, approval by Nasdaq of the initial listing application required as a result of the Change of Control determination described in Note 14, and satisfaction of the remaining closing conditions under the Merger Agreement. Because the execution and ultimate success of these plans depend on the occurrence of significant events that are outside the Company's control, management cannot conclude that the plans will be effectively implemented in a manner that alleviates the conditions giving rise to substantial doubt. Accordingly, substantial doubt about the Company's ability to continue as a going concern is not alleviated as of the date these condensed consolidated financial statements are issued.

The condensed consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amount and classification of liabilities that might result from the outcome of this uncertainty.

Basis of Presentation:

The fiscal year for ClearOne is the twelve months ending on December 31. The condensed consolidated financial statements include the accounts of ClearOne and its subsidiaries. All significant inter-company accounts and transactions have been eliminated.

On October 24, 2025, the Company completed the sale of certain intellectual property, product inventory, and non-exclusive rights to customer data (the “Asset Sale”). The disposal represented a strategic shift that has had a major effect on the Company’s operations and financial results. Accordingly, the related operating results are presented as discontinued operations in accordance with ASC 205-20 for all periods presented. Prior-period amounts in the unaudited condensed consolidated statements of operations and cash flows have been recast to conform to this presentation. See Note 2 — Discontinued Operations and Assets Held for Sale for additional information.

These accompanying interim unaudited condensed consolidated financial statements have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) and are not audited. Certain information and footnote disclosures that are usually included in financial statements prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) have been either condensed or omitted in accordance with SEC rules and regulations. The accompanying condensed consolidated financial statements contain all adjustments, consisting of normal recurring accruals, necessary for a fair presentation of our financial position as of June 30, 2026 and December 31, 2025, the results of operations for the three and six months ended June 30, 2026 and 2025, and the cash flows for the six months ended June 30, 2026 and 2025. The results of operations for the three and six months ended June 30, 2026 and 2025 are not necessarily indicative of the results for a full-year period. These interim unaudited condensed consolidated financial statements should be read in conjunction with the financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2025 filed with the SEC.

On April 22, 2026 the Company completed its reincorporation from Delaware to Nevada by conversion pursuant to the Plan of Conversion approved by stockholders on March 12, 2026. The Company is now a Nevada corporation, and all references to the Company's governing law and stockholder rights in these financial statements should be read in light of Nevada law. The conversion was a change in legal domicile only; the Company's assets and liabilities were carried forward at their historical carrying amounts, and the conversion had no effect on the Company's financial position, results of operations, or cash flows. See Note 10 — Shareholders' Equity.

Reverse Stock Split

The Company completed a 1-for-15 reverse stock split of the Company's issued and outstanding common stock, par value $0.001 per share, effective at 5:00 p.m. Eastern Time on June 9, 2025. The common stock began trading on a split-adjusted basis on the Nasdaq Capital Market on June 10, 2025, under the symbol "CLRO" and a new CUSIP number of 18506U203. The reverse stock split was primarily intended to increase the per share market price of the common stock in order to regain compliance with the minimum bid price requirement for continued listing on the Nasdaq Capital Market. As a result of the reverse stock split, every 15 shares of issued and outstanding common stock were automatically combined into one share, with no fractional shares issued (any fractional interests were rounded up to the next whole share). The reverse stock split did not change the par value of the common stock or the authorized number of shares but reduced the number of issued and outstanding shares from approximately 26.0 million to approximately 1.7 million, with proportional adjustments to outstanding stock options, warrants, and shares reserved under equity incentive plans. For additional details, refer to the Company's Current Report on Form 8-K filed with the SEC on June 2, 2025, including the press release attached as Exhibit 99.1 thereto.

All share and per-share amounts in these condensed consolidated financial statements and related notes have been retroactively adjusted to reflect the reverse stock split for all periods presented.

Restricted Cash

The Company includes restricted cash with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the condensed consolidated statements of cash flows, in accordance with ASU 2016-18.

Restricted cash was $447 as of June 30, 2026 and $519 as of December 31, 2025.

As of December 31, 2025, restricted cash consisted of the remaining proceeds of the $3,000 convertible note issued to First Finance on June 20, 2025, which were subject to contractual disbursement restrictions under the related Note Purchase Agreement, and were fully disbursed during the six months ended June 30, 2026.

As of June 30, 2026, restricted cash consisted of proceeds of the Loan Agreement entered into with First Finance on June 30, 2026. Under the terms of the Loan Agreement, disbursement of the loan proceeds is subject to review and approval by the lender. See Note 4 — Notes Payable.

Product Warranties

The Company provides assurance-type warranties on previously sold products and records a liability for the estimated cost to repair or replace products under warranty at the time of sale in accordance with ASC 460. The liability is based on historical claim experience, the nature of the underlying products, current information on repair costs and expected failure rates. The Company reviews warranty estimates each period and records adjustments to the liability when facts and circumstances indicate changes in expected claims or costs.

Significant Accounting Policies

The significant accounting policies were described in Note 1 to the audited consolidated financial statements included in the Company’s annual report on Form 10-K for the year ended December 31, 2025. There have been no changes to these policies during the quarter ended June 30, 2026 that are of significance or potential significance to the Company, other than presentation of discontinued operations as described above and in Note 2, and the addition of the Company's accounting for the related party note payable described in Note 4, which is recorded at amortized cost with interest expense recognized as incurred .

Recent Accounting Pronouncements

ASU 2024-03, Income Statement—Reporting Comprehensive Income (Topic 220): Disaggregation of Income Statement Expenses

In November 2024, the FASB issued ASU No. 2024-03, Income Statement—Reporting Comprehensive Income (Topic 220): Disaggregation of Income Statement Expenses, which requires disaggregated disclosure of specified natural expense categories underlying certain income statement expense captions. The standard is effective for annual periods beginning after December 15, 2026 and interim periods beginning after December 15, 2027, with early adoption permitted, and may be applied prospectively or retrospectively. The Company is evaluating the impact of the standard and does not expect adoption to have a material effect on its financial position or results of operations.

The Company has determined that recently issued accounting standards, other than the above discussed, will not have a material impact on its consolidated financial position, results of operations or cash flows.