Allurion (NASDAQ: ALUR) posts Q1 2026 revenue drop, deeper net loss and going-concern warning
Allurion Technologies reported a challenging first quarter of 2026. Revenue was $2.9 million, down from $5.6 million a year earlier, as sales declined across several geographies. The company posted a net loss of $6.1 million compared with a $1.5 million loss in the prior-year quarter, partly driven by a $4.1 million warrant inducement expense.
Cash and cash equivalents were $5.1 million as of March 31, 2026, while total assets were $14.0 million against total liabilities of $91.9 million, resulting in a stockholders’ deficit of $77.9 million. The balance sheet includes a $48.8 million Revenue Interest Financing liability and $28.6 million of RTW Convertible Notes, both carried at fair value.
Management discloses substantial doubt about Allurion’s ability to continue as a going concern within one year, citing recurring operating losses, negative operating cash flows, covenant noncompliance under its credit facilities, and the need for additional capital. Cost reductions from prior restructuring actions sharply lowered operating expenses, but they did not offset weaker revenue and financing-related fair value movements.
Positive
- None.
Negative
- Substantial doubt about going concern: Management states recurring losses, negative operating cash flows, covenant noncompliance and dependence on new capital raise substantial doubt about the company’s ability to continue as a going concern within one year.
- High leverage and stockholders’ deficit: Total liabilities of $91.9 million versus $14.0 million of assets produce a stockholders’ deficit of $77.9 million, including sizeable fair value liabilities for Revenue Interest Financing and convertible notes.
- Revenue decline and wider net loss: Quarterly revenue fell to $2.9 million from $5.6 million, and net loss increased to $6.1 million from $1.5 million, pressured by warrant inducement expense and fair value changes.
Insights
High leverage, covenant breaches and going-concern doubt elevate financial risk.
Allurion shows a fragile capital structure. As of March 31, 2026, total liabilities of $91.9 million sat against only $14.0 million of assets, leaving a stockholders’ deficit of $77.9 million. Key obligations include $48.8 million of Revenue Interest Financing and $28.6 million of RTW Convertible Notes, both measured at fair value.
Management explicitly concludes there is substantial doubt about the company’s ability to continue as a going concern, noting recurring losses, negative operating cash flows, noncompliance with financial covenants, and reliance on future financings. The RTW notes have been reclassified as current because of covenant breaches, concentrating refinancing and liquidity pressure in the near term.
Operating expenses fell significantly versus the prior year, reflecting restructuring actions, and net cash used in operating activities improved to $3.2 million from $9.5 million. However, weaker revenue and fair value adjustments, including warrant inducement expense, drove a larger net loss. Future filings detailing execution of the planned exchange of RTW obligations into preferred equity and any additional capital raises will be important for assessing how the balance sheet evolves.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM
(Mark One)
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from _________________ to _________________
Commission File Number:
(Exact Name of Registrant as Specified in its Charter)
(State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer |
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Registrant’s telephone number, including area code: (
Securities registered pursuant to Section 12(b) of the Act:
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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No
As of May 12, 2026, the registrant had
Table of Contents
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Page |
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PART I. |
FINANCIAL INFORMATION |
1 |
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Item 1. |
Financial Statements (Unaudited) |
1 |
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Condensed Consolidated Balance Sheets |
1 |
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Condensed Consolidated Statements of Operations |
2 |
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Condensed Consolidated Statements of Comprehensive Income (Loss) |
3 |
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Condensed Consolidated Statements of Stockholders’ Deficit |
4 |
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Condensed Consolidated Statements of Cash Flows |
5 |
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Notes to Unaudited Condensed Consolidated Financial Statements |
7 |
Item 2. |
Management’s Discussion and Analysis of Financial Condition and Results of Operations |
31 |
Item 3. |
Quantitative and Qualitative Disclosures About Market Risk |
42 |
Item 4. |
Controls and Procedures |
42 |
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PART II. |
OTHER INFORMATION |
44 |
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Item 1. |
Legal Proceedings |
44 |
Item 1A. |
Risk Factors |
44 |
Item 2. |
Unregistered Sales of Equity Securities and Use of Proceeds |
45 |
Item 3. |
Defaults Upon Senior Securities |
45 |
Item 4. |
Mine Safety Disclosures |
45 |
Item 5. |
Other Information |
45 |
Item 6. |
Exhibits |
47 |
Signatures |
48 |
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i
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements, which are not purely historical, include, but are not limited to, statements regarding the plans, strategies and prospects, both business and financial, of Allurion Technologies, Inc. (“Allurion”, the "Company", "we", "our", or "us"). Forward-looking statements involve known and unknown risks, uncertainties, assumptions and other factors. Such risks, uncertainties and other factors could cause the actual results, performance or achievements of the Company, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements.
Generally, statements that are not historical facts, including statements concerning possible or assumed future actions, business strategies, events, or results of operations, are forward-looking statements. These statements may be preceded by, followed by or include the words “believes”, “estimates”, “expects”, “projects”, “target”, “goal”, “forecasts”, “may”, “will”, “potential”, “should”, “would”, “could”, “future”, “seeks”, “plans”, “predicts”, “propose”, “scheduled”, “anticipates”, “intends”, or similar expressions. Such statements are based on the beliefs and assumptions of the management of Allurion. Although Allurion believes that its plans, intentions and expectations reflected in or suggested by these forward-looking statements are reasonable, Allurion cannot assure you that it will achieve or realize these plans, intentions or expectations.
Forward-looking statements in this Quarterly Report on Form 10-Q include, but are not limited to, statements about the ability of Allurion to:
ii
We have based the forward-looking statements contained in this Quarterly Report on Form 10-Q primarily on our current expectations and projections about future events and trends that we believe may affect Allurion's business, financial condition, results of operations, prospects, business strategy, and financial needs. The outcome of the events described in these forward-looking statements is subject to risks, uncertainties, assumptions and other factors described under the heading "Risk Factors" in this Quarterly Report on Form 10-Q, if any, and in the section entitled “Risk Factors” within our Annual Report on Form 10-K for the fiscal year ended December 31, 2025 filed with the U.S. Securities and Exchange Commission (the "SEC") on March 30, 2026. These risks are not exhaustive. Other sections of this Quarterly Report on Form 10-Q include additional factors that could adversely impact our business and financial performance. Moreover, Allurion operates in very competitive and rapidly changing environments. New risks and uncertainties emerge from time to time and it is not possible for us to predict all risks and uncertainties that could have an impact on the forward-looking statements contained in this Quarterly Report on Form 10-Q.
We cannot assure you that the results, events and circumstances reflected in the forward-looking statements will be achieved or occur, and actual results, events or circumstances could differ materially from those described in the forward-looking statements.
In addition, statements that “we believe” and similar statements reflect our beliefs and opinions on the relevant subject. These statements are based upon information available to us as of the date of this Quarterly Report on Form 10-Q, and while we believe such information forms a reasonable basis for such statements, such information may be limited or incomplete, and such statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information. These statements are inherently uncertain and investors are cautioned not to unduly rely upon these statements. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, except as may be required under applicable securities laws.
iii
PART I—FINANCIAL INFORMATION
Item 1. Financial Statements.
ALLURION TECHNOLOGIES, INC. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(dollars in thousands, except share and per share amounts)
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March 31, |
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December 31, |
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Assets |
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Current assets: |
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Cash and cash equivalents |
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$ |
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$ |
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Accounts receivable, net of allowance of doubtful accounts of $ |
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Inventory, net |
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Prepaid expenses and other current assets |
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Total current assets |
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Property and equipment, net |
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Right-of-use asset |
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Other long-term assets |
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Total assets |
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$ |
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$ |
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Liabilities and Stockholders’ Deficit |
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Current liabilities: |
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Accounts payable |
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$ |
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$ |
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Current portion of lease liabilities |
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Accrued expenses and other current liabilities |
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Current portion of convertible notes payable |
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Total current liabilities |
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Warrant liabilities |
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Revenue Interest Financing liability |
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Earn-out liabilities |
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Lease liabilities, net of current portion |
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Other liabilities |
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Total liabilities |
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$ |
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$ |
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Commitments and Contingencies (Note 15) |
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Stockholders’ deficit: |
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Preferred stock, $ |
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— |
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— |
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Common stock, $ |
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Additional paid-in capital |
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Accumulated other comprehensive gain (loss) |
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Accumulated deficit |
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( |
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( |
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Total stockholders’ deficit |
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( |
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( |
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Total liabilities and stockholders’ deficit |
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$ |
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$ |
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The accompanying notes are an integral part of these condensed consolidated financial statements.
1
ALLURION TECHNOLOGIES, INC. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(dollars in thousands, except share and per share amounts)
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Three Months Ended March 31, |
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2026 |
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2025 |
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Revenue |
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$ |
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$ |
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Cost of revenue |
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Gross profit |
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Operating expenses: |
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Sales and marketing |
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Research and development |
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General and administrative |
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Total operating expenses: |
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Loss from operations |
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( |
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( |
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Other income (expense): |
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Changes in fair value of warrants |
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Changes in fair value of debt |
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( |
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Changes in fair value of Revenue Interest Financing |
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( |
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( |
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Changes in fair value of earn-out liabilities |
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Warrant inducement expense |
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( |
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— |
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Other income (expense), net |
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( |
) |
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Total other income (expense): |
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( |
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Loss before income taxes |
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( |
) |
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( |
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Provision for income taxes |
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( |
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( |
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Net loss |
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$ |
( |
) |
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$ |
( |
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Net loss per share |
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Basic and diluted |
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$ |
( |
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$ |
( |
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Weighted-average shares outstanding |
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Basic and diluted |
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The accompanying notes are an integral part of these condensed consolidated financial statements.
2
ALLURION TECHNOLOGIES, INC. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(dollars in thousands)
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Three Months Ended March 31, |
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2026 |
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2025 |
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Net loss |
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$ |
( |
) |
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$ |
( |
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Other comprehensive income: |
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Change in fair value of Revenue Interest Financing due to change in credit risk |
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Change in fair value of RTW Convertible Notes due to change in credit risk |
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Comprehensive income (loss) |
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$ |
( |
) |
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$ |
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The accompanying notes are an integral part of these condensed consolidated financial statements.
3
ALLURION TECHNOLOGIES, INC. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ DEFICIT
(dollars in thousands, except share amounts)
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Common Sock |
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Additional |
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Accumulated Other |
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Accumulated |
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Stockholders’ |
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Shares |
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Amount |
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Paid-in Capital |
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Comprehensive Income (Loss) |
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Deficit |
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Deficit |
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Balance as of January 1, 2025 |
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$ |
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$ |
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$ |
( |
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$ |
( |
) |
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$ |
( |
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Exercise of stock options |
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— |
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— |
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— |
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— |
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— |
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— |
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Issuance of common stock in connection with vesting of RSU awards |
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— |
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— |
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— |
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— |
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— |
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Issuance of common stock in connection with RTW Private Placement, net of issuance costs |
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— |
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— |
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— |
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Issuance of common stock in connection with January Public Offering, net of issuance costs |
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— |
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— |
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Issuance of common stock in connection with February Public Offering and Leavitt Private Placement, net of issuance costs |
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— |
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— |
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Stock-based compensation expense |
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— |
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— |
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— |
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— |
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Other comprehensive income |
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— |
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— |
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— |
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— |
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Net loss |
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— |
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— |
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— |
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— |
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( |
) |
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( |
) |
Balance as of March 31, 2025 |
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$ |
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$ |
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$ |
( |
) |
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$ |
( |
) |
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$ |
( |
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Balance as of January 1, 2026 |
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$ |
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$ |
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$ |
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$ |
( |
) |
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$ |
( |
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Issuance of common stock to consultants |
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— |
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— |
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— |
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Warrant Inducement |
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— |
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— |
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— |
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Stock-based compensation expense |
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— |
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— |
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— |
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— |
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Other comprehensive income |
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— |
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— |
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— |
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— |
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Net loss |
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— |
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— |
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— |
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— |
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( |
) |
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( |
) |
Balance as of March 31, 2026 |
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$ |
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$ |
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$ |
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$ |
( |
) |
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$ |
( |
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The accompanying notes are an integral part of these condensed consolidated financial statements.
4
ALLURION TECHNOLOGIES, INC. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(dollars in thousands)
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Three Months Ended March 31, |
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2026 |
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2025 |
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Operating Activities: |
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Net loss |
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$ |
( |
) |
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$ |
( |
) |
Adjustments to reconcile net loss to net cash used in operating activities: |
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Non-cash lease expense |
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Depreciation and amortization |
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Stock-based compensation |
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Provision for uncollectible accounts |
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— |
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Unrealized exchange (gain) loss |
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( |
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Provision for inventory |
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Change in fair value of warrant liabilities |
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( |
) |
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( |
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Warrant inducement expense |
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— |
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Change in fair value of debt |
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( |
) |
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Change in fair value of Revenue Interest Financing |
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Change in fair value of earn-out liabilities |
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— |
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( |
) |
Change in fair value of Share Obligation |
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( |
) |
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Issuance costs associated with warrants recorded at fair value |
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Changes in operating assets and liabilities: |
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Accounts receivable |
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( |
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Inventory |
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Prepaid expenses, other current and long-term assets |
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Lease liabilities |
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( |
) |
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( |
) |
Accounts payable |
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( |
) |
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( |
) |
Accrued expenses and other current liabilities |
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( |
) |
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( |
) |
Net cash used in operating activities |
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$ |
( |
) |
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$ |
( |
) |
Investing Activities: |
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Purchases of property and equipment |
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— |
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— |
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Net cash used in investing activities |
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$ |
— |
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$ |
— |
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Financing Activities: |
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Proceeds from equity offerings, net of issuance costs |
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— |
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Proceeds from warrant inducement, net of issuance costs |
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— |
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Net cash provided by financing activities |
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$ |
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$ |
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Net increase (decrease) in cash and cash equivalents and restricted cash |
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( |
) |
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Cash and cash equivalents and restricted cash at beginning of period |
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Cash and cash equivalents and restricted cash at end of period |
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$ |
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$ |
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Supplemental cash flow information on non-cash investing and financing activities |
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Deferred financing costs in accounts payable and accrued expenses |
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$ |
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$ |
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Change in fair value of RTW Convertible Notes through OCI |
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Change in fair value of Revenue Interest Financing through OCI |
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|
|
|
|
|
||
The accompanying notes are an integral part of these condensed consolidated financial statements.
5
ALLURION TECHNOLOGIES, INC. AND SUBSIDIARIES
A reconciliation of the amounts of cash and cash equivalents and restricted cash in the condensed consolidated balance sheets to the amount in the condensed consolidated statements of cash flows is as follows (in thousands):
|
|
March 31, |
|
|
December 31, |
|
||
|
|
2026 |
|
|
2025 |
|
||
Cash and cash equivalents |
|
$ |
|
|
$ |
|
||
Restricted cash included in other long-term assets |
|
|
|
|
|
|
||
Cash and cash equivalents and restricted cash shown in the statement of cash flows |
|
$ |
|
|
$ |
|
||
The accompanying notes are an integral part of these condensed consolidated financial statements.
6
Organization
Allurion Technologies, Inc. (“Allurion” or the “Company”) is a vertically integrated medical device company that is developing, manufacturing, and commercializing innovative weight loss experiences centered around its Allurion™ Smart Capsule. The Allurion Smart Capsule is the world’s first and only swallowable, Procedureless™ intragastric balloon for weight loss that does not require surgery, endoscopy, or anesthesia for placement. Allurion sells the Allurion Smart Capsule and connected scale through distributors or directly to health care providers.
The Company also offers tiered access to artificial intelligence ("AI")-powered remote patient monitoring tools, a mobile app for patients and a clinic dashboard for providers, referred to as the Allurion Virtual Care Suite (“VCS”) and, collectively with the Allurion Smart Capsule, referred to as the “Allurion Program”. The base tier of the VCS is free of charge to those purchasing the Allurion Smart Capsule, as well as customers looking for a weight-loss management platform for patients utilizing other weight loss treatments, including anti-obesity medications and bariatric surgery. More full-scale versions of the VCS are available to health care providers on an upgrade basis. Allurion currently markets the Allurion Program in over
Business Combination Agreement
On February 9, 2023, Allurion Technologies Opco, Inc. (formerly Allurion Technologies, Inc., “Legacy Allurion”) and Allurion Technologies, Inc. (formerly Allurion Technologies Holdings, Inc.) entered into the Business Combination Agreement (as subsequently amended on May 2, 2023, the “Business Combination Agreement”) with Compute Health Acquisition Corp. (“CPUH” or "Compute Health"), Compute Health Corp. (“Merger Sub I”) and Compute Health LLC (“Merger Sub II” and, together with Merger Sub I, the “Merger Subs”). Pursuant to the Business Combination Agreement, on August 1, 2023 (the “Closing Date”), the Mergers (as defined below) were consummated in three steps: (a) Compute Health merged with and into Allurion (the “CPUH Merger”), with Allurion surviving the CPUH Merger as a publicly listed entity (the time at which the CPUH Merger became effective, the “CPUH Merger Effective Time”) and becoming the sole owner of the Merger Subs; (b) three hours following the consummation of the CPUH Merger, Merger Sub I merged with and into Legacy Allurion (the “Intermediate Merger” and the time at which the Intermediate Merger became effective, the “Intermediate Merger Effective Time”), with Legacy Allurion surviving the Intermediate Merger and becoming a direct, wholly-owned subsidiary of Allurion; and (c) thereafter, Legacy Allurion merged with and into Merger Sub II (the “Final Merger” and, collectively with the CPUH Merger and the Intermediate Merger, the “Mergers”, and together with all other transactions contemplated by the Business Combination Agreement, the “Business Combination”), with Merger Sub II surviving the Final Merger and remaining a direct, wholly-owned subsidiary of Allurion (the time at which the Final Merger became effective, the “Final Merger Effective Time”). Shares of Allurion's Common Stock (defined below) began trading on the New York Stock Exchange ("NYSE") under the ticker symbol “ALUR” on August 2, 2023. Upon completion of the Business Combination, Legacy Allurion's business operations continued as our business operations.
The Business Combination was accounted for as a reverse capitalization in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Under this method of accounting, Compute Health was treated as the “acquired” company for financial reporting purposes and Legacy Allurion was the accounting “acquirer.” Accordingly, the Business Combination was treated as the equivalent of Legacy Allurion issuing stock for the net assets of Compute Health, accompanied by a recapitalization. As a result of the reverse recapitalization, the assets and liabilities of the Company are presented at their historical carrying values, and the assets and liabilities of Compute Health are recognized on the acquisition date and measured on the basis of the net proceeds from the capital transaction, with no goodwill or other intangible assets recorded. This determination is primarily based on the fact that, immediately following the Business Combination, Legacy Allurion stockholders had a majority of the voting power of Allurion, Legacy Allurion controlled the majority of the board seats of Allurion, and Legacy Allurion senior management comprised all of the senior management of Allurion. The equity structure has been restated in all comparative periods up to the Closing Date to reflect the number of shares of the Company's common stock, par value $
Unless otherwise indicated, references in this Quarterly Report on Form 10-Q to the "Company", "our", and "Allurion" refer to the condensed consolidated operations of Allurion Technologies, Inc. and its subsidiaries after giving effect to the Business Combination. References to CPUH and Compute Health refer to Compute Health Acquisition Corp. and its subsidiaries prior to the consummation of the Business Combination, and references to "Legacy Allurion" refer to Allurion Technologies, Inc. prior to the consummation of the Business Combination.
Basis of Presentation
7
The accompanying unaudited interim condensed consolidated financial statements have been prepared in accordance with U.S. GAAP and the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”). Any reference in these notes to the applicable accounting guidance is meant to refer to the authoritative U.S. GAAP as found in the Accounting Standards Codification ("ASC"), and Accounting Standards Update ("ASU"), of the Financial Accounting Standards Board ("FASB"). They should be read in conjunction with our audited financial statements as of and for the year ended December 31, 2025 included in the Company's Annual Report on Form 10-K filed with the SEC on March 30, 2026. The financial statements as of March 31, 2026 and for the three months ended March 31, 2026 and 2025 presented in this report are unaudited; however, in the opinion of management, such financial statements reflect all adjustments, consisting solely of normal recurring adjustments, necessary for a fair presentation of the results for the interim periods presented. The results of operations for the periods presented are not necessarily indicative of the results that might be expected for future interim periods or for the full year.
Our foreign operations are subject to exchange rate fluctuations and foreign currency transaction costs. The functional currency for all of our foreign subsidiaries is the United States dollar except Allurion Australia Pty Ltd., which uses the Australian dollar. When remeasuring from a local currency to the functional currency, assets and liabilities are remeasured into U.S. dollars at exchange rates in effect at the balance sheet dates and results of operations transacted in local currency are remeasured into U.S. dollars using average exchange rates for the period presented. A loss from remeasurement of ($
Going Concern
The accompanying condensed consolidated financial statements have been prepared as though the Company will continue as a going concern, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. The Company has evaluated whether there are certain conditions and events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date that the consolidated financial statements are issued.
The Company (1) has incurred recurring losses from operations and cash outflows from operating activities since inception, (2) anticipates net losses and negative operating cash flows for the foreseeable future, (3) needs to raise additional capital to satisfy its current obligations and finance its future operations and (4) is not in compliance with certain financial covenants required under its credit facilities. Through March 31, 2026, the Company has funded its operations primarily with proceeds from the sale of its Common Stock, convertible preferred stock, issuance of convertible notes, issuance of term loans, and funds received upon consummation of the Business Combination.
Until such time as we can generate sufficient revenue to fund operations, we expect to use proceeds from the issuance of equity, debt financings, or other capital transactions to fund our operations and satisfy our liquidity requirements. Additionally, the Company has entered into an Exchange Agreement with RTW, as disclosed in Note 11, Capital Stock and Stockholder's Deficit, under which the Company's existing credit facilities will be exchanged for preferred stock upon the satisfaction of certain closing conditions. Because the amount and timing of such financings are uncertain, the Company has concluded that management’s plans do not alleviate substantial doubt about its ability to continue as a going concern for a reasonable period of time.
The accompanying consolidated financial statements are prepared in accordance with generally accepted accounting principles applicable to a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business, and do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might result from the outcome of this uncertainty.
2. Summary of Significant Accounting Policies
There have been no significant changes to the significant accounting policies disclosed in Note 2 of the “Notes to Consolidated Financial Statements” to the consolidated audited financial statements as of and for the year ended December 31, 2025 included in our Annual Report on Form 10-K.
Use of Estimates
The preparation of these condensed consolidated 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 condensed consolidated financial statements, and the reported amounts of revenues and expenses during the reporting period. Management considers many factors in selecting appropriate financial accounting policies and controls in developing the estimates and assumptions that are used in the preparation of these condensed consolidated financial statements. Management must apply significant judgment in this process. In addition, other factors may affect estimates, including expected
8
Risk of Concentration of Credit, Significant Customers and Significant Suppliers
Financial instruments that potentially expose the Company to concentrations of credit risk consist primarily of cash equivalents and accounts receivable, net. The Company maintains deposits in accredited financial institutions in excess of federally insured limits. The Company maintains its cash, cash equivalents and restricted cash with financial institutions that management believes to be of high credit quality. The Company has not experienced any losses on such accounts and does not believe it is exposed to any unusual credit risk beyond the normal credit risk associated with commercial banking relationships.
Significant customers are those that represent more than
|
|
Revenue |
|
|
Accounts Receivable |
|
||||||||||
|
|
Three Months Ended March 31, |
|
|
March 31, |
|
|
December 31, |
|
|||||||
|
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
||||
Customer A |
|
|
% |
|
N/A |
|
|
N/A |
|
|
N/A |
|
||||
Customer B |
|
N/A |
|
|
|
% |
|
|
% |
|
|
% |
||||
The Company relies on third parties for the supply of parts and components for its products as well as third-party logistics providers. In instances where these parties fail to perform their obligations, the Company may be unable to find alternative suppliers of parts and components to satisfactorily deliver its products to its customers on time, if at all, which could have a material adverse effect on the Company’s operating results, financial condition and cash flows and damage its customer relationships.
Recently Adopted Accounting Pronouncements
In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which require public entities, on an annual basis, to provide disclosure of specific categories in the rate reconciliation, as well as disclosure of income taxes paid disaggregated by jurisdiction. The Company
Recently Issued Accounting Pronouncements Not Yet Adopted
In November 2024, the Financial Accounting Standards Board issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, which intends to improve financial reporting by requiring disclosure of additional information about specific expense categories. This guidance is effective for annual reporting periods beginning after December 15, 2026 and interim reporting periods beginning after December 15, 2027. Early adoption is permitted and the guidance is to be applied prospectively and may be applied retrospectively. The Company is currently evaluating the impact of this guidance on its consolidated financial statements and related disclosures.
3. Revenue
Revenue by geographic region is based on the country in which our customer is located and is summarized by geographic area as follows (in thousands):
|
|
Three Months Ended March 31, |
|
|||||
|
|
2026 |
|
|
2025 |
|
||
Italy |
|
$ |
|
|
$ |
|
||
Spain |
|
|
|
|
|
|
||
Chile |
|
|
|
|
|
|
||
Egypt |
|
|
|
|
|
|
||
All Other Countries |
|
|
|
|
|
|
||
Total Revenues |
|
$ |
|
|
$ |
|
||
9
4. Inventory
Inventory consists of the following (in thousands):
|
|
March 31, |
|
|
December, 31 |
|
||
|
|
2026 |
|
|
2025 |
|
||
Finished goods |
|
$ |
|
|
$ |
|
||
Work in progress |
|
|
|
|
|
|
||
Raw materials |
|
|
|
|
|
|
||
Total Inventory |
|
$ |
|
|
$ |
|
||
5. Property and Equipment, net
Property and equipment consist of the following (in thousands):
|
|
|
March 31, |
|
|
December 31, |
|
||
|
Estimated Useful Life (in Years) |
|
2026 |
|
|
2025 |
|
||
Computers and purchased software |
|
$ |
|
|
$ |
|
|||
Leasehold improvements |
Shorter of useful life |
|
|
|
|
|
|
||
Furniture and fixtures |
|
|
|
|
|
|
|||
Machinery and equipment |
|
|
|
|
|
|
|||
Property and equipment—at cost |
|
|
|
|
|
|
|
||
Less accumulated depreciation and amortization |
|
|
|
( |
) |
|
|
( |
) |
Construction in progress |
|
|
|
|
|
|
|
||
Property and equipment—net |
|
|
$ |
|
|
$ |
|
||
Depreciation expense was $
|
|
Three Months Ended March 31, |
|
|||||
|
|
2026 |
|
|
2025 |
|
||
Cost of revenue |
|
$ |
|
|
$ |
|
||
Research and development |
|
|
|
|
|
|||
General and administrative |
|
|
|
|
|
|||
Sales and marketing |
|
|
|
|
|
|||
Total depreciation and amortization expense |
|
$ |
|
|
$ |
|
||
10
6. Accrued Expenses and Other Current Liabilities
Accrued expenses and other current liabilities consist of the following (in thousands):
|
|
March 31, |
|
|
December 31, |
|
||
|
|
2026 |
|
|
2025 |
|
||
Other accrued expenses |
|
$ |
|
|
$ |
|
||
Accrued compensation |
|
|
|
|
|
|
||
Accrued professional fees |
|
|
|
|
|
|
||
Accrued restructuring |
|
|
|
|
|
|
||
Accrued selling and marketing |
|
|
|
|
|
|
||
Marketing reimbursement |
|
|
|
|
|
|
||
Total accrued expenses and other current liabilities |
|
$ |
|
|
$ |
|
||
In November 2024, the Company's management approved and initiated plans to reduce its cost structure. The restructuring plan initiated in November 2024 was substantially completed during the first half of 2025, with remaining payments to be made in accordance with local regulations through March 2026. Substantially all of the charge represents the severance cost of terminated employees, and are included in cost of revenue and operating expenses in the statement of operations.
Accrual at December 31, 2024 |
|
$ |
|
|
Restructuring charges and related costs |
|
|
( |
) |
Cash payments |
|
|
( |
) |
Accrual at December 31, 2025 |
|
|
|
|
Restructuring charges and related costs |
|
|
|
|
Cash payments |
|
|
( |
) |
Accrual at March 31, 2026 |
|
$ |
|
In August 2025, the Company's management approved and initiated plans to reduce its cost structure. The restructuring plan initiated in August 2025 was substantially completed during the third quarter of 2025, with remaining payments to be made in accordance with local regulations through December 2026. Substantially all of the charges represent the severance cost of terminated employees, and are included in cost of revenue and operating expenses in the statement of operations.
Accrual at December 31, 2024 |
|
$ |
|
|
Restructuring charges and related costs |
|
|
|
|
Cash payments |
|
|
( |
) |
Accrual at December 31, 2025 |
|
|
|
|
Restructuring charges and related costs |
|
|
|
|
Cash payments |
|
|
( |
) |
Accrual at March 31, 2026 |
|
$ |
|
7. Debt
The components of the Company’s third-party debt consist of the following (in thousands):
|
|
March 31, |
|
|
December 31, |
|
||
|
|
2026 |
|
|
2025 |
|
||
RTW Convertible Notes |
|
$ |
|
|
$ |
|
||
Total principal amounts of debt |
|
|
|
|
|
|
||
Change in fair value |
|
|
( |
) |
|
|
( |
) |
Current Portion of convertible notes payable |
|
|
|
|
|
|
||
Long-term debt, net of current portion and discounts |
|
$ |
|
|
$ |
|
||
11
RTW Convertible Notes
On April 14, 2024, the Company entered into a note purchase agreement (the "Original Note Purchase Agreement") with RTW as agent for the purchasers (the "Purchasers") party thereto from time to time (RTW in such capacity, the "Principal Purchaser"), and Acquiom Agency Services LLC ("Acquiom") as collateral agent for the Purchasers. Subsequently, on April 16, 2024, the Company, the Principal Purchaser, the Purchasers, and Acquiom entered into the First Amendment to the Original Note Purchase Agreement (the Original Note Purchase Agreement as amended, the "Amended Note Purchase Agreement").
Pursuant to the Amended Note Purchase Agreement, the Company issued and sold $
On January 7, 2025, the Company and Allurion Technologies, LLC ("Allurion OpCo") entered into an Omnibus Amendment (the “Omnibus Amendment”) with Allurion Australia Pty Ltd, Allurion France, and RTW to amend the Amended Note Purchase Agreement, the Revenue Interest Financing Agreement, and the New RIFA (collectively, the "Existing Documents").
The Omnibus Amendment requires, among other things, (i) the Company and Allurion OpCo to maintain certain minimum balances of unrestricted cash in controlled accounts in the U.S. in the amounts corresponding to the calculations set forth therein, and (ii) the Company to receive minimum trailing 12-month consolidated Revenue (as defined in the Amended Note Purchase Agreement) in amounts set forth therein, tested quarterly beginning with the 12-month period ending September 30, 2025. The Omnibus Amendment also requires that (i) Allurion France shall have successfully regained marketing authorization from the Agence Nationale de Sécurité du Médicament (“ANSM”) in France on or prior to December 31, 2025 and (ii) Allurion OpCo shall have received Marketing Authorization from the U.S. Food & Drug Administration for the Commercialization of the Product in the United States no later than June 30, 2026.
Pursuant to the Omnibus Amendment, the investors and the purchasers party thereto will receive a number of shares of the Company’s Common Stock, representing in the aggregate five percent (
On April 15, 2025, the Company, the Principal Purchaser, and the Purchasers entered into a Second Amendment to the Note Purchase Agreement (the "Second Amendment to Note Purchase Agreement"), which amended the Existing Note Purchase Agreement to reflect additional conversions and other provisions. The Second Amendment to Note Purchase Agreement provides for the mandatory conversion of $
12
common stock. The Purchasers also have the right to provide notice to the Company to convert up to an additional $
In addition, without regard to the Market Capitalization Condition, the Purchasers may provide the Company notice to convert up to an additional $
The Second Amendment to Note Purchase Agreement is accounted for as an extinguishment of debt under ASC 470, due to the substantive conversion features included in the Second Amendment to Note Purchase Agreement. The fair value of the RTW Convertible Notes were remeasured immediately before and after the Amendment was signed on April 15, 2025 as $
The RTW Convertible Notes are accounted for under the FVO election of ASC 825 as the notes contain embedded derivatives, including the conversion upon Stockholder Approval, the conversion upon a Fundamental Change Company Notice, the conversion upon a Make-Whole Fundamental Change, redemption upon the event of default, and redemption upon a Fundamental Change, which would require bifurcation and separate accounting. The RTW Convertible Notes were initially measured at their issue-date estimated fair value and subsequently remeasured at estimated fair value on a recurring basis at each reporting period date. The fair value of the RTW Convertible Notes at issuance was $
The Share Obligation is accounted for as a liability under ASC 480, Distinguishing Liabilities from Equity ("ASC 480"). As the Share Obligation was initiated in exchange for amendments of the Amended Note Purchase Agreement, the Revenue Interest Financing Agreement, and the New RIFA, all of which are accounted for under the FVO election, the liability was recorded at its initial fair value of $
For the three months ended March 31, 2026, the Company recorded a loss of $
8. Revenue Interest Financing, Side Letter, and PIPE Conversion Option
On February 9, 2023, Legacy Allurion entered into the Revenue Interest Financing Agreement. Pursuant to the Revenue Interest Financing, at the closing of the Business Combination, RTW paid Allurion an aggregate of $
13
by Allurion and its subsidiaries at a rate up to
If RTW has not received aggregate revenue interest payments equal to at least
The Revenue Interest Financing is accounted for under the FVO election of ASC 825 as the Revenue Interest Financing contains embedded derivatives, including the requirements to settle the Revenue Interest Financing prior to maturity upon the occurrence of certain contingent events and the Company's ability to prepay the Revenue Interest Financing, which would require bifurcation and separate accounting. The Revenue Interest Financing was initially measured at its issue-date estimated fair value and subsequently remeasured at estimated fair value on a recurring basis at each reporting period date. Changes in fair value are recorded as a component of Other income (expense) in the condensed consolidated statements of operations. A portion of the estimated change in fair value must be reported in other comprehensive loss to the extent that it is attributable to instrument-specific credit risk. In connection with the issuance of the Investment Amount, we paid $
Concurrently, and in connection with the Amended Note Purchase Agreement, the Revenue Interest Financing Agreement was amended pursuant to an Omnibus Amendment (the "RIFA Amendment") by and among the Company, Allurion Opco, Allurion Australia Pty Ltd, a proprietary limited company organized under the laws of Australia and a wholly-owned subsidiary of the Company, the Original RIFA Investors (as defined therein) and RTW, on April 14, 2024. The RIFA Amendment, among other things, increased the rate of revenue interest payments to be paid to RTW on all current and future products, digital solutions and services developed, imported, manufactured, marketed, offered for sale, promoted, sold, tested or otherwise distributed by Allurion and its subsidiaries for net sales less than or equal to $
The RIFA Amendment was accounted for as a modification with the change in fair value of the option held by RTW, pursuant to which RTW may elect to convert up to $
In connection with the Company entering into the Revenue Interest Financing, if, at any time beginning 12 months and ending 24 months following the closing of the Mergers, the VWAP per share of Allurion Common Stock is less than $
On October 22, 2024, funds affiliated with RTW provided notice to the Company of their election of the PIPE Conversion Option under the Amended and Restated RTW Side Letter to surrender
14
$
The exercise of the PIPE Conversion Option was accounted for as a settlement of the derivative liability. As such, the PIPE Conversion Option was remeasured as of October 30, 2024 just prior to conversion, to $
For the three months ended March 31, 2026, the Company recorded a $
9. Fair Value Measurements
The following tables present the fair value hierarchy for the Company's assets and liabilities that are measured at fair value at issuance date and on a recurring basis and indicate the level within the fair value hierarchy of the valuation techniques the Company utilized to determine such fair value (in thousands):
Fair Value Measurement as of March 31, 2026 |
|
|||||||||||||||
|
|
Total |
|
|
Level 1 |
|
|
Level 2 |
|
|
Level 3 |
|
||||
Assets: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Cash equivalents |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Money market funds |
|
$ |
|
|
$ |
|
|
$ |
— |
|
|
$ |
— |
|
||
Total assets |
|
$ |
|
|
$ |
|
|
$ |
— |
|
|
$ |
— |
|
||
Liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Legacy Allurion Common Stock Warrant Liabilities |
|
$ |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
|
||
Public Warrants |
|
|
|
|
|
|
|
|
— |
|
|
|
— |
|
||
Public Offering Warrants |
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
||
July 2024 Private Placement Warrants |
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
||
January 2025 Warrants |
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
||
February 2025 Offering Warrants |
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
||
November 2025 Private Placement Warrants |
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
||
Inducement Warrants |
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
||
Revenue Interest Financing |
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
||
Earn-out Liability |
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
||
RTW Convertible Notes |
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
||
Success Fee Derivative Liability |
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
||
Share Obligation |
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
||
Total Liabilities |
|
$ |
|
|
$ |
|
|
$ |
— |
|
|
$ |
|
|||
15
Fair Value Measurement as of December 31, 2025 |
|
|||||||||||||||
|
|
Total |
|
|
Level 1 |
|
|
Level 2 |
|
|
Level 3 |
|
||||
Assets: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Cash equivalents |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Money market funds |
|
$ |
|
|
$ |
|
|
$ |
— |
|
|
$ |
— |
|
||
Total assets |
|
$ |
|
|
$ |
|
|
$ |
— |
|
|
$ |
— |
|
||
Liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Legacy Allurion Common Stock Warrant Liability |
|
$ |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
|
||
Public Warrants |
|
|
|
|
|
|
|
|
— |
|
|
|
— |
|
||
Public Offering Warrants |
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
||
July 2024 Private Placement Warrants |
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
||
January 2025 Warrants |
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
||
February 2025 Offering Warrants |
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
||
November 2025 Private Placement Warrants |
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
||
Revenue Interest Financing |
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
||
Earn-out Liability |
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
||
RTW Convertible Notes |
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
||
Success Fee Derivative Liability |
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
||
Share Obligation |
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
||
Total Liabilities |
|
$ |
|
|
$ |
|
|
$ |
— |
|
|
$ |
|
|||
Public Warrants
As a result of the Business Combination on August 1, 2023, the Company assumed
Legacy Allurion Warrants, Public Offering Warrants, July 2024 Private Placement Warrants, January 2025 Warrants, February 2025 Offering Warrants, November 2025 Warrants, and Inducement Warrants
The Company has classified the Legacy Allurion Common Stock Warrants, Public Offering Warrants (defined below), July 2024 Private Placement Warrants (defined below), January 2025 Warrants (defined below), February 2025 Offering Warrants, (defined below), November 2025 Warrants (defined below), and Inducement Warrants (defined below) within Level 3 of the hierarchy as the fair value is derived using the Black-Scholes option pricing model, which uses a combination of observable (Level 2) and unobservable (level 3) inputs. See table below for the assumptions used in the pricing model of the Legacy Allurion Common Stock Warrants, Public Offering Warrants, July 2024 Private Placement Warrants, January 2025 Warrants, February 2025 Offering Warrants, November 2025 Warrants, and Inducement Warrants:
16
|
|
Measurement |
|
Interest |
|
|
Exercise |
|
|
Estimated Fair Value of Underlying Share Price |
|
|
Expected |
|
|
Expected |
|
|||||
Legacy Allurion Series C Preferred Stock warrants (as converted to Common) |
|
March 31, 2026 |
|
|
% |
|
$ |
|
|
$ |
|
|
|
% |
|
|
|
|||||
Legacy Allurion Other Common Stock |
|
March 31, 2026 |
|
|
% |
|
|
|
|
|
|
|
|
% |
|
|
|
|||||
Legacy Allurion Series D-1 Preferred Stock |
|
March 31, 2026 |
|
|
|
|
|
|
|
|
|
|
% |
|
|
|||||||
Public Offering Warrants |
|
March 31, 2026 |
|
|
% |
|
|
|
|
|
|
|
% |
|
|
|
||||||
July 2024 Private Placement Warrants |
|
March 31, 2026 |
|
|
% |
|
|
|
|
|
|
|
|
% |
|
|
|
|||||
January 2025 Warrants |
|
March 31, 2026 |
|
|
% |
|
|
|
|
|
|
|
|
% |
|
|
|
|||||
February 2025 Offering Warrants |
|
March 31, 2026 |
|
|
% |
|
|
|
|
|
|
|
|
% |
|
|
|
|||||
November 2025 Private Placement Warrants |
|
March 31, 2026 |
|
|
% |
|
|
|
|
|
|
|
|
% |
|
|
|
|||||
Inducement Warrants |
|
March 31, 2026 |
|
|
% |
|
|
|
|
|
|
|
|
% |
|
|
|
|||||
|
|
Measurement |
|
Interest |
|
|
Exercise |
|
|
Estimated Fair Value of Underlying Share Price |
|
|
Expected |
|
|
Expected |
|
|||||
Legacy Allurion Series C Preferred Stock warrants (as converted to Common) |
|
December 31, 2025 |
|
|
% |
|
$ |
|
|
$ |
|
|
|
% |
|
|
|
|||||
Legacy Allurion Other Common Stock |
|
December 31, 2025 |
|
|
% |
|
|
|
|
|
|
|
|
% |
|
|
|
|||||
Legacy Allurion Series D-1 Preferred Stock |
|
December 31, 2025 |
|
|
|
|
|
|
|
|
|
|
% |
|
|
|||||||
Public Offering Warrants |
|
December 31, 2025 |
|
|
% |
|
|
|
|
|
|
|
% |
|
|
|
||||||
July 2024 Private Placement Warrants |
|
December 31, 2025 |
|
|
% |
|
|
|
|
|
|
|
|
% |
|
|
|
|||||
January 2025 Warrants |
|
December 31, 2025 |
|
|
% |
|
|
|
|
|
|
|
|
% |
|
|
|
|||||
February 2025 Offering Warrants |
|
December 31, 2025 |
|
|
% |
|
|
|
|
|
|
|
|
% |
|
|
|
|||||
November 2025 Private Placement Warrants |
|
December 31, 2025 |
|
|
% |
|
|
|
|
|
|
|
|
% |
|
|
|
|||||
Expected dividend yield for all calculations is
The following table reconciles the changes in fair value for the three months ended March 31, 2026 and 2025 of the warrant liabilities valued using Level 3 inputs:
17
|
|
Preferred Stock Warrants (as converted to Common) |
|
|
Common Stock Warrants |
|
|
Public Offering Warrants |
|
|
July 2024 Private Placement Warrants |
|
|
January 2025 Warrants |
|
|
February 2025 Warrants |
|
|
November 2025 Warrants |
|
|
Inducement Warrants |
|
|
Total |
|
|||||||||
Balance – January 1, 2025 |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
|
|||||||
Fair value at issuance |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
|||
Change in fair value |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
— |
|
|
|
— |
|
|
|
( |
) |
Balance – March 31, 2025 |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Balance - January 1, 2026 |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
— |
|
|
$ |
|
||||||||
Warrant inducement (gain) loss |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
|
||
Change in fair value |
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
Exercise of warrants |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
— |
|
|
|
( |
) |
Balance – March 31, 2026 |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|||||||||
2019 Term Loan Success Fee Derivative Liability
The derivative liability for the success fee associated with Legacy Allurion's November 2019 loan and security agreement with Western Alliance Bank (the "2019 Term Loan" and such fee, the "Success Fee") was recorded at fair value as of March 31, 2026 and December 31, 2025 using the following assumptions: weighted-average probability for the likelihood of a change in control or liquidity event within
Revenue Interest Financing and PIPE Conversion Option
The Revenue Interest Financing is accounted for using the FVO election. Under the FVO election, the financial instrument is initially measured at its issue-date estimated fair value and subsequently remeasured at estimated fair value on a recurring basis at each reporting period date. The fair value of the Revenue Interest Financing was remeasured as of March 31, 2026 and December 31, 2025 using a discounted cash flow ("DCF") method under the income approach utilizing future revenue projections and a discount rate of
The fair value of the PIPE Conversion Option was accounted for as a derivative under ASC 815. Upon the exercise of the PIPE Conversion Option and resulting New RIFA on October 30, 2024, the PIPE Conversion Option was reclassified as an addition to the Revenue Interest Financing liability, and as such there is no PIPE Conversion Option liability as of March 31, 2026 and December 31, 2025.
Earn-Out Liability
Upon the closing of the Business Combination, Legacy Allurion equity holders are entitled to receive additional shares of Allurion Common Stock if the share price achieves certain targets (the "Earn-Out Shares"). The Earn-Out Shares were accounted for as a liability because the triggering events that determine the number of shares to be earned included events that were not indexed to Allurion Common Stock, with the change in fair value recognized in Change in the fair value of earn-out liabilities in the consolidated statement of operations.
|
|
March 31, 2026 |
|
|
December 31, 2025 |
|
||
Stock Price |
|
$ |
|
|
$ |
|
||
Risk-free interest rate |
|
|
% |
|
|
% |
||
Expected term (in years) |
|
|
|
|
||||
Expected volatility |
|
|
% |
|
|
% |
||
RTW Convertible Notes
The RTW Convertible Notes are accounted for using the FVO election. Under the FVO election, the financial instrument is initially measured at its issue-date estimated fair value and subsequently measured at estimated fair value on a recurring basis at each reporting period date. The fair value of the RTW Convertible Notes was remeasured as of March 31, 2026 using a DCF method under the income approach with a MCSM applied to determine the simulated stock price at each payment date and event that may trigger
18
conversion of the RTW Convertible Notes.
|
|
March 31, 2026 |
|
|
December 31, 2025 |
|
||
Stock Price |
|
$ |
|
|
$ |
|
||
Risk-free interest rate |
|
|
% |
|
|
% |
||
Discount Rate |
|
|
% |
|
|
% |
||
Expected term (in years) |
|
|
|
|
|
|||
Expected volatility |
|
|
% |
|
|
% |
||
Share Obligation
The Share Obligation is accounted for as a liability under ASC 480, with the liability initially measured at its issue-date estimate fair value and subsequently measured at its estimated fair value on a recurring basis at each reporting period date.
|
|
March 31, 2026 |
|
|
December 31, 2025 |
|
||
Stock Price |
|
$ |
|
|
$ |
|
||
Risk-free interest rate |
|
|
% |
|
|
% |
||
Expected term (in years) |
|
|
|
|
|
|
||
Expected volatility |
|
|
% |
|
|
% |
||
The changes in the fair values of the Success Fee derivative liability, Revenue Interest Financing, Earn-out liability, RTW Convertible Notes, and Share Obligation categorized with Level 3 inputs for the three months ended March 31, 2026 and 2025 were as follows:
|
|
Success Fee |
|
|
Revenue |
|
|
Earn-Out |
|
|
RTW Convertible Notes |
|
|
Share Obligation |
|
|
Total |
|
||||||
Balance - January 1, 2025 |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
— |
|
|
$ |
|
|||||
Fair value upon issuance |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
||
Change in fair value |
|
|
— |
|
|
|
|
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
Change in fair value - OCI |
|
|
— |
|
|
|
( |
) |
|
|
— |
|
|
|
( |
) |
|
|
— |
|
|
|
( |
) |
Balance – March 31, 2025 |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Balance - January 1, 2026 |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||||
Change in fair value |
|
|
— |
|
|
|
|
|
|
— |
|
|
|
|
|
|
( |
) |
|
|
|
|||
Change in fair value - OCI |
|
|
— |
|
|
|
( |
) |
|
|
— |
|
|
|
( |
) |
|
|
— |
|
|
|
( |
) |
Balance – March 31, 2026 |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||||
The change in fair value of the Success Fee derivative liability, Revenue Interest Financing, Earn-Out liability, RTW Convertible Notes, and Share Obligation at each period is recorded as a component of Other income (expense) in the condensed consolidated statements of operations, with the exception of the changes in fair value associated with the change in credit risk related to the Revenue Interest Financing and RTW Convertible Notes, which is recorded as a component of other comprehensive loss.
10. Income Taxes
The Company recorded income tax expense of less than $
As of March 31, 2026 and 2025, the Company maintained a full valuation allowance against its net deferred tax assets as the Company has incurred significant operating losses since inception and has concluded that its net deferred tax asset is not more-likely-than-not realizable.
As of March 31, 2026 and 2025, the Company has
11. Capital Stock and Stockholders' Deficit
Preferred Equity
19
On November 11, 2025, the Company entered into a securities purchase and exchange agreement (the "Exchange Agreement") with certain entities managed by RTW, pursuant to which RTW has agreed to exchange all of the (i) principal amount of the RTW Convertible Notes, purchased pursuant to the terms of the Amended Note Purchase Agreement, including interest accrued on the RTW Convertible Notes; (ii) Company obligations under the Revenue Interest Financing Agreement; and (iii) Company obligations under the New RIFA, for shares of a newly issued series of Series B convertible preferred stock, par value $
Allurion's charter authorizes the issuance of up to
Common Equity
Allurion's charter authorizes the issuance of up to
July 2024 Public Offering
On June 28, 2024, the Company entered into an underwriting agreement with Jefferies LLC and TD Securities (USA) LLC, as representative of the several underwriters (the "Underwriters"), pursuant to which the Company agreed to issue and sell
The Public Offering Warrants met the definition of a derivative under ASC 815 and the Share Overallotment met the requirements for equity classification under ASC 815. The $
RTW Private Placement
On January 14, 2025, the Company entered into a subscription agreement (the “RTW Subscription Agreement”) with funds affiliated with RTW, pursuant to which the Company agreed to sell
January 2025 Public Offering and Concurrent Private Placement
On January 24, 2025, the Company entered into a securities purchase agreement (the “January 2025 Securities Purchase Agreement”) with certain accredited investors named therein, pursuant to which the Company agreed to issue and sell
Certain purchasers in the January 2025 Offering and January 2025 Private Placement are holders of warrants to purchase Common Stock issued in the Public Offering in July 2024. The exercise price for the Public Offering Warrants initially was $
20
The January 2025 Warrants met the definition of a derivative under ASC 815. The $
February 2025 Public Offering and Concurrent Private Placement and Leavitt Private Placement
On February 19, 2025, the Company entered into a securities purchase agreement (the “February 2025 Securities Purchase Agreement”) with certain accredited investors named therein, pursuant to which the Company agreed to issue and sell
Additionally, on February 19, 2025, the Company entered into a subscription agreement (the “Leavitt Subscription Agreement”) with an accredited investor affiliated with Leavitt Equity Partners LLC (collectively, “Leavitt”), pursuant to which the Company agreed to issue and sell
The February 2025 Offering Warrants met the definition of a derivative under ASC 815. The $
November 2025 PIPE
On November 11, 2025, the Company entered into a securities purchase agreement (the “November 2025 Securities Purchase Agreement”) with certain accredited investors named therein, pursuant to which the Company agreed to issue and sell
The November 2025 Warrants met the definition of a derivative under ASC 815. The $
Warrant Inducement
On February 24, 2026, the Company entered into a warrant exercise inducement offer letter (the “Inducement Letter”) with certain holders of the Company's January 2025 Warrants, February 2025 Offering Warrants, and November 2025 Warrants (collectively, the “Existing Warrants”). Pursuant to the terms of the Inducement Letter, the Company agreed to amend the Existing Warrants by lowering the exercise price of the Existing Warrants to $
21
exercise price of $
The Warrant Inducement was accounted for as a warrant exercise inducement under ASC 815. Additionally, the Inducement Warrants met the definition of a derivative under ASC 815. The $
The number of shares of Common Stock that have been reserved for issuance upon the potential conversion or exercise, as applicable, of the Company’s securities as of March 31, 2026, is as follows:
Outstanding options to purchase Common Stock |
|
|
|
|
Restricted Stock Units |
|
|
|
|
Warrants to purchase Common Stock |
|
|
|
|
Shares of Common Stock issued upon the exercise of Public Warrants |
|
|
|
|
Earn-Out shares |
|
|
|
|
Convertible Notes |
|
|
|
|
Total |
|
|
|
Warrants to Purchase Common Stock
In connection with the closing of the Business Combination, all outstanding warrants to purchase Legacy Allurion preferred stock and Legacy Allurion common stock were converted into Rollover Warrants to purchase Allurion Common Stock using the Exchange Ratio.
In connection with the equity offerings defined above, the following warrants were outstanding to purchase Common Stock as of March 31, 2026:
March 31, 2026 |
|
|||||||||||||||
Issuance Date |
|
Remaining |
|
|
Underlying Equity Instrument |
|
Balance Sheet |
|
Shares Issuable |
|
|
Weighted |
|
|||
3/30/2021 |
|
|
|
|
Common stock |
|
Liability |
|
|
|
|
|
|
|||
9/15/2022 |
|
|
|
|
Common stock |
|
Liability |
|
|
|
|
|
|
|||
6/4/2022 |
|
|
|
|
Common stock |
|
Liability |
|
|
|
|
|
|
|||
1/17/2017 |
|
|
|
|
Common stock |
|
Equity |
|
|
|
|
|
|
|||
8/3/2017 |
|
|
|
|
Common stock |
|
Equity |
|
|
|
|
|
|
|||
9/8/2017 |
|
|
|
|
Common stock |
|
Liability |
|
|
|
|
|
|
|||
6/19/2018 |
|
|
|
|
Common stock |
|
Liability |
|
|
|
|
|
|
|||
6/25/2019 |
|
|
|
|
Common stock |
|
Liability |
|
|
|
|
|
|
|||
7/1/2024 |
|
|
|
|
Common stock |
|
Liability |
|
|
|
|
|
|
|||
1/27/2025 |
|
|
|
|
Common stock |
|
Liability |
|
|
|
|
|
|
|||
2/20/2025 |
|
|
|
|
Common stock |
|
Liability |
|
|
|
|
|
|
|||
11/11/2025 |
|
|
|
|
Common stock |
|
Liability |
|
|
|
|
|
|
|||
2/24/2026 |
|
|
|
|
Common stock |
|
Liability |
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
22
December 31, 2025 |
|
|||||||||||||||
Issuance Date |
|
Remaining |
|
|
Underlying Equity Instrument |
|
Balance Sheet |
|
Shares Issuable |
|
|
Weighted |
|
|||
3/30/2021 |
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Common stock |
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Liability |
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9/15/2022 |
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Common stock |
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Liability |
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6/4/2022 |
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Common stock |
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Liability |
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1/17/2017 |
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Common stock |
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Equity |
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8/3/2017 |
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Common stock |
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Equity |
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9/8/2017 |
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Common stock |
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Liability |
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6/19/2018 |
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Common stock |
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Liability |
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6/25/2019 |
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Common stock |
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Liability |
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7/1/2024 |
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Common stock |
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Liability |
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1/27/2025 |
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Common stock |
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Liability |
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2/20/2025 |
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Common stock |
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Liability |
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11/11/2025 |
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Common stock |
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Liability |
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In Compute Health's initial public offering, it sold units at a price of $
Chardan Equity Facility
On December 18, 2023, we entered into a ChEF Purchase Agreement (the "Purchase Agreement") and a Registration Rights Agreement, each with Chardan Capital Markets ("Chardan") related to a "ChEF," Chardan's committed equity facility (the "Chardan Equity Facility"). Pursuant to the Purchase Agreement, the Company has the right from time to time at its option to sell to Chardan up to the lesser of (i) $
Exchange Agreement with RTW
On November 11, 2025, the Company entered into Exchange Agreement with certain entities managed by RTW, pursuant to which RTW has agreed to exchange all of the (i) principal amount of the RTW Convertible Notes, purchased pursuant to the terms of the Amended Note Purchase Agreement, including interest accrued on the RTW Convertible Notes; (ii) Company obligations under the Revenue Interest Financing Agreement; and (iii) Company obligations under the New RIFA, for shares of Series B Preferred Stock of the Company.
The Exchange Agreement contains customary representations, warranties and agreements by the Company, customary conditions to closing, certain obligations of the parties, and indemnification provisions. On December 18, 2025, the Company obtained stockholder approval of the issuance of the Series B Preferred Stock. RTW's obligation to consummate the closing of the Exchange is conditioned upon compliance with the listing requirements of the national securities exchange on which the Common Stock is then listed on.
The Exchange Agreement creates an obligation for the Company to issues shares of Series B Preferred Stock upon satisfaction of the closing conditions (the "Preferred Stock Forward Contract"). The Preferred Stock Forward Contract was determined to be an
23
equity classified freestanding financial instrument in accordance with ASC 815-40 and ASC 480-10, respectively. The fair value as of November 11, 2025 was determined as the fair value of the Series B Preferred Stock that will be issued less the fair value of RIFA and RTW Convertible Notes. The fair value of the Series B Preferred Stock was performed using a scenario based approach, combining a DCF model with a MCSM valuation approach along with a risk free rate of
12. Net Loss per Share
Basic and diluted net loss per share was calculated as follows:
|
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Three Months Ended March 31, |
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|||||
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2026 |
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2025 |
|
||
Numerator: |
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|
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Net loss |
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$ |
( |
) |
|
$ |
( |
) |
Denominator: |
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Basic and diluted weighted-average common stock outstanding |
|
|
|
|
|
|
||
Net loss per share, basic and diluted |
|
$ |
( |
) |
|
$ |
( |
) |
The Company’s potentially dilutive securities have been excluded from the computation of diluted net loss per share as the effect would be to reduce the net loss per share. Therefore, the weighted average number of common shares outstanding used to calculate both basic and diluted net loss per share attributable to common stockholders is the same. The Company excluded the following potential common shares, presented based on amounts outstanding at each period end, from the computation of diluted net loss per share attributable to common stockholders for the periods indicated because including them would have had an anti-dilutive effect:
|
|
As of March 31, |
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|||||
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|
2026 |
|
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2025 |
|
||
Outstanding options to purchase Common Stock |
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Restricted Stock Units |
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Warrants to purchase Common Stock |
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Shares of Common Stock issued upon the exercise of Public Warrants |
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Earn-Out Shares |
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Convertible notes (as converted to common stock) |
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||
Total |
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13. Stock Based Compensation
Stock Incentive Plans
The Company’s 2010 Stock Incentive Plan (the “2010 Plan”) provided for the grant of qualified incentive stock options, nonqualified stock options, and other awards to the Company’s employees, officers, directors, advisors, and outside consultants to purchase the Company’s Common Stock. On December 11, 2020, the Company’s Board of Directors adopted the Amended and Restated 2020 Stock Option and Grant Plan (the “2020 Plan”), which provided for the grant of qualified incentive stock options, nonqualified stock options, and other awards to the Company’s employees, officers, directors, advisors, and outside consultants to purchase the Company’s Common Stock. Each stock option from the 2010 Plan and the 2020 Plan that was outstanding immediately prior to the Business Combination, whether vested or unvested, was cancelled and exchanged for a stock option to purchase Allurion Common Stock based on the Exchange Ratio. The per share exercise price for each stock option was divided by the Exchange Ratio.
In connection with the closing of the Business Combination, the Company adopted the 2023 Stock Option and Incentive Plan (the "2023 Plan"), which provides for the award of stock options (both incentive and non-qualified), stock appreciation rights,
24
restricted stock units ("RSUs"), restricted stock awards, cash-based awards, and dividend equivalent rights. On October 15, 2025 the Board voted to amend the 2023 Plan to the Amended and Restated 2023 Equity Incentive Plan (the "Amended 2023 Plan") to increase the aggregate number of shares of common stock issuable. The Amended 2023 Plan was approved by stockholders on December 18, 2025. As of March 31, 2026, a total of
As of March 31, 2026,
Stock-based compensation expense included in the condensed consolidated statement of operations was as follows:
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Three Months Ended March 31, |
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|||||
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2026 |
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2025 |
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||
Cost of revenue |
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$ |
|
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$ |
|
||
Selling, general, and administrative |
|
|
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|
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Research and development |
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|
|
|
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|
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Total stock-based compensation expense |
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$ |
|
|
$ |
|
||
Stock Options
The following table summarizes the option activity under the 2010 Plan, 2020 Plan, 2023 Plan, and Amended 2023 Plan during the three months ended March 31, 2026:
|
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Number of |
|
|
Weighted |
|
|
Weighted |
|
|
Aggregate |
|
||||
|
|
|
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(per option) |
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(in years) |
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(in thousands) |
|
||||
Outstanding—January 1, 2026 |
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$ |
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$ |
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Granted |
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||||
Cancellations and forfeitures |
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( |
) |
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Exercised |
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Outstanding— March 31, 2026 |
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||||
Exercisable at March 31, 2026 |
|
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|
$ |
|
|
|
|
|
$ |
|
||||
Total stock compensation expense related to stock option awards during the three months ended March 31, 2026 was $
The fair value of each option award is estimated on the date of grant using the Black-Scholes option-pricing model and the assumptions noted in the table below. Expected volatility for the Company’s Common Stock was determined based on an average of the historical volatility of a peer group of public companies that are similar to the Company. The expected term of options granted to employees was calculated using the simplified method, which represents the average of the contractual term of the option and the weighted-average vesting period of the option. The Company uses the simplified method because it does not have sufficient historical option exercise data to provide a reasonable basis upon which to estimate expected term. The expected term of options granted to non-employees is the remaining contractual term of the award. The assumed dividend yield is based upon the Company’s expectation of not paying dividends in the foreseeable future. The risk-free rate for periods within the expected life of the option is based upon the U.S. Treasury yield curve in effect at the time of grant. There were
25
On December 18, 2025, our board of directors approved a stock option repricing (the "Option Repricing") to be effective on December 18, 2025 (the "Effective Date") in accordance with our 2023 Plan. Pursuant to the Option Repricing the exercise price of each stock option previously granted under the 2023 Plan, totaling
Restricted Stock Units
In December 2022, the Company issued RSUs to a member of the Board of Directors with vesting subject to both a performance-based closing condition dependent on the successful Business Combination with Compute Health and time-based vesting conditions which are fully vested as of December 31, 2025. In October 2023 and March 2024, the Company issued additional RSUs to Board members and in November 2024 and May 2025, to employees and Board members, all of which vest over
The following table summarizes the restricted stock unit activity under the 2020 Plan, 2023 Plan, and Amended 2023 Plan during the three months ended March 31, 2026:
|
|
Number of RSUs |
|
|
Weighted |
|
||
|
|
|
|
|
(per share) |
|
||
Outstanding—January 1, 2026 |
|
|
|
|
$ |
|
||
Granted |
|
|
|
|
|
|
||
Cancellations and forfeitures |
|
|
( |
) |
|
|
|
|
Vested |
|
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( |
) |
|
|
|
|
Outstanding—March 31, 2026 |
|
|
|
|
$ |
|
||
Total stock compensation expense related to RSUs for the three months ended March 31, 2026 was $
Employee Stock Purchase Plan
In connection with the closing of the Business Combination, the Company adopted the 2023 Employee Stock Purchase Plan (the "2023 ESPP"). Under the 2023 ESPP plan, substantially all employees may voluntarily enroll to purchase the Company's Common Stock through payroll deductions at a price equal to
14. Employee Benefit Plan
The Company has a 401(k) retirement plan that covers eligible U.S. employees. Eligible employees may elect to contribute up to the maximum limits, as set by the Internal Revenue Service, of their eligible compensation. The Company may elect to make a
26
discretionary contribution or match a discretionary percentage of employee contributions. During each of the three months ended March 31, 2026 and 2025, the Company's matching contributions to the plan were less than $
15. Commitments and Contingencies
Leases
With respect to contracts involving the use of assets, if the Company has the right to direct the use of the asset and obtain substantially all economic benefits from the use of an asset, it accounts for the service contract as a lease.
As of March 31, 2026, the Company was a party to two different leases for office, manufacturing, and laboratory space under non-cancelable office leases in one city. These leases total approximately
In July 2025, the Company signed an Assignment of Lease and Consent to Assignment (the "Lease Assignment") for one of its Natick leases ending March 2028, whereby a third-party agreed to assume the Company's rights, duties and obligations under the lease beginning September 1, 2025. The lease assignment was contingent upon the landlord's consent and the Company is secondarily liable to the third-party assignee for obligations under the lease. For the year ended December 31, 2025 the Company derecognized the related operating lease right-of-use asset and operating lease liability of $
In February 2026, one of the Company's building leases expired and the company entered into a short term lease for the location.
The components of right-of-use ("ROU") assets and lease liabilities are included in the condensed consolidated balance sheets. The short-term portion of the Company's operating lease liability is recorded as part of Accrued expenses and other current liabilities on the condensed consolidated balance sheets.
Aggregate Lease Information
Other pertinent lease information for the three months ended March 31, 2026 and 2025 is as follows (in thousands):
|
|
Three Months Ended |
|
|||||
|
|
March 31, 2026 |
|
|
March 31, 2025 |
|
||
Operating lease costs |
|
$ |
|
|
$ |
|
||
Short-term lease costs |
|
|
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|
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|
||
Variable operating lease costs |
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|
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|
||
Operating cash flows paid for amounts in the measurement of lease liabilities |
|
|
|
|
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|
||
Future commitments under non-cancelable operating lease agreements as of March 31, 2026 are as follows (in thousands):
2026 |
|
$ |
|
|
2027 |
|
|
|
|
2028 |
|
|
|
|
Total lease payments |
|
$ |
|
|
Less: present value adjustment |
|
|
( |
) |
Present value of total lease liabilities |
|
|
|
|
Less: current lease liability |
|
|
( |
) |
Long-term lease liabilities |
|
$ |
|
The weighted-average remaining lease terms and discount rates related to our leases were as follows:
27
|
|
March 31, 2026 |
|
|
March 31, 2025 |
|
||
Weighted -average remaining lease term (in years) |
|
|
|
|
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|
||
Weighted-average discount rate |
|
|
% |
|
|
% |
||
Product Liability
The Company has not received any material product liability claims but nevertheless has obtained and maintains insurance related to potential product liability claims.
Litigation and Claims
In the normal course of operations, the Company may become involved in various claims and legal proceedings related to, for example, the validity or scope of its intellectual property rights, employee-related matters, securities class action, or adverse patient reactions. Additionally, during the normal course of business, the Company may be a party to legal claims that may not be covered by insurance.
On August 12, 2025, Vanderbilt University Medical Center (“Vanderbilt”) filed a complaint against the Company in the United States District Court for the Middle District of Tennessee, captioned Vanderbilt University Medical Center v. Allurion Technologies, Inc., d/b/a Allurion. Vanderbilt's complaint alleges that the Company breached the Clinical Trial Agreement, dated June 30, 2022, by and between the Company and Vanderbilt (the "Clinical Trial Agreement"), related to the clinical trial for the Smart Capsule by failing to reimburse medical expenses incurred in treating a patient enrolled in such trial at Vanderbilt. Vanderbilt was seeking damages of approximately $
French Regulatory Decision
On August 6, 2024, it was announced that the ANSM, the French regulatory authority, had suspended sales of the Allurion Balloon in France, and the Company withdrew the device from the French market. The Company implemented a remediation plan to reduce certain risks associated with the advertising, follow-up program, and adverse events for the Allurion Balloon. For the year ended December 31, 2024, the Company recognized a reduction to revenues of $
NYSE Continued Listing Standards
On August 29, 2024, the Company received written notice from the NYSE notifying us that as of August 29, 2024, we were not in compliance with the continued listing standard set forth in Section 802.01B of the NYSE’s Listed Company Manual (the "Minimum Market Capitalization Standard") because its average market capitalization was less than $
On March 2, 2026, Company announced that it received a letter (the “Delisting Notice”) from the staff of the NYSE indicating that the Company does not meet certain of the NYSE's continued listing standards as set forth in the Minimum Market Capitalization Standard.
On March 6, 2026, the NYSE subsequently informed the Company that it has determined to commence proceedings to delist the Company’s Common Stock, and warrants to purchase
28
16. Segment Information
Segment reporting is prepared on the same basis that the Company's chief executive officer, who is our chief operating decision maker (“CODM”), manages the business, makes operating decisions, and assesses performance. The Company operates in
Disclosures about significant segment expenses and long-lived assets by geography are presented below. Refer to Note 3, Revenue for information on revenue by geography. Significant segment expenses are set forth in the following table (in thousands):
Significant segment expenses are set forth in the following table (in thousands):
|
|
Three Months Ended March 31, |
|
|||||
|
|
2026 |
|
|
2025 |
|
||
Revenue |
|
$ |
|
|
$ |
|
||
Less: |
|
|
|
|
|
|
||
Cost of revenue |
|
|
|
|
|
|
||
Sales and marketing |
|
|
|
|
|
|
||
Clinical trials and medical affairs |
|
|
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|
||
Product development |
|
|
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|
||
Digital |
|
|
|
|
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|
||
Quality and regulatory |
|
|
|
|
|
|
||
General and administrative |
|
|
|
|
|
|
||
Other segment items (1) |
|
|
|
|
|
( |
) |
|
Net loss |
|
$ |
( |
) |
|
$ |
( |
) |
(1) Other segment items included in Net loss primarily include changes in fair value of warrant liabilities, changes in fair value of debt, changes in fair value of the Revenue Interest Financing, changes in fair value of earn-out liabilities, Warrant Inducement expense, and other income (expense).
Long-lived assets, consisting of property and equipment, net and ROU assets by geography were as follows (in thousands):
|
|
March 31, |
|
|
December 31, |
|
||
|
|
2026 |
|
|
2025 |
|
||
United States |
|
$ |
|
|
$ |
|
||
All other countries |
|
|
|
|
|
|
||
Long-lived assets |
|
$ |
|
|
$ |
|
||
17. Related-party Transactions
Convertible Note Agreement with RTW
Pursuant to the Amended Note Purchase Agreement, on April 16, 2024, we issued and sold $
January 2025 Private Placement with RTW
On January 14, 2025, the Company entered into the RTW Subscription Agreement with funds affiliated with RTW, pursuant to which the Company agreed to sell
Second Amendment to Amended Note Purchase Agreement
On April 15, 2025, the Company, the Purchasers and RTW, as agent for the Purchasers entered into the Second Amendment to Note Purchase Agreement, which amended the Amended Note Purchase Agreement to reflect additional conversion and other provisions, including provisions permitting the conversion of the RTW Convertible Notes at reduced conversion prices, resulting in the potential issuance of additional shares, which had been approved by the Company’s stockholders at the Special Meeting of
29
Stockholders held on April 10, 2025. On April 16, 2025, subject to the terms of the Second Amendment to Note Purchase Agreement, the Purchasers provided notice of conversion of $
Exchange Agreement with RTW
On November 11, 2025, the Company entered into the Exchange Agreement with RTW. Refer to Note 11, Capital Stock and Stockholders Deficit, for more information regarding the Exchange Agreement. As of December 31, 2025, the Exchange has not occurred.
November 2025 Private Placement with RTW
On November 11, 2025, the Company entered into the RTW Subscription Agreement with funds affiliated with RTW, pursuant to which the Company agreed to sell
30
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
The following discussion and analysis includes information that our management believes is relevant to an assessment and understanding of our condensed consolidated results of operations and financial condition. The discussion and analysis should be read together with the unaudited consolidated financial statements as of and for the three months ended March 31, 2026 and March 31, 2025 included in this Quarterly Report on Form 10-Q, and the audited consolidated financial statements as of and for the years ended December 31, 2025 and December 31, 2024 that are included in our Annual Report on Form 10-K filed with the SEC on March 30, 2026 (the "Annual Report on Form 10-K"). This discussion may contain forward-looking statements that involve risks and uncertainties. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of various factors, including those set forth in the sections titled “Cautionary Statement Regarding Forward-Looking Statements” and “Risk Factors” in our Annual Report on Form 10-K and this Quarterly Report on Form 10-Q. For purposes of this section, all references in this discussion and analysis to “Allurion,” the “Company”, “we,” “us,” or “our” refers to the business and operations of Allurion and its consolidated subsidiaries following the consummation of the Business Combination and to Legacy Allurion and its consolidated subsidiaries prior to the consummation of the Business Combination. “Legacy Allurion” refers to Allurion Technologies, LLC, which was previously known as Allurion Technologies Opco, Inc. (formerly Allurion Technologies, Inc.) prior to the consummation of the Business Combination. Capitalized terms not defined in this Management’s Discussion and Analysis of Financial Condition and Results of Operations section have the meanings ascribed to them in the condensed consolidated financial statements and the notes thereto included in this Quarterly Report on Form 10-Q.
Overview
Allurion is a leading medical device company that is focused on creating a best-in-class weight loss platform to treat obese and overweight patients. Our platform, the Allurion Program (the "Allurion Program"), features the world’s first and only swallowable, Procedureless™ intragastric balloon for weight loss (the "Allurion Smart Capsule") and offers artificial intelligence ("AI")-powered remote patient monitoring tools, a proprietary behavior change program, secure messaging and video telehealth that are delivered by the Allurion Virtual Care Suite ("VCS").
The Allurion Program was designed to achieve metabolically healthy weight loss, which entails losing weight, maintaining that weight loss, and maintaining or increasing muscle mass in the process. Unlike other options that lead to short-term weight loss and muscle wasting, the Allurion Program is intended to deliver longer lasting results while reducing fat and not muscle. We believe the Allurion Program is also synergistic in combination with other weight loss therapies, including glucagon-like peptide 1 ("GLP-1") receptor agonists.
Our proprietary intragastric balloon, the Allurion Smart Capsule, is swallowed as a capsule under the guidance of a health care provider without surgery, endoscopy, or anesthesia for placement.
The Allurion VCS is comprised of tools to support patients’ weight loss experience, which we believe benefit both patients and health care providers:
In addition to its use by Allurion Smart Capsule patients, we believe the VCS can potentially be a platform for optimal long-term follow up after other medical and surgical weight loss interventions in the future. We have incorporated a Treatment Tracking and Clinic-Led Onboarding feature into the VCS that enables seamless onboarding and management of patients undergoing one or multiple weight loss treatments, including gastric balloons such as the Allurion Balloon, surgery, or medication, and in April 2024, launched the VCS in the United States for patients utilizing other weight loss treatments, including anti-obesity medications and bariatric surgery.
Our Allurion Program products are currently sold in the United States, Europe, the Middle East, Africa, Latin America, Canada and the Asia-Pacific region.
Since our inception, we have incurred significant operating losses. Our ability to generate revenue and achieve cost improvements sufficient to achieve profitability will depend on the successful further development and commercialization of our
31
products and receipt and maintenance of regulatory approvals. We generated revenue of $2.9 million and $5.6 million for the three months ended March 31, 2026 and 2025, respectively, and incurred losses from operations of $3.7 million and $7.3 million for those same periods, respectively. We expect to continue to incur operating losses for the foreseeable future as we focus on obtaining regulatory approvals for our products in new markets, refining our sales and marketing strategies, and continuing research and development efforts to further enhance our existing products. Further, following the closing of the Business Combination, we have incurred, and expect to continue to incur, additional costs associated with operating as a public company. As a result, we will need additional funding for expenses related to our operating activities, including selling, marketing, general and administrative, and research and development expenses.
Because of the numerous risks and uncertainties associated with obtaining and maintaining regulatory approval, market acceptance of our products, product development and enhancement, and commercialization, we are unable to accurately predict the timing or amount of increased expenses or when, or if, we will be able to achieve or maintain profitability. Until such time, if ever, as we can generate substantial revenue sufficient to achieve profitability, we expect to finance our operations through a combination of equity offerings and debt financings. We may be unable to raise additional funds or enter into such other agreements or arrangements when needed on favorable terms, or at all. If we are unable to raise capital or enter into such agreements as, and when, needed, we may have to significantly delay, scale back or discontinue the further development and commercialization efforts of one or more of our products, or may be forced to reduce or terminate our operations. See the subsection entitled — “Liquidity and Capital Resources” below.
Recent Developments
FDA Approval
On February 20, 2026, the U.S. Food and Drug Administration (“FDA”) granted PMA approval for the Allurion Gastric Balloon System (AGBS), featuring the Allurion Smart Capsule. In the United States, the AGBS is indicated to promote short-term limited weight loss in adult individuals with obesity between the ages of 22 years and 65 years with a body mass index (BMI) ≥ 30 kg/m2 and ≤ 40 kg/m2 who have had at least one unsuccessful attempt at a weight loss program. The residence time for each balloon is variable with an average observed residence time of 15.3 weeks. The AGBS is to be used in conjunction with a moderate intensity lifestyle modification therapy program. The AGBS consists of up to two Allurion Balloons placed during a 10-month period.
Warrant Inducement
On February 24, 2026, Allurion Technologies, Inc. (the “Company”) entered into a warrant exercise inducement offer letter (the “Inducement Letter”) with certain holders (the “Exercising Holders”) of certain of the Company’s: (i) warrants issued in January 2025 to purchase shares of common stock, par value $0.0001 per share (“Common Stock”), with an exercise price of $6.00 per share (the “January 2025 Warrants”); (ii) warrants issued in February 2025 to purchase shares of Common Stock with an exercise price of $5.23 per share (the “February 2025 Warrants”); and (iii) warrants issued in November 2025 to purchase shares of Common Stock with an exercise price of $1.67 per share (the “November 2025 Warrants” and together with the January 2025 Warrants, February 2025 Warrants, the “Existing Warrants”).
Pursuant to the terms of the Inducement Letter, the Company agreed to amend the Existing Warrants by lowering the exercise price of the Existing Warrants to $1.15 per share. Additionally, the Exercising Holders agreed to exercise for cash certain of their Existing Warrants to purchase an aggregate of 2,659,565 shares of Common Stock in exchange for the Company’s agreement to issue to such Exercising Holder new warrants (the “New Warrants”) to purchase up to an aggregate of 5,319,130 shares of Common Stock. The Company received aggregate gross proceeds of approximately $3.1 million from the exercise of the Existing Warrants by the Exercising Holders.
Each New Warrant is exercisable into shares of Common Stock at a price per share of $1.15, will initially be exercisable following stockholder approval (the “Initial Exercise Date”), and will expire on the five-year anniversary of the Initial Exercise Date. Subject to limited exceptions, a holder of New Warrants will not have the right to exercise any portion of its New Warrants if the holder (together with such holder’s affiliates, and any persons acting as a group together with such holder or any of such holder’s affiliates) would beneficially own a number of shares of Common Stock in excess of 4.99% (or 9.99% at the Existing Holders’ option).
The Company has engaged Roth Capital Partners, LLC (“Roth”) as its financial advisor in connection with these transactions and will pay Roth a fee equal to 5.0% of its gross proceeds from the exercise of the Existing Warrants. The Company also agreed to pay Roth up to $40,000 for fees and expenses of legal counsel and other out-of-pocket expenses.
NYSE Continued Listing Standards
On March 2, 2026, Company announced that it received a letter (the “Delisting Notice”) from the staff of the NYSE indicating that the Company does not meet certain of the NYSE's continued listing standards as set forth in the Minimum Market Capitalization Standard.
32
On March 6, 2026, the NYSE subsequently informed the Company that it has determined to commence proceedings to delist the Company’s Common Stock, and warrants to purchase 0.056818 shares of Common Stock, with an exercise price of $202.50 per share of Common Stock, as a result of the Company’s non-compliance with Rule 802.01B of the NYSE Listed Company Manual that requires listing companies to maintain an average global market capitalization of at least $15 million over a period of 30 consecutive trading days. Trading in the Common Stock on the NYSE was suspended after market close on March 6, 2026. The Company has appealed this delisting determination. If the Company is unsuccessful in its appeal, the Company expects the NYSE will file a Form 25 with the SEC, which would result in the delisting of the Company’s Common Stock and Warrants from the NYSE on the tenth day after the Form 25 is filed.
As a result of the suspension in trading and delisting process, and pending the Company’s appeal, the Common Stock is trading on the OTCQB Market. The Company may apply to list on a higher-tier market operated by the OTC Market Group, Inc. under its current symbols "ALUR" and “ALUR.WS”.
Key Factors Affecting Our Operating Results
We believe that our performance and future success depend on many factors that present significant opportunities but also pose risks and challenges, including those discussed below and in the “Risk Factors” section of our Annual Report on Form 10-K.
Operating Segments
We operate our business in a single segment and as one reporting unit, which is how our chief operating decision maker ("CODM"), our chief executive officer, reviews financial performance and allocates resources. The CODM reviews financial information presented on a regular basis at the consolidated level for purposes of allocating resources and evaluating financial performance. Since we operate as one operating segment, all required financial segment information can be found in the consolidated financial statements.
Components of Our Results of Operations
Revenue
We derive revenue from the sale of the Allurion Smart Capsule to customers, which are either distributors or health care providers. The Allurion Smart Capsule is the foundation of the Allurion Program, a holistic weight loss program that offers patients the opportunity to receive, and clinic and other health care providers the ability to deliver, behavior change assistance through their use of our remote patient support and monitoring tools.
Cost of Revenue
Cost of revenue consists primarily of costs that are closely correlated or directly related to the delivery of our products, including material costs, labor costs, and depreciation expense for fixed assets.
33
Operating Expenses
Sales and Marketing Expenses
Sales and marketing expenses consist primarily of salaries and related expenses (including commissions) for our sales and marketing personnel. Marketing programs consist of advertising, training events, brand building, product marketing activities, and shipping costs.
Research and Development Expenses
Our research and development expenses consist of costs associated with performing research and development activities such as registering our products in various jurisdictions and performing clinical trials. These costs include salaries and benefits, stock-based compensation, non-capitalizable software development costs, product development costs, materials and supplies, clinical trial activities, registration expenses, depreciation of equipment, and other outside services.
General and Administrative Expenses
General and administrative expenses consist primarily of salaries and personnel-related costs, including stock-based compensation, for our personnel in executive, information technology, finance and accounting, human resources and other administrative functions. General and administrative expenses also include legal fees relating to corporate matters; professional fees paid for accounting, auditing, consulting and tax services; insurance costs; travel expenses; office and information technology costs; and facilities, depreciation and other expenses related to general and administrative activities, which include direct or allocated expenses for rent and maintenance of facilities and utilities.
Other Income (Expense)
Change in Fair Value of Warrants
The change in fair value of warrants consists of the expense recognized upon the mark to market of our warrant liabilities.
Change in Fair Value of Debt
The change in fair value of debt consists of the expense recognized upon the mark to market of our convertible debt.
Change in Fair Value of Revenue Interest Financing
The change in fair value of Revenue Interest Financing consists of the expense recognized upon the mark to market of the Revenue Interest Financing with RTW. See Note 9, Fair Value Measurements for further information.
Change in Fair Value of Earn-out Liabilities
The change in fair value of earn-out liabilities consists of the gain or loss recognized upon mark to market of the contingent earn-out consideration. See Note 9, Fair Value Measurements for further information.
Warrant Inducement Expense
Warrant inducement expense consists of the gain or loss recognized upon the Warrant Inducement and issuance of Inducement Warrants. See Note 11, Capital Stock and Stockholders Deficit for further information.
Other Income, net
Other income (expense), net consists of interest earned on our invested cash balances, which primarily consist of deposit accounts and money market funds, foreign currency transaction gains and losses and expense recognized upon the mark to market of the Share Obligation liability (as defined in Note 7, Debt, in the accompanying notes to the consolidated financial statements). See Note 9, Fair Value Measurements, for further information.
34
Results of Operations
Comparison of the Three Months Ended March 31, 2026 and 2025 (unaudited)
The following table summarizes our results of operations for the three months ended March 31, 2026 and 2025 (in thousands):
|
|
Three Months Ended March 31, |
|
|||||||||
|
|
2026 |
|
|
2025 |
|
|
Change |
|
|||
Revenue |
|
$ |
2,947 |
|
|
$ |
5,580 |
|
|
$ |
(2,633 |
) |
Cost of revenue |
|
|
1,718 |
|
|
|
1,419 |
|
|
|
299 |
|
Gross profit |
|
|
1,229 |
|
|
|
4,161 |
|
|
|
(2,932 |
) |
Operating expenses: |
|
|
|
|
|
|
|
|
|
|||
Sales and marketing |
|
|
1,304 |
|
|
|
3,621 |
|
|
|
(2,317 |
) |
Research and development |
|
|
912 |
|
|
|
2,624 |
|
|
|
(1,712 |
) |
General and administrative |
|
|
2,744 |
|
|
|
5,198 |
|
|
|
(2,454 |
) |
Total operating expenses: |
|
|
4,960 |
|
|
|
11,443 |
|
|
|
(6,483 |
) |
Loss from operations |
|
|
(3,731 |
) |
|
|
(7,282 |
) |
|
|
3,551 |
|
Other income (expense): |
|
|
|
|
|
|
|
|
|
|||
Changes in fair value of warrants |
|
|
4,324 |
|
|
|
5,669 |
|
|
|
(1,345 |
) |
Changes in fair value of debt |
|
|
(750 |
) |
|
|
3,330 |
|
|
|
(4,080 |
) |
Changes in fair value of Revenue Interest Financing |
|
|
(1,820 |
) |
|
|
(3,820 |
) |
|
|
2,000 |
|
Changes in fair value of earn-out liabilities |
|
|
— |
|
|
|
910 |
|
|
|
(910 |
) |
Warrant inducement expense |
|
|
(4,145 |
) |
|
|
— |
|
|
|
(4,145 |
) |
Other income (expense), net |
|
|
49 |
|
|
|
(213 |
) |
|
|
262 |
|
Total other income (expense): |
|
|
(2,342 |
) |
|
|
5,876 |
|
|
|
(8,218 |
) |
(Loss) income before income taxes: |
|
|
(6,073 |
) |
|
|
(1,406 |
) |
|
|
(4,667 |
) |
Provision for income taxes: |
|
|
(22 |
) |
|
|
(95 |
) |
|
|
73 |
|
Net (loss) income |
|
$ |
(6,095 |
) |
|
$ |
(1,501 |
) |
|
$ |
(4,594 |
) |
Revenue
Revenue decreased $2.6 million, or 47%, to $2.9 million for the three months ended March 31, 2026 compared to the same period in 2025. The decrease in revenue was primarily the result of lower investment in sales and marketing as we move our strategy to "business to business to customer" and away from direct to customer and distributor transitions initiated in the second quarter of 2025. The decrease was also driven by selling less or no product to certain distributors and accounts to manage our credit risk.
Cost of Revenue
Cost of revenue increased $0.3 million, or 21%, to $1.7 million for the three months ended March 31, 2026 compared to the same period in 2025. The increase in cost of revenue was a result of a $0.4 million increase and excess and obsolete inventory charges, partially offset by a decrease in cost of goods sold driven by decreased gastric balloon units sold and less labor and overhead absorbed due to lower production volumes.
Gross Profit
Gross profit decreased $2.9 million, or 70%, to $1.2 million for the three months ended March 31, 2026 compared to the same period in 2025. The decrease in gross profit was primarily the result of a $0.4 million increase in excess and obsolete inventory charges on lower sales and lower production volumes.
Operating Expenses
Sales and Marketing Expenses
Sales and marketing expenses decreased $2.3 million, or 64%, to $1.3 million for the three months ended March 31, 2026 compared to the same period in 2025. The decrease in sales and marketing expenses was primarily the result of a $1.5 million decrease in salaries and related benefits due to lower headcount as a result of the restructuring implemented during the third quarter of 2025, a
35
$0.3 million decrease in marketing expenditures driven by a reorganization of our selling and marketing spend focusing on more efficient channels and geographies, and a $0.2 million decrease in shipping and logistics expense.
Research and Development Expenses
Research and development expenses decreased $1.7 million, or 65%, to $0.9 million for the three months ended March 31, 2026 compared to the same period in 2025. The decrease in research and development expenses was primarily the result of a $0.8 million decrease in costs related to the AUDACITY clinical trial as the fourth and final module of the PMA was submitted to the FDA in June 2025 and we received FDA approval in February 2026, a $0.7 million decrease attributable to salaries and related benefit costs due to lower headcount as a result of the restructuring implemented during the third quarter of 2025, and a $0.1 million decrease in outside consulting costs.
General and Administrative Expenses
General and administrative expenses decreased $2.5 million, or 47%, to $2.7 million for the three months ended March 31, 2026 compared to the same period in 2025. The decrease in general and administrative expenses was primarily the result of a $1.6 million decrease in legal and professional fees, driven by $1.4 million of one-time financing costs during the three months ended March 31, 2025, a $0.5 million decrease in salaries and related benefit costs due to lower headcount as a result of the restructuring implemented during the third quarter of 2025, and a $0.2 million decrease in stock based compensation expense.
Other income (expense)
Change in Fair Value of Warrants
The $4.3 million gain attributable to the change in fair value of warrants for the three months ended March 31, 2026, compared to the same period in 2025, was due to mark to market fluctuations in our warrant liabilities due to the decline in value of our Common Stock during the applicable periods, as well as the issuance of the Inducement Warrants, for which there were no comparable mark to market fluctuations in the prior period.
Change in Fair Value of Debt
The $0.8 million loss attributable to the change in fair value of debt for the three months ended March 31, 2026, compared to the same period in 2025, was due to mark to market fluctuations in our convertible debt during the period.
Change in Fair Value of Revenue Interest Financing
The $1.8 million loss attributable to the change in fair value of the Revenue Interest Financing for the three months ended March 31, 2026, compared to the $3.8 million loss for the same period in 2025, was due to mark to market fluctuations in our Revenue Interest Financing during the period.
Change in Fair Value of Earn-Out Liabilities
The $0.9 million change in value of earn-out liabilities for the three months ended March 31, 2026, compared the same period in 2025, was due to fluctuations in our stock price.
Warrant Inducement Expense
The $4.1 million loss attributable to the Warrant inducement charge for the three months ended March 31, 2026, compared the same period in 2025, was due to a $5.9 million loss related to the issuance of the Inducement Warrants, partially offset by a $1.7 million gain related to change in fair value of the Existing Warrants.
Other Income, Net
The change in Other income, net for the three months ended March 31, 2026, compared to the same period in 2025, was a gain of $0.3 million attributable to a $0.1 million gain related to the Share Obligation.
Provision for Income Taxes
We recorded a provision for income taxes of less than $0.1 million for the three months ended March 31, 2026, compared to $0.1 million for the same period in 2025. The provision for income taxes is due to net income in certain foreign jurisdictions.
Liquidity and Capital Resources
Since our inception, we have primarily obtained cash to fund our operations through the sale of Common Stock and preferred stock, issuance of term loans, and issuance of convertible debt instruments. As of March 31, 2026 we had $5.1 million in cash and cash equivalents. We incurred operating losses of $3.7 million and $7.3 million for the three months ended March 31, 2026 and 2025, respectively. We incurred cash outflows from operating activities of $3.2 million and $9.5 million during the three months ended March 31, 2026 and 2025, respectively. As of March 31, 2026, we had an accumulated deficit of $257.1 million. We expect to continue to generate operating losses for the foreseeable future.
36
Our future capital requirements will depend on many factors, including:
Our revenue for the three months ended March 31, 2026 was $2.9 million, which represented a year-over-year decrease of 47%. The decrease in revenue was primarily the result of lower investment in sales and marketing as we move our strategy to "business to business to customer" and away from direct to customer and distributor transitions initiated in the second quarter of 2025. The decrease was also driven by selling less or no product to certain distributors and accounts to manage our credit risk. If our current cash and anticipated revenue and resulting cash flows from operations are insufficient to satisfy our liquidity requirements, due to increased expenditures, lower demand for our sales of our gastric balloon system, the occurrence of other events, or the realization of the risks described in our Annual Report on Form 10-K under the heading "Risk Factors," we may be required to raise additional capital through the issuances of public or private equity or debt financing or other capital sources earlier than expected.
Until such time as we can generate sufficient revenue to fund operations, we expect to use proceeds from the issuance of equity, debt financings, or other capital transactions to fund our operations and satisfy our liquidity requirements, but the amount and timing of such financings are uncertain. Additionally, the Company has entered into an Exchange Agreement with RTW, as disclosed in Note 11, Capital Stock and Stockholders Deficit, under which the Company's existing credit facilities will be exchanged for preferred stock upon the satisfaction of certain closing conditions. Based on the Company's recurring losses from operations incurred since inception, its expectation of continuing operating losses for the foreseeable future, the potential need to raise additional capital to finance its future operations, and noncompliance with certain financial covenants under its credit facilities, the Company has concluded that there is substantial doubt about its ability to continue as a going concern for a period of one year from the date that the condensed consolidated financial statements included in this Quarterly Report on Form 10-Q are issued.
Financing Arrangements
Revenue Interest Financing Agreement
On August 1, 2023, we received $40.0 million in proceeds from the Revenue Interest Financing Agreement with RTW, which matures in December 2030. We entered into the Revenue Interest Financing Agreement on February 9, 2023 and received the proceeds at the closing of the Business Combination. On April 14, 2024, the Revenue Interest Financing Agreement was amended to, among other things, increase the rate of revenue interest payments to be paid to RTW. The Revenue Interest Financing Agreement, as subsequently amended by the Omnibus Amendment, is included in Revenue Interest Financing liability on our consolidated balance sheet as of December 31, 2025. See Note 8, Revenue Interest Financing, Side Letter, and PIPE Conversion Option in the notes to our annual consolidated financial statements for the years ended December 31, 2025 and 2024 for additional details regarding the Revenue Interest Financing Agreement.
On October 22, 2024, funds affiliated with RTW provided notice to the Company of their election under the Amended and Restated RTW Side Letter to surrender 30,000 shares of Common Stock of the Company representing $7.5 million in consideration for an additional Revenue Interest Financing Agreement. Accordingly, on October 30, 2024, the Company and the funds affiliated with RTW entered into the New RIFA.
Chardan Purchase Agreement
On December 18, 2023, we entered into the ChEF Purchase Agreement with Chardan. Pursuant to the ChEF Purchase Agreement, we have the right from time to time at our option to sell to Chardan up to the lesser of (i) $100,000,000 in aggregate gross purchase price of newly issued shares of our common stock, and (ii) the Exchange Cap, subject to certain conditions.
The Company had sold all shares registered under the Exchange Cap, or 377,879 shares of Common Stock to Chardan at a purchase price of $1.8 million in connection with the Purchase Agreement as of the year ended December 31, 2025.
Note Purchase Agreement
On April 16, 2024, we received $48.0 million in gross proceeds from the Amended Note Purchase Agreement with RTW, which proceeds were used to repay all outstanding principal, accrued and unpaid interest and other obligations with respect to the Fortress Term Loan.
On April 15, 2025, we entered into the Second Amendment to Note Purchase Agreement with the Purchasers and RTW. On April 16, 2025, pursuant to the Second Amendment to Note Purchase Agreement, the Purchasers provided notice of conversion of $5.0 million of principal amount of the RTW Convertible Notes based on the closing price of the Common Stock on the immediately preceding trading day and resulting market capitalization of less than $15.0 million. The parties agreed that the Market Capitalization Condition was triggered and such mandatory conversion of $5.0 million of principal amount of the RTW Convertible Notes shall
37
occur at the floor price of $3.35 per share. We subsequently issued an aggregate of 1,492,539 shares of Common Stock (subject to rounding for fractional shares) in accordance with the terms of the Second Amendment to Note Purchase Agreement.
On November 4, 2025, pursuant to the terms of the Second Amendment to Note Purchase Agreement, the Purchasers provided notice of conversion of $5.0 million of principal amount of the RTW Convertible Notes at the Floor Conversion Rate, which notice was accepted by the Company on November 5, 2025. The Company subsequently issued an aggregate of 1,492,539 shares of Common Stock to the Purchasers in accordance with the terms of the Second Amendment to Note Purchase Agreement.
As of March 31, 2026, $38.0 million of the RTW Convertible Notes remains outstanding (excluding accrued PIK interest) and is included in current portion of convertible notes payable on our consolidated balance sheets at fair value. See Note 7, Debt, in the notes to our annual consolidated financial statements for the years ended December 31, 2025 and 2024 for additional details related to the Notes.
July 2024 Public Offering and Concurrent Private Placement
On July 1, 2024, we received $15.2 million in net proceeds from the issuance of 576,261 shares of Common Stock and 662,701 warrants to purchase Common Stock, and $2.5 million in net proceeds from the sale and issuance of 2,260,159 shares of Series A Preferred Stock (as converted to 90,407 shares of Common Stock following the Series A Stockholder Approval and Reverse Stock Split) and 90,407 private placement warrants to purchase Common Stock, in each case at an offering price of $30.00 per share and accompanying warrant. On July 5, 2024, the Underwriters partially exercised their option to purchase an additional 77,091 shares of Common Stock for additional net proceeds of $2.2 million.
January 2025 RTW Private Placement
On January 16, 2025, we received net proceeds of $2.5 million from the issuance of 841,751 shares of Common Stock to funds affiliated with RTW at a purchase price of $2.97 per share.
January 2025 Public Offering and Concurrent Private Placement
On January 27, 2025, we received net proceeds of $5.8 million, from the issuance of 1,240,000 shares of Common Stock and 1,240,000 January 2025 Warrants at an offering price of $6.00 per share and accompanying warrant.
Leavitt Private Placement
On February 20, 2025, we received net proceeds of $1.3 million, from the issuance of 267,686 shares of Common Stock and 535,372 Leavitt Private Placement Warrants at an offering price of $5.23 per share and accompanying warrant.
February 2025 Public Offering and Concurrent Private Placement
On February 20, 2025, the Company received net proceeds of $3.9 million, from the issuance of 900,000 shares of Common Stock and 1,800,000 February 2025 Warrants at an offering price of $5.23 per share and accompanying warrant.
November 2025 Private Placement
On November 11, 2025, the Company entered into the November 2025 Securities Purchase Agreement with certain accredited investors named therein, pursuant to which the Company agreed to issue and sell 2,994,012 November 2025 Private Placement Shares and accompanying November 2025 Private Placement Warrants to purchase up to 2,994,012 shares of Common Stock for an aggregate purchase price of approximately $5.0 million at a purchase price of $1.67 per share and accompanying Private Placement Warrant.
Exchange Agreement with RTW
On November 11, 2025, the Company entered into the Exchange Agreement with certain entities managed by RTW, pursuant to which RTW has agreed to exchange all of the (i) principal amount of the Notes, purchased pursuant to the terms of the Note Purchase Agreement, including interest accrued on the Notes; (ii) Company obligations under the Revenue Interest Financing Agreement; and (iii) Company obligations under the New RIFA for shares of Series B Preferred Stock.
Warrant Inducement
On February 24, 2026, the Company entered into the Inducement Letter with certain holders of its Existing Warrants, pursuant to which these holders agreed to exercise for cash certain of their Existing Warrants to purchase an aggregate of 2,659,565 shares of Common Stock (the “Warrant Inducement”) in exchange for the Company's agreement to issue to such holder new warrants (the “Inducement Warrants”) to purchase up to an aggregate of 5,319,130 shares of Common Stock at an exercise price of $1.15. The Warrant Inducement resulted in approximately $3.1 million of gross proceeds.
Material Cash Requirements for Known Contractual and Other Obligations
38
Leases
We have entered into various non-cancellable operating leases for our corporate office, manufacturing facilities, research and development labs, management office space and certain equipment. The leases have varying terms expiring between 2026 and 2028. See Note 15, Commitments and Contingencies for additional details related to our noncancelable operating leases.
RTW Convertible Notes
On April 16, 2024, we received $48 million in gross proceeds from the Amended Note Purchase Agreement with RTW, which proceeds were used to repay all outstanding principal, accrued and unpaid interest and other obligations with respect to the Fortress Term Loan.
On April 15, 2025, we entered into the Second Amendment to Note Purchase Agreement. On April 16, 2025, pursuant to the Second Amendment to Note Purchase Agreement, the Purchasers provided notice of conversion of $5.0 million of principal amount of the RTW Convertible Notes based on the closing price of the Common Stock on the immediately preceding trading day and resulting market capitalization of less than $15.0 million. The parties agreed that the Market Capitalization Condition was triggered and such mandatory conversion of $5.0 million of principal amount of the RTW Convertible Notes shall occur at the floor price of $3.35 per share. We subsequently issued an aggregate of 1,492,539 shares of Common Stock (subject to rounding for fractional shares) in accordance with the terms of the Second Amendment to Note Purchase Agreement. On November 4, 2025, the Purchasers provided notice of a conversion of $5.0 million of principal amount of RTW Convertible Notes and we accepted the notice on November 5, 2025. We subsequently issued an aggregate of 1,492,539 shares of Common Stock (subject to rounding for fractional shares) at the floor price of $3.35 per share in accordance with the terms of the Second Amendment to Note Purchase Agreement.
Revenue Interest Financing
We received $40.0 million in proceeds from the Revenue Interest Financing Agreement with RTW on August 1, 2023. In exchange, we are obligated to remit to RTW certain revenue interest payments on all current and future products, digital solutions and services developed, imported, manufactured, marketed, offered for sale, promoted, sold, tested or otherwise distributed by Allurion and its subsidiaries at certain specified rates. On April 14, 2024, the Revenue Interest Financing Agreement was amended to, among other things, increase the rate of revenue interest payments to be paid to RTW for net sales less than or equal to $100 million prior to December 31, 2026 was increased from 6% to 12%, and increase the royalty rate on net sales less than or equal to $100 million on or after January 1, 2027 was increased from 10% to 12%.
If RTW has not received aggregate revenue interest payments equal to at least 100% of the Investment Amount by December 31, 2027, we must make a cash payment in an amount sufficient to catch RTW up to 100% of the Investment Amount. If RTW has not received revenue interest payments equal to at least 240% of the Investment Amount by December 31, 2030, we must make a cash payment in an amount sufficient to catch RTW up to 240% of the Investment Amount.
Further, on October 22, 2024, funds affiliated with RTW provided notice to the Company of their election under the Amended and Restated RTW Side Letter (as amended) to surrender 30,000 shares of Common Stock of the Company representing $7.5 million in consideration for an additional Revenue Interest Financing Agreement. Accordingly, on October 30, 2024, the Company and the funds affiliated with RTW entered into the New RIFA. The New RIFA has substantially identical terms and conditions as the RIFA Amendment, except that the amount of financing provided under the Additional Revenue Interest Financing Agreement is equal to the conversion amount of $7.5 million.
Research and Development Costs
We have completed our U.S. FDA AUDACITY clinical trial after submitting the fourth and final module of the PMA in June 2025 and receiving FDA approval in February 2026 and expect our expenses to decrease significantly as we continue to make payments related to the obligations with each clinical trial site. Our clinical trial costs are dependent on, among other things, the size, number, and length of our clinical trial.
Other Capital Requirements
We enter into agreements in the normal course of business with various vendors, which are generally cancelable upon notice. Payments due upon cancellation typically consist only of payments for services provided or expenses incurred, including non-cancelable obligations of service providers, up to the date of cancellation.
Cash Flows
39
The following table sets forth a summary of cash flows for the periods presented:
|
|
Three Months Ended March 31, |
|
|||||
(In thousands) |
|
2026 |
|
|
2025 |
|
||
Net cash used in operating activities |
|
$ |
(3,221 |
) |
|
$ |
(9,469 |
) |
Net cash used in investing activities |
|
|
— |
|
|
|
— |
|
Net cash provided by financing activities |
|
|
2,866 |
|
|
|
14,499 |
|
Net increase (decrease) in cash and cash equivalents, and |
|
$ |
(355 |
) |
|
$ |
5,030 |
|
Net Cash Used in Operating Activities
Three Months Ended March 31, 2026
During the three months ended March 31, 2026, operating activities used $3.2 million of cash resulting from a net loss of $6.1 million, cash used from changes in our operating assets and liabilities of $1.0 million, partially offset non-cash expenses of $3.9 million.
Non-cash expense consisted of $4.1 million of warrant inducement expense, $1.8 million of expense related to the change in fair value of our Revenue Interest Financing, $0.8 million of expense related to the change in fair value of debt, $0.6 million of stock-based compensation expense, a $0.4 million provision for inventory, $0.2 million of issuance costs associated with warrants recorded at fair value, $0.2 million of depreciation and amortization, $0.1 million of non-cash lease expense, and $0.1 million of unrealized losses. This non-cash expense was partially offset by $4.3 million of income related to the change in fair value of warrants and $0.1 million of income related to the change in fair value of the Share Obligation.
Net cash used in our operating assets and liabilities consisted of a $1.7 million decrease in accounts payable, accrued expenses, and other current liabilities and a $0.1 million decrease in our lease liabilities. This was partially offset by a $0.4 million decrease in accounts receivable, a $0.2 million decrease in inventory, and a $0.2 million decrease in prepaid expenses.
The net decrease in accounts payable, accrued expenses and other current liabilities was primarily related to decreased expenses resulting from the restructuring implemented during the third quarter of 2025 and timing of payments.
Three Months Ended March 31, 2025
During the three months ended March 31, 2025, operating activities used $9.5 million of cash resulting from cash used from changes in our operating assets and liabilities of $4.8 million, non-cash income of $3.2 million, and a net loss of $1.5 million.
Non-cash income consisted of $5.7 million of income related mark to market adjustments related to our warrant liabilities, $3.3 million of income related to the change in fair value of our convertible debt, $0.9 million of income related to the change in fair value of our earn-out liabilities, and $0.3 million on unrealized gains. This non-cash income was partially offset by $3.8 million of expense related to the change in fair value of our Revenue Interest Financing, $1.1 million of issuance costs associated with warrants recorded at fair value, $0.9 million of stock-based compensation expense, a $0.7 million loss on changes in fair value of the Share Obligation, $0.2 million of non-cash lease expense, and $0.2 million of depreciation and amortization expense.
Net cash used in our operating assets and liabilities consisted of a $3.9 million decrease in accounts payable, accrued expenses, and other current liabilities, a $0.9 million increase in accounts receivable, and a $0.2 million decrease in our lease liabilities, partially offset by a $0.1 million decrease in prepaid expenses, other current and long-term assets and a less than $0.1 million decrease in inventory.
The net decrease in accounts payable, accrued expenses and other current liabilities was primarily related to decreased expenses resulting from the restructuring implemented during the fourth quarter of 2024 and timing of payments. The increase in accounts receivable was the result of an increase in revenue and decrease in cash collections.
Net Cash Used in Investing Activities
Three Months Ended March 31, 2026 and 2025
During the three months ended March 31, 2026 and 2025, cash used in investing activities was zero.
Net Cash Provided by Financing Activities
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Three Months Ended March 31, 2026 and 2025
During the three months ended March 31, 2026, cash provided by financing activities was $2.9 million of net proceeds from the Warrant Inducement.
During the three months ended March 31, 2025, cash provided by financing activities was $14.5 million, consisting of $14.5 million of net proceeds from the RTW Private Placement, January 2025 Offering, February 2025 Offering, and Leavitt Private Placement.
Critical Accounting Policies and Estimates
Our condensed consolidated financial statements are prepared in accordance with generally accepted accounting principles in the United States. The preparation of our condensed consolidated financial statements and related disclosures requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, costs and expenses, and the disclosure of contingent assets and liabilities in our condensed consolidated financial statements. We base our estimates on historical experience, known trends and events and various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. We evaluate our estimates and assumptions on an ongoing basis. Our actual results may differ from these estimates under different assumptions or conditions.
There have been no material changes in our critical accounting policies and significant judgments and estimates as compared to those disclosed in “Part II, Item 7—Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025. See Note 2, Summary of Significant of Accounting Policies in the accompanying notes to the condensed consolidated financial statements included in Part 1, Item 1 of this Quarterly Report on Form 10-Q for additional details of our accounting policies.
Recent Accounting Pronouncements
See Note 2, Summary of Significant of Accounting Policies in the accompanying notes to the condensed consolidated financial statements included in Part 1, Item 1 of this Quarterly Report on Form 10-Q for a description of recently issued accounting pronouncements that may potentially impact our financial position, results of operations or cash flows.
Emerging Growth Company and Smaller Reporting Company
We are an emerging growth company, as defined in the Jumpstart Our Business Startups Act (“JOBS Act”). Under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards until such time as those standards apply to private companies. We have elected to use this extended transition period for complying with new or revised accounting standards that have different effective dates for public and private companies until the earlier of the date that (i) we are no longer an emerging growth company or (ii) we affirmatively and irrevocably opt out of the extended transition period provided in the JOBS Act. As a result, these financial statements may not be comparable to companies that comply with the new or revised accounting pronouncements as of public company effective dates. We may choose to early adopt any new or revised accounting standards whenever such early adoption is permitted for private companies.
Additionally, we are a “smaller reporting company” as defined in Item 10(f)(1) of Regulation S-K, which allows us to take advantage of certain exemptions from disclosure requirements including exemption from compliance with the auditor attestation requirements of Section 404. We will remain a smaller reporting company until the last day of the fiscal year in which (i) the market value of the shares of our Common Stock held by non-affiliates exceeds $250 million as of the prior June 30, and (ii) our annual revenue exceeded $100 million during such completed fiscal year or the market value of the shares of our Common Stock held by non-affiliates exceeds $700 million as of the prior June 30. To the extent we take advantage of such reduced disclosure obligations, it may also make comparison of our financial statements with other public companies difficult or impossible.
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Item 3. Quantitative and Qualitative Disclosures About Market Risk.
Interest Rate Risk
We had cash and cash equivalents totaling $5.1 million at March 31, 2026. Cash equivalents were invested primarily in money market funds. Our investment policy is focused on the preservation of capital and supporting our liquidity needs. Under our investment policy, we invest in highly rated securities, issued by the U.S. government or liquid money market funds. We do not invest in financial instruments for trading or speculative purposes, nor do we use leveraged financial instruments. We utilize external investment managers who adhere to the guidelines of our investment policy. A hypothetical 10% change in interest rates would not have a material impact on the value of our cash, cash equivalents, net loss or cash flows.
As of March 31, 2026, we had no variable rate debt outstanding.
Foreign Currency Exchange Risk
We are exposed to foreign currency risks that arise from normal business operations. These risks include transaction gains and losses associated with transactions denominated in currencies other than a location’s functional currency and the remeasurement of foreign currencies to our U.S. dollar reporting currency. As such, we have exposure to adverse changes in exchange rates associated with operating expenses of our foreign operations. Transaction gains or losses are included in Other income (expense), net in the condensed consolidated statements of operations, as incurred.
We believe that a 10% increase or decrease in current exchange rates between the U.S. dollar and our foreign currencies could have a material impact on our business, financial condition or results of operations. Our primary exposures related to foreign currency denominated sales and expenses are in Europe and we also have exposure in the Middle East and the Asia-Pacific region, and are monitoring potential developing exposure in the Latin American, Canadian and African markets.
To date, we have not engaged in any foreign currency hedging activities. As our international operations grow, we will continue to reassess our approach to managing the risks relating to fluctuations in foreign currency exchange rates. During the three months ended March 31, 2026, the effect of an immediate 10% adverse change in foreign exchange rates on foreign-denominated accounts would have had an impact of approximately 5% on revenues and 1% on expenses and would have impacted our net loss by approximately less than 1%. During the three months ended March 31, 2025, the effect of an immediate 10% adverse change in foreign exchange rates on foreign-denominated accounts would have had an impact of approximately 5% on revenues and 3% on expenses and would have impacted our net loss by approximately 1%.
Item 4. Controls and Procedures.
Evaluation of Disclosure Controls and Procedures
Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure.
Our Chief Executive Officer, who is our principal executive officer and principal financial officer, has reviewed and evaluated the effectiveness of the Company's disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) promulgated under the Exchange Act) as of the end of the period covered by this Quarterly Report on Form 10-Q. Based on that review and evaluation, the Chief Executive Officer has concluded that the Company's disclosure controls and procedures were not effective as of March 31, 2026 as a result of the material weaknesses in our internal control over financial reporting discussed below.
In connection with the audits of our consolidated financial statements as of and for the years ended December 31, 2025 and 2024, we identified material weaknesses in our internal control over financial reporting that we are currently working to remediate, which relate to: (a) insufficient segregation of duties in the financial statement close process; (b) a lack of sufficient levels of staff with public company and technical accounting experience to maintain proper control activities and perform risk assessment and monitoring activities; and (c) insufficient information systems controls, including access and change management controls. We have concluded that these material weaknesses in our internal control over financial reporting occurred because we did not have the necessary business processes, personnel and related internal controls to operate in a manner to satisfy the accounting and financial reporting timeline requirements prior to being a public company.
We are focused on designing and implementing effective internal controls measures to improve our evaluation of disclosure controls and procedures, including internal control over financial reporting, and remediating the material weaknesses. In order to remediate these material weaknesses, we have taken and plan to take the following actions:
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While progress has been made to enhance our internal control over financial reporting, we are still in the process of building and enhancing our processes, procedures, and controls. Additional time is required to complete the remediation of these material weaknesses and the assessment to ensure the sustainability of these remediation actions. We believe the above actions, when complete, will be effective in the remediation of the material weaknesses described above.
Changes in Internal Control Over Financial Reporting
During the most recently completed fiscal quarter, there has been no change in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
Limitations on Effectiveness of Controls and Procedures
In designing and evaluating our disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. In addition, the design of disclosure controls and procedures must reflect the fact that there are resource constraints and that management is required to apply judgment in evaluating the benefits of possible controls and procedures relative to their costs.
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PART II—OTHER INFORMATION
Item 1. Legal Proceedings.
From time to time, we may become involved in legal proceedings or be subject to claims arising in the ordinary course of our business. We are not currently a party to any material legal proceedings. Regardless of outcome, such proceedings or claims can have an adverse impact on the Company because of defense and settlement costs, diversion of resources and other factors, and there can be no assurances that favorable outcomes will be obtained.
On August 12, 2025, Vanderbilt University Medical Center (“Vanderbilt”) filed a complaint against us in the United States District Court for the Middle District of Tennessee, captioned Vanderbilt University Medical Center v. Allurion Technologies, Inc., d/b/a Allurion. Vanderbilt’s complaint alleges that we breached the Clinical Trial Agreement, dated June 30, 2022, by and between us and Vanderbilt, related to the clinical trial for the Allurion Balloon by failing to reimburse medical expenses incurred in treating a patient enrolled in such trial at Vanderbilt. Vanderbilt was seeking damages of approximately $2.5 million. In April 2026, the Company and Vanderbilt agreed to settle this dispute and release all claims related to the same for payment of $750,000, paid in three equal monthly installments beginning on May 1, 2026.
Item 1A. Risk Factors.
Information regarding risk factors appears in Part I, Item 1A. "Risk Factors" of our Annual Report on Form 10-K. There have been no material changes from the risk factors previously disclosed in such Annual Report on Form 10-K. In addition to the matters set forth herein, investors should review the risks factors and other information provided in the Annual Report on Form 10-K prior to making an investment in the Company. Our business, financial condition and operating results can be affected by a number of factors, whether currently known or unknown, including but not limited to those described in the Annual Report on Form 10-K, any one or more of which could, directly or indirectly, cause our actual financial condition and operating results to vary materially from past, or from anticipated future, financial conditions and operating results. Any of these factors, in whole or in part, could materially and adversely affect our business, financial condition, operating results and stock price.
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Item 2. Unregistered Sales of Equity Securities, Use of Proceeds, and Issuer Purchases of Equity Securities
Unregistered Sales of Equity Securities, Use of Proceeds
Not applicable.
Issuer Purchases of Equity Securities
Not applicable.
Item 3. Defaults Upon Senior Securities.
None.
Item 4. Mine Safety Disclosures.
Not applicable.
Item 5. Other Information.
(a) Notice of Delisting
On May 11, 2026, we received a letter (the “Delisting Notice”) from the staff of the New York Stock Exchange (the “Exchange” or “NYSE”) indicating that we do not meet certain of the Exchange’s continued listing standards as set forth in Section 802.01C of the NYSE Listed Company Manual that require listed companies to maintain an average closing price of a security of not less than $1.00 over a consecutive 30 trading-day period.
We are required to notify the NYSE within 10 business days of receipt of the Delisting Notice, or Tuesday, May 26, 2026, of our intent to cure the trading price deficiency or be subject to suspension and delisting procedures. Provision by us of notice of intent to cure the deficiency will enable us to qualify for a six-month cure period. As described below, our securities have been suspended from trading on the NYSE as a result of other deficiencies. Nevertheless, we intend to seek to cure the trading price deficiency and to provide the NYSE with the required notice of such intent in a timely manner. The cure of such trading price deficiency may be effectuated through implementation of the reverse stock split previously approved by our stockholders.
As previously reported, on March 2, 2026, we received a notice from the Exchange stating that we were not in compliance with the continued listing criteria of Section 802.01B of the NYSE Listed Company Manual, which requires us to maintain either (i) at least $50 million of stockholders’ equity or (ii) at least $50 million of total market capitalization on a 30-trading day average basis; and on August 29, 2024, we received a notice from the Exchange stating that we were not in compliance with the continued listing criteria of Section 802.01B of the NYSE Listed Company Manual. We have a right to a review these prior determinations by a Committee of the Board of Directors of the Exchange (the “Committee”), have appealed the NYSE’s previous determinations to commence delisting proceedings, and have a review by the Committee scheduled for July 16, 2026.
Nevertheless, because our market capitalization is below $15 million, trading of our securities on the NYSE is currently suspended pending the resolution of our appeal. Our securities are currently being traded on the OTCQB exchange.
Our efforts to regain compliance with the continued listing requirements of the NYSE or gain compliance with the initial listing requirements of another exchange, such as the NYSE American, are ongoing and include discussions and negotiations with existing creditors and security holders, as well as capital raising efforts. In furtherance thereof, we have previously announced an agreement with our largest creditor to exchange all of its outstanding debt securities for shares of preferred stock at an exchange ratio representing a substantial premium to the Company’s current trading price, subject to certain conditions, and have completed a warrant inducement transaction. Nevertheless, there can be no assurance that we will be able to regain compliance with the Exchange’s continued listing standards or gain compliance with the initial listing requirements of another nationally recognized securities exchange.
The Delisting Notice does not affect our ongoing business operations or our reporting requirements with the Securities and Exchange Commission. The Delisting Notice has no immediate impact on the listing of our shares of common stock, par value $0.0001 per share (the “Common Stock”) or our warrants to purchase 0.056818 shares of Common Stock, with an exercise price of $202.50 per share of Common Stock (the “Warrants”), which will continue to be listed and traded on the OTCQB exchange during the Exchange’s review period, subject to our compliance with the other listing requirements of the OTCQB exchange.
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If the Common Stock ultimately were to be delisted from the Exchange for any reason, such delisting could negatively impact us by (i) reducing the liquidity and market price of our Common Stock and Warrants; (ii) reducing the number of investors willing to hold or acquire the Common Stock and Warrants, which could negatively impact our ability to raise equity financing; (iii) limiting our ability to use a registration statement to offer and sell freely tradable securities, thereby preventing us from accessing the public capital markets; and (iv) impairing our ability to provide equity incentives to its employees.
(c)
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Item 6. Exhibits.
The following list of exhibits includes exhibits submitted with this Quarterly Report on Form 10-Q as filed with the SEC and those incorporated by reference to other filings.
Exhibit Number |
|
Description |
Incorporated by Reference herein from - Form or Schedule |
File Number |
Exhibit |
Filed Date |
3.1 |
|
Amended and Restated Certificate of Incorporation of Allurion Technologies, Inc. (f/k/a Allurion Technologies Holdings, Inc.) |
8-K |
001-41767 |
3.1 |
August 7, 2023 |
3.2 |
|
Certificate of Amendment to the Amended and Restated Certificate of Incorporation of Allurion Technologies, Inc. |
8-K |
001-41767 |
3.1 |
December 31, 2024 |
3.3 |
|
Bylaws of Allurion Technologies, Inc. (f/k/a Allurion Technologies Holdings, Inc.) |
8-K |
001-41767 |
3.2 |
August 7, 2023 |
4.1 |
|
Warrant Agreement, dated February 4, 2021, between Compute Health Acquisition Corp. and Continental Stock Transfer & Trust Company, as warrant agent. |
8-K |
001-40001 |
4.1 |
February 9, 2021 |
4.2 |
|
Amendment to Warrant Agreement, dated August 1, 2023, by and between Compute Health and Continental Stock Transfer & Trust Company. |
8-K |
001-41767 |
4.2 |
August 7, 2023 |
4.3 |
|
Warrant Assignment, Assumption and Amendment Agreement, dated August 1, 2023, by and among Compute Health Acquisition Corp., New Allurion Holdings, Inc., and Continental Stock Transfer & Trust Company. |
8-K |
001-41767 |
4.3 |
August 7, 2023 |
4.4 |
|
Description of Capital Stock. |
10-K/A |
001-41767 |
4.4 |
August 19, 2025 |
4.5 |
|
Form of Public Warrant. |
8-K |
001-41767 |
4.1 |
July 1, 2024 |
4.6 |
|
Form of Private Placement Warrant. |
8-K |
001-41767 |
4.2 |
July 1, 2024 |
4.7 |
|
Form of Common Warrant (January 2025). |
8-K |
001-41767 |
4.1 |
January 28, 2025 |
4.8 |
|
Form of Common Warrant (February 2025). |
8-K |
001-41767 |
4.1 |
February 21, 2025 |
4.9 |
|
Form of Private Placement Warrant (February 2025). |
8-K |
001-41767 |
4.2 |
February 21, 2025 |
4.10 |
|
Form of Private Placement Warrant (November 2025). |
8-K |
001-41767 |
4.1 |
November 12, 2025 |
4.11 |
|
Form of New Warrant. |
8-K |
001-41767 |
4.1 |
February 25, 2026 |
10.1 |
|
Form of Inducement Letter. |
8-K |
001-41767 |
10.1 |
February 25, 2026 |
31.1* |
|
Certification of Principal Executive Officer and Principal Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
|
|
|
|
32.1** |
|
Certification of Principal Executive Officer and Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
|
|
|
|
101.INS |
|
Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because XBRL tags are embedded within the Inline XBRL document. |
|
|
|
|
101.SCH |
|
Inline XBRL Taxonomy Extension Schema Document |
|
|
|
|
101.CAL |
|
Inline XBRL Taxonomy Extension Calculation Linkbase Document |
|
|
|
|
101.DEF |
|
Inline XBRL Taxonomy Extension Definition Linkbase Document |
|
|
|
|
101.LAB |
|
Inline XBRL Taxonomy Extension Label Linkbase Document |
|
|
|
|
101.PRE |
|
Inline XBRL Taxonomy Extension Presentation Linkbase Document |
|
|
|
|
104 |
|
Cover Page Interactive Data File (embedded within the Inline XBRL document) |
|
|
|
|
* Filed herewith.
** Furnished herewith
# Certain of the exhibits and schedules to this exhibit have been omitted in accordance with Regulation S-K Item 601(a)(5). The Registrant agrees to furnish supplementally a copy of all omitted exhibits and schedules to the SEC upon its request.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
|
|
Allurion Technologies, Inc. |
|
|
|
|
|
Date: May 15, 2026 |
|
By: |
/s/ Shantanu Gaur |
|
|
|
Shantanu Gaur |
|
|
|
Chief Executive Officer and President |
|
|
|
Principal Executive Officer and Principal Financial Officer |
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