NewHydrogen, Inc. (NEWH) posts Q2 2026 loss and seeks new funding
NewHydrogen, Inc. is developing ThermoLoop™ thermochemical green hydrogen technology and remained pre-revenue in Q2 2026. For the quarter it recorded a net loss of $917,822, and a six‑month net loss of $1,740,818, driven by higher R&D of $674,387 and G&A of $861,116.
Cash declined to $739,528 at June 30, 2026, with working capital of $788,355 and a shareholders’ deficit of $2,643,279. The accumulated deficit reached $182,530,308, and management states that these conditions raise substantial doubt about continuing as a going concern within one year. The company raised $763,035 by issuing 46.4 million shares under a $3,000,000 equity purchase agreement and later issued a further 5.3 million shares in July. It continues funding a thermochemical water‑splitting research program at UC Santa Barbara, amended to total $1,690,038, while management believes existing cash will cover about four months of planned spending and that additional equity or debt financing will be required in 2026.
Positive
- None.
Negative
- Going-concern warning citing substantial doubt about operations within one year.
- $1,740,818 six-month net loss and $182,530,308 accumulated deficit.
- Only $739,528 cash and about four months of runway, reliant on new financing.
Key Figures
Key Terms
going concern financial
mezzanine financing financial
thermochemical water splitting technical
ASC Topic 820 financial
Black Scholes financial
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 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
| 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:
(Name of registrant in its charter)
(State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer Identification No.) |
(Address of principal executive offices) (Zip Code)
Registrant’s
telephone Number:
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
| None | None | None |
Indicate
by check mark whether the registrant (1) has filed all reports required 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, a 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.
| Large accelerated filer ☐ | Accelerated filer ☐ |
| Smaller
reporting company | |
| Emerging
growth company |
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
The
number of shares of registrant’s common stock issued and outstanding as of July 31, 2026 was
NEWHYDROGEN, INC.
INDEX
| Page | ||
| PART I: FINANCIAL INFORMATION | ||
| ITEM 1 | FINANCIAL STATEMENTS (Unaudited) | 1 |
| Condensed Balance Sheets | 1 | |
| Condensed Statements of Operations | 2 | |
| Condensed Statement of Shareholders’ Deficit | 3 | |
| Condensed Statements of Cash Flows | 4 | |
| Notes to the Condensed Financial Statements | 5 | |
| ITEM 2 | MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS | 11 |
| ITEM 3 | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK | 15 |
| ITEM 4 | CONTROLS AND PROCEDURES | 15 |
| PART II: OTHER INFORMATION | ||
| ITEM 1 | LEGAL PROCEEDINGS | 16 |
| ITEM 1A | RISK FACTORS | 16 |
| ITEM 2 | UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS | 16 |
| ITEM 3 | DEFAULTS UPON SENIOR SECURITIES | 16 |
| ITEM 4 | MINE SAFETY DISCLOSURES | 16 |
| ITEM 5 | OTHER INFORMATION | 16 |
| ITEM 6 | EXHIBITS | 17 |
| SIGNATURES | 18 | |
| i |
PART I – FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
NEWHYDROGEN, INC.
CONDENSED BALANCE SHEETS
| June 30, | December 31, | |||||||
| 2026 | 2025 | |||||||
| (Unaudited) | ||||||||
| ASSETS | ||||||||
| Current assets: | ||||||||
| Cash | $ | $ | ||||||
| Prepaid expenses and other current assets | ||||||||
| Total current assets | ||||||||
| Property and equipment: | ||||||||
| Machinery and equipment | ||||||||
| Less: accumulated depreciation | ( | ) | ( | ) | ||||
| Net property and equipment | ||||||||
| Other assets: | ||||||||
| Patents, net of amortization of $ | ||||||||
| Deposit | ||||||||
| Total other assets | ||||||||
| Total assets | $ | $ | ||||||
| LIABILITIES, MEZZANINE AND STOCKHOLDERS’ EQUITY (DEFICIT) | ||||||||
| Current liabilities: | ||||||||
| Accounts payable and accrued liabilities | $ | $ | ||||||
| Total current liabilities | ||||||||
| Mezzanine: | ||||||||
| Series C Convertible Preferred Stock, | ||||||||
| Commitments and contingencies | - | - | ||||||
| Stockholders’ equity (deficit): | ||||||||
| Preferred stock, $ | - | - | ||||||
| Common stock, $ | ||||||||
| Additional paid in capital | ||||||||
| Accumulated deficit | ( | ) | ( | ) | ||||
| Total stockholders’ deficit | ( | ) | ( | ) | ||||
| Total liabilities, mezzanine and stockholders’ equity | $ | $ | ||||||
The accompanying notes are an integral part of these condensed financial statements.
| 1 |
NEWHYDROGEN, INC.
CONDENSED STATEMENTS OF OPERATIONS
(Unaudited)
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Revenue: | $ | - | $ | - | $ | - | $ | - | ||||||||
| Operating expenses: | ||||||||||||||||
| Selling and marketing expenses | ||||||||||||||||
| General and administrative expenses | ||||||||||||||||
| Research and development | ||||||||||||||||
| Depreciation and amortization | ||||||||||||||||
| Total operating expenses | ||||||||||||||||
| Loss from operations before other income (expense) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Other income (expense): | ||||||||||||||||
| Interest income | ||||||||||||||||
| Other expenses | - | - | ( | ) | - | |||||||||||
| Total other income (expense) | ( | ) | ||||||||||||||
| Net income (loss) | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| Basic and diluted earnings (loss) per share | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| Weighted average number of common shares outstanding, basic and diluted | ||||||||||||||||
The accompanying notes are an integral part of these condensed financial statements.
| 2 |
NEWHYDROGEN, INC.
CONDENSED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIT)
THREE AND SIX MONTHS ENDED JUNE 30, 2026 AND 2025
(Unaudited)
| Series C | Additional | |||||||||||||||||||||||||||||||||||
| Preferred Stock | Preferred Stock | Common Stock | Paid in | Accumulated | ||||||||||||||||||||||||||||||||
| Shares | Amount | Shares | Amount | Shares | Amount | Capital | Deficit | Total | ||||||||||||||||||||||||||||
| Balance, December 31, 2025 | $ | - | $ | - | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||||||||||||||
| Stock compensation cost | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||
| Net loss | - | - | - | - | - | - | - | ( | ) | ( | ) | |||||||||||||||||||||||||
| Balance, March 31, 2026 | - | - | ( | ) | ( | ) | ||||||||||||||||||||||||||||||
| Issuance of common shares for equity financing at cost | - | - | - | - | - | |||||||||||||||||||||||||||||||
| Stock compensation cost | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||
| Adjustment to mezzanine | ( | ) | ( | ) | - | - | - | - | - | |||||||||||||||||||||||||||
| Net loss | - | - | - | - | - | - | - | ( | ) | ( | ) | |||||||||||||||||||||||||
| Balance, June 30, 2026 | $ | - | $ | - | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||||||||||||||
| Balance, December 31, 2024 | $ | - | $ | - | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||||||||||||||
| Stock compensation cost | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||
| Net loss | - | - | - | - | - | - | - | ( | ) | ( | ) | |||||||||||||||||||||||||
| Balance, March 31, 2025 | - | - | ( | ) | ( | ) | ||||||||||||||||||||||||||||||
| Issuance of common shares for equity financing at cost | - | - | - | - | - | |||||||||||||||||||||||||||||||
| Stock compensation cost | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||
| Net loss | - | - | - | - | - | - | - | ( | ) | ( | ) | |||||||||||||||||||||||||
| Balance, June 30, 2025 | $ | - | $ | - | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||||||||||||||
The accompanying notes are an integral part of these condensed financial statements.
| 3 |
NEWHYDROGEN, INC.
CONDENSED STATEMENTS OF CASH FLOWS
(Unaudited)
| Six Months Ended June 30, | ||||||||
| 2026 | 2025 | |||||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||
| Net income (loss) | $ | ( | ) | $ | ( | ) | ||
| Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ||||||||
| Depreciation and amortization | ||||||||
| Non-cash stock compensation expense | ||||||||
| Changes in operating assets and liabilities: | ||||||||
| Prepaid expenses and other current assets | ( | ) | ( | ) | ||||
| Accounts payable and accrued liabilities | ( | ) | ||||||
| Net cash provided by (used in) operating activities | ( | ) | ( | ) | ||||
| CASH FLOWS FROM INVESTING ACTIVITIES: | - | - | ||||||
| CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||
| Common shares issued through an equity financing agreement | - | |||||||
| Net cash provided by financing activities | - | |||||||
| Net increase (decrease) in cash | ( | ) | ( | ) | ||||
| Cash, cash equivalents, and restricted cash - beginning of period | ||||||||
| Cash, cash equivalents, and restricted cash - end of period | $ | $ | ||||||
| SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION: | ||||||||
| Cash paid during the period for: | ||||||||
| Interest | $ | - | $ | - | ||||
| Income taxes | $ | - | $ | - | ||||
| Non-cash investing and financing activities: | ||||||||
| Adjustment to mezzanine | $ | $ | - | |||||
| Equity financing cost | $ | - | $ | |||||
The accompanying notes are an integral part of these condensed financial statements.
| 4 |
NEWHYDROGEN, INC.
CONDENSED NOTES TO FINANCIAL STATEMENTS
AS OF JUNE 30, 2026
(Unaudited)
1. ORGANIZATION AND NATURE OF BUSINESS
Organization
NewHydrogen, Inc. (the “Company”) was incorporated in the state of Nevada on April 24, 2006. The Company, based in Santa Clarita, California, began operations on April 25, 2006 to develop and market Photovoltaic solar technology products.
Nature of Business
We are a developer of clean energy technologies. Our current focus is on developing a green hydrogen production technology that uses water and heat rather than electricity to produce the world’s cheapest green hydrogen.
Going Concern
The
accompanying financial statements have been prepared assuming the Company will continue as a going concern. As of June 30, 2026 the Company
has an accumulated deficit of $
The financial statements do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts of and classification of liabilities that might be necessary in the event the Company cannot continue in existence.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Accounting
The accompanying unaudited condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all normal recurring adjustments considered necessary for a fair presentation have been included. Operating results for the three and six months ended June 30, 2026, are not necessarily indicative of the results that may be expected for the year ending December 31, 2026. For further information refer to the financial statements and footnotes thereto included in the Company’s Form 10-K for December 31, 2025.
Revenue Recognition
The Company will recognize revenue when services are performed, and at the time of shipment of products, provided that evidence of an arrangement exists, title and risk of loss have passed to the customer, fees are fixed or determinable, and collection of the related receivable is reasonably assured. The Company adopted Accounting Standards Codification (“ASC”) 606, whereby revenue will be recognized as performance obligations are satisfied, and customers obtain control of goods or services. However, in the event of a loss on a sale is foreseen, the Company will recognize the loss as it is determined. To date, the Company has not had significant revenues.
| 5 |
Cash and Cash Equivalent
The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents.
Concentration Risk
Cash
includes amounts deposited in financial institutions in excess of insurable Federal Deposit Insurance Company (FDIC) limits. At times
throughout the year, the Company may maintain cash balances in certain bank accounts in excess of FDIC limits. As of June 30, 2026, the
cash balance in excess of the FDIC limits was $
Use of Estimates
The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the accompanying financial statements. Significant estimates made in preparing these financial statements include the estimate of useful lives of property and equipment, the deferred tax valuation allowance and the fair value of stock options. Actual results could differ from those estimates.
Property and Equipment
Property and equipment are stated at cost, and are depreciated using straight line over its estimated useful lives:
SCHEDULE OF PROPERTY AND EQUIPMENT
| Computer equipment | ||
| Machinery and equipment |
Depreciation
expense for the six months ended June 30, 2026 and 2025 was $
Intangible Assets
The Company has patent applications to protect the inventions and processes behind its proprietary bio-based back-sheet, a protective covering for the back of photovoltaic solar modules traditionally made from petroleum-based film. Intangible assets that have finite useful lives continue to be amortized over their useful lives (See Note 6).
SCHEDULE OF INTANGIBLE ASSETS AMORTIZED OVER THEIR USEFUL LIVES
| Useful Lives | June 30, 2026 | December 31, 2025 | ||||||||
| Patents | $ | $ | ||||||||
| Less accumulated amortization | ( | ) | ( | ) | ||||||
| Intangible assets | $ | $ | ||||||||
SCHEDULE OF PATENT AMORTIZATION
| Remainder of 2026 | $ | |||
| 2027 | ||||
| 2028 | ||||
| Thereafter | ||||
| Total | $ | |||
Amortization
expense for the six months ended June 30, 2026 and 2025 was $
| 6 |
Stock-Based Compensation
The Company measures the cost of employee services received in exchange for an equity award based on the grant-date fair value of the award. All grants under our stock-based compensation programs are accounted for at fair value and that cost is recognized over the period during which an employee, consultant, or director are required to provide service in exchange for the award (the vesting period).
Determining the appropriate fair value of the stock-based compensation requires the input of subjective assumptions, including the expected life of the stock-based payment and stock price volatility. The Company used Black Scholes to value its stock option awards which incorporated the Company’s stock price, volatility, U.S. risk-free rate, dividend rate, and estimated life.
Research and Development
Research
and development costs are expensed as incurred. Total research and development costs were $
Advertising and Marketing
The
Company expenses the cost of advertising and promotional materials when incurred. The advertising and marketing costs were $
Segment Reporting
NewHydrogen, Inc. operates as a single operating segment, focusing on developing clean energy technology.
The accounting policies of the operating segment are the same as those described in the summary of significant accounting policies. The Company’s chief operating decision maker (“CODM”) is the Chief Executive Officer and Acting Chief Financial Officer. The CODM assesses performance for the segment and decides how to allocate resources based on net income (loss) that is reported on the income statement. The measure of segment assets is reported on the balance sheet as total assets.
As the Company did not generate revenues in the current period, the CODM assessed Company performance through the achievement of target identification goals. In addition to the Company’s Statement of Operations, the CODM regularly works to develop budgeted and forecasted expense information which is used to determine the Company’s liquidity needs and cash allocation.
Net Earnings (Loss) per Share Calculations
We follow ASC Subtopic 260-10, Earnings per Share, which specifies the computation, presentation, and disclosure requirements of earnings per share information. Basic loss per share has been calculated based upon the weighted average number of common shares outstanding. Diluted income (loss) per share reflects the potential dilution that could occur if stock options or other contracts to issue common stock were exercised or converted during the period. Dilutive securities having an anti-dilutive effect on diluted earnings per share are excluded from the calculation.
Due to the net loss for the three and six months ended June 30, 2026 and 2025, basic and diluted income per share were the same, as all securities had an anti-dilutive effect. The following table presents potentially dilutive securities that were not included in the computation of diluted net income per share for the three months ended June 30, 2026 and 2025, as their inclusion would be anti-dilutive.
SCHEDULE OF NET EARNINGS PER SHARE
| June 30, 2026 | June 30, 2025 | |||||||
| Weighted average options to purchase common stock | ||||||||
| Weighted average warrants to purchase common stock | ||||||||
| 7 |
The following table presents potentially dilutive securities that were not included in the computation of diluted net income per share for the six months ended June 30, 2026 and 2025, as their inclusion would be anti-dilutive.
| June 30, 2026 | June 30, 2025 | |||||||
| Weighted average options to purchase common stock | ||||||||
| Weighted average warrants to purchase common stock | ||||||||
Fair Value of Financial Instruments
Fair Value of Financial Instruments requires disclosure of the fair value information, whether recognized in the balance sheet, where it is practicable to estimate that value. As of June 30, 2026, the amounts reported for cash, prepaid expenses, accounts payable, and accrued expenses, approximate the fair value because of their short maturities.
Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. ASC Topic 820 established a three-tier fair value hierarchy which prioritizes the inputs used in measuring fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (level 1 measurements) and the lowest priority to unobservable inputs (level 3 measurements). These tiers include:
| ● | Level 1, defined as observable inputs such as quoted prices for identical instruments in active markets; | |
| ● | Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable such as quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active; and | |
| ● | Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions, such as valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable. |
We measure certain financial instruments at fair value on a recurring basis. As of June 30, 2026, there were no financial instruments to report.
Recently Issued Accounting Pronouncements
In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, which requires incremental disclosures about specific expense categories, including but not limited to, purchases of inventory, employee compensation, depreciation, amortization and selling expenses. The amendments are effective for fiscal years beginning after December 15, 2026, and for interim periods within fiscal years beginning after December 15, 2027. Early adoption is permitted and the amendments may be applied either prospectively or retrospectively. The Company is currently evaluating this ASU to determine its impact on the Company’s disclosures. The amendments only impact disclosures and are not expected to have an impact on the Company’s financial condition and results of operations.
The Company considers all new pronouncements and management has determined that there have been no recently adopted or issued accounting standards that had or will have a material impact on its financial statements.
3. PREFERRED STOCK
As
of June 30, 2026, the Company had
During
the six months ended June 30, 2026,
The Series S Preferred Stock has been classified under mezzanine financing, a hybrid of debt and equity financing that gives a lender the right to convert debt to an equity interest in a company in case of default, generally, after venture capital companies and other senior lenders are paid.
| 8 |
4. COMMON STOCK
On
May 2, 2025, the Company entered into a purchase agreement with an investor for the sale of up to $
5. STOCK OPTIONS AND WARRANTS
Stock Options
The
2022 Incentive Plan authorizes a variety of incentive equity awards consisting of incentive stock options, non-qualified stock options,
restricted stock, restricted stock units, and reserves for issuance up to
Transactions involving our options are summarized as follows:
SCHEDULE OF STOCK OPTIONS
| Weighted | ||||||||||||
| Average | ||||||||||||
| Weighted | Grant-Date | |||||||||||
| Number of | Average | Per Share | ||||||||||
| Options | Exercise Price | Fair Value | ||||||||||
| Options outstanding at December 31, 2025 | $ | $ | ||||||||||
| Granted | $ | $ | ||||||||||
| Canceled/Expired | - | $ | - | $ | - | |||||||
| Exercised | - | $ | - | $ | - | |||||||
| Options outstanding at June 30, 2026 | $ | $ | ||||||||||
Details of our options outstanding as of June 30, 2026, are as follows:
SCHEDULE OF WEIGHTED AVERAGE REMAINING CONTRACTUAL LIFE OF OPTIONS OUTSTANDING
| Options Exercisable | Weighted Average Exercise Price of Options Exercisable | Weighted Average Contractual Life of Options Exercisable (Years) | Weighted Average Contractual Life of Options Outstanding (Years) | |||||||||||
On
April 1, 2026, the Company granted
Total
stock compensation expense related to the options for the six months ended June 30, 2026, and 2025, was $
| 9 |
The Company uses the Black Scholes model to value option grants. The Black Scholes model requires the use of these assumptions to determine the fair value of the stock-based awards. The Company uses management’s best estimates, which include the awards expected term, the fair value of the common stock, the expected volatility of the price of the common stock, the risk-free interest rate, and the expected dividend yield of the common stock. The expected term represents the period that the Company’s stock-based awards are expected to be outstanding. The Company has based its expected term on the simplified method available under U.S. GAAP.
Warrants
Transactions involving our warrants are summarized as follows:
SCHEDULE OF WARRANTS ACTIVITY
| Weighted | ||||||||||||
| Average | ||||||||||||
| Weighted | Grant-Date | |||||||||||
| Number of | Average | Per Share | ||||||||||
| Warrants | Exercise Price | Fair Value | ||||||||||
| Warrants outstanding at December 31, 2025 | $ | $ | ||||||||||
| Granted | - | $ | - | $ | - | |||||||
| Canceled/Expired | ( | ) | $ | $ | ||||||||
| Exercised | - | $ | - | $ | - | |||||||
| Warrants outstanding at June 30, 2026 | $ | $ | ||||||||||
Details of our warrants outstanding as of June 30, 2026, are as follows:
SCHEDULE OF WARRANTS OUTSTANDING
| Warrants Exercisable | Weighted Average Contractual Life of Warrants Outstanding and Exercisable (Years) | |||||
6. COMMITMENTS AND CONTINGENCIES
Research Agreement
On
June 28, 2023, the Company entered into a Research Agreement (the “Agreement”) with The Regents of the University of California
(the “University”), on behalf of its Santa Barbara Campus. Pursuant to the Agreement, the University will perform certain
research with respect to Thermochemical Water Splitting for Hydrogen Production from Water. The Agreement provides that the research
will be completed under the direction of Professors Phillip Christopher and Eric McFarland, who will serve as principal Investigators.
The Agreement also sets forth the rights to any data or information developed by the University under the Agreement, as well as the ownership
of any patentable developments or discoveries arising from the Agreement. On November 17, 2025, the Company and the Regents of the University
of California amended the Research Agreement to increase consideration payable to the University to $
Legal
In the normal course of business, the Company may be involved in legal proceedings, claims and assessments arising. Such matters are subject to many uncertainties, and outcomes are not predictable with assurance. In the opinion of management, the ultimate disposition of these matters will not have a material adverse effect on the Company’s financial position or results of operations.
As
of June 30, 2026, there were
7. SUBSEQUENT EVENT
Management has evaluated subsequent events according to the requirements of ASC TOPIC 855 and has no subsequent events to report except as described herein.
On
July 8, 2026, the Company issued
| 10 |
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Special Note on Forward-Looking Statements.
Certain statements in “Management’s Discussion and Analysis and Results of Operations” below, and elsewhere in this quarterly report, are not related to historical results, and are forward-looking statements. Forward-looking statements present our expectations or forecasts of future events. You can identify these statements by the fact that they do not relate strictly to historical or current facts. These statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements. Forward-looking statements frequently are accompanied by such words such as “may,” “will,” “should,” “could,” “expects,” “plans,” “intends,” “anticipates,” “believes,” “estimates,” “predicts,” “potential” or “continue,” or the negative of such terms or other words and terms of similar meaning. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance, achievements, or timeliness of such results. Moreover, neither we nor any other person assumes responsibility for the accuracy and completeness of such forward-looking statements. We are under no duty to update any of the forward-looking statements after the date of this quarterly report. Subsequent written and oral forward looking statements attributable to us or to persons acting on our behalf are expressly qualified in their entirety by the cautionary statements and risk factors set forth in our annual report on Form 10-K filed with the SEC on March 30, 2026, and in other reports filed by us with the SEC.
You should read the following description of our financial condition and results of operations in conjunction with the financial statements and accompanying notes included in this report.
Overview
We are a developer of clean energy technologies. Our current focus is on developing a thermochemical green hydrogen production technology to lower the cost of green hydrogen production.
Hydrogen is the cleanest and most abundant element in the universe, and we can’t live without it. Hydrogen is the key ingredient in making fertilizers needed to grow food for the world. It is also used for transportation, refining oil and making steel, glass, pharmaceuticals and more. Nearly all the hydrogen today is made from hydrocarbons like coal, oil, and natural gas, which are dirty and limited resources. Water, on the other hand, is an infinite and renewable worldwide resource.
Currently, the most common method of making green hydrogen is to split water into oxygen and hydrogen with an electrolyzer using green electricity produced from solar or wind. However, green electricity is and always will be very expensive. It currently accounts for 73% of the cost of green hydrogen. By using heat directly, we can skip the expensive process of making electricity, and fundamentally lower the cost of green hydrogen. Inexpensive heat can be obtained from concentrated solar, geothermal, nuclear reactors and industrial waste heat for use in our novel low-cost thermochemical water splitting process. Working with a world class research team at UC Santa Barbara, our goal is to help usher in the green hydrogen economy that Goldman Sachs (in a 2022 report) estimated to have a future market value of $12 trillion.
We have previously developed an innovative material technology to reduce the cost per watt of electricity produced by Photovoltaic, or PV, solar modules.
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Application of Critical Accounting Policies
Our discussion and analysis of our financial condition and results of operations are based upon our unaudited financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosures of contingent assets and liabilities. On an ongoing basis, we evaluate our estimates, including those related to impairment of property, plant and equipment, intangible assets, deferred tax assets and fair value computation using a Binomial lattice valuation model. We base our estimates on historical experience and on various other assumptions, such as the trading value of our common stock and estimated future undiscounted cash flows, that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions; however, we believe that our estimates, including those for the above-described items, are reasonable.
Use of Estimates
The preparation of financial statements in conformity with generally accepted accounting principles, requires management to make estimates and assumptions that affect the amounts reported in the accompanying financial statements. Significant estimates made in preparing these financial statements, include the estimate of useful lives of property and equipment, the deferred tax valuation allowance and the fair value of stock options. Actual results could differ from those estimates.
Fair Value of Financial Instruments
Our cash, cash equivalents, prepaid expenses, and accounts payable are stated at cost which approximates fair value due to the short-term nature of these instruments.
Recently Issued Accounting Pronouncements
In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, which requires incremental disclosures about specific expense categories, including but not limited to, purchases of inventory, employee compensation, depreciation, amortization and selling expenses. The amendments are effective for fiscal years beginning after December 15, 2026, and for interim periods within fiscal years beginning after December 15, 2027. Early adoption is permitted and the amendments may be applied either prospectively or retrospectively. The Company is currently evaluating this ASU to determine its impact on the Company’s disclosures. The amendments only impact disclosures and are not expected to have an impact on the Company’s financial condition and results of operations.
The Company considers all new pronouncements and management has determined that there have been no recently adopted or issued accounting standards that had or will have a material impact on its financial statements.
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Results of Operations – Three months ended June 30, 2026, compared to the Three months ended June 30, 2025.
OPERATING EXPENSES
Selling and Marketing Expenses
Selling and marketing (“S&M”) expenses increased by $15,786 to $109,878 for the three months ended June 30, 2026, compared to $94,092 for the prior period ended June 30, 2025. The primary increase in S&M expenses was the result of an increase in spending on website development and marketing.
General and Administrative Expenses
General and administrative (“G&A”) expenses increased by $83,265 to $464,318 for the three months ended June 30, 2026, compared to $381,053 for the prior period ended June 30, 2025. The majority of the increase related to increased stock option expense for a vesting amendment, increased accounting fees and an increase due to timing of market fees.
Research and Development
Research and Development (“R&D”) expenses increased by $195,007 to $342,874 for the three months ended June 30, 2026, compared to $147,867 for the prior period ended June 30, 2025. This overall increase in R&D expenses was the result of an increase in research agreement costs, and consultant costs.
Depreciation and Amortization Expense
Depreciation and amortization expense for the three months ended June 30, 2026 and 2025 was $821 and $820, respectively.
Net Loss
Our net loss for the three months ended June 30, 2026 was $917,822, compared to $623,704 for the prior period ended June 30, 2025. The Company has not generated any revenues. The majority of the increase in net loss was due to an overall increase in operating expenses and non-cash expense associated with the net change in stock option expense in the current period. The estimates for stock compensation expense were based on multiple inputs, including the market price of our stock, interest rates, our stock price volatility, variable conversion prices based on market prices as defined in the respective agreements and probabilities of certain outcomes based on management projections. These inputs were subject to significant changes from period to period and to management’s judgment; therefore, the estimated fair value of the stock options fluctuate, and the fluctuation may be material.
Results of Operations – Six months ended June 30, 2026, compared to the Six months ended June 30, 2025.
OPERATING EXPENSES
Selling and Marketing Expenses
S&M expenses increased by $2,876 to $203,447 for the six months ended June 30, 2026, compared to $200,571 for the prior period ended June 30, 2025. The primary reason for the increase in S&M expenses was due to an increase in website development offset by a decrease in ad campaigns.
General and Administrative Expenses
G&A expenses increased by $212,610 to $861,116 for the six months ended June 30, 2026, compared to $648,506 for the prior period ended June 30, 2025. The majority of the increase related to an increase in stock compensation expense for a vesting amendment and an increase in audit fees. These increases were offset by decreases to legal fees and market fees.
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Research and Development
R&D expenses increased by $425,002 to $674,387 for the six months ended June 30, 2026, compared to $249,385 for the prior period ended June 30, 2025. This overall increase in R&D expenses was the result of an increase in research agreement costs, and consultant costs.
Depreciation and Amortization Expense
Depreciation and amortization expense for the six months ended June 30, 2026 and 2025 was $1,642 and $1,641, respectively.
Net Loss
Our net loss for the six months ended June 30, 2026 was $1,740,818, compared to $1,099,798 for the prior period ended June 30, 2025. The Company has not generated any revenues. The majority of the increase in net loss was due to an overall increase in operating expenses and non-cash expense associated with the net change in stock option expense in the current period. The estimates for stock compensation expense were based on multiple inputs, including the market price of our stock, interest rates, our stock price volatility, variable conversion prices based on market prices as defined in the respective agreements and probabilities of certain outcomes based on management projections. These inputs were subject to significant changes from period to period and to management’s judgment; therefore, the estimated fair value of the stock options fluctuate, and the fluctuation may be material.
LIQUIDITY AND CAPITAL RESOURCES
Liquidity is the ability of a company to generate funds to support its current and future operations, satisfy its obligations, and otherwise operate on an ongoing basis. Significant factors in the management of liquidity are funds generated by operations, levels of accounts receivable and accounts payable and capital expenditures.
The accompanying unaudited condensed financial statements as of June 30, 2026, have been prepared on a going concern basis of accounting, which contemplates continuity of operations, realization of assets and liabilities and commitments in the normal course of business. The accompanying unaudited condensed financial statements do not reflect any adjustments that might result if we are unable to continue as a going concern. During the six months ended June 30, 2026, we did not generate any revenues, and recognized a net loss of $1,740,818, due to a change in operating expenses and cash of $1,460,435 used in operations. As of June 30, 2026, we had working capital of $788,355 and a shareholders’ deficit of $2,643,279.
Management believes that we will be able to continue to raise funds through the sale of our securities to existing and new investors, including through the use of its equity financing agreement entered into with GHS. Management believes that funding from existing and prospective new investors and future revenue will provide the additional cash needed to meet our obligations as they become due and will allow the development of our core business operations. No assurance can be given that any future financing will be available or, if available, that it will be on terms that are satisfactory to the Company. Even if the Company is able to obtain additional financing, it may contain undue restrictions on our operations, in the case of debt-financing or cause substantial dilution for our stockholders, in case of equity financing.
As of June 30, 2026, we had working capital of $788,355 compared to $1,433,163 for the year ended December 31, 2025. This decrease in working capital was due primarily to a decrease in cash.
During the six months ended June 30, 2026, we used $1,460,435 in cash for operating activities, as compared to $1,003,615 for the prior period ended June 30, 2025. The increase in the use of cash for operating activities for the current period was a result of an increase in research and development, and general and administrative costs.
There was no investing activities during the six months ended June 30, 2026 and June 30, 2025.
During the six months ended June 30, 2026, we received $763,035 in cash for financing activities as compared to $0 for the prior period ended June 30, 2025. Cash received during the current period was for shares issued through an equity financing agreement.
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Our independent auditors, in their report on our audited financial statements for the year ended December 31, 2025, expressed substantial doubt about our ability to continue as a going concern without additional capital becoming available. Our financial statements as of June 30, 2026, have been prepared under the assumption that we will continue as a going concern. Our ability to continue as a going concern, ultimately is dependent upon our ability to generate revenue, which is dependent upon our ability to obtain additional equity or debt financing, attain further operating efficiencies and, ultimately, to achieve profitable operations. Our financial statements do not include any adjustments that might result from the outcome of this uncertainty.
PLAN OF OPERATION AND FINANCING NEEDS
We are engaged in the development of clean energy technologies to lower the cost of producing green hydrogen. The Company’s current focus is on developing ThermoLoop™, a breakthrough technology that uses water and heat rather than electricity to potentially produce the world’s lowest cost green hydrogen.
Our plan of operation within the next twelve months is to utilize our cash balances to maintain the existing ThermoLoop™ technology development program at UCSB.
We believe that our current cash and investment balances will be sufficient to support development activity and general and administrative expenses for the next four months. Management estimates that it will require additional cash resources during 2026, based upon its current operating plan and condition. We do not expect increased expenses until early 2027 when we ramp up prototyping efforts related to our thermochemical water splitting technology.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
As a smaller reporting company, as that term is defined in Item 10(f)(1) of Regulation S-K, we are not required to provide information required by this Item.
ITEM 4. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
As of the end of the period covered by this report, we conducted an evaluation, under the supervision and with the participation of our chief executive officer and acting chief financial officer of our disclosure controls and procedures (as defined in Rule 13a-15(e) and Rule 15d-15(e) of the Exchange Act). Based upon this evaluation, our chief executive officer and chief financial officer concluded as of June 30, 2026, that our disclosure controls and procedures are effective to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is: (i) recorded, processed, summarized and reported, within the time periods specified in the Commission’s rules and forms, and (ii) accumulated and communicated to our management, including our chief executive officer and acting chief financial officer, or person performing similar functions, as appropriate to allow timely decisions regarding required disclosure.
Changes in Internal Control over Financial Reporting
There was no change to our internal control over financial reporting that occurred during our most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
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PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
As of the date of this report, we are not a party to any pending legal proceeding, nor is our property the subject of a pending legal proceeding, that is not in the ordinary course of business or otherwise material to the financial condition of our business. None of our directors, officers or affiliates is involved in a proceeding adverse to our business or has a material interest adverse to our business.
ITEM 1A. RISK FACTORS
There are no material changes from the risk factors previously disclosed in the Registrant’s annual report on Form 10-K filed on March 30, 2026.
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
None
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4. MINE SAFETY DISCLOSURES
Not applicable.
ITEM 5. OTHER INFORMATION
Rule 10b5-1 Trading Arrangement
During
our last fiscal quarter, no director or officer of the Company
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ITEM 6. EXHIBITS
| Exhibit No. | Description | |
| 31.1 | Certification by Chief Executive Officer pursuant to Sarbanes-Oxley Section 302 (filed herewith). | |
| 31.2 | Certification by Acting Chief Financial Officer pursuant to Sarbanes-Oxley Section 302 (filed herewith). | |
| 32.1 | Certification by Chief Executive Officer pursuant to 18 U.S.C. Section 1350 (furnished herewith). | |
| 32.2 | Certification by Acting Chief Financial Officer pursuant to 18 U.S.C. Section 1350 (furnished herewith). | |
| EX-101.INS | Inline XBRL Instance Document | |
| EX-101.SCH | Inline XBRL Taxonomy Extension Schema Document | |
| EX-101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase | |
| EX-101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase | |
| EX-101.LAB | Inline XBRL Taxonomy Extension Labels Linkbase | |
| EX-101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase | |
| 104 | Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101) |
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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.
| NEWHYDROGEN, INC. | ||
| Date: August 3, 2026 | By: | /s/ Steven Hill |
| Chief Executive Officer | ||
| (Principal Executive Officer) | ||
| Date: August 3, 2026 | By: | /s/ David Lee |
| Chairman, President and Acting Chief Financial Officer | ||
| (Principal Financial and Accounting Officer) | ||
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