Scientific Industries: $2.35M continuing operations loss
Sentiment and the balance of points
Rhea-AI Sentiment reads the wording of the document, how positive or negative its language is on a 1 to 5 scale. The balance of points shown with the takes weighs what the document actually discloses, so the two can disagree, for example when a trial that missed its main goal is described in upbeat language.
Scientific Industries, Inc. (SCND) reported nine-month revenue of $4.0523 million, up 18.2% from $3.4271 million a year earlier. Gross margin was 45.3%, compared with 39.8%. For the quarter, revenue was $1.3548 million versus $1.4040 million, with gross margin of 54.8% versus 45.5%. Nine-month continuing operations recorded a $2.3531 million loss, compared with $132,300 income; third-quarter net income was $470,000 versus $3.9944 million.
Lower Genie Division sale gains shaped the earnings comparisons: the company recorded a $1.695 million gain when the product-line transition was completed in September 2026, compared with $5.2634 million in the 2025 quarter and nine-month period. Nine-month operating cash outflow was $2.475 million, versus $4.3907 million. Management expects negative operating cash flows in the foreseeable future but projects sufficient funds for at least one year from statement issuance; it cautioned that the operating plan may not succeed.
How this balance works
Rhea-AI gives every point it takes from this document a weight. Minor counts 1, Moderate 3 and Major 9, so one Major point outweighs several Minor ones. The bar adds up the weights on each side, and when neither side holds more than 65% of the total the balance reads Mixed.
It reads the document as published, with the same rules for every company, and it does not look at what the market expected or at how the stock traded, so a point can be objectively good on a day the stock falls.
Rhea-AI Sentiment measures something else, the tone of the wording.
Positive
- Moderate pointNine-month revenue increased 18.2% to $4.0523 million.
- Moderate pointOperating cash used declined to $2.475 million from $4.3907 million.
Negative
- Major pointNine-month continuing operations swung to a $2.3531 million loss from $132,300 income.
- Moderate pointThird-quarter net income was $470,000, versus $3.9944 million a year earlier.
Filing Explained
The option grant creates potential, not completed, share issuance; separate lease liabilities total $1,210,500.
The September 30, 2026 Form 10-Q reports 11,928,599 common shares issued and outstanding, the same count as December 31, 2025. During the nine months, the company granted 1,112,000 options; unlike issued common shares, these options can add shares only if exercised.
At quarter end, 3,324,275 options and warrants for 7,625,350 shares remained outstanding; the filing says these potential shares were excluded from diluted earnings per share because their exercise prices exceeded the stock’s fair market value in the periods reported. Of the February option grant, 535,000 vest in 2030 and 577,000 vest monthly over 12 months; most were granted instead of cash salary and director fees being paid.
Separately, the September 30 lease schedule lists
Key Figures
Key Terms
full valuation allowance financial
Level 3 financial
anti-dilutive financial
earn-out financial
operating lease right-of-use assets financial
contract liabilities financial
FAQ
AI-generated questions and answers. How Rhea-AI works. Not financial advice.
How much revenue did SCND report for the first nine months of 2026?
Why did SCND report a $1.695 million gain in the third quarter of 2026?
AI-generated analysis. How Rhea-AI works. Not financial advice.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
For the quarterly period ended
For the transition period from ________to________
Commission file number
(Exact Name of Registrant as specified in Its Charter) |
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(State or other jurisdiction of incorporation or organization) |
| (I.R.S. Employer Identification No.) |
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(Address of principal executive offices) |
| (Zip Code) |
(
(Registrant’s telephone number, including area code)
Not Applicable
(Former name, former address and former fiscal year, if changed since last report)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class |
| Trading Symbol(s) |
| Name of each exchange on which registered |
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| OTC |
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 and post 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 Act) Yes
The number of shares outstanding of the registrant’s common stock, par value $.05 per share (“Common Stock”) as of November 6, 2026 is
SCIENTIFIC INDUSTRIES, INC.
Table of Contents
PART I - Financial Information |
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Item 1. | CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) |
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| Condensed Consolidated Balance Sheets |
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| Condensed Consolidated Statements of Operations and Comprehensive Gain (Loss) |
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| Condensed Consolidated Statements of Changes in Shareholders’ Equity |
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| Condensed Consolidated Statements of Cash Flows |
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| Notes to Unaudited Condensed Consolidated Financial Statements |
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Item 2. | MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS |
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Item 3. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK |
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Item 4. | CONTROLS AND PROCEDURES |
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PART II - Other Information |
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Item 1. | Legal Proceedings |
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Item 1A. | Risk Factors |
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Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds |
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Item 3. | Defaults Upon Senior Securities |
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Item 4. | Mine Safety Disclosures |
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Item 5. | Other Information |
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Item 6. | Exhibits |
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SIGNATURE |
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| Table of Contents |
PART I – FINANCIAL INFORMATION
Item 1. Financial Statements
SCIENTIFIC INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
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| As of September 30, 2026 |
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| As of December 31, 2025 |
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ASSETS |
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Current assets: |
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Investment securities |
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Trade accounts receivable, less allowance for doubtful accounts of $ |
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Inventories |
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Income tax receivable |
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Prepaid expenses and other current assets |
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Current assets of discontinued operations |
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Total current assets |
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Property and equipment, net |
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Goodwill |
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Other intangible assets, net |
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Inventories |
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Operating lease right-of-use assets |
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Other assets |
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Total assets |
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LIABILITIES AND SHAREHOLDERS’ EQUITY |
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Current liabilities: |
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Accounts payable |
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Accrued expenses |
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Contract liabilities |
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Lease liabilities, current portion |
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Current liabilities of discontinued operations |
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Total current liabilities |
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Lease liabilities, less current portion |
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Total liabilities |
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Shareholders’ equity: |
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Common stock, $ |
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Additional paid-in capital |
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Accumulated other comprehensive income |
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Accumulated deficit |
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Total shareholders’ equity |
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Total liabilities and shareholders’ equity |
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See notes to unaudited condensed consolidated financial statements.
| 3 |
| Table of Contents |
SCIENTIFIC INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE GAIN (LOSS)
(UNAUDITED)
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| For the Three Months Ended September 30, |
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| For the Nine Months Ended September 30, |
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Revenues |
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Cost of revenues |
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Gross profit |
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Operating expenses: |
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General and administrative |
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Selling |
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Research and development |
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Total operating expenses |
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Loss from operations |
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Other income: |
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Other income (expense), net |
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Gain on disposition of discontinued operations (See Note 11) |
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Interest income |
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Total other income, net |
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Income (loss) from operations before income tax expense |
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Income tax expense, current |
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Income (loss) from continuing operations |
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Discontinued Operations: |
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Income from discontinued operations, net of tax |
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Net income (loss) |
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Comprehensive gain (loss): |
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Foreign currency translation gain (loss) |
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Other comprehensive gain (loss) |
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Total comprehensive gain (loss) |
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Basic and Diluted income (loss) per common share: |
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Continuing operations |
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Discontinued operations |
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Consolidated operations |
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Weighted Average Shares Outstanding |
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See notes to unaudited condensed consolidated financial statements.
| 4 |
| Table of Contents |
SCIENTIFIC INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY
(UNAUDITED)
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| Common Stock |
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| Additional Paid-in |
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| Total Shareholders’ |
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| Amount |
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| Deficit |
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| Equity |
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Balance December 31, 2025 |
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Net loss |
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Foreign currency translation adjustment |
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Stock-based compensation |
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Balance March 31, 2026 |
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Net loss |
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Foreign currency translation adjustment |
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Stock-based compensation |
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Balance June 30, 2026 |
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Net income |
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Foreign currency translation adjustment |
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Stock-based compensation |
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Balance September 30, 2026 |
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| $ | ( | ) |
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| Common Stock |
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| Total Shareholders’ |
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| Equity |
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Balance December 31, 2024 |
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Loss from continuing operations |
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Income from discontinued operations |
|
| - |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign currency translation adjustment |
|
| - |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock-based compensation |
|
| - |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance March 31, 2025 |
|
|
|
| $ |
|
| $ |
|
| $ |
|
| $ | ( | ) |
| $ |
| |||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from continuing operations |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ( | ) |
|
| ( | ) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from discontinued operations |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance of Common Stock and Warrants, net of issuance costs |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign currency translation adjustment |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock-based compensation |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance June 30, 2025 |
|
|
|
| $ |
|
| $ |
|
| $ |
|
| $ | ( | ) |
| $ |
| |||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from continuing operations |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from discontinued operations |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance of Common Stock and Warrants, net of issuance costs |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign currency translation adjustment |
|
|
|
|
|
|
|
|
|
|
|
|
|
| ( | ) |
|
|
|
|
|
| ( | ) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock-based compensation |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance September 30, 2025 |
|
|
|
| $ |
|
| $ |
|
| $ |
|
| $ | ( | ) |
| $ |
| |||||
See notes to unaudited condensed consolidated financial statements
| 5 |
| Table of Contents |
SCIENTIFIC INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
|
| For the Nine Months Ended September 30, |
| |||||
|
| 2026 |
|
| 2025 |
| ||
Operating activities: |
|
|
|
|
|
| ||
Net income (loss) |
| $ | ( | ) |
| $ |
| |
Less: Income from discontinued operations, net of tax |
|
|
|
|
|
| ||
Income (loss) from continuing operations |
| $ | ( | ) |
| $ |
| |
Adjustments to reconcile net income (loss) from continuing operations to net cash used in operating activities: |
|
|
|
|
|
|
|
|
Gain on disposition of discontinued operations |
|
| ( | ) |
|
| ( | ) |
Depreciation and amortization |
|
|
|
|
|
| ||
Stock-based compensation |
|
|
|
|
|
| ||
Gain on sale of investment securities |
|
|
|
|
| ( | ) | |
Unrealized holding loss (gain) on investment securities |
|
|
|
|
| ( | ) | |
Noncash lease expense |
|
|
|
|
|
| ||
Changes in operating assets and liabilities: |
|
|
|
|
|
|
|
|
Trade accounts receivable |
|
|
|
|
|
| ||
Inventories |
|
| ( | ) |
|
| ( | ) |
Prepaid and other current assets |
|
|
|
|
| ( | ) | |
Other assets |
|
|
|
|
|
| ||
Accounts payable |
|
|
|
|
| ( | ) | |
Accrued expenses |
|
| ( | ) |
|
| ( | ) |
Contract liabilities |
|
|
|
|
|
| ||
Lease liabilities |
|
| ( | ) |
|
| ( | ) |
|
|
|
|
|
|
|
|
|
Net cash used in operating activities |
|
| ( | ) |
|
| ( | ) |
|
|
|
|
|
|
|
|
|
Investing activities: |
|
|
|
|
|
|
|
|
Purchases of investment securities |
|
| ( | ) |
|
| ( | ) |
Redemption of investment securities |
|
|
|
|
|
| ||
Proceeds from disposition of discontinued operations |
|
|
|
|
|
| ||
Acquisition of intangible assets |
|
| ( | ) |
|
|
| |
Capital expenditures |
|
| ( | ) |
|
| ( | ) |
|
|
|
|
|
|
|
|
|
Net cash provided by investing activities |
|
|
|
|
|
| ||
|
|
|
|
|
|
|
|
|
Financing activities: |
|
|
|
|
|
|
|
|
Proceeds from issuance of common stock |
|
|
|
|
|
| ||
Issuance costs of common stock and warrants |
|
| |
|
|
| ( | ) |
Net cash provided by financing activities |
| $ |
|
| $ |
| ||
|
|
|
|
|
|
|
|
|
Discontinued Operations: |
|
|
|
|
|
|
|
|
Net cash provided by discontinued operations |
|
|
|
|
|
| ||
|
|
|
|
|
|
|
|
|
Net change in cash and cash equivalents |
|
|
|
|
|
| ||
|
|
|
|
|
|
|
|
|
Effect of changes in foreign currency exchange rates on cash and cash equivalents |
|
| ( | ) |
|
|
| |
|
|
|
|
|
|
|
|
|
Net increase in cash and cash equivalents |
|
|
|
|
|
| ||
Cash and cash equivalents, beginning of period |
|
|
|
|
|
| ||
Cash and cash equivalents, end of period |
| $ |
|
| $ |
| ||
|
|
|
|
|
|
|
|
|
SUPPLEMENTAL DISCLOSURES: |
|
|
|
|
|
|
|
|
Noncash financing activities |
|
|
|
|
|
|
|
|
Record right-of-use assets |
| $ |
|
| $ |
| ||
Record lease liabilities |
| $ |
|
| $ |
| ||
See notes to unaudited condensed consolidated financial statements
| 6 |
| Table of Contents |
SCIENTIFIC INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. Nature of the Business and Basis of Presentation
Scientific Industries, Inc. and its subsidiaries (the “Company”) design, manufacture, and market a variety of benchtop laboratory equipment, weight and measurement and bioprocessing systems and products. The Company is headquartered in Bohemia, New York where it produces benchtop laboratory and pharmacy equipment. Additionally, the Company has a location in Baesweiler, Germany, where it designs and produces a variety of bioprocessing products, and administrative facilities in Pearl River, New York and Pittsburgh, Pennsylvania related to sales and marketing. The products, which are sold to customers worldwide, include laboratory and pharmacy balances and scales, force gauges, bioprocessing sensors and analytical tools.
The accompanying (a) unaudited condensed balance sheet as of December 31, 2025, which has been derived from audited financial statements, and (b) unaudited interim condensed consolidated financial statements are prepared pursuant to the Securities and Exchange Commission’s rules and regulations for reporting on Form 10-Q. Accordingly, certain information and notes required by accounting principles generally accepted in the United States (“U.S. GAAP”) for complete financial statements are not included herein. The Company believes that all adjustments necessary for a fair presentation of these interim statements have been included and that they are of a normal and recurring nature. These interim statements should be read in conjunction with the Company’s consolidated financial statements and notes thereto, included in its Annual Report on Form 10-K for the fiscal year ended December 31, 2025. The results for the nine months ended September 30, 2026, are not necessarily an indication of the results for the full fiscal year ending December 31, 2026.
2. Significant Accounting Policies
Principles of Consolidation
In the opinion of our management, the unaudited Condensed Consolidated Financial Statements have been prepared on a basis consistent with the audited Consolidated Financial Statements and include all adjustments necessary for the fair presentation of the Company’s financial condition, results of operations and cash flows for the interim periods presented. Such adjustments are of a normal, recurring nature. The results of operations and cash flows for the interim periods presented may not necessarily be indicative of full-year results. Reference should be made to the Consolidated Financial Statements contained in our 2025 Form 10-K.
The accompanying unaudited interim condensed consolidated financial statements include the accounts of Scientific Industries, Inc., Scientific Bioprocessing Holdings, Inc. (“SBHI”), a Delaware corporation and wholly-owned subsidiary, which holds 100% of the outstanding stock of Scientific Bioprocessing, Inc. (“SBI”), a Delaware corporation, and aquila biolabs GmbH (“Aquila”), a German corporation (all collectively referred to as the “Company”). All material intercompany balances and transactions have been eliminated in consolidation.
Liquidity and Going Concern Considerations
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 for at least one year after the date the Unaudited Condensed Consolidated Financial Statements are issued. The Company has recorded recurring losses from operations and continued cash outflow from operating activities as a result of its strategic focus on the Bioprocessing Systems Operations, which is still in its start-up stage.
Historically the Company has relied on equity financings to support its business operations. For the nine months ended September 30, 2026, the Company generated negative cash flows from operations of $
| 7 |
| Table of Contents |
New Accounting Pronouncements
In July 2025, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update No. (“ASU”) 2025-05, “Financial Instruments - Credit Losses (Topic 326): Measurements of Credit Losses for Accounts Receivable and Contract Assets”, which provides a practical expedient related to the estimation of expected credit losses for current accounts receivable and current contract assets that arise from transactions accounted for under Accounting Standards Codification (“ASC 606”), “Revenue from Contracts with Customers”. Under ASU 2025-05, an entity is required to disclose whether it has elected to use the practical expedient. The practical expedient allows entities to assume that current conditions as of the balance sheet date remain unchanged over the remaining life of the asset. ASU 2025-05 became effective for annual reporting periods beginning after December 15, 2025, and interim reporting periods within those annual reporting periods. The Company implemented this pronouncement beginning January 1, 2026 and elected to apply the practical expedient which had no material impact on the Company’s Unaudited Condensed Consolidated Financial Statements.
In December 2025, the FASB issued ASU 2025-11, “Interim Reporting (Topic 270)”, which is intended to improve the navigability of the guidance in ASC 270, “Interim Reporting”, and clarify when it applies. Under the amendments, an entity is subject to ASC 270 if it provides interim financial statements and notes in accordance with U.S. GAAP so that internal financials are not misleading. ASU 2025-11 also addresses the form and content of such financial statements, interim disclosures requirements, and establishes a principle under which an entity must disclose events since the end of the last annual reporting period that have a material impact on the entity. ASU 2025-11 is effective for interim reporting periods within annual reporting periods beginning after December 15, 2027. The Company is currently evaluating ASU 2025-11 to determine the impact it may have on its consolidated financial statements.
In November 2024, the FASB issued Accounting Standards Update (“ASU”) No. 2024-03, Disaggregation of Income Statement Expenses, which requires disclosures of certain additional expense information on an annual and interim basis, including, among other items, the amounts of purchases of inventory, employee compensation, depreciation and intangible asset amortization included within each income statement expense caption, as applicable. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026 and interim periods beginning after December 15, 2027, with early adoption permitted, and should be applied either on a prospective basis or retrospective basis. The Company is currently evaluating the impact of this guidance but does not anticipate a material impact on its condensed consolidated financial statements or related disclosures.
There are no other recent accounting pronouncements issued but not yet adopted that would have a material effect on our condensed consolidated financial statements.
Use of Estimates
The preparation of unaudited financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, costs and expenses and related disclosures in the accompanying notes.
Reclassification
Certain prior period amounts have been reclassified to conform to the current period presentation.
3. Fair Value of Financial Instruments
The Company follows ASC 820, “Fair Value Measurement”, which has defined the fair value of financial instruments as the amount 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. Fair value measurements do not include transaction costs.
The accounting guidance also expands the disclosure requirements around fair value and establishes a fair value hierarchy for valuation inputs. The hierarchy prioritizes the inputs into three levels based on the extent to which inputs used in measuring fair value are observable in the market. Each fair value measurement is reported in one of the three levels, which is determined by the lowest level input that is significant to the fair value measurement in its entirety. These levels are described below:
| 8 |
| Table of Contents |
Level 1 Inputs that are based upon unadjusted quoted prices for identical instruments traded in active markets.
Level 2 Quoted prices in markets that are not considered to be active or financial instruments for which all significant inputs are observable, either directly or indirectly.
Level 3 Prices or valuation that require inputs that are both significant to the fair value measurement and unobservable.
In valuing assets and liabilities, the Company is required to maximize the use of quoted market prices and minimize the use of unobservable inputs. The Company calculated the fair value of its Level 1 and 2 instruments based on the exchange traded price of similar or identical instruments where available or based on other observable instruments. These calculations take into consideration the credit risk of both the Company and its counterparties. For Level 3 investments, where observable inputs are not available, the fair value was determined based on the price at which shares were purchased and redeemed as of September 30, 2026, by the private credit funds. The investments which seek high current income, comprised of private credit funds which deal in first lien senior secured debt and asset-based lending in the United States that are issued in private offerings. The Company has not changed its valuation techniques in measuring the fair value of any financial assets and liabilities during the three-month period ended September 30, 2026.
The carrying amounts of cash, cash equivalents, accounts receivable, and accounts payable approximate their fair value due to their short-term maturity and insignificant risk of value changes.
The following tables set forth by level within the fair value hierarchy, the Company’s financial assets that were accounted for at fair value on a recurring basis as of September 30, 2026, and December 31, 2025, according to the valuation techniques the Company used to determine their fair values:
|
| Fair Value Measurement as of September 30, 2026 |
| |||||||||||||
|
| Level 1 |
|
| Level 2 |
|
| Level 3 |
|
| Total |
| ||||
Assets: |
|
|
|
|
|
|
|
|
|
|
|
| ||||
Investment securities: |
|
|
|
|
|
|
|
|
|
|
|
| ||||
Mutual Funds |
| $ |
|
| $ |
|
| $ |
|
| $ |
| ||||
Private Credit Funds |
|
|
|
|
| $ |
|
| $ |
|
| $ |
| |||
Total |
| $ |
|
| $ |
|
| $ |
|
| $ |
| ||||
|
| Fair Value Measurement as of December 31, 2025 |
| |||||||||||||
|
| Level 1 |
|
| Level 2 |
|
| Level 3 |
|
| Total |
| ||||
Assets: |
|
|
|
|
|
|
|
|
|
|
|
| ||||
Investment securities |
|
|
|
|
|
|
|
|
|
|
|
| ||||
Mutual Funds |
| $ |
|
| $ |
|
| $ |
|
| $ |
| ||||
Private Credit Funds |
|
|
|
|
| $ |
|
| $ |
|
| $ |
| |||
Total |
| $ |
|
| $ |
|
| $ |
|
| $ |
| ||||
| 9 |
| Table of Contents |
Investments in marketable securities by security type as of September 30, 2026, and December 31, 2025, consisted of the following:
As of September 30, 2026: |
| Cost |
|
| Fair Value |
|
| Unrealized Holding Loss |
| |||
Mutual funds |
| $ |
|
| $ |
|
| $ |
| |||
Private Credit Funds |
| $ |
|
| $ |
|
| $ |
| |||
Total |
| $ |
|
| $ |
|
| $ |
| |||
As of December 31, 2025: |
| Cost |
|
| Fair Value |
|
| Unrealized Holding Gain |
| |||
Mutual funds |
| $ |
|
| $ |
|
| $ | ( | ) | ||
Private Credit Funds |
| $ |
|
| $ |
|
| $ | ( | ) | ||
Total |
| $ |
|
| $ |
|
| $ | ( | ) | ||
The table below presents a reconciliation of all assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the nine months ended September 30, 2026 and for the year ended December 31, 2025.
|
| 2026 |
|
| 2025 |
| ||
Balance of recurring Level 3 assets at beginning of period |
| $ |
|
| $ |
| ||
Total gains or losses for the period: |
|
|
|
|
|
|
|
|
Purchases |
|
|
|
|
|
| ||
Sales |
|
|
|
|
|
| ||
Issuances |
|
|
|
|
|
| ||
Settlements |
|
|
|
|
|
| ||
Transfers into Level 3 |
|
|
|
|
|
| ||
Transfers out of Level 3 |
|
|
|
|
|
| ||
Balance of recurring Level 3 assets at end of period |
| $ |
|
| $ |
| ||
| 10 |
| Table of Contents |
4. Inventories
Inventories of the Company are as follows:
|
| As of September 30, 2026 |
|
| As of December 31, 2025 |
| ||
Raw materials |
| $ |
|
| $ |
| ||
Work-in-process |
|
|
|
|
|
| ||
Finished goods |
|
|
|
|
|
| ||
Total Inventories |
| $ |
|
| $ |
| ||
|
|
|
|
|
|
|
|
|
Inventories - Current Asset |
| $ |
|
| $ |
| ||
Inventories - Noncurrent Asset |
| $ |
|
| $ |
| ||
5. Goodwill and Finite Lived Intangible Assets
Goodwill represents the excess of the purchase price over the fair value of the net assets acquired in connection with the Company’s acquisitions. Goodwill amounted to $
Finite lived intangible assets are as follows:
As of September 30, 2026 |
| Useful Lives |
| Cost |
|
| Accumulated Amortization |
|
| Net |
| |||
Technology, trademarks |
|
| $ |
|
| $ |
|
| $ |
| ||||
Trade names |
|
|
|
|
|
|
|
|
|
| ||||
Websites |
|
|
|
|
|
|
|
|
|
| ||||
Customer relationships |
|
|
|
|
|
|
|
|
|
| ||||
Sublicense agreements |
|
|
|
|
|
|
|
|
|
| ||||
Non-compete agreements |
|
|
|
|
|
|
|
|
|
| ||||
Patents |
|
|
|
|
|
|
|
|
|
| ||||
|
|
|
| $ |
|
| $ |
|
| $ |
| |||
As of December 31, 2025 |
| Useful Lives |
| Cost |
|
| Accumulated Amortization |
|
| Net |
| |||
Technology, trademarks |
|
| $ |
|
| $ |
|
| $ |
| ||||
Trade names |
|
|
|
|
|
|
|
|
|
| ||||
Websites |
|
|
|
|
|
|
|
|
|
| ||||
Customer relationships |
|
|
|
|
|
|
|
|
|
| ||||
Sublicense agreements |
|
|
|
|
|
|
|
|
|
| ||||
Non-compete agreements |
|
|
|
|
|
|
|
|
|
| ||||
Patents |
|
|
|
|
|
|
|
|
|
| ||||
|
|
|
| $ |
|
| $ |
|
| $ |
| |||
| 11 |
| Table of Contents |
Total amortization expense was $
Estimated future fiscal year amortization expense of intangible assets as of September 30, 2026, is as follows:
As of September 30, 2026 |
| Amount |
| |
Remainder of year ending 2026 |
| $ |
| |
2027 |
|
|
| |
2028 |
|
|
| |
2029 |
|
|
| |
2030 |
|
|
| |
Thereafter |
|
|
| |
Total |
| $ |
| |
6. Commitment and Contingencies
Legal Matters
During the normal course of business, the Company may be named from time to time as a party to claims and litigations arising in the ordinary course of business. When the Company becomes aware of potential litigation, it evaluates the merits of the case in accordance with ASC 450, "Contingencies". Litigation and contingency accruals are based on our assessment, including advice of legal counsel, regarding the expected outcome of litigation or other dispute resolution proceedings. If the Company determines that an unfavorable outcome is probable and can be reasonably assessed, it establishes the necessary accruals. As of September 30, 2026 and December 31, 2025, the Company is not aware of any contingent legal liabilities that should be reflected in the unaudited condensed consolidated financial statements.
Leases
The Company’s approximate future minimum rental payments under all operating leases as of September 30, 2026, were as follows:
As of September 30, 2026: |
| Amount |
| |
Remainder of fiscal year ending 2026 |
| $ |
| |
2027 |
|
|
| |
2028 |
|
|
| |
2029 |
|
|
| |
2030 |
|
|
| |
Thereafter |
|
|
| |
Total future minimum payments |
| $ |
| |
Less: Imputed interest |
|
| ( | ) |
Total Present Value of Operating Lease Liabilities |
| $ |
| |
| 12 |
| Table of Contents |
7. Shareholders’ Equity
Stock Options
The Company’s 2022 Equity Incentive Plan (“2022 Plan”) provides for the issuance of up to
Grants of Incentive and Nonstatutory Stock Options
On February 17, 2026, as part of the Company’s strategic initiatives to reduce operating costs and conserve cash for operations and annual management and Board compensation reviews, the Company granted an aggregate of
On July 1, 2025, the Company granted and issued stock options to purchase
On May 13, 2025, in connection with the Company’s annual compensation reviews for its management and key employees, the Company granted an aggregate of
The following table summarizes the Company’s stock options activity for the nine months ended September 30, 2026:
|
| Number of Options |
|
| Weighted Average Exercise Price |
|
| Weighted Average Remaining Contractual Term (In Years) |
| |||
Outstanding at December 31, 2025 |
|
|
|
| $ |
|
|
|
| |||
Granted |
|
|
|
| $ |
|
|
|
|
| ||
Exercised |
|
|
|
|
|
|
|
|
|
|
|
|
Expired |
|
| ( | ) |
| $ |
|
|
|
|
| |
Outstanding at September 30, 2026 |
|
|
|
| $ |
|
|
|
| |||
Stock compensation expense related to stock options of $
| 13 |
| Table of Contents |
8. Loss Per Common Share
Basic Earnings Per Share (“EPS”) is computed by dividing net income or loss by the weighted average number of shares outstanding during the reported period. Diluted EPS is computed similarly to basic EPS, except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential additional common shares that were dilutive had been issued. In periods for which the Company reports a net loss, the Common Stock equivalents are not included, as they would be anti-dilutive. The following table sets forth the weighted average number of common shares outstanding for each period presented.
|
| For the Three Months Ended |
|
| For the Nine Months Ended |
| ||||||||||
|
| September 30, |
|
| September 30, |
| ||||||||||
|
| 2026 |
|
| 2025 |
|
| 2026 |
|
| 2025 |
| ||||
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Basic and Diluted Earnings per share: |
|
|
|
|
|
|
|
|
|
|
|
| ||||
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Income (loss) from continuing operations |
| $ |
|
| $ |
|
| $ | ( | ) |
| $ |
| |||
Income from discontinued operations, net of taxes |
|
|
|
|
|
|
|
|
|
|
|
| ||||
Net gain (loss) |
| $ |
|
| $ |
|
| $ | ( | ) |
| $ |
| |||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average number of common shares outstanding |
|
|
|
|
|
|
|
|
|
|
|
| ||||
Effect of dilutive securities: |
|
|
|
|
|
|
|
|
|
|
|
| ||||
Weighted average number of dilutive common shares outstanding |
|
|
|
|
|
|
|
|
|
|
|
| ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted gain (loss) per common share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Continuing operations |
| $ |
|
| $ |
|
| $ | ( | ) |
| $ |
| |||
Discontinued operations |
|
|
|
|
|
|
|
|
|
|
|
| ||||
Consolidated operations |
| $ |
|
| $ |
|
| $ | ( | ) |
| $ |
| |||
A total of
A total of
9. Related Parties
Consulting Agreements
Commencing in September 2023 the Company has a consulting agreement with John Nicols, a Director of the Company since March 2024 for services provided to the Bioprocessing Systems Operations segment.
During the three months ended September 30, 2026 and 2025, the Company paid $
During the nine months ended September 30, 2026 and 2025, the Company paid $
| 14 |
| Table of Contents |
10. Segment Information and Concentration
The Company views its operations as two operating segments: the manufacture and marketing of benchtop laboratory equipment, including analytical and pharmacy balances and scales (“Benchtop Laboratory Equipment Operations”), and the manufacture, design, and marketing of bioprocessing systems and products (“Bioprocessing Systems”). The Company also has included a non-operating Corporate segment for expenses directly related to Corporate operations. All inter-segment revenues are eliminated.
Segment information is reported as follows:
Three Months Ended September 30, 2026 |
| Benchtop Laboratory Equipment |
|
| Bioprocessing Systems |
|
| Corporate and Other |
|
| Consolidated |
| ||||
Revenues |
| $ |
|
| $ |
|
| $ |
|
| $ |
| ||||
Foreign Sales |
|
|
|
|
|
|
|
|
|
|
|
| ||||
Loss From Operations |
|
| ( | ) |
|
| ( | ) |
|
| ( | ) |
|
| ( | ) |
Assets |
|
| 3,475,100 |
|
|
| 2,835,700 |
|
|
| 4,623,000 |
|
|
| 10,933,800 |
|
Long-Lived Asset Expenditures |
|
|
|
|
|
|
|
|
|
|
|
| ||||
Depreciation and Amortization |
|
|
|
|
|
|
|
|
|
|
|
| ||||
Three Months Ended September 30, 2025 |
| Benchtop Laboratory Equipment |
|
| Bioprocessing Systems |
|
| Corporate and Other |
|
| Consolidated |
| ||||
Revenues |
| $ |
|
| $ |
|
| $ |
|
| $ |
| ||||
Foreign Sales |
|
|
|
|
|
|
|
|
|
|
|
| ||||
Loss From Operations |
|
| ( | ) |
|
| ( | ) |
|
| ( | ) |
|
| ( | ) |
Assets |
|
| 3,678,600 |
|
|
| 3,747,300 |
|
|
| 7,131,500 |
|
|
| 14,557,400 |
|
Long-Lived Asset Expenditures |
|
| ( | ) |
|
|
|
|
|
|
|
| ( | ) | ||
Depreciation and Amortization |
|
|
|
|
|
|
|
|
|
|
|
| ||||
For the three months ended September 30, 2026, one customer accounted for approximately
For the three months ended September 30, 2026, one vendor accounted for approximately
Nine Months Ended September 30, 2026 |
| Benchtop Laboratory Equipment |
|
| Bioprocessing Systems |
|
| Corporate and Other |
|
| Consolidated |
| ||||
Revenues |
| $ |
|
| $ |
|
| $ |
|
| $ |
| ||||
Foreign Sales |
|
|
|
|
|
|
|
|
|
|
|
| ||||
Loss From Operations |
|
| ( | ) |
|
| ( | ) |
|
| ( | ) |
|
| ( | ) |
Assets |
|
|
|
|
|
|
|
|
|
|
|
| ||||
Long-Lived Asset Expenditures |
|
|
|
|
|
|
|
|
|
|
|
| ||||
Depreciation and Amortization |
|
|
|
|
|
|
|
|
|
|
|
| ||||
Nine Months Ended September 30, 2025 |
| Benchtop Laboratory Equipment |
|
| Bioprocessing Systems |
|
| Corporate and Other |
|
| Consolidated |
| ||||
Revenues |
| $ |
|
| $ |
|
| $ |
|
| $ |
| ||||
Foreign Sales |
|
|
|
|
|
|
|
|
|
|
|
| ||||
Loss From Operations |
|
| ( | ) |
|
| ( | ) |
|
| ( | ) |
|
| ( | ) |
Assets |
|
|
|
|
|
|
|
|
|
|
|
| ||||
Long-Lived Asset Expenditures |
|
| ( | ) |
|
|
|
|
|
|
|
| ( | ) | ||
Depreciation and Amortization |
|
|
|
|
|
|
|
|
|
|
|
| ||||
For the nine months ended September 30, 2026, one customer accounted for approximately
For the nine months ended September 30, 2026, one vendor accounted for approximately
| 15 |
| Table of Contents |
A reconciliation of the Company’s consolidated segment loss from operations to consolidated loss from operations before discontinued operations and income taxes for the three months and nine months ended September 30, 2026 and 2025, respectively are as follows:
Three Months Ended September 30, 2026 |
| Benchtop Laboratory Equipment |
|
| Bioprocessing Systems |
|
| Corporate and Other |
|
| Consolidated |
| ||||
Loss From Operations |
|
| ( | ) |
|
| ( | ) |
|
| ( | ) |
|
| ( | ) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income (expense) net |
|
| ( | ) |
|
|
|
|
|
|
|
| ( | ) | ||
Gain on disposition of Genie Product Line |
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
Interest income |
|
|
|
|
|
|
|
|
|
|
|
| ||||
Total other income, net |
|
|
|
|
|
|
|
|
|
|
|
| ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from operations before discontinued operations and income taxes |
| $ |
|
| $ | ( | ) |
| $ | ( | ) |
| $ |
| ||
Three Months Ended September 30, 2025 |
| Benchtop Laboratory Equipment |
|
| Bioprocessing Systems |
|
| Corporate and Other |
|
| Consolidated |
| ||||
Loss From Operations |
|
| ( | ) |
|
| ( | ) |
|
| ( | ) |
|
| ( | ) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income (expense), net |
|
|
|
|
|
|
|
| ( | ) |
|
|
| |||
Gain on disposal of Genie Product Line |
|
|
|
|
|
|
|
|
|
|
|
| ||||
Interest income |
|
|
|
|
|
|
|
|
|
|
|
| ||||
Total other income, net |
|
|
|
|
|
|
|
|
|
|
|
| ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from operations before discontinued operations and income taxes |
| $ |
|
| $ | ( | ) |
| $ | ( | ) |
| $ |
| ||
Nine Months Ended September 30, 2026 |
| Benchtop Laboratory Equipment |
|
| Bioprocessing Systems |
|
| Corporate and Other |
|
| Consolidated |
| ||||
Loss From Operations |
|
| ( | ) |
|
| ( | ) |
|
| ( | ) |
|
| ( | ) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income (expense), net |
|
| ( | ) |
|
|
|
|
|
|
|
|
| |||
Gain on disposal of Genie Product Line |
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
Interest income |
|
|
|
|
|
|
|
|
|
|
|
| ||||
Total other income, net |
|
|
|
|
|
|
|
|
|
|
|
| ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from operations before discontinued operations and income taxes |
| $ |
|
| $ | ( | ) |
| $ | ( | ) |
| $ | ( | ) | |
Nine Months Ended September 30, 2025 |
| Benchtop Laboratory Equipment |
|
| Bioprocessing Systems |
|
| Corporate and Other |
|
| Consolidated |
| ||||
Loss From Operations |
|
| ( | ) |
|
| ( | ) |
|
| ( | ) |
|
| ( | ) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income (expense), net |
|
|
|
|
|
|
|
| ( | ) |
|
|
| |||
Gain on disposition of Genie Product Line |
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
Interest income |
|
|
|
|
|
|
|
|
|
|
|
| ||||
Total other income, net |
|
|
|
|
|
|
|
|
|
|
|
| ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from operations before discontinued operations and income taxes |
| $ |
|
| $ | ( | ) |
| $ | ( | ) |
| $ |
| ||
| 16 |
| Table of Contents |
11. Discontinued Operations
On August 7, 2025, the Company entered into an Asset Purchase Agreement (the “Purchase Agreement”) pursuant to which the Company sold substantially all of the assets of the Genie Division of the Company’s Benchtop Laboratory Equipment Operations located in Bohemia, New York to Troemner, LLC (the “Buyer”). The purchase price consisted of $
As of September 30, 2026, the Current Assets for Discontinued Operations were $
The following is the breakdown of the income generated from discontinued operations.
|
| For the three months ended |
| |||||
|
| September 30, |
| |||||
|
| 2026 |
|
| 2025 |
| ||
|
|
|
|
|
|
| ||
Net Revenue |
| $ |
|
| $ |
| ||
Cost of Goods Sold |
|
|
|
|
|
| ||
Gross Profit |
|
|
|
|
|
| ||
Operating Expenses: |
|
|
|
|
|
|
|
|
General and Administrative |
|
|
|
|
|
| ||
Selling |
|
|
|
|
|
| ||
Research and Development |
|
|
|
|
|
| ||
Total Expenses |
| $ |
|
| $ |
| ||
Income from discontinued operations |
| $ |
|
| $ |
| ||
|
| For the nine months ended |
| |||||
|
| September 30, |
| |||||
|
| 2026 |
|
| 2025 |
| ||
|
|
|
|
|
|
| ||
Net Revenue |
| $ |
|
| $ |
| ||
Cost of Goods Sold |
|
|
|
|
|
| ||
Gross Profit |
|
|
|
|
|
| ||
Operating Expenses: |
|
|
|
|
|
|
|
|
General and Administrative |
|
|
|
|
|
| ||
Selling |
|
|
|
|
|
| ||
Research and Development |
|
|
|
|
|
| ||
Total Expenses |
| $ |
|
| $ |
| ||
Income from discontinued operations |
| $ |
|
| $ |
| ||
In our Unaudited Condensed Consolidated Statements of Cash Flows, the cash provided by operating activities from discontinued operations for the nine months ended September 30, 2026 and 2025 was $
12. Subsequent Events
On October 1, 2026, the Company entered into an employment agreement with its Chief Financial Officer for a two-year term through September 30, 2028 which may be extended by mutual agreement, at an annual salary of $
| 17 |
| Table of Contents |
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
Forward-Looking Statements. The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our audited financial statements and related notes included in our Annual Report on Form 10-K for the year ended December 31, 2025. Certain statements contained in this report are not based on historical facts, but are forward-looking statements that are based upon various assumptions about future conditions. Actual events in the future could differ materially from those described in the forward-looking statements. Numerous unknown factors and future events could cause such differences, including but not limited to, product demand, market acceptance, success of marketing strategy, success of expansion efforts, impact of competition, adverse economic conditions, and other factors affecting the Company’s business that are beyond the Company’s control, which are discussed elsewhere in this report. Consequently, no forward-looking statement can be guaranteed. The Company undertakes no obligation except as required by law, to publicly update forward-looking statements, whether as a result of new information, future events or otherwise. Throughout this Quarterly Report on Form 10-Q, the terms the “Company,” “Scientific,” “we,” “our” or “us,” refer to Scientific Industries, Inc. and its subsidiaries on a consolidated basis, unless stated or the context implies otherwise.
Overview;
Scientific Industries, Inc., a Delaware corporation (“SI” and along with its subsidiaries, the “Company”, “we”, “our”), is engaged in the design, manufacture, and marketing a variety of benchtop laboratory equipment, weight and measurement products (“Benchtop Laboratory Equipment”), and through its wholly-owned subsidiary, Scientific Bioprocessing Holdings, Inc., a Delaware corporation (“SBHI”), the design, manufacture, and marketing of bioprocessing systems and products (“Bioprocessing Systems”). SBHI has two wholly-owned subsidiaries – Scientific Bioprocessing, Inc., a Delaware corporation (“SBI”), and aquila biolabs GmbH, a German corporation (“Aquila”). The Company's products are used primarily in pharmacies, pharmaceutical companies, university and industrial laboratories, and other industries that utilize weighing and pill counting systems and bioprocessing analytical tools. The Company’s results reflect those of the Benchtop Laboratory Equipment Operations and the Bioprocessing Systems Operations and its corporate operation.
Results of Operations.
Three months ended September 30, 2026 and 2025
Revenue
Net revenues for the three months ended September 30, 2026 decreased by $49,200 (3.5%) to $1,354,800 from $1,404,000 for the three months ended September 30, 2025, primarily due to reduced sales from our Bioprocessing Systems Operations.
Gross profit
The gross profit percentage for the three months ended September 30, 2026, and 2025 was 54.8% and 45.5%, respectively. The increase is due primarily to a higher gross margin percentage in the Bioprocessing Systems Operations derived from increased sales of its DOTS product line, which have higher margins than legacy products.
General and administrative
General and administrative expenses for the three months ended September 30, 2026, and 2025 were $677,200 and $803,600, respectively. The decrease of $126,400 (15.7%) is due primarily to decreased employee-related costs associated with a reduction in workforce in the Benchtop Operations.
Selling
Selling expenses for the three months ended September 30, 2026 and 2025 were $615,300 and $735,900, respectively. The decrease of $120,600 (16.4%) is due primarily to cost savings initiatives including reduction in salesforce and marketing activities by the Bioprocessing Systems Operations.
| 18 |
| Table of Contents |
Research and development
Research and development expenses for the three months ended September 30, 2026, and 2025 were $662,200 and $621,400, respectively. The increase of $40,800 (6.6%) is due primarily to the increase of research and development expenditures for new products associated with the Bioprocessing Systems Operations.
Other income, net
Other income, net for the three months ended September 30, 2026 and 2025 was $1,721,600 and $5,526,900, respectively, reflecting $1,695,000, and $5,263,400, respectively in gains generated from the disposition of the Genie product line of the Benchtop Laboratory Equipment Operations which occurred in August 2025 as discussed in Note 11 of Item 1. Financial Statements, and completed during the current year quarter.
Income tax
Income tax for the three months ended September 30, 2026, and 2025, was $39,800 and $15,300, respectively, all of which is current state tax liability. The Company maintains a full valuation allowance of $12,928,006 as of September 30, 2026 against its consolidated net deferred tax asset as the Company determined the net deferred tax assets, which includes net operating loss carry-forwards and other tax credits, are not more likely than not to be realized in the foreseeable future.
Nine months ended September 30, 2026 and 2025
Revenue
Net revenues for the nine months ended September 30, 2026 increased by $625,200 (18.2%) to $4,052,300 from $3,427,100 for the nine months ended September 30, 2025, primarily due to a $386,600 increase in Benchtop Laboratory Equipment sales which, since the August 2025 Genie division sale, is comprised entirely of Torbal and VIVID brand products, as well as a $238,600 increase in sales from our Bioprocessing Systems Operations.
Gross profit
The gross profit percentage for the nine months ended September 30, 2026, and 2025 was 45.3% and 39.8%, respectively. The increase is due primarily to a higher gross margin percentage in the Bioprocessing Systems Operations derived from increased sales of its DOTS product line which have higher margins than legacy products.
General and administrative
General and administrative expenses for the nine months ended September 30, 2026, and 2025 were $1,978,100 and $2,571,400, respectively. The decrease of $593,300 (23.1%) is due primarily to decreased employee-related costs associated with a reduction in force in both the Benchtop Laboratory Equipment and Bioprocessing Systems Operations and a reduction of corporate expenses.
Selling
Selling expenses for the nine months ended September 30, 2026 and 2025 were $1,949,500 and $2,355,400, respectively. The decrease of $405,900 (17.2%) is due primarily to cost savings initiatives including reduction in salesforce and marketing activities by the Bioprocessing Systems Operations.
| 19 |
| Table of Contents |
Research and development
Research and development expenses for the nine months ended September 30, 2026, and 2025 were $2,060,300 and $1,870,900, respectively. The increase of $189,400 (10.1%) is due primarily to the increase of research and development expenditures for new products associated with the Bioprocessing Systems Operations and to a lesser extent, the Benchtop Laboratory Equipment's VIVID pill counters.
Other income, net
Other income, net, for the nine months ended September 30, 2026 and 2025 was $1,839,100 and $5,582,300, respectively, reflecting $1,695,000, and $5,263,400, respectively in gains generated from the disposition of the Genie product line of the Benchtop Laboratory Equipment Operations which occurred in August 2025 as discussed in Note 11 of Item 1. Financial Statements and completed during the current year period.
Income tax
Income tax for the nine months ended September 30, 2026, and 2025 was $39,800 and $15,300, respectively, all of which relates to state tax liability. The Company maintains a full valuation allowance of $12,928,006 as of September 30, 2026 against its consolidated net deferred tax asset as the Company determined the net deferred tax assets, which includes net operating loss carry-forwards and other tax credits, are not more likely than not to be realized in the future.
Liquidity and Capital Resources.
Historically the Company has relied on equity financings to support its business operations. For the nine months ended September 30, 2026, the Company generated negative cash flows from operations of $2,475,000, while reporting net income of $470,000 for the three months ended September 30, 2026, with improved operating margins. The Company has an accumulated deficit of $37,504,000 as of September 30, 2026, and expects to continue to generate negative cash flows from operations in the foreseeable future; however, based on management’s current operating plan to decrease expenses and increase revenues with new product offerings, in addition to the cash generated from the Laboratory Equipment Operations’ Genie Division sale during fiscal 2025 (refer to Note 11), plus other cash received related to the various post Genie Division sale agreements and escrow account, the Company projects having sufficient funds to support business operations for at least one year from the date of issuance of the Unaudited Condensed Consolidated Financial Statements for the nine months ended September 30, 2026; however, there is no assurance that management’s current operating plan will be successful.
The following table discloses our cash flows for the periods presented:
|
| For the nine months ended September 30, |
| |||||
|
| 2026 |
|
| 2025 |
| ||
Net cash used in operating activities |
| $ | (2,475,000 | ) |
| $ | (4,390,700 | ) |
Net cash provided by investing activities |
|
| 2,710,200 |
|
|
| 2,444,300 |
|
Net cash provided by financing activities |
|
| - |
|
|
| 1,952,300 |
|
Effect of changes in foreign currency exchange rates |
|
| (73,300 | ) |
|
| 39,100 |
|
Net cash (used in) provided by discontinued operations |
|
| 232,200 |
|
|
| 529,700 |
|
(Decrease) increase in cash and cash equivalents |
|
| 394,100 |
|
|
| 574,700 |
|
Net cash used in operating activities decreased by $1,915,700 for the nine months ended September 30, 2026 as compared to the nine months ended September 30, 2025. The net change is primarily due to cost reductions related to both the Benchtop and Bioprocessing Systems operations as well as corporate expenses.
Net cash provided by investing activities was $2,710,200 compared to $2,444,300, which reflected a $5,919,200 decrease in proceeds from the Genie product line sale in the current year period compared to the prior year period, largely offset by $5,697,600 decreased purchases of investment securities, and $482,000 increased redemptions of investment securities.
The decrease in net cash provided by financing activities for the nine months ended September 30, 2026 as compared to the nine months ended September 30, 2025 is related to there being no stock issuances for the nine months ended September 30, 2026.
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Critical Accounting Estimates
The preparation of financial statements and related disclosures in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”) requires us to make judgments, assumptions, and estimates that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. “Note 2-Summary of significant accounting policies” to the Condensed Consolidated Financial Statements in our Annual Report on Form 10-K for the year ended December 31, 2025 (“2025 Form 10-K”) describes the significant accounting policies and methods used in the preparation of the consolidated financial statements. Our critical accounting estimates are identified in Management’s Discussion and Analysis of Financial Condition and Results of Operations in Part II, Item 7 of our 2025 Form 10-K. Such accounting policies and estimates require significant judgments and assumptions to be used in the preparation of the consolidated financial statements, and actual results could differ from our assumptions and estimates, and such differences could be material.
ITEM 3. Quantitative and Qualitative Disclosures about Market Risk
We are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and are not required to provide the information otherwise required under this item.
ITEM 4. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
As of the end of the period covered by this report, our management, with the participation and supervision of our Chief Executive Officer and Chief Financial Officer, have evaluated the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934). In designing and evaluating our disclosure controls and procedures, we recognize that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives and that we are required to apply our judgment in evaluating the cost-benefit relationship of possible controls and procedures. Further, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, within the Company have been detected. Based on the evaluation of our disclosure controls and procedures and internal controls over financial reporting as of September 30, 2026, our Chief Executive Officer and our Chief Financial Officer concluded that our disclosure controls and procedures were effective. Our management has concluded that the condensed consolidated financial statements included in this Quarterly Report on Form 10-Q present fairly, in all material respects, the Company’s financial position, results of operations and cash flows for the periods disclosed in accordance with U.S. GAAP.
Changes in Internal Controls Over Financial Reporting
There were no changes in our internal control over financial reporting identified in connection with the evaluation required by Rule 13a-15(d) and 15d-15(d) of the Exchange Act that occurred during the three months ended September 30, 2026 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
| 21 |
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PART II – OTHER INFORMATION
ITEM 1. Legal Proceedings
None
ITEM 1A. Risk Factors
Not required for smaller reporting companies.
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
None
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| Table of Contents |
ITEM 6. Exhibits
Exhibit Number |
| Description of document |
31.1 |
| Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |
31.2 |
| Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |
32.1 |
| Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |
32.2 |
| Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |
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SIGNATURES
Pursuant to the requirements of Section13 or 15(d) of the Securities Exchange Act of 1934, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| SCIENTIFIC INDUSTRIES, INC. (Registrant) | ||
|
|
|
|
Date: November 13, 2026 | By: | /s/ Helena R. Santos | |
|
| Helena R. Santos |
|
|
| President, Chief Executive Officer, and Treasurer |
|
| SCIENTIFIC INDUSTRIES, INC. (Registrant) | ||
|
|
|
|
Date: November 13, 2026 | By: | /s/ Zachary Rovinsky | |
|
| Zachary Rovinsky |
|
|
| Chief Financial Officer, Asst Treasurer, Asst Secretary |
|
| 24 |