[10-Q] Sensus Healthcare, Inc. Quarterly Earnings Report
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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1
SENSUS HEALTHCARE, INC.
QUARTERLY REPORT ON FORM 10-Q
TABLE OF CONTENTS
| Page | ||
| PART I – Financial Information | ||
| Item 1. | Condensed Consolidated Financial Statements (unaudited) | 4 |
| Condensed Consolidated Balance Sheets (unaudited) | 4 | |
| Condensed Consolidated Statements of Loss (unaudited) | 5 | |
| Condensed Consolidated Statements of Stockholders’ Equity (unaudited) | 6 | |
| Condensed Consolidated Statements of Cash Flows (unaudited) | 7 | |
| Notes to the Condensed Consolidated Financial Statements (unaudited) | 8 | |
| Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 22 |
| Item 3. | Quantitative and Qualitative Disclosures about Market Risk | 27 |
| Item 4. | Controls and Procedures | 27 |
| PART II – Other Information | ||
| Item 1. | Legal Proceedings | 27 |
| Item 1A. | Risk Factors | 27 |
| Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds | 27 |
| Item 3. | Defaults Upon Senior Securities | 28 |
| Item 4. | Mine Safety Disclosure | 28 |
| Item 5. | Other Information | 28 |
| Item 6. | Exhibits | 29 |
| Signatures | 30 | |
2
INTRODUCTORY NOTE
Forward-Looking Statements
This report includes statements that are, or may be deemed, “forward-looking statements.” In some cases, these statements can be identified by the use of forward-looking terminology such as “believes,” “estimates,” “anticipates,” “expects,” “plans,” “intends,” “may,” “could,” “might,” “will,” “should,” “approximately,” or “potential,” or negative or other variations of those terms or comparable terminology, although not all forward-looking statements contain these words.
Forward-looking statements involve risks and uncertainties because they relate to events, developments, and circumstances relating to Sensus Healthcare, Inc., our industry, and/or general economic or other conditions that may or may not occur in the future or may occur on longer or shorter timelines or to a greater or lesser degree than anticipated. In addition, even if future events, developments and circumstances are consistent with the forward-looking statements contained in this report, they may not be predictive of results or developments in future periods. Although we believe that we have a reasonable basis for each forward-looking statement contained in this report, forward-looking statements are not guarantees of future performance, and our actual results of operations, financial condition and liquidity, and the development of the industry in which we operate, may differ materially from the forward looking statements contained in this report as a result of the following factors, among others: the level and availability of government and/or third party payor reimbursement for clinical procedures using our products, and the willingness of healthcare providers to purchase our products if the level of reimbursement declines; concentration of our customers in the U.S. and China, including the concentration of sales to one particular customer in the U.S.; the development by others of new products, treatments, or technologies that render our technology partially or wholly obsolete; the regulatory requirements applicable to us and our competitors; our ability to efficiently manage our manufacturing processes and costs; the risks arising from doing business in China and other foreign countries, including ongoing geopolitical tensions between the U.S. and China; legislation, regulation, or other governmental action that affects our products, taxes, international trade regulation (including the possibility of tariffs and fluctuations in tariffs on equipment we export or materials we import), or other aspects of our business; the performance of the Company’s information technology systems and its ability to maintain data security; the possibility that inflationary pressures continue to impact our sales; our ability to obtain and maintain the intellectual property needed to adequately protect our products, and our ability to avoid infringing or otherwise violating the intellectual property rights of third parties; and other risks described from time to time in our filings with the Securities and Exchange Commission.
To date, geopolitical uncertainties other than those relating to China have not had any significant impact on our business, but we continue to monitor developments and will address them in future disclosures, if applicable.
Any forward-looking statements that we make in this report speak only as of the date of such statement, and we undertake no obligation to update such statements to reflect events or circumstances after the date this report is filed, except as may be required by applicable law.
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PART I. FINANCIAL INFORMATION
Item 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
SENSUS HEALTHCARE, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
| As of March 31, | As of December 31, | |||||||
| (in thousands, except shares and per share data) | 2026 | 2025 | ||||||
| (unaudited) | ||||||||
| Assets | ||||||||
| Current assets | ||||||||
| Cash and cash equivalents | $ | $ | ||||||
| Accounts receivable, net | ||||||||
| Inventories | ||||||||
| Prepaid inventory | ||||||||
| Other current assets | ||||||||
| Total current assets | ||||||||
| Property and equipment, net | ||||||||
| Deferred tax assets, net | ||||||||
| Operating lease right-of-use assets, net | ||||||||
| Other noncurrent assets | ||||||||
| Total assets | $ | $ | ||||||
| Liabilities and stockholders’ equity | ||||||||
| Current liabilities | ||||||||
| Accounts payable and accrued expenses | $ | $ | ||||||
| Product warranties | ||||||||
| Operating lease liabilities, current portion | ||||||||
| Deferred revenue, current portion | ||||||||
| Total current liabilities | ||||||||
| Operating lease liabilities | ||||||||
| Deferred revenue, net of current portion | ||||||||
| Total liabilities | ||||||||
| Commitments and contingencies | — | — | ||||||
| Stockholders’ equity | ||||||||
| Preferred stock, | — | — | ||||||
| Common stock, $ | ||||||||
| Additional paid-in capital | ||||||||
| Treasury stock, | ( | ) | ( | ) | ||||
| Retained earnings | ||||||||
| Total stockholders’ equity | ||||||||
| Total liabilities and stockholders’ equity | $ | $ | ||||||
See accompanying notes to the condensed consolidated financial statements (unaudited).
4
SENSUS HEALTHCARE, INC.
CONDENSED CONSOLIDATED STATEMENTS OF LOSS
(unaudited)
| For the Three Months Ended March 31, | ||||||||
| (in thousands, except shares and per share data) | 2026 | 2025 | ||||||
| Revenues | $ | $ | ||||||
| Cost of sales | ||||||||
| Gross profit | ||||||||
| Operating expenses | ||||||||
| General and administrative | ||||||||
| Selling and marketing | ||||||||
| Research and development | ||||||||
| Total operating expenses | ||||||||
| Loss from operations | ( | ) | ( | ) | ||||
| Other income: | ||||||||
| Interest income, net | ||||||||
| Other income, net | ||||||||
| Loss before income taxes | ( | ) | ( | ) | ||||
| (Benefit from) provision for income taxes | ( | ) | ||||||
| Net loss | $ | ( | ) | $ | ( | ) | ||
| Net loss per share – basic | $ | ( | ) | $ | ( | ) | ||
| diluted | $ | ( | ) | $ | ( | ) | ||
| Weighted average number of shares used in | ||||||||
| computing net loss per share – basic | ||||||||
| diluted | ||||||||
See accompanying notes to the condensed consolidated financial statements (unaudited).
5
SENSUS HEALTHCARE, INC.
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
(unaudited)
| Common Stock | Additional Paid-In | Treasury Stock | Retained | |||||||||||||||||||||||||
| (in thousands, except shares) | Shares | Amount | Capital | Shares | Amount | Earnings | Total | |||||||||||||||||||||
| December 31, 2024 | $ | $ | ( | ) | $ | ( | ) | $ | $ | |||||||||||||||||||
| Stock-based compensation | — | — | — | — | — | |||||||||||||||||||||||
| Stock repurchase | — | — | — | ( | ) | ( | ) | — | ( | ) | ||||||||||||||||||
| Net loss | — | — | — | — | — | ( | ) | ( | ) | |||||||||||||||||||
| March 31, 2025 | $ | $ | ( | ) | $ | ( | ) | $ | $ | |||||||||||||||||||
| December 31, 2025 | $ | $ | ( | ) | $ | ( | ) | $ | $ | |||||||||||||||||||
| Stock-based compensation | — | — | — | — | — | |||||||||||||||||||||||
| Forfeitures of restricted stock awards | ( | ) | — | — | — | — | — | — | ||||||||||||||||||||
| Net loss | — | — | — | — | — | ( | ) | ( | ) | |||||||||||||||||||
| March 31, 2026 | $ | $ | ( | ) | $ | ( | ) | $ | $ | |||||||||||||||||||
See accompanying notes to the condensed consolidated financial statements (unaudited).
6
SENSUS HEALTHCARE, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
| For the Three Months Ended March 31, | ||||||||
| (in thousands) | 2026 | 2025 | ||||||
| Cash flows from operating activities | ||||||||
| Net loss | $ | ( | ) | $ | ( | ) | ||
| Adjustments to reconcile net loss to net cash and cash equivalents used in operating activities: | ||||||||
| Depreciation | ||||||||
| Amortization of right-of-use assets | ||||||||
| Provision for product warranties | ||||||||
| Stock-based compensation | ||||||||
| Deferred income taxes | ( | ) | ||||||
| Changes in operating assets and liabilities: | ||||||||
| Accounts receivable | ||||||||
| Inventories | ( | ) | ( | ) | ||||
| Prepaid inventory | ( | ) | ( | ) | ||||
| Other current assets | ( | ) | ( | ) | ||||
| Other noncurrent assets | ||||||||
| Accounts payable and accrued expenses | ||||||||
| Operating lease liability | ( | ) | ( | ) | ||||
| Deferred revenue | ( | ) | ( | ) | ||||
| Product warranties | ( | ) | ( | ) | ||||
| Net cash used in operating activities | ( | ) | ( | ) | ||||
| Cash flows from investing activities | ||||||||
| Acquisition of property and equipment | ( | ) | ( | ) | ||||
| Net cash used in investing activities | ( | ) | ( | ) | ||||
| Cash flows from financing activities | ||||||||
| Repurchase of common stock | — | ( | ) | |||||
| Net cash used in financing activities | — | ( | ) | |||||
| Net decrease in cash and cash equivalents | ( | ) | ( | ) | ||||
| Cash and cash equivalents – beginning of period | ||||||||
| Cash and cash equivalents – end of period | $ | $ | ||||||
| Supplemental disclosure of cash flow information: | ||||||||
| Interest paid | $ | — | $ | — | ||||
| Income tax paid | $ | — | $ | — | ||||
| Income tax refunds received | $ | — | $ | — | ||||
| Supplemental schedule of noncash investing and financing transactions: | ||||||||
| Net transfers from inventory to fixed assets | $ | $ | ||||||
| Lease liability arising from obtaining right-of-use-assets | $ | — | $ | |||||
See accompanying notes to the condensed consolidated financial statements (unaudited).
7
SENSUS
HEALTHCARE, INC.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
Note 1 — Organization and Summary of Significant Accounting Policies
Description of the Business
Sensus Healthcare, Inc. (together, with its subsidiaries, unless the context otherwise indicates, “Sensus” or the “Company”) is a manufacturer of radiation therapy devices sold to healthcare providers globally through its distribution and marketing network. The Company operates from its corporate headquarters located in Boca Raton, Florida.
In 2024, the Company formed Sensus Healthcare Services, LLC, a wholly owned subsidiary that provides operational healthcare services to dermatology clinics in the form of leased equipment, radiation oncology oversight and physicist oversight, and on-site device operation by radiotherapy technologists where the Company receives a contractual percentage of all superficial radiation therapy (“SRT”) reimbursement to the practice.
Basis of Presentation and Principles of Consolidation
These condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) and include the accounts of the Company and its subsidiaries. Accounts and transactions between consolidated entities have been eliminated.
These financial statements have been prepared in accordance with GAAP for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. They do not include all of the information and notes required by GAAP. In the opinion of management, all adjustments considered necessary for a fair presentation of the results have been included. Operating results for the three months ended March 31, 2026 are not necessarily indicative of the results that may be expected for the year ending December 31, 2026 or for any other period.
The condensed consolidated balance sheet as of December 31, 2025 has been derived from the audited financial statements at that date, but does not include all of the information and notes required by GAAP for complete financial statements. For further information, refer to the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025 (the “2025 Annual Report”).
Use of Estimates
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, including disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expense during the reporting periods. Actual results could differ from those estimates.
Revenue Recognition
The Company derives revenue from sales of the Company’s devices and services related to maintaining and repairing the devices as part of a service contract or on an ad-hoc basis without a service contract.
The Company provides warranties, generally for one year, in conjunction with the sale of its products. These warranties entitle the customer to repair, replacement, or modification of the defective product, subject to the terms of the relevant warranty. The Company has determined that these warranties do not represent separate performance obligations, as the customer does not have the option to purchase the warranty separately and the warranty does not provide the customer with a service in addition to the assurance that the product complies with agreed-upon specifications. The Company records an estimate of future warranty claims at the time it recognizes revenue from the sale of the device based upon management’s estimate of the future claims rate.
8
Revenue is recognized upon transfer of control of promised goods or services to customers when the product is shipped or the service is rendered, based on the amount the Company expects to receive in exchange for those goods or services. The Company enters into contracts that can include multiple services, which are accounted for separately if they are determined to be distinct.
To determine the transaction price for contracts in which a customer promises consideration in a form other than cash, the Company measures the estimated fair value of the noncash consideration at contract inception. If the Company cannot reasonably estimate the fair value of the noncash consideration, the Company measures the consideration indirectly by reference to the stand-alone selling price of the products promised to the customer or class of customer in exchange for the consideration.
Our service contracts include maintenance or repair service for device purchases and personnel service to assist in the use and operation of leased-out equipment under lease agreements where the Company is the lessor.
The revenues from maintenance or repair service contracts are recognized over the service contract period on a straight-line basis. In the event that a customer does not sign a service contract, but requests maintenance or repair services after the warranty expires, the Company recognizes revenue when the service is rendered. There is no termination provision in the service contract or any penalties in practice for cancellation of the service contract.
The revenues from personnel service contracts are recognized in the period that the work is performed, as the Company has elected the practical expedient under Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers, to recognize revenue in the amount to which the entity has a right to invoice. The service contracts can be terminated by mutual written agreement.
The Company has determined that in practice no significant discount is given on service contracts when offered with the device purchase or equipment lease as compared to when sold on a stand-alone basis. The service level provided is identical whether the service contract is purchased on a stand-alone basis or together with the device purchase or equipment lease. The Company may also incur preparation cost to ensure the customer’s space meets the requirement and specifications for the operation of the equipment. The preparation cost is expensed as incurred.
The Company also generates revenue from leases in which the Company is the lessor. The Company identifies the lease and non-lease components and allocates the contract consideration on a relative stand-alone selling price basis at lease inception. The Company has elected the practical expedient to combine lease and non-lease components when the components qualify to be combined, and such combined components are accounted for as a lease under ASC 842, Leases. Revenues from non-lease components that are not qualified to be combined are recognized under ASC 606, Revenue from Contracts with Customers when the related services are rendered.
The components of disaggregated revenue for the three months ended March 31, 2026 and 2025 were as follows:
Schedule of Total Revenue
| For the Three Months Ended | ||||||||
| March 31, | ||||||||
| (in thousands) | 2026 | 2025 | ||||||
| Product Revenue - recognized at a point in time | $ | $ | ||||||
| Product Revenue - recognized over time | ||||||||
| Service Revenue - recognized at a point in time | ||||||||
| Service Revenue - recognized over time | ||||||||
| Total Revenue | $ | $ | ||||||
9
The Company operates in a highly regulated environment, primarily in the U.S. dermatology market, in which state regulatory approval is sometimes required prior to the customer being able to use the product. In cases where such regulatory approval is pending, revenue is deferred until such time as regulatory approval is obtained.
Deferred revenue activity as of March 31, 2026 was as follows:
Schedule of Deferred Revenue
| (in thousands) | Product | Service | Total | |||||||||
| December 31, 2025 | $ | $ | $ | |||||||||
| Revenue recognized | ( | ) | ( | ) | ( | ) | ||||||
| Amounts invoiced | ||||||||||||
| March 31, 2026 | $ | $ | $ | |||||||||
Remaining performance obligations of deposits for products have original expected durations of one year or less. Estimated service revenue to be recognized in the future related to the performance obligations that are unsatisfied (or partially unsatisfied) as of March 31, 2026 is as follows:
Schedule of Remaining Performance Obligations
| Year | Service Revenue | ||||
| 2026 (April 1 - December 31, 2026) | |||||
| 2027 | |||||
| Total | $ | ||||
For the three months ended March 31, 2026 and 2025, the Company paid commissions for certain equipment sales. Because commissions are expected to be recovered through product revenue within one year, the Company expenses commissions as incurred.
In addition, the Company incurs commissions associated with equipment lease agreements, which are accounted as initial direct costs and recorded in other noncurrent assets in the condensed consolidated balance sheets. The commission is capitalized at the commencement of the lease and recognized as an expense in selling and marketing expenses over the lease term.
Shipping and handling costs are expensed as incurred and are included in cost of sales.
Concentration
Financial instruments that potentially subject the Company to concentration of credit risk consist primarily of cash and cash equivalents and accounts receivable.
Two customers located in the U.S. accounted for
Geographical Information
The following table illustrates total revenue for the three months ended March 31, 2026 and 2025 by geographic region.
Schedule of Total Revenue by geographic region
| For the Three Months Ended March 31, | ||||||||||||||||
| (in thousands) | 2026 | 2025 | ||||||||||||||
| United States | $ | % | $ | % | ||||||||||||
| China | % | % | ||||||||||||||
| Other | % | % | ||||||||||||||
| Total Revenue | $ | % | $ | % | ||||||||||||
10
Fair Value of Financial Instruments
Carrying amounts of cash equivalents, accounts receivable, accounts payable and the revolving credit facility approximate fair value due to their relative short maturities.
Fair Value Measurements
The Company uses a fair value hierarchy that prioritizes inputs to valuation approaches used to measure fair value. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. Assets and liabilities measured and reported at fair value are classified and disclosed in one of the following categories:
Level 1 Inputs:
Quoted prices (unadjusted) in active markets for identical assets or liabilities at the reporting date.
| ● | Level 1 assets may include listed mutual funds, ETFs and listed equities |
Level 2 Inputs:
Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities that are not active; quotes from pricing services or brokers for which the Company can determine that orderly transactions took place at the quoted price or that the inputs used to arrive at the price are observable; and inputs other than quoted prices that are observable, such as models or other valuation methodologies.
| ● | Level 2 assets may include debt securities and foreign currency exchange contracts that have inputs to the valuations that generally can be corroborated by observable market data. |
Level 3 Inputs:
Unobservable inputs for the valuation of the asset or liability, which may include nonbinding broker quotes.
| ● | Level 3 assets include investments for which there is little, if any, market activity. These inputs require significant management judgment or estimation. |
Significance of Inputs: The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the financial instrument.
Cash and Cash Equivalents
Cash and cash equivalents primarily consist of cash, money market funds and short-term, highly liquid investments with original maturities of three months or less.
11
Accounts Receivable
The
Company extends credit to customers based on an assessment of their financial condition and generally does not require collateral.
Exposure to losses on receivables is expected to vary by customer due to the financial condition of each customer. The Company
estimates future credit losses based on the age of customer receivable balances, collection history and forecasted economic trends.
Future collections can be significantly different from historical collection trends or current estimates. The Company monitors
exposure to credit losses and maintains allowances for anticipated losses considered necessary under the circumstances. The allowance
for expected credit losses was $
Inventories
Inventories consist of finished product and components and are stated at the lower of cost or net realizable value, determined using the first-in, first-out method.
Earnings Per Share
Basic net loss per share is calculated by dividing net loss by the weighted-average number of common shares outstanding for the period using the treasury stock method for options, restricted stock and warrants. Diluted net loss per share is computed by giving effect to all potential dilutive common share equivalents outstanding for the period.
The factors used in the net loss per share computation are as follows:
Schedule of Earnings Per Share Computation
| For the Three Months Ended | ||||||||
| March 31, | ||||||||
| (in thousands, except share and per share amounts) | 2026 | 2025 | ||||||
| Basic | ||||||||
| Net loss | $ | ( | ) | $ | ( | ) | ||
| Weighted average number of shares used in computing net loss per share – basic | ||||||||
| Net loss per share - basic | $ | ( | ) | $ | ( | ) | ||
| Diluted | ||||||||
| Net loss | $ | ( | ) | $ | ( | ) | ||
| Weighted average number of shares used in computing net loss per share – basic | ||||||||
| Dilutive effects of: | ||||||||
| Stock options | ||||||||
| Restricted stock awards | ||||||||
| Weighted average number of shares used in computing net loss per share – diluted | ||||||||
| Net loss per share - diluted | $ | ( | ) | $ | ( | ) | ||
| The shares in full amount listed below were not included in the computation of diluted net loss | ||||||||
| per share because to do so would have been antidilutive for the periods presented: | ||||||||
| Restricted stock awards | ||||||||
| Stock options | ||||||||
Diluted net loss per share for the three months ended March 31, 2026 and 2025 excludes the dilutive effect of any stock options or shares issued under restricted stock awards, as the inclusion would be antidilutive due to the Company’s net losses during the periods.
12
Leases
The Company evaluates arrangements at inception to determine if an arrangement is or contains a lease. Operating lease assets represent the Company’s right to control an underlying asset for the lease term, and operating lease liability represents the Company’s obligation to make lease payments arising from the lease. Control of an underlying asset is conveyed to the Company if the Company obtains the rights to direct the use of and to obtain substantially all of the economic benefits from using the underlying asset. Operating lease assets and liabilities are recognized at the commencement date of the lease based upon the present value of lease payments over the lease term. When determining the lease term, the Company includes options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. The Company uses an incremental borrowing rate that the Company would expect to incur for a fully collateralized loan over a similar term under similar economic conditions to determine the present value of the lease payments. The Company has lease agreements which include lease and non-lease components, which the Company has elected to account for as a single lease component for all classes of underlying assets.
The lease payments used to determine the Company’s operating lease assets may include lease incentives, and stated rent increases are recognized in the Company’s operating lease assets in the Company’s condensed consolidated balance sheets. Operating lease assets are amortized to rent expense over the lease term and included in operating expenses in the condensed consolidated statements of loss.
For leases in which the Company is the lessor, the Company identifies the lease and non-lease components and allocates the contract consideration to the different components on a relative stand-alone selling price basis at lease inception. The Company uses a residual approach for the components when the stand-alone selling price is not directly observable or those for which the Company has not established a price.
The
Company has elected the practical expedient to combine lease and non-lease components when the components qualify to be combined.
Continuous supporting services are the primary non-lease components and are not predominant. As a result, the combined components
are accounted for as a lease under ASC 842, Leases. The revenues from non-lease components that are not qualified to be
combined are recognized when the services are rendered under ASC 606, Revenue from Contracts with Customers. The revenues
from non-lease components were $
For operating leases where the Company is the lessor, the Company recognizes the underlying assets and depreciates them over the estimated useful life which is based upon to estimate the residual value expected at the end of the lease term. Lease income is recognized on a straight-line basis over the lease term when the lease payment is determined. Leasing revenue is not recognized when collection of all contractual rents over the term of the agreement is not probable. When collection is not probable, the Company limits the lease revenue to the lesser of the revenue recognized on a straight-line basis or cash basis. The lease income is included in revenues in the condensed consolidated statements of loss.
Variable lease payments associated with the leases are recognized when the event, activity, or circumstance in the lease agreement on which those payments are assessed occurs. Variable lease payments are presented within revenues in the condensed consolidated statements of loss.
Income Taxes
The Company recognizes deferred tax assets and liabilities for the expected future tax consequences of events that have been recognized in the Company’s condensed consolidated financial statements or tax returns. Under this method, deferred tax assets and liabilities are determined based on differences between the financial statement carrying amounts and the tax bases of the assets and liabilities using the enacted tax rates in effect in the years in which the differences are expected to reverse. A valuation allowance against deferred tax assets is recorded if, based on the weight of the available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized.
13
In July 2025, the One Big Beautiful Bill Act (the “Tax Act”) was enacted, introducing various changes to U.S. corporate taxation, including provisions permitting 100% bonus depreciation on qualified property and immediate expensing of research and development expenditures. The effects of the Tax Act have been reflected in the Company’s results beginning in the third quarter of 2025. The Tax Act did not have a material impact on the Company’s income tax expense or effective tax rate for the period. The Company expects that certain provisions of the Tax Act will defer the timing of cash tax payments in future periods.
Uncertain tax positions are recognized in the condensed consolidated financial statements only if that position is more likely than not to be sustained upon examination by taxing authorities, based on the technical merits of the position. The Company’s practice is to recognize interest and/or penalties related to income tax matters in income tax expense.
Recent Accounting Pronouncements
In November 2024, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures, which requires entities to (i) disclose amounts of (a) purchase of inventory, (b) employee compensation, (c) depreciation, (d) intangible asset amortization, and, (e) depreciation, depletion, and amortization recognized as part of oil-and gas-producing activities, (ii) include certain amounts that are already required to be disclosed under current GAAP in the same disclosures as other disaggregation requirements, (iii) disclose a qualitative description of the amounts remaining in relevant expense captions that are not necessarily disaggregated quantitatively, and (iv) disclose the total amount of selling expenses, in annual reporting periods, an entity’s definition of selling expense. ASU No. 2024-03 is effective for annual reporting periods beginning after December 15, 2026 and interim reporting periods beginning after December 15, 2027. Early adoption is permitted. The Company is currently evaluating ASU No. 2024-03 to determine the impact it may have on its condensed consolidated financial statements.
In December 2025, the FASB issued ASU No. 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 GAAP. ASU No. 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 No. 2025-11 is effective for interim reporting periods within annual reporting periods beginning after December 15, 2027. Early adoption is permitted. The Company is currently evaluating ASU No. 2025-11 to determine the impact it may have on its condensed consolidated financial statements.
Note 2 — Property and Equipment
Property and equipment consist of the following:
Schedule of Property and Equipment
| (in thousands) | As of March 31, 2026 | As of December 31, 2025 | Estimated Useful Lives | ||||||||
| Operations equipment | $ | $ | |||||||||
| Equipment leased to customers | |||||||||||
| Tradeshow and demo equipment | |||||||||||
| Computer equipment | |||||||||||
| Research and development equipment | |||||||||||
| Subtotal | |||||||||||
| Construction in progress | |||||||||||
| Less accumulated depreciation | ( | ) | ( | ) | |||||||
| Property and Equipment, Net | $ | $ | |||||||||
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Depreciation expense was $
Note 3 — Debt
In September 2023, the Company entered
into a revolving credit facility (the “Credit Facility”) with Comerica Bank (“Comerica”) that originally
provided for maximum borrowings of $
At March 31, 2026 and December 31, 2025, the Company was in default under the Credit Facility for failing to maintain the required minimum profitability covenant. There were no borrowings outstanding under the facility at March 31, 2026 and December 31, 2025.
On May 8, 2026, the Company received notice from Fifth Third that the Credit Facility will terminate effective as of May 20, 2026.
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Note 4 — Product Warranties
Changes in product warranty liability were as follows for the three months ended March 31, 2026:
| Schedule of Changes in Product Warranty Liability | ||||
| (in thousands) | Amount | |||
| Balance, December 31, 2025 | $ | |||
| Warranties accrued during the period | ||||
| Payments on warranty claims | ( | ) | ||
| Balance, March 31, 2026 | $ | |||
Note 5 — Leases
Operating Lease Agreements
The Company leases its headquarters office from an unrelated
third party under a lease expiring in September 2027. The amortization expense of the right of use lease asset was $
The following table presents information about the amount, timing and uncertainty of cash flows arising from the Company’s operating leases as of March 31, 2026.
| Schedule of Received Lease Agreements | ||||
| Maturity of Operating Lease Liability | Amount | |||
| 2026 (April 1 - December 31, 2026) | ||||
| 2027 | ||||
| Total undiscounted operating leases payments | $ | |||
| Less: Imputed interest | ( | ) | ||
| Present Value of Operating Lease Liability | $ | |||
| Operating lease liability, current portion | $ | |||
| Operating lease liability, net of current portion | $ | |||
| Other Information | ||||
| Weighted-average remaining lease term | | |||
| Weighted-average discount rate | % | |||
Cash
paid for amounts included in the measurement of the operating lease liability was $
Operating
lease cost recognized as expense was $
Lessor Accounting
The Company, through its subsidiary, Sensus Healthcare Services, LLC, leases superficial radiotherapy equipment to dermatology clinics. These leases generally have an initial term of 60 months and automatically renew for a one-year period upon the expiration of the initial lease term. Payments due under the leases may be fixed or variable payments.
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The component of lease income for the three months ended March 31, 2026 is as follows:
| Schedule of Operating Lease Income | ||||||||
| (in thousands) | For the Three Months Ended March 31, 2026 | For the Three Months Ended March 31, 2025 | ||||||
| Lease income - operating leases - fixed payments | $ | $ | ||||||
| Lease income - operating leases - variable payments | ||||||||
| Total | $ | $ | ||||||
The future minimum fixed lease payments to be received under the lease agreements as of March 31, 2026 are as follows:
| Schedule of Received Lease Agreements | ||||
| (in thousands) | Amount | |||
| 2026 (April 1 - December 31, 2026) | ||||
| 2027 | ||||
| 2028 | ||||
| 2029 | ||||
| Thereafter | ||||
| Total | $ | |||
Note 6 – Commitments and Contingencies
Manufacturing Agreement
The Company has a contract manufacturing agreement with an unrelated third party for the production and manufacture of the SRT-100 (and subsequently the SRT-100 Vision and the SRT-100+), in accordance with the Company’s product specifications. The agreement renews for successive one-year periods unless either party notifies the other party in writing, at least sixty days prior to the anniversary date of the agreement, that it will not renew the agreement. The Company or the manufacturer may terminate the agreement upon ninety days’ prior written notice.
The Company pays this manufacturer for
finished goods in advance of the inventory being received. The Company paid this manufacturer $
Legal Contingencies
The Company is party to certain legal proceedings in the ordinary course of business. The Company assesses, in conjunction with its legal counsel, the need to record a liability for litigation and related contingencies.
In August 2019, the Company received a Civil Investigative Demand from the Department of Justice (the “Department”) seeking documents and written responses in connection with an investigation of the billing to Medicare by a physician who had treated patients with the Company’s SRT-100. The Department subsequently advised the Company that it was considering expanding the investigation to determine whether the Company had any involvement in the physician’s use of certain reimbursements codes. The Company has fully cooperated with the Department. The Company disputes that it has engaged in any wrongdoing with respect to such reimbursement claims; among other considerations, the Company does not submit claims for reimbursement or provide coding or billing advice to physicians. To the Company’s knowledge, the Department has made no determination as to whether the Company engaged in any wrongdoing, or whether to pursue any legal action against the Company. Should the Department decide to pursue legal action, the Company believes it has strong and meritorious defenses and will vigorously defend itself. As of March 31, 2026, the Company was unable to estimate the cost, if any, associated with this matter.
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Note 7 — Stockholders’ Equity
Preferred Stock
The Company has authorized
Treasury Stock
Treasury stock includes shares surrendered
by employees for tax withholding on the vesting of restricted stock awards and shares repurchased in open market transactions.
No shares were surrendered by employees for tax withholding for the three months ended March 31, 2026 and 2025. During the three
months ended March 31, 2026 and 2025, the Company repurchased zero and
Note 8 — Equity-based Compensation
2016 and 2017 Equity Incentive Plans
The Company’s 2016 Equity Incentive
Plan and the 2017 Incentive Plan, as amended in June 2023 and August 2025 (collectively, the “Plans”), provide for
the issuance of up to
On December 19, 2022, a total of
On January 11, 2024,
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On December 17, 2024,
On December 12, 2025,
Restricted Stock
Restricted stock activity for the three months ended March 31, 2026 is summarized below:
Schedule of Restricted Stock Activity
| Unvested at | Restricted Stock | Weighted- Average Grant Date Fair Value | ||||||
| December 31, 2025 | $ | |||||||
| Granted | — | — | ||||||
| Vested | — | — | ||||||
| Forfeited | ( | ) | ||||||
| March 31, 2026 | $ | |||||||
The Company recognizes forfeitures as they occur. There was no reduction of stock compensation expense related to the forfeitures for the three months ended March 31, 2026 and 2025.
Stock compensation expense related to restricted
stock, excluding the recognition of forfeitures, was $
Unrecognized stock compensation expense
was $
Stock Options
Stock options expire ten years after the grant date. Options that have been granted are exercisable and vest based on the terms of the related agreements.
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The following table summarizes the Company’s stock options activity after December 31, 2025:
Schedule of Stock Option Activity
| Number of Options | Weighted- Average Exercise Price | Weighted- Average Remaining Contractual Term (In Years) | |||||||||||
| Outstanding - December 31, 2025 | $ | ||||||||||||
| Granted | — | — | — | ||||||||||
| Exercised | — | — | — | ||||||||||
| Expired | — | — | — | ||||||||||
| Outstanding - March 31, 2026 | $ | ||||||||||||
| Exercisable – March 31, 2026 | $ | ||||||||||||
As of March 31, 2026, all outstanding stock options are fully vested. The stock options outstanding had no intrinsic value as of March 31, 2026 and December 31, 2025.
Note 9 — Income Taxes
The Company accounts for income taxes in accordance with ASC 740, Income Taxes, (“ASC 740”), which prescribes a recognition threshold and measurement process for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. ASC 740 also provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure and transition.
Effective income tax rates for interim periods are based upon the Company’s current estimated annual tax rate, which varies based upon the Company’s estimate of taxable earnings or loss and the mix of taxable earnings or loss in the various states in which the Company operates. In addition, the Company recognizes taxes related to unusual or infrequent items or resulting from a change in judgment regarding a position taken in a prior period as discrete items in the interim period in which the event occurs.
As of March 31, 2026 and December 31, 2025, management determined there continues to be sufficient positive evidence that it is more likely than not that the net deferred tax asset (other than foreign net operation losses) is realizable.
The Company recorded a benefit for
income taxes of $
The effective tax rates for the three months
ended March 31, 2026 and 2025 were
The effective tax rate differs from the U.S. federal statutory rate for the three months ended March 31, 2026, primarily due to nondeductible expenses, state income taxes and the favorable impact of tax credits.
As of March 31, 2026, the Company’s U.S. federal and certain state tax returns remain subject to examination, beginning with those filed for the year ended December 31, 2018.
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Note 10 — Segment Reporting
The Company has a single reportable segment focused on selling medical devices which are used to treat oncological and non-oncological skin conditions with SRT technology and providing services related to operating, maintaining, and repairing these devices.
The Company’s chief executive officer serves as the Company’s operating decision-maker (the “CODM”), assessing performance and making operating decisions using net income as the primary measure of profitability. The CODM is not regularly provided with specific segment expenses, but focuses on revenue, gross profit, and net income. Expense information, including cost of sales can be easily computed from the provided information. These segment (and consolidated) measures of profitability are shown in the condensed consolidated statements of loss. The measure of segment assets is reported on the condensed consolidated balance sheets as total assets.
Note 11 — Subsequent Events
The Company has evaluated subsequent events and transactions that occurred after the balance sheet date up to the date that the condensed consolidated financial statements were issued for potential recognition or disclosure. The Company did not identify any subsequent events that would have required adjustment to or disclosure in the condensed consolidated financial statements.
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Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion and analysis should be read in conjunction with the information set forth within the condensed consolidated financial statements and the notes thereto included elsewhere in this Quarterly Report on Form 10-Q, and with our Management’s Discussion and Analysis of Financial Condition and Results of Operations in the 2025 Annual Report.
Overview
Sensus Healthcare, Inc. (together, with its subsidiaries, Sensus Medical Devices Ltd. and Sensus Healthcare Services, LLC, unless the context otherwise indicates, “Sensus,” “we,” “us,” “our,” or the “Company”) is a medical device company committed to providing highly effective, non-invasive treatments for non-melanoma skin cancer and post-surgical keloid scar prevention. The Company uses a proprietary low-energy X-ray technology known as superficial radiation therapy (“SRT”), which is based on decades of dedicated research and development, and has successfully incorporated SRT into a portfolio of treatment devices: the SRT-100TM, SRT-100+TM and SRT-100 VisionTM. To date, SRT technology has been used to effectively and safely treat oncological and non-oncological skin conditions of close to one-million patients around the world.
Our business was organized in 2010 and the Company, incorporated in Delaware, completed its initial public offering in 2016. The Company operates from its corporate headquarters located in Boca Raton, Florida. In February 2024, the Company formed Sensus Healthcare Services, LLC, a wholly owned subsidiary that provides operational healthcare offerings to dermatology clinics in the form of equipment, radiation oncology and physicist oversight, and on-site device operation by radiotherapy technologists. The term the Company uses for this service model is the “Fair Deal Agreement.”
Segment Information
The Company manages its business globally within one reportable segment, which is consistent with how our management views the business, prioritizes investment and resource allocation decisions, and assesses operating performance.
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Results of Operations
| For the Three Months Ended | ||||||||
| March 31, | ||||||||
| (in thousands, except shares and per share data) | 2026 | 2025 | ||||||
| Revenues | $ | 3,394 | $ | 8,344 | ||||
| Cost of sales | 2,403 | 3,990 | ||||||
| Gross profit | 991 | 4,354 | ||||||
| Operating expenses | ||||||||
| General and administrative | 2,043 | 2,208 | ||||||
| Selling and marketing | 1,716 | 2,186 | ||||||
| Research and development | 1,590 | 2,606 | ||||||
| Total operating expenses | 5,349 | 7,000 | ||||||
| Loss from operations | (4,358 | ) | (2,646 | ) | ||||
| Other income: | ||||||||
| Interest income, net | 125 | 184 | ||||||
| Other income, net | 125 | 184 | ||||||
| Loss before income tax | (4,233 | ) | (2,462 | ) | ||||
| (Benefit from) provision for income taxes | (1,607 | ) | 110 | |||||
| Net loss | $ | (2,626 | ) | $ | (2,572 | ) | ||
Three months ended March 31, 2026 compared to the three months ended March 31, 2025
Revenues. Revenues were $3.4 million for the three months ended March 31, 2026 compared to $8.3 million for the three months ended March 31, 2025, a decrease of $4.9 million, or 59.0%. The decrease in revenue was primarily driven by a lower number of units sold (10 in the three months ended March 31, 2026, compared to 21 in the three months ended March 31, 2025), reflecting no units sold in the current period to a historically large customer. In addition, some systems placed during the quarter were under Fair Deal Agreement program and rental arrangements, for which revenue is recognized over the term of the agreement rather than at the time of shipment.
Cost of sales. Cost of sales was $2.4 million for the three months ended March 31, 2026 compared to $4.0 million for the three months ended March 31, 2025, a decrease of $1.6 million, or 40%. The decrease in cost of sales was primarily related to lower number of units sold.
Gross profit. Gross profit was $1.0 million for the three months ended March 31, 2026 compared to $4.4 million for the three months ended March 31, 2025, a decrease of $3.4 million, or 77.3%. Our overall gross profit percentage was 29.4% in the three months ended March 31, 2026 compared to 53.0% in the corresponding period in 2025. The decrease in gross profit and margin was primarily driven by product mix, including a higher proportion of international shipments, which carry lower average selling prices, and costs associated with new system placements pursuant to the Fair Deal Agreement program, which are recognized upfront while related revenue is recognized over the term of the applicable agreement.
General and administrative. General and administrative expense was $2.0 million for the three months ended March 31, 2026 compared to $2.2 million for the three months ended March 31, 2025, a decrease of $0.2 million, or 9.1%. The net decrease in general and administrative expense was primarily due to lower professional fees.
Selling and marketing. Selling and marketing expense was $1.7 million for the three months ended March 31, 2026 compared to $2.2 million for the three months ended March 31, 2025, a decrease of $0.5 million, or 22.7%. The decrease was primarily driven by an decrease in tradeshow expenses.
Research and development. Research and development expense was $1.6 million for the three months ended March 31, 2026 compared to $2.6 million for the three months ended March 31, 2025, a decrease of $1.0 million, or 42%. The decrease was primarily due to the decrease in lobbying costs related to billing code reimbursement, decreased headcount, and decrease in product development costs related to next generation systems.
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Other income. Other income of $0.1 and $0.2 million for the three months ended March 31, 2026 and 2025, respectively, relates primarily to interest income.
Income taxes. The effective tax rates for the three months ended March 31, 2026 and 2025 were 37.9% and (4.5%), respectively. The increase in the effective tax rate for the three months ended March 31, 2026 compared to the prior period was primarily due to projected full year income and a decrease in the estimated tax credits that are expected to be generated and utilized in proportion to the amount of pretax profit.
The Company evaluates the realizability of its deferred tax assets on a quarterly basis, considering both positive and negative evidence in accordance with ASC 740. A key component of this assessment is the Company’s recent cumulative earnings history. As of March 31, 2026, the Company has generated cumulative pre-tax income over the most recent three-year period, which represents significant positive evidence supporting the realizability of its deferred tax assets.
However, the Company’s operating results have historically exhibited seasonality, with variability in revenue and profitability across interim periods driven in part by the timing of equipment sales and customer purchasing patterns. This seasonality can result in fluctuations in quarterly and annual earnings and introduces additional uncertainty into projections of future taxable income.
Management continues to monitor all available evidence, including recent operating results, forecasts of future profitability, and the impact of business trends, in assessing the need for a valuation allowance. While management currently believes it is more likely than not that its deferred tax assets are realizable (excluding certain foreign net operating losses), changes in the Company’s operating performance, including the continuation or worsening of seasonal variability or declines in revenue, could impact this conclusion in future periods and may result in the recording of a valuation allowance, which could materially affect the Company’s results of operations.
Financial Condition
The following discussion summarizes significant changes in assets and liabilities. Please see the condensed consolidated balance sheets as of March 31, 2026 and December 31, 2025 contained in Part I, Item 1 of this filing.
Assets
Cash and cash equivalents were $18.3 million at March 31, 2026 compared to $22.1 million at December 31, 2025, a decrease of $3.8 million. See Cash Flows for details on the change in cash and cash equivalents during the three months ended March 31, 2026.
Accounts receivable was $3.6 million at March 31, 2026 compared to $6.0 million at December 31, 2025, a decrease of $2.4 million. The decrease was primarily due to the decrease in sales and concentration of sales to the Company’s historically large customer, which have historically been subject to extended payment terms.
Inventories were $16.5 million at March 31, 2026 compared to $14.6 million at December 31, 2025, an increase of $1.9 million. The increase was primarily due to the anticipation of increasing future sales.
Liabilities
There were no borrowings outstanding under our revolving line of credit with Comerica Bank at March 31, 2026 and December 31, 2025.
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Liquidity and Capital Resources
In general terms, liquidity is a measurement of the Company’s ability to meet its cash needs. For the three months ended March 31, 2026, funding was derived primarily from cash generated by the sale of equipment to our customers in the ordinary course of business and existing cash reserves. The Company believes that proceeds from maturing cash equivalents, as well as cash on hand are sufficient to meet operating capital and funding requirements for the next 12 months from the date this Quarterly Report was issued. The Company’s liquidity position and capital requirements may be impacted by a number of factors, including the following:
| ● | ability to generate and increase revenue; |
| ● | fluctuations in gross margins, operating expenses and net results; and |
| ● | financial market instability or disruptions to the banking system due to bank failures |
The Company’s primary short-term capital needs, which are subject to change, include expenditures related to:
| ● | expansion of sales and marketing activities; and |
| ● | expansion of research and development activities. |
Sensus’s management regularly evaluates cash requirements for current operations, commitments, capital requirements and business development transactions, and may seek to raise additional funds for these purposes in the future. However, there can be no assurance that it will be able to raise such funds or the terms on which such funds may be raised, if at all.
Cash flows
The following table provides a summary of cash flows for the periods indicated:
| For the Three Months Ended | ||||||||
| March 31, | ||||||||
| (in thousands) | 2026 | 2025 | ||||||
| Net cash provided by (used in): | ||||||||
| Operating activities | $ | (3,753 | ) | $ | (2,677 | ) | ||
| Investing activities | (3 | ) | (7 | ) | ||||
| Financing activities | — | (300 | ) | |||||
| Total | $ | (3,756 | ) | $ | (2,984 | ) | ||
Cash flows from operating activities
Net cash used in operating activities was $3.8 million for the three months ended March 31, 2026, consisting of net loss of $2.6 million and non-cash activity of $1.3 million, offset by a decrease in net operating liabilities of $0.1 million. Cash flows used in operating activities primarily include the receipt of revenues offset by the payment of operating expenses incurred in the normal course of business. Non-cash items consisted of stock-based compensation expense, deferred income taxes, provision for product warranties, amortization of right-of-use asset, and depreciation of property and equipment. Net cash used in operating activities was $2.7 million for the three months ended March 31, 2025, consisting of net loss of $2.6 million and an increase in net operating assets of $0.5 million, offset by non-cash charges of $0.4 million. Cash flows used in operating activities primarily include the receipt of revenues offset by the payment of operating expenses incurred in the normal course of business. Non-cash items consisted of stock-based compensation expense, provision for product warranties, amortization of right-of-use asset and depreciation of property and equipment.
Cash flows from investing activities
Net cash used in investing activities for the three months ended March 31, 2026 reflected $3 thousand of purchases of property and equipment. Net cash used in investing activities for the three months ended March 31, 2025 reflected $7 thousand of purchases of property and equipment.
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Cash flows from financing activities
No cash was used in financing activities for the three months ended March 31, 2026. Net cash used in financing activities for the three months ended March 31, 2025 reflected $0.3 million of repurchases of common stock.
Inflation
During the first quarter of 2026, we continued to experience some increase in commodity and shipping prices and energy and labor costs which resulted in minor inflationary pressures across various parts of our business and operations, including on our customers, partners, and suppliers. We continue to monitor the impact of inflation and we are taking actions, such as ordering inventory in advance, to minimize its effects on our product cost and sales.
Indebtedness
Please see Note 3, Debt, to the condensed consolidated financial statements.
Contractual Obligations and Commitments
Please see Note 6, Commitments and Contingencies, to the condensed consolidated financial statements.
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Critical Accounting Policies and Estimates
The preparation of the condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenue and expense during the reporting periods. Management has not applied any critical accounting estimates but has identified revenue recognition policies as critical to understanding the Company’s financial condition and results of operations. For a detailed discussion on the application of these and other accounting policies, see the Note 1, Organization and Summary of Significant Accounting Policies to the consolidated financial statements included in the 2025 Annual Report for further information.
Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Not applicable.
Item 4. CONTROLS AND PROCEDURES
Evaluation of Disclosure Control and Procedures
As of March 31, 2026, the end of the period covered by this Form 10-Q, our management, including our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934). Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer each concluded that, as of March 31, 2026, the end of the period covered by this Form 10-Q, we maintained effective disclosure controls and procedures.
Changes in Internal Control Over Financial Reporting
There have been no significant changes in our internal control over financial reporting during our most recently completed fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
The Company is party to certain legal proceedings in the ordinary course of business. The Company assesses, in conjunction with its legal counsel, the need to record a liability for litigation and related contingencies. See Note 6, Commitments and Contingencies.
Item 1A. Risk Factors
As a smaller reporting company, we are not required to provide disclosure pursuant to this item in this Form 10-Q.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
| (a) | Sales of Unregistered Securities |
There were no unregistered sales of securities during the three months ended March 31, 2026.
| (b) | Use of Proceeds from the Sale of Registered Securities |
None.
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| (c) | Purchases of Equity Securities by the Registrant and Affiliated Purchasers. |
None.
Item 3. Defaults Upon Senior Securities
At March 31, 2026 and December 31, 2025, the Company was in default under the Credit Facility for failing to maintain the required minimum profitability covenant. There were no borrowings outstanding under the facility at March 31, 2026 and December 31, 2025. As a result of the default, the Company is currently unable to borrow funds under the Credit Facility. Please see Note 3, Debt, to the condensed consolidated financial statements for more information.
Item 4. Mine Safety Disclosure
Not applicable.
Item 5. Other Information
(a) Termination of Credit Facility
On May 8, 2026, the Company received notice from Fifth Third that the Credit Facility will terminate effective as of May 20, 2026. At March 31, 2026 and December 31, 2025, the Company was in default under the Credit Facility for failing to maintain the required minimum profitability covenant. There were no borrowings outstanding under the facility at March 31, 2026 and December 31, 2025.
See Note 3, Debt, to the condensed consolidated financial statements for more information, including a summary of the material terms and conditions of the Credit Facility. Such summary is qualified in its entirety by reference to the agreements underlying the Credit Facility: the Credit Agreement, Master Revolving Note, and Security Agreement, which were filed as Exhibits 10.1, 10.2, and 10.3 to the Company’s Current Report on Form 8-K filed with the SEC on September 14, 2023, and the Amendment No. 1 to the Credit Agreement and Amendment No. 1 to the Master Revolving Note, which were filed as Exhibits 10.1 and 10.2 to the Company's Quarterly Report on Form 10-Q filed with the SEC on November 14, 2024.
(c) Rule 10b5-1 Trading Plans
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Item 6. Exhibits
EXHIBIT INDEX
| Exhibit No. | Description | |
| 31.1* | Certification of Joseph C. Sardano, Chairman and Chief Executive Officer of Sensus Healthcare, Inc., Pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934. | |
| 31.2* | Certification of Javier Rampolla, Chief Financial Officer of Sensus Healthcare, Inc., Pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934. | |
| 32.1* | Certification of Joseph C. Sardano, Chairman and Chief Executive Officer of Sensus Healthcare, Inc., Pursuant to 18 U.S.C. Section 1350. | |
| 32.2* | Certification of Javier Rampolla, Chief Financial Officer of Sensus Healthcare, Inc., Pursuant to 18 U.S.C. Section 1350. | |
| 101.INS* | Inline XBRL Instance Document. | |
| 101.SCH* | Inline XBRL Taxonomy Extension Schema Document. | |
| 101.CAL* | Inline XBRL Taxonomy Extension Calculation Linkbase Document. | |
| 101.LAB* | Inline XBRL Taxonomy Extension Label Linkbase Document. | |
| 101.PRE* | Inline XBRL Taxonomy Extension Presentation Linkbase Document. | |
| 101.DEF* | Inline XBRL Taxonomy Extension Definition Linkbase Document. | |
| 104.* | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101). |
| * | Filed electronically herewith. |
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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.
| SENSUS HEALTHCARE, INC. | |
| Date: May 13, 2026 | /s/ Joseph C. Sardano |
| Joseph C. Sardano | |
| Chief Executive Officer | |
| (Principal Executive Officer) | |
| Date: May 13, 2026 | /s/ Javier Rampolla |
| Javier Rampolla | |
| Chief Financial Officer | |
| (Principal Financial Officer and Principal Accounting Officer) |
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