VerifyMe (NASDAQ: VRME) Q1 2026 revenue falls 60% amid logistics shift
Rhea-AI Filing Summary
VerifyMe, Inc. reported Q1 2026 revenue of $1.8 million, down from $4.5 million in Q1 2025, a 60% decline mainly from losing ProActive services revenue after a prior carrier agreement ended in September 2025. Despite lower sales, gross profit was $1.0 million versus $1.5 million, and gross margin improved to 54% from 33% on a more profitable mix and process improvements. Operating loss widened to ($0.8) million from ($0.6) million, largely due to higher legal costs related to a proposed merger and lower gross profit. Net loss was ($0.7) million, or ($0.05) per diluted share, similar to the prior year’s per-share loss. Adjusted EBITDA was ($0.1) million compared with approximately breakeven. As of March 31, 2026, the company reported $3.5 million in cash, $5.1 million in working capital, and total assets of $12.1 million. Management highlighted full implementation of ProActive services, transitions to a new strategic shipping partner, and plans to begin offering Premium services with that partner in Q2 2026.
Positive
- Gross margin improved to 54% in Q1 2026 from 33% a year earlier, reflecting a more profitable mix of ProActive and Premium services and process improvements despite significantly lower revenue.
Negative
- Q1 2026 revenue declined 60% year over year to $1.8 million from $4.5 million, primarily due to the loss of ProActive services revenue after termination of a key carrier agreement.
Insights
Revenue fell sharply, but margins and liquidity remain relatively solid.
VerifyMe posted Q1 2026 revenue of $1.8M, down 60% from $4.5M a year earlier, mainly from the loss of ProActive services tied to a terminated carrier agreement. This is a substantial top-line reset for the business.
However, gross margin expanded to 54% from 33% as the mix shifted and ProActive processes improved. Net loss was $0.7M, only modestly worse than Q1 2025, with higher merger-related professional fees partly offset by cost controls and higher margin.
Liquidity appears adequate in this snapshot, with $3.5M in cash, $5.1M in working capital, and total liabilities of $1.7M as of March 31, 2026. The sustainability of this position will depend on successfully transitioning customers to the new shipping partner and executing on the proposed merger described in the forward-looking statements.
8-K Event Classification
Key Figures
Key Terms
Adjusted EBITDA financial
working capital financial
non-GAAP financial measures financial
forward-looking statements regulatory
Convertible note financial
Earnings Snapshot
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
| Date of Report (Date of earliest event reported): |
(Exact name of registrant as specified in its charter)
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_____________________
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) |
Name of each exchange on which registered | ||
| The |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
| 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. ¨
| Item 2.02 | Results of Operations and Financial Condition. |
On May 15, 2026, VerifyMe, Inc. (the “Company”) issued a press release to report financial results for the quarter ended March 31, 2026. The Company’s press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K.
The information furnished pursuant to this Item 2.02, including Exhibit 99.1, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities under such section and shall not be deemed to be incorporated by reference into any filing of the Company under the Securities Act of 1933, as amended, or the Exchange Act.
| Item 9.01 | Financial Statements and Exhibits. |
(d) Exhibits
| Exhibit No. | Description | |
| 99.1 | VerifyMe, Inc. Press Release dated May 15, 2026. | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document). |
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 hereunto duly authorized.
| VerifyMe, Inc. | ||||
| Date: May 15, 2026 |
/s/ Adam Stedham |
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| Name: | Adam Stedham | |||
| Title: | Chief Executive Officer and President | |||
Exhibit 99.1
VerifyMe Reports First Quarter 2026 Financial Results
| · | Quarterly revenue of $1.8 million, compared to $4.5 million in Q1 2025 |
| · | Quarterly gross profit of $1.0 million or 54%, compared to $1.5 million or 33% in Q1 2025 |
| · | Net loss of ($0.7) million, compared to ($0.6) million in Q1 2025 |
| · | Adjusted EBITDA(1) of ($0.1) million, compared to $0.0 million in Q1 2025 |
| · | Cash of $3.5 million and working capital of $5.1 million as of March 31, 2026 |
Lake Mary, FL – May 15, 2026 – PRNewswire — VerifyMe, Inc. (NASDAQ: VRME) (“VerifyMe,” “we,” “our,” or the “Company”) provides time and temperature sensitive logistics, and brand protection and enhancement solutions, announced today the Company’s financial results for its first quarter ended March 31, 2026 (“Q1 2026”).
Adam Stedham, VerifyMe’s CEO and President stated, “During Q1 of 2026, we fully implemented ProActive services and continued to transition ProActive customers from using our legacy shipping partner to using our new strategic shipping partner. We also transitioned key Premium customers to our Direct Premium model, allowing us to continue servicing these customers as they continue to ship with our legacy partner. In addition, we are in the final stages of integrating our technology with our new partner to begin offering our Premium services in Q2 of 2026. We believe our financial performance in Q1 of 2026 demonstrates the scalability of our model as we achieved improved gross profit margins despite lower revenues. We are now focused on completing our integrations and growing our revenues by both transitioning legacy customers and adding new customers.”
Key Financial Highlights for Q1 2026:
| · | Quarterly consolidated revenue of $1.8 million in Q1 2026, compared to $4.5 million for the three months ended March 31, 2025 (“Q1 2025”). |
| · | Gross profit of $1.0 million or 54% in Q1 2026, compared to $1.5 million or 33% in Q1 2025. |
| · | Net loss of ($0.7) million or ($0.05) per diluted share in Q1 2026, compared to ($0.6) million or ($0.05) and Q1 2025. |
| · | Adjusted EBITDA(1) of ($0.1) million in Q1 2026, compared to $0.0 in Q1 2025. |
| · | Cash of $3.5 million as of March 31, 2026. On May 11, 2026 cash of $2.1 million received from final payment on loan made in August 2025 to ZenCredit. |
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(1) Adjusted EBITDA is a non-GAAP financial measure. See "Use of Non-GAAP Financial Measures" below for information about this non-GAAP measure. A reconciliation to the most directly comparable GAAP measure, net loss, is included as a schedule to this release.
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Financial Results for the Three Months Ended March 31, 2026:
Revenue in Q1 2026 was $1.8 million, compared to $4.5 million in Q1 2025. Revenue for the quarter decreased by $2.7 million, or 60%. The decrease in revenue is primarily due to the loss of ProActive services revenue, as a result of the September 2025 termination of our agreement with our prior carrier partner.
Gross profit in Q1 2026 was $1.0 million, compared to $1.5 million in Q1 2025, a decline of ($0.5) million, or 36%. The resulting gross margin percentage was 54% for the three months ended March 31, 2026, compared to 33% for the three months ended March 31, 2025. The increase in gross profit percentage results from the mix of ProActive and Premium services provided during the quarter and process improvements implemented to increase ProActive services margins.
Operating loss was ($0.8) million in Q1 2026, compared to ($0.6) million in Q1 2025. The increased loss primarily relates to an increase in legal expenses associated with the Company’s proposed merger recorded in general and administrative expenses and the decrease in gross profit.
Net loss was ($0.7) million in Q1 2026, compared to ($0.6) million in Q1 2025. The resulting loss per diluted share was ($0.05) in Q1 2026 and in Q1 2025.
Adjusted EBITDA(1) in Q1 2026 was ($0.1) million, compared to $0.0 in Q1 2025. Adjusted EBITDA(1) is a non-GAAP financial measure. Please see “Use of Non-GAAP Financial Measures” for a discussion of this non-GAAP measure. A reconciliation to the most directly comparable GAAP measure, net loss is included as a schedule to this release.
At March 31, 2026, we had a $3.5 million cash balance and $5.1 million in working capital.
At March 31, 2026, we had 13,581,242 shares issued and 13,119,065 shares outstanding.
Earnings Call
The company is not scheduling an earnings call but intends to have a shareholder call after the Form S-4 registration statement and proxy statement associated with our previously announced merger agreement is declared effective by the US Securities and Exchange Commission.
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(1) Adjusted EBITDA is a non-GAAP financial measure. See "Use of Non-GAAP Financial Measures" below for information about this non-GAAP measure. A reconciliation to the most directly comparable GAAP measure, net loss, is included as a schedule to this release.
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About VerifyMe, Inc.
VerifyMe, Inc. (NASDAQ: VRME), provides specialized logistics for time and temperature sensitive products, as well as brand protection and enhancement solutions. To learn more, visit www.verifyme.com.
Cautionary Note Regarding Forward-Looking Statements
This release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The words “believe,” “continue,” “may,” “should,” "will," and similar expressions, as they relate to us, are intended to identify forward-looking statements. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our financial condition, results of operations, business strategy and financial needs. Important factors that could cause actual results to differ from those in the forward-looking statements include our engagement in future acquisitions or strategic partnerships that increase our capital requirements or cause us to incur debt or assume contingent liabilities, our reliance on one key strategic partner for shipping services, competition including by our key strategic partner, seasonal trends in our business, severe climate conditions, the highly competitive nature of the industry in which we operate, our brand image and corporate reputation, impairments related to our goodwill and other intangible assets, economic and other factors such as recessions, downturns in the economy, inflation, global uncertainty and instability, the effects of pandemics, changes in United States social, political, and regulatory conditions and/or a disruption of financial markets, reduced freight volumes due to economic conditions, reduced discretionary spending in a recessionary environment, global supply-chain delays or shortages, fluctuations in labor costs, raw materials, and changes in the availability of key suppliers, our history of losses, our ability to use our net operating losses to offset future taxable income, the confusion of our name brand with other brands, the ability of our technology to work as anticipated and to successfully provide analytics logistics management, our ability to continue to invest in the development and commercialization of our product and service offerings, the ability of our strategic partners to integrate our solutions into their product offerings, our ability to manage our growth effectively, our ability to successfully develop and expand our sales and marketing capabilities, risks related to doing business outside of the U.S., intellectual property litigation, our ability to successfully develop, implement, maintain, upgrade, enhance, and protect our information technology systems, our reliance on third-party information technology service providers, our ability to respond to evolving laws related to information technology such as privacy laws, our ability to attract, retain and develop successors for management, our ability to work with partners in selling our technologies to businesses, production difficulties, our inability to enter into contracts and arrangements with future partners, our ability to acquire new customers, issues which may affect the reluctance of large companies to change their purchasing of products, acceptance of our technologies and the efficiency of our authenticators in the field, our ability to comply with the continued listing standards of the Nasdaq Capital Market, our ability to timely pay amounts due and comply with the covenants under our debt facilities, and our ability to complete the proposed business combination, including due to the failure to obtain approval of the securityholders of the Company, certain regulatory approvals, or satisfying other conditions to closing, in the merger agreement. These risk factors and uncertainties include those more fully described in VerifyMe’s Annual Report and Quarterly Reports filed with the Securities and Exchange Commission, including under the heading entitled “Risk Factors.” Should one or more of these risks or uncertainties materialize, or should any of our underlying assumptions prove incorrect, actual results may vary materially from those currently anticipated. Any forward-looking statement made by us herein speaks only as of the date on which it is made. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. We undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by law.
Use of Non-GAAP Financial Measures
This press release includes both financial measures in accordance with U.S. generally accepted accounting principles (“GAAP”), as well as non-GAAP financial measures. Generally, a non-GAAP financial measure is a numerical measure of a company’s performance, financial position or cash flows that either excludes or includes amounts that are not normally included or excluded in the most directly comparable measure calculated and presented in accordance with GAAP. Non-GAAP financial measures should be viewed as supplemental to and should not be considered as alternatives to any other GAAP financial measures. They may not be indicative of the historical operating results of VerifyMe nor are they intended to be predictive of potential future results. Investors should not consider non-GAAP financial measures in isolation or as substitutes for performance measures calculated in accordance with GAAP.
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VerifyMe’s management uses and relies on EBITDA and Adjusted EBITDA, which are non-GAAP financial measures. The Company believes that both management and shareholders benefit from referring to EBITDA and Adjusted EBITDA in planning, forecasting and analyzing future periods. Additionally, the Company believes Adjusted EBITDA is useful to investors to evaluate its results because it excludes certain items that are not directly related to the Company’s core operating performance. In particular, with regard to our comparison of Adjusted EBITDA for the three months ended March 31, 2026, to the three months ended March 31, 2025, we believe is useful to investors in understanding the results of operations. The Company’s management uses these non-GAAP financial measures in evaluating its financial and operational decision making and as a means to evaluate period-to-period comparison. The Company’s management recognizes that EBITDA and Adjusted EBITDA, as non-GAAP financial measures, have inherent limitations because of the described excluded items.
The Company defines EBITDA as net loss before interest (income) expense, income tax expense (benefit), and depreciation and amortization. Adjusted EBITDA represents EBITDA plus non-cash stock compensation expense, severance expense, gain on derecognized liability, impairments, change in fair value of contingent consideration, and one-time professional expenses for acquisitions and divestiture. VerifyMe believes EBITDA and Adjusted EBITDA are important measures of VerifyMe’s operating performance because they allow management, investors and analysts to evaluate and assess VerifyMe’s core operating results from period-to-period after removing the impact of items of a non-operational nature that affect comparability.
A reconciliation of EBITDA and Adjusted EBITDA to the most comparable financial measure, net loss, calculated in accordance with GAAP is included in a schedule to this press release. The Company believes that providing the non-GAAP financial measure, together with the reconciliation to GAAP, helps investors make comparisons between VerifyMe and other companies. In making any comparisons to other companies, investors need to be aware that companies use different non-GAAP measures to evaluate their financial performance. Investors should pay close attention to the specific definition being used and to the reconciliation between such measure and the corresponding GAAP measure provided by each company under applicable SEC rules as the presentation here may not be comparable to other similarly titled measures of other companies.
For Other Information Contact:
Company: VerifyMe, Inc.
Email: IR@verifyme.com
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VerifyMe, Inc.
Consolidated Balance Sheets
(In thousands, except share data)
| March 31, 2026 | December 31, 2025 | |||||||
| (Unaudited) | ||||||||
| ASSETS | ||||||||
| CURRENT ASSETS | ||||||||
| Cash and cash equivalents | $ | 3,519 | $ | 4,353 | ||||
| Accounts receivable, net of allowance for credit loss reserve, $21 and $10 as of March 31, 2026 and December 31, 2025, respectively | 818 | 857 | ||||||
| Note receivable, net of allowance for credit loss reserve, $12 and $12 as of March 31, 2026 and December 31, 2025, respectively | 1,988 | 1,988 | ||||||
| Unbilled revenue | 285 | 338 | ||||||
| Prepaid expenses and other current assets | 208 | 154 | ||||||
| Inventory | 31 | 37 | ||||||
| TOTAL CURRENT ASSETS | 6,849 | 7,727 | ||||||
| PROPERTY AND EQUIPMENT, NET | $ | 16 | $ | 20 | ||||
| INTANGIBLE ASSETS, NET | 2,325 | 2,345 | ||||||
| GOODWILL | 2,926 | 2,926 | ||||||
| TOTAL ASSETS | $ | 12,116 | $ | 13,018 | ||||
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||
| CURRENT LIABILITIES | ||||||||
| Accounts payable | $ | 532 | $ | 745 | ||||
| Other accrued expense | 457 | 530 | ||||||
| Convertible note – related party, current | 400 | 400 | ||||||
| Convertible note, current | 350 | 350 | ||||||
| TOTAL CURRENT LIABILITIES | 1,739 | 2,025 | ||||||
| TOTAL LIABILITIES | $ | 1,739 | $ | 2,025 | ||||
| STOCKHOLDERS' EQUITY | ||||||||
| Series A Convertible Preferred Stock, $0.001 par value, 37,564,767 shares authorized; 0 shares issued and outstanding as of March 31, 2026 and December 31, 2025, respectively | - | - | ||||||
| Series B Convertible Preferred Stock, $0.001 par value; 85 shares authorized; 0.85 shares issued and outstanding as of March 31, 2026 and December 31, 2025, respectively | - | |||||||
| - | ||||||||
| Common stock, $0.001 par value; 675,000,000 shares authorized; 13,581,242 and 13,553,049 shares issued, 13,119,065 and 13,071,601 shares outstanding as of March 31, 2026 and December 31, 2025, respectively | 14 | 14 | ||||||
| Additional paid in capital | 102,096 | 102,059 | ||||||
| Treasury stock at cost; 462,117 and 481,448 shares at March 31, 2026 and December 31, 2025, respectively | (476 | ) | (502 | ) | ||||
| Accumulated deficit | (91,257 | ) | (90,578 | ) | ||||
| STOCKHOLDERS' EQUITY | 10,377 | 10,993 | ||||||
| TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ | 12,116 | $ | 13,018 | ||||
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VerifyMe, Inc.
Consolidated Statements of Operations
(Unaudited)
(In thousands, except share data)
| Three Months Ended | ||||||||
| March 31, 2026 | March 31, 2025 | |||||||
| NET REVENUE | $ | 1,772 | $ | 4,455 | ||||
| COST OF REVENUE | 812 | 2,965 | ||||||
| GROSS PROFIT | 960 | 1,490 | ||||||
| OPERATING EXPENSES | ||||||||
| Management and Technology(a) | 570 | 926 | ||||||
| General and administrative (a) | 1,016 | 856 | ||||||
| Research and development | - | 5 | ||||||
| Sales and marketing (a) | 141 | 296 | ||||||
| Total Operating expenses | 1,727 | 2,083 | ||||||
| LOSS BEFORE OTHER INCOME (EXPENSE) | (767 | ) | (593 | ) | ||||
| OTHER INCOME (EXPENSE) | ||||||||
| Interest income, net | 88 | 22 | ||||||
| TOTAL OTHER INCOME, NET | 88 | 22 | ||||||
| NET LOSS | $ | (679 | ) | $ | (571 | ) | ||
| LOSS PER SHARE | ||||||||
| BASIC | (0.05 | ) | (0.05 | ) | ||||
| DILUTED | (0.05 | ) | (0.05 | ) | ||||
| WEIGHTED AVERAGE COMMON SHARE OUTSTANDING | ||||||||
| BASIC | 13,352,749 | 12,292,150 | ||||||
| DILUTED | 13,352,749 | 12,292,150 | ||||||
| (a) | Includes share-based compensation of $63 thousand and $333 thousand for the three months ended March 31, 2026 and March 31, 2025, respectively. |
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VerifyMe, Inc.
Consolidated EBITDA and Adjusted EBITDA Reconciliation
Table (Unaudited)
(In thousands)
| Three months ended March 31, | ||||||||
| 2026 | 2025 | |||||||
| Net loss (GAAP) | $ | (679 | ) | $ | (571 | ) | ||
| Interest income, net | (88 | ) | (22 | ) | ||||
| Amortization and depreciation | 132 | 286 | ||||||
| Total EBITDA (Non-GAAP) | (635 | ) | (307 | ) | ||||
| Adjustments: | ||||||||
| Stock based compensation | - | 41 | ||||||
| Fair value of restricted stock and restricted stock units issued in exchange for services | 77 | 292 | ||||||
| Severance expense | - | 57 | ||||||
| Gain on derecognized liability | - | (100 | ) | |||||
| One-time professional expenses for acquisitions/divestiture | 474 | 17 | ||||||
| Total Adjusted EBITDA (Non-GAAP) | $ | (84 | ) | $ | - | |||
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