UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2025

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _______________ to _______________

Commission File Number: 000-24249

Interpace Biosciences, Inc.

(Exact name of registrant as specified in its charter)

Delaware		22-2919486
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification No.)

Waterview Plaza, Suite 310, 2001 Route 46, Parsippany, NJ 07054

(Address of principal executive offices and zip code)

(855) 776-6419

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
None		N/A		N/A

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. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

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 ☐
Non-accelerated filer ☒		Smaller reporting company ☒
		Emerging Growth Company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date:

Class		Shares Outstanding November 7, 2025
Common Stock, par value $0.01 per share		4,428,539

INTERPACE BIOSCIENCES, INC.

FORM 10-Q FOR PERIOD ENDED SEPTEMBER 30, 2025

TABLE OF CONTENTS

		Page No.

	PART I - FINANCIAL INFORMATION

Item 1.	Unaudited Interim Condensed Consolidated Financial Statements

	Condensed Consolidated Balance Sheets at September 30, 2025 (unaudited) and December 31, 2024	3

	Condensed Consolidated Statements of Operations for the three and nine-month periods ended September 30, 2025 and 2024 (unaudited)	4

	Condensed Consolidated Statements of Stockholders’ Deficit for the three and nine-month periods ended September 30, 2025 and 2024 (unaudited)	5

	Condensed Consolidated Statements of Cash Flows for the nine-month periods ended September 30, 2025 and 2024 (unaudited)	6

	Notes to Unaudited Condensed Consolidated Financial Statements	7

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	21

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	30

Item 4.	Controls and Procedures	31

	PART II - OTHER INFORMATION

Item 1.	Legal Proceedings	31

Item 1A.	Risk Factors	31

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	31

Item 3.	Defaults Upon Senior Securities	31

Item 4.	Mine Safety Disclosures	31

Item 5.	Other Information	31

Item 6.	Exhibits	32

Signatures		33

PART I. FINANCIAL INFORMATION

INTERPACE BIOSCIENCES, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except share and per share data)

	September 30,			December 31,
	2025			2024
	(unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	1,423		$	1,461
Accounts receivable		5,966			8,544
Other current assets		1,741			1,768
Total current assets		9,130			11,773
Property and equipment, net		1,541			1,361
Operating lease right of use assets		1,320			1,613
Other long-term assets		45			45
Total assets	$	12,036		$	14,792

LIABILITIES AND STOCKHOLDERS’ DEFICIT
Current liabilities:
Accounts payable	$	1,411		$	1,659
Accrued salary and bonus		1,447			2,207
Other accrued expenses		1,450			1,799
Note payable at fair value		977			4,290
Current liabilities of discontinued operations		660			660
Total current liabilities		5,945			10,615
Operating lease liabilities, net of current portion		864			1,183
Other long-term liabilities		5,525			5,211
Total liabilities		12,334			17,009

Commitments and contingencies (Note 8)		-

Stockholders’ deficit:
Redeemable preferred stock, $.01 par value; 5,000,000 shares authorized, 47,000 shares Series C issued and outstanding		-			-
Common stock, $.01 par value; 100,000,000 shares authorized; 4,569,333 and 4,539,663 shares issued, respectively; 4,428,539 and 4,409,323 shares outstanding, respectively		407			406
Additional paid-in capital		234,829			234,811
Accumulated deficit		(233,462	)		(235,380	)
Treasury stock, at cost (140,794 and 130,340 shares, respectively)		(2,072	)		(2,054	)
Total stockholders’ deficit		(298	)		(2,217	)

Total liabilities and stockholders’ deficit	$	12,036		$	14,792

The accompanying notes are an integral part of these condensed consolidated financial statements

INTERPACE BIOSCIENCES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited, in thousands, except for per share data)

	2025			2024			2025			2024
	For The Three Months						For The Nine Months
	Ended September 30,						Ended September 30,
	2025			2024			2025			2024

Revenue, net	$	8,756		$	12,295		$	29,504		$	34,515
Cost of revenue		3,317			4,393			11,418			12,496
Gross profit		5,439			7,902			18,086			22,019
Operating expenses:
Sales and marketing		2,087			2,864			7,811			8,571
Research and development		150			199			500			483
General and administrative		2,057			2,538			7,268			6,918
Total operating expenses		4,294			5,601			15,579			15,972

Operating income from continuing operations		1,145			2,301			2,507			6,047
Interest accretion expense		-			(4	)		-			(34	)
Note payable interest		(30	)		(141	)		(156	)		(514	)
Other expense, net		(115	)		(394	)		(112	)		(406	)
Income from continuing operations before tax		1,000			1,762			2,239			5,093
(Benefit) provision for income taxes		(11	)		4			7			12
Income from continuing operations		1,011			1,758			2,232			5,081

Loss from discontinued operations, net of tax		(100	)		(82	)		(314	)		(260	)

Net income	$	911		$	1,676		$	1,918		$	4,821

Basic income (loss) per share of common stock:
From continuing operations	$	0.23		$	0.40		$	0.50		$	1.16
From discontinued operations		(0.02	)		(0.02	)		(0.07	)		(0.06	)
Net income (loss) per basic share of common stock	$	0.21		$	0.38		$	0.43		$	1.10

Diluted income (loss) per share of common stock:
From continuing operations	$	0.04		$	0.40		$	0.08		$	1.15
From discontinued operations		(0.01	)		(0.02	)		(0.01	)		(0.06	)
Net income (loss) per diluted share of common stock	$	0.03		$	0.38		$	0.07		$	1.09

Weighted average number of common shares and common share equivalents outstanding:
Basic		4,425			4,393			4,423			4,380
Diluted		27,695			4,423			27,693			4,404

The accompanying notes are an integral part of these condensed consolidated financial statements

INTERPACE BIOSCIENCES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ DEFICIT

(unaudited, in thousands)

	Shares		Amount		Shares		Amount		Shares		Amount			Capital			Deficit			Total
														Additional
	Preferred Stock				Common Stock				Treasury Stock					Paid in			Accumulated
	Shares		Amount		Shares		Amount		Shares		Amount			Capital			Deficit			Total
Balance -December 31, 2023		-	$	-		4,447,489	$	405		96,044	$	(2,008	)	$	188,146		$	(242,082	)	$	(55,539	)

Issuance of common stock		-		-		39,668		1		-		-			(1	)		-			-
Treasury stock purchased		-		-		-		-		14,715		(16	)		-			-			(16	)
Stock-based compensation expense		-		-		-		-		-		-			79			-			79
Net income		-		-		-		-		-		-			-			708			708

Balance -March 31, 2024		-	$	-		4,487,157	$	406		110,759	$	(2,024	)	$	188,224		$	(241,374	)	$	(54,768	)

Stock-based compensation expense		-		-		-		-		-		-			53			-			53
Net income		-		-		-		-		-		-			-			2,437			2,437

Balance -June 30, 2024		-	$	-		4,487,157	$	406		110,759	$	(2,024	)	$	188,277		$	(238,937	)	$	(52,278	)

Stock-based compensation expense		-		-		-		-		-		-			86			-			86
Treasury stock purchased		-		-		-		-		17,437		(22	)		-			-			(22	)
Net income		-		-		-		-		-		-			-			1,676			1,676

Balance -September 30, 2024		-	$	-		4,487,157	$	406		128,196	$	(2,046	)	$	188,363		$	(237,261	)	$	(50,538	)

Balance -December 31, 2024		47,000	$	-		4,539,663	$	406		130,340	$	(2,054	)	$	234,811		$	(235,380	)	$	(2,217	)

Issuance of common stock		-		-		21,336		1		-		-			-			-			1
Treasury stock purchased		-		-		-		-		7,566		(15	)		-			-			(15	)
Series C issuance costs		-		-		-		-		-		-			(13	)		-			(13	)
Stock-based compensation expense		-		-		-		-		-		-			15			-			15
Net income		-		-		-		-		-		-			-			1,647			1,647

Balance -March 31, 2025		47,000	$	-		4,560,999	$	407		137,906	$	(2,069	)	$	234,813		$	(233,733	)	$	(582	)

Stock-based compensation expense		-		-		-		-		-		-			9			-			9
Net loss		-		-		-		-		-		-			-			(640	)		(640	)

Balance -June 30, 2025		47,000	$	-		4,560,999	$	407		137,906	$	(2,069	)	$	234,822		$	(234,373	)	$	(1,213	)
Balance		47,000	$	-		4,560,999	$	407		137,906	$	(2,069	)	$	234,822		$	(234,373	)	$	(1,213	)

Stock-based compensation expense		-		-		-		-		-		-			7			-			7
Issuance of common stock		-		-		8,334		-		-		-			-			-			-
Treasury stock purchased		-		-		-		-		2,888		(3	)		-			-			(3	)
Net income		-		-		-		-		-		-			-			911			911
Net income (loss)		-		-		-		-		-		-			-			911			911

Balance -September 30, 2025		47,000	$	-		4,569,333	$	407		140,794	$	(2,072	)	$	234,829		$	(233,462	)	$	(298	)
Balance		47,000	$	-		4,569,333	$	407		140,794	$	(2,072	)	$	234,829		$	(233,462	)	$	(298	)

The accompanying notes are an integral part of these condensed consolidated financial statements.

INTERPACE BIOSCIENCES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited, in thousands)

	2025			2024
`	For The Nine Months Ended September 30,
	2025			2024

Cash Flows From Operating Activities
Net income	$	1,918		$	4,821
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		307			205
Interest accretion expense		-			34
Amortization of deferred financing fees		42			-
Stock-based compensation		31			218
Bad debt expense reversal		-			(100	)
Credit loss expense		-			26
Asset impairment - lab supplies		198			-
Change in fair value of note payable		87			445
Amortization on operating lease right of use asset		293			332
Other changes in operating assets and liabilities:
Accounts receivable		2,578			(2,241	)
Other current assets		(213	)		237
Accounts payable		(417	)		137
Accrued salaries and bonus		(777	)		(320	)
Other accrued expenses		(385	)		(236	)
Operating lease liabilities		(283	)		(355	)
Other long-term liabilities		314			259
Net cash provided by operating activities		3,693			3,462

Cash Flows From Investing Activity
Purchase of property and equipment		(318	)		(747	)
Net cash used in investing activities		(318	)		(747	)

Cash Flows From Financing Activities
Payments made on note payable		(3,400	)		(4,100	)
Series C conversion costs		(13	)		-
Net cash used in financing activities		(3,413	)		(4,100	)

Net decrease in cash and cash equivalents		(38	)		(1,385	)
Cash and cash equivalents from continuing operations– beginning		1,461			3,498
Cash and cash equivalents from discontinued operations– beginning		-			-
Cash and cash equivalents – beginning	$	1,461		$	3,498
Cash and cash equivalents from continuing operations– ending	$	1,423		$	2,113
Cash and cash equivalents from discontinued operations– ending		-			-
Cash and cash equivalents – ending	$	1,423		$	2,113

The accompanying notes are an integral part of these condensed consolidated financial statements.

INTERPACE BIOSCIENCES, INC.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

(Tabular information in thousands, except per share amounts)

1. OVERVIEW

Nature of Business

Interpace Biosciences, Inc. (“Interpace” or the “Company”) is a company that provides molecular diagnostics, bioinformatics and pathology services for evaluation of risk of cancer by leveraging the latest technology in personalized medicine for improved patient diagnosis and management. The Company develops and commercializes genomic tests and related first line assays principally focused on early detection of patients with indeterminate biopsies and at high risk of cancer using the latest technology.

2. BASIS OF PRESENTATION

The accompanying unaudited interim condensed consolidated financial statements and related notes (the “Interim Financial Statements”) should be read in conjunction with the consolidated financial statements of the Company and its wholly-owned subsidiaries (Interpace Diagnostics Lab Inc., Interpace Diagnostics Corporation, and Interpace Diagnostics, LLC), and related notes as included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024, as filed with the Securities & Exchange Commission (“SEC”) on March 31, 2025 and as amended on April 28, 2025.

The Interim Financial Statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) for interim financial reporting and the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. The Interim Financial Statements include all normal recurring adjustments that, in the judgment of management, are necessary for a fair presentation of such interim financial statements. Discontinued operations include the Company’s wholly owned subsidiaries: Group DCA, LLC, InServe Support Solutions; and TVG, Inc., its Commercial Services business unit, which was sold on December 22, 2015 and its Interpace Pharma Solutions business which was sold on August 31, 2022. All significant intercompany balances and transactions have been eliminated in consolidation. Operating results for the three- and nine-month periods ended September 30, 2025 are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 2025.

3. LIQUIDITY

In October 2021, the Company entered into an $8.0 million term loan with BroadOak Fund V, L.P. (“BroadOak”) (the “Term Loan”), the proceeds of which were used to repay in full at their maturity the existing secured promissory notes with Ampersand Capital Partners (“Ampersand”) and 1315 Capital II, L.P. (“1315 Capital”). In May 2022, the Company entered into a Subordinated Convertible Promissory Note agreement with BroadOak for an additional $2.0 million (the “Convertible Note”), which was converted into a subordinated term loan and was added to the outstanding Term Loan balance. The Term Loan has been subsequently amended. See Note 13, Notes Payable, for more details. The balance of the Term Loan outstanding at September 30, 2025 was $1.0 million.

Further, along with many laboratories, the Company has been negatively impacted by Local Coverage Determination (“LCD”) L39365, which was finalized on April 24, 2025 by our local Medicare Administrative Contractor, Novitas. This LCD, which governs “Genetic Testing for Oncology,” resulted in the loss of Medicare coverage for one of our molecular tests, PancraGEN^®.

On January 9, 2025, the Company announced the new LCD established non-coverage for its PancraGEN^® test, and that it would stop offering the test and would not accept specimens for first-line fluid chemistry and PancraGEN^® testing after February 7, 2025. As a result of the established non-coverage for PancraGEN^®, the Company announced, in January 2025, that its board of directors had approved a restructuring and cost-savings plan to reduce operating costs and better align its workforce with the loss of PancraGEN^® (the “Restructuring Plan”).

On January 27, 2025, the Company announced that CMS had directed its Medicare Administrative Contractors, Novitas and First Coast Service Options, Inc., to delay implementation of the Genetic Testing for Oncology LCD (L39365), from February 23, 2025 until April 24, 2025. On April 24, 2025, the Company announced that the LCD would take effect immediately and that specimens for first-line fluid chemistry and PancraGEN^® testing will not be accepted by the Company after May 2, 2025. On April 25, 2025, the Company announced implementation of its previously approved Restructuring Plan.

Under the Restructuring Plan, the Company reduced its workforce and impacted employees received severance benefits. The Company incurred severance and related costs of $0.7 million for the nine months ended September 30, 2025.

For the nine months ended September 30, 2025, the Company had operating income from continuing operations of $2.5 million. As of September 30, 2025, the Company had cash and cash equivalents of $1.4 million, total current assets of $9.1 million and current liabilities of $5.9 million. As of November 7, 2025, the Company had approximately $2.1 million of cash and cash equivalents.

The Company intends to meet its ongoing capital needs by using its available cash, as well as through targeted margin improvement; collection of accounts receivable; containment of costs; and the potential use of other financing options and other strategic alternatives.

The Company continues to explore various strategic alternatives, dilutive and non-dilutive sources of funding, including equity and debt financings, strategic alliances, business development and other sources in order to provide additional liquidity. With the delisting of its common stock, par value $0.01 per share (“Common Stock”), from Nasdaq in February 2021, the Company’s ability to raise additional capital on terms acceptable to it has been adversely impacted. There can be no assurance that the Company will be successful in obtaining such funding on terms acceptable to it.

Even with the loss of reimbursement coverage of PancraGEN^®, as of the date of this filing, the Company anticipates that current cash and cash equivalents and forecasted cash receipts will be sufficient to meet its anticipated cash requirements through the next twelve months from the date of the filing of this report.

4. DISCONTINUED OPERATIONS

Liabilities classified as discontinued operations as of both September 30, 2025 and December 31, 2024 consists of accrued expenses which are liabilities related to the former Commercial Services business unit.

The table below presents the significant components of its former discontinued operations results included within loss from discontinued operations, net of tax in the condensed consolidated statements of operations for the three and nine-months ended September 30, 2025 and 2024.

	2025			2024			2025			2024
	For The Three Months Ended						For The Nine Months Ended
	September 30,						September 30,
	2025			2024			2025			2024

Revenue, net	$	-		$	-		$	-		$	-

Loss from discontinued operations		-			-			-			-
Income tax expense		100			82			314			260
Loss from discontinued operations, net of tax	$	(100	)	$	(82	)	$	(314	)	$	(260	)

There was no cash flow activity from discontinued operations for the nine months ended September 30, 2025 or September 30, 2024. There was no depreciation and amortization expense for the three or nine months ended September 30, 2025 and September 30, 2024, respectively, in discontinued operations.

5. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Accounting Estimates

The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts of assets and liabilities reported and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Management’s estimates are based on historical experience, facts and circumstances available at the time, and various other assumptions that are believed to be reasonable under the circumstances. Significant estimates include accounting for valuation allowances related to deferred income taxes, allowances for credit losses, revenue recognition, and unrecognized tax benefits. The Company periodically reviews these matters and reflects changes in estimates in earnings as appropriate. Actual results could materially differ from those estimates.

Revenue Recognition

We derive our revenues from the performance of proprietary assays or tests. The Company’s performance obligation is fulfilled upon the completion, review and release of test results to the customer. We subsequently bill third-party payers or direct-bill payers for the tests performed. Under Accounting Standards Codification 606, revenue is recognized based on the estimated transaction price or net realizable value, which is determined based on historical collection rates by each payer category for each proprietary test offered by the Company. To the extent the transaction price includes variable consideration, for all third party and direct-bill payers and proprietary tests, we estimate the amount of variable consideration that should be included in the transaction price using the expected value method based on historical experience.

We regularly review the ultimate amounts received from the third-party and direct-bill payers and related estimated reimbursement rates and adjust the net realizable values (“NRVs”) and related contractual allowances accordingly. If actual collections and related NRVs vary significantly from our estimates, we will adjust the estimates of contractual allowances, which affects net revenue in the period such variances become known.

Financing and Payment

For non-Medicare claims, our payment terms vary by payer category. Payment terms for direct-payers in our clinical services are typically thirty days. Commercial third-party-payers are required to respond to a claim within a time period established by their respective state regulations, generally between thirty to sixty days. However, payment for commercial third-party claims may be subject to a denial and appeal process, which could take up to two years in some instances where multiple appeals are submitted. The Company generally appeals all denials from commercial third-party payers. We bill Medicare directly for tests performed for Medicare patients and must accept Medicare’s fee schedule for the covered tests as payment in full.

Costs to Obtain or Fulfill a Customer Contract

Sales commissions are expensed in the period in which they have been earned. These costs are recorded in sales and marketing expense in the condensed consolidated statements of operations.

Accounts Receivable

The Company’s accounts receivable represent unconditional rights to consideration and are generated using its clinical services. The Company’s clinical services are fulfilled upon completion of the test, review and release of the test results. In conjunction with fulfilling these services, the Company bills the third-party payer or direct-bill payer. Contractual adjustments represent the difference between the list prices and the reimbursement rates set by third-party payers, including Medicare, commercial payers, and amounts billed to direct-bill payers. Specific accounts may be written off after several appeals, which in some cases may take longer than twelve months.

Leases

The Company determines if an arrangement contains a lease in whole or in part at the inception of the contract. Right-of-use (“ROU”) assets represent the Company’s right to use an underlying asset for the lease term while lease liabilities represent our obligation to make lease payments arising from the lease. All leases with terms greater than twelve months result in the recognition of a ROU asset and a liability at the lease commencement date based on the present value of the lease payments over the lease term. Unless a lease provides all of the information required to determine the implicit interest rate, we use our incremental borrowing rate based on the information available at the commencement date in determining the present value of the lease payments. We use the implicit interest rate in the lease when readily determinable.

Our lease terms include all non-cancelable periods and may include options to extend (or to not terminate) the lease when it is reasonably certain that we will exercise that option. Leases with terms of twelve months or less at the commencement date are expensed on a straight-line basis over the lease term and do not result in the recognition of an asset or liability. See Note 7, Leases.

Other Current Assets

Other current assets consisted of the following as of September 30, 2025 and December 31, 2024:

SCHEDULE OF OTHER CURRENT ASSETS

	September 30, 2025		December 31, 2024
Lab supplies	$	1,104	$	1,211
Prepaid expenses		584		535
Other		53		22
Total other current assets	$	1,741	$	1,768

The Company recorded an asset impairment charge of approximately $0.2 million for the nine months ended September 30, 2025. The charge related to lab supplies that were no longer useful as a result of the loss of PancraGEN reimbursement in April 2025.

Income Taxes

The One Big Beautiful Bill Act (the “OBBBA”), enacted on July 4, 2025, includes several corporate tax provisions relevant to U.S. businesses. Included in this legislation are provisions that allow for the immediate expensing of domestic research and development expenses, extensions of bonus depreciation, and modifications to the international tax regimes. The provisions in the legislation are generally effective beginning in 2026. The Company is continuing to evaluate the impact of these provisions on its financial statements, but the OBBBA did not have a material impact on its income tax provision for the three and nine months ended September 30, 2025.

Basic and Diluted Net Income (Loss) per Share

A reconciliation of the number of shares of common stock, par value $0.01 per share, used in the calculation of basic and diluted income (loss) per share for the three- and nine-month periods ended September 30, 2025 and 2024 is as follows:


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2025		2024		2025		2024
Basic weighted average number of common shares		4,425		4,393		4,423		4,380
Potential dilutive effect of stock-based awards		3		30		3		24
Dilutive effect of preferred stock		23,267		-		23,267		-
Diluted weighted average number of common shares		27,695		4,423		27,693		4,404

For the three- and nine-month periods ended September 30, 2025 and 2024, the following outstanding stock-based awards were excluded from the computation of the effect of dilutive securities on income (loss) per share for the following periods as they would have been anti-dilutive (rounded to thousands):


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2025		2024		2025		2024
Options		246		288		246		288
Restricted stock units (RSUs)		133		145		133		145
Anti-dilutive securities		379		433		379		433

6. FAIR VALUE MEASUREMENTS

Cash and cash equivalents, accounts receivable and accounts payable approximate fair value due to their relative short-term nature. The Company’s financial liabilities reflected at fair value in the condensed consolidated financial statements include note payable. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. In determining fair value, the Company uses various methods including market, income and cost approaches. Based on these approaches, the Company often utilizes certain assumptions that market participants would use in pricing the asset or liability, including assumptions about risk and/or the risks inherent in the inputs to the valuation technique. These inputs can be readily observable, market-corroborated, or generally unobservable inputs. The Company utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs. Based upon observable inputs used in the valuation techniques, the Company is required to provide information according to the fair value hierarchy. The fair value hierarchy ranks the quality and reliability of the information used to determine fair values into three broad levels as follows:

	Level 1:	Valuations for assets and liabilities traded in active markets from readily available pricing sources for market transactions involving identical assets or liabilities.

	Level 2:	Valuations for assets and liabilities traded in less active dealer or broker markets. Valuations are obtained from third-party pricing services for identical or similar assets or liabilities.

	Level 3:	Valuations incorporate certain assumptions and projections in determining the fair value assigned to such assets or liabilities.

In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. 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 asset or liability. The valuation methodologies used for the Company’s financial instruments measured on a recurring basis at fair value, including the general classification of such instruments pursuant to the valuation hierarchy, are set forth in the tables below:

	As of September 30, 2025				Fair Value Measurements
	Carrying		Fair		As of September 30, 2025
	Amount		Value		Level 1		Level 2		Level 3

Liabilities:
Note payable:
Term loan		1,000		977		-		-		977
	$	1,000	$	977	$	-	$	-	$	977

	As of December 31, 2024				Fair Value Measurements
	Carrying		Fair		As of December 31, 2024
	Amount		Value		Level 1		Level 2		Level 3
Liabilities:
Note payable:
Term Loan	$	4,400	$	4,290	$	-	$	-	$	4,290
	$	4,400	$	4,290	$	-	$	-	$	4,290

In connection with the Term Loan, the Company records the loan at fair value. The fair value of the loan is determined by a probability-weighted approach regarding the loan’s change in control feature. See Note 13, Notes Payable, for more details. The fair value measurement is based on the estimated probability of a change in control and thus represents a Level 3 measurement.

A roll forward of the carrying value of the Term Loan to September 30, 2025 is as follows :

	December 31, 2024		Payments			Accretion/Interest Accrued		Adjustment to Fair Value/Mark to Market		September 30, 2025

Term Loan	$	4,290	$	(3,400	)	$	-	$	87	$	977

	$	4,290	$	(3,400	)	$	-	$	87	$	977

Certain of the Company’s non-financial assets are measured at fair value on a nonrecurring basis when there is an indicator of impairment and recorded at fair value only when an impairment charge is recognized.

7. LEASES

The table below presents the lease-related assets and liabilities recorded in the Condensed Consolidated Balance Sheet:

	Classification on the Balance Sheet	September 30, 2025		December 31, 2024

Assets
Operating lease assets	Operating lease right of use assets		1,320		1,613
Total lease assets		$	1,320	$	1,613

Liabilities
Current
Operating lease liabilities	Other accrued expenses		419		383
Total current lease liabilities		$	419	$	383
Noncurrent
Operating lease liabilities	Operating lease liabilities, net of current portion		864		1,183
Total long-term lease liabilities			864		1,183
Total lease liabilities		$	1,283	$	1,566

The weighted average remaining lease term for the Company’s operating lease was 2.75 years as of September 30, 2025 and the weighted average discount rate for that lease was 12.0%. Total operating lease expense from continuing operations under these agreements for the three months ended September 30, 2025 and 2024 was approximately $0.1 million and $0.2 million, respectively, and for the nine months ended September 30, 2025 and 2024 was approximately $0.4 million and $0.5 million, respectively. Total cash paid under these agreements for the nine months ended September 30, 2025 and 2024 was approximately $0.4 million and $0.5 million, respectively. The Company’s operating lease expenses are recorded within “Cost of revenue” and “General and administrative expenses.”

The table below reconciles the cash flows to the lease liabilities recorded on the Company’s Condensed Consolidated Balance Sheet as of September 30, 2025:

	Operating Leases
2025 - remaining three months	$	137
2026		550
2027		550
2028		275
Total minimum lease payments		1,512
Less: amount of lease payments representing effects of discounting		229
Present value of future minimum lease payments		1,283
Less: current obligations under leases		419
Long-term lease obligations	$	864

8. COMMITMENTS AND CONTINGENCIES

Litigation

From time to time, the Company may become involved in various lawsuits and legal proceedings which arise in the ordinary course of business. When the Company is aware of a claim or potential claim, it assesses the likelihood of any loss or exposure. If it is probable that a loss will result and the amount of the loss can be reasonably estimated, the Company will record a liability for the loss. In addition to the estimated loss, the recorded liability includes probable and estimable legal costs associated with the claim or potential claim. Litigation is subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harm the Company’s business. There is no pending litigation involving the Company at this time.

Due to the nature of the businesses in which the Company is engaged, it is subject to certain risks. Such risks include, among others, risk of liability for personal injury or death to persons using products or services that the Company promotes or commercializes. There can be no assurance that substantial claims or liabilities will not arise in the future due to the nature of the Company’s business activities. There is also the risk of employment-related litigation and other litigation in the ordinary course of business.

The Company could also be held liable for errors and omissions of its employees in connection with the services it performs that are outside the scope of any indemnity or insurance policy. The Company could be materially adversely affected if it were required to pay damages or incur defense costs in connection with a claim that is outside the scope of an indemnification agreement; if the indemnity, although applicable, is not performed in accordance with its terms; or if the Company’s liability exceeds the amount of applicable insurance or indemnity.

9. OTHER ACCRUED EXPENSES

Other accrued expenses consisted of the following as of September 30, 2025 and December 31, 2024:

SCHEDULE OF OTHER ACCRUED EXPENSES

	September 30, 2025		December 31, 2024
Operating lease liability	$	419	$	383
Accrued sales and marketing		28		22
Accrued lab costs		48		173
Accrued professional fees		304

SEC Form 10-Q filed by Interpace Biosciences, Inc.