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 June 30, 2025

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

COMMISSION FILE NUMBER: 001-40254

MOVANO INC.

(Exact name of registrant as specified in its charter)

Delaware		82-4233771
(State of incorporation)		(I.R.S. Employer Identification No.)

6800 Koll Center Parkway, Pleasanton, CA 94566

(Address of principal executive office) (Zip code)

(415) 651-3172

(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
Common Stock, par value $0.0001 per share		MOVE		The Nasdaq Stock Market LLC

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, 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 ☒

As of September 22, 2025, there were 8,349,080 shares of our common stock, par value $0.0001 per share, outstanding.

MOVANO INC.

FORM 10-Q

FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2025

INDEX

		PAGE
PART I – FINANCIAL INFORMATION		1

Item 1. Financial Statements		1

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations		20

Item 3. Quantitative and Qualitative Disclosure About Market Risk		28

Item 4. Controls and Procedures		28

PART II – OTHER INFORMATION		29

Item 1. Legal Proceedings		29

Item 1A. Risk Factors		29

Item 2. Recent Sales of Unregistered Securities; Use of Proceeds from Registered Securities		30

Item 3. Defaults Upon Senior Securities		30

Item 4. Mine Safety Disclosures		30

Item 5. Other Information		30

Item 6. Exhibits		31

SIGNATURES		32

EXHIBIT INDEX

PART I – FINANCIAL INFORMATION

Item 1. Financial Statements

Movano Inc.

Condensed Consolidated Balance Sheets

(in thousands, except share and per share data)

(Unaudited)

	June 30,			December 31,
	2025			2024

ASSETS
Current assets:
Cash and cash equivalents	$	2,109		$	7,902
Payroll tax credit, current portion		52			52
Vendor deposits		8			28
Inventory		2,479			2,046
Prepaid expenses and other current assets		238			362
Total current assets		4,886			10,390
Property and equipment, net		157			213
Right-of-use asset		509			600
Other assets		108			117
Total assets	$	5,660		$	11,320

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	2,791		$	2,016
Deferred revenue		5			36
Other current liabilities		831			1,393
Total current liabilities		3,627			3,445
Noncurrent liabilities:
Other noncurrent liabilities		396			520
Total noncurrent liabilities		396			520
Total liabilities		4,023			3,965

Commitments and contingencies (Note 10)

Stockholders’ equity:
Preferred stock, $0.0001 par value, 5,000,000 shares authorized at June 30, 2025 and December 31, 2024; no shares issued and outstanding at June 30, 2025 and December 31, 2024		—			—
Common stock, $0.0001 par value, 500,000,000 shares authorized at June 30, 2025 and December 31, 2024; 8,301,204 and 6,840,291 shares issued and outstanding at June 30, 2025 and December 31, 2024, respectively		10			10
Additional paid-in capital		158,137			155,452
Accumulated deficit		(156,510	)		(148,107	)
Total stockholders’ equity		1,637			7,355
Total liabilities and stockholders’ equity	$	5,660		$	11,320

See accompanying notes to condensed consolidated financial statements.

Movano Inc.

Condensed Consolidated Statements of Operations and Comprehensive Loss

(in thousands, except share and per share data)

(Unaudited)

	Three Months Ended June 30,						Six Months Ended June 30,
	2025			2024			2025			2024

Revenue	$	103		$	—		$	309		$	852

COSTS AND EXPENSES:
Cost of revenue		362			380			1,004			1,595
Research and development		1,401			2,907			3,784			5,794
Sales, general and administrative		1,600			3,110			4,019			5,614
Total costs and expenses		3,363			6,397			8,807			13,003

Loss from operations		(3,260	)		(6,397	)		(8,498	)		(12,151	)

Other income (expense), net:
Interest and other income, net		35			207			95			241
Other income (expense), net		35			207			95			241

Net loss and total comprehensive loss	$	(3,225	)	$	(6,190	)	$	(8,403	)	$	(11,910	)

Net loss per share, basic and diluted	$	(0.41	)	$	(0.93	)	$	(1.13	)	$	(2.30	)

Weighted average shares used in computing net loss per share, basic and diluted		7,793,900			6,635,891			7,460,398			5,185,388

See accompanying notes to condensed consolidated financial statements.

Movano Inc.

Condensed Consolidated Statements of Stockholders’ Equity (Deficit)

(in thousands, except share data)

(Unaudited)

					Additional					Total
	Common Stock				Paid-In		Accumulated			Stockholders’
Three Months Ended June 30, 2024	Shares		Amount		Capital		Deficit			Equity
Balance at March 31, 2024		3,741,439	$	6	$	128,616	$	(130,100	)	$	(1,478	)
Stock-based compensation		—		—		1,544		—			1,544
Issuance of common stock in April 2024 sale		2,806,898		4		12,955		—			12,959
Issuance of pre-funded warrants in April 2024 sale		—		—		980		—			980
Issuance of common stock warrants in April 2024 sale		—		—		8,756		—			8,756
Issuance of common stock		45,561		—		185		—			185
Issuance of common stock upon exercise of options		2,667		—		15		—			15
Vesting of early exercised stock options		—		—		7		—			7
Net loss		—		—		—		(6,190	)		(6,190	)
Balance at June 30, 2024		6,596,565	$	10	$	153,058	$	(136,290	)	$	16,778

					Additional					Total
	Common Stock				Paid-In		Accumulated			Stockholders’
Six Months Ended June 30, 2024	Shares		Amount		Capital		Deficit			Equity
Balance at December 31, 2023		3,723,218	$	6	$	127,823	$	(124,380	)	$	3,449
Stock-based compensation		—		—		2,161		—			2,161
Issuance of common stock in April 2024 sale		2,806,898		4		12,955		—			12,959
Issuance of pre-funded warrants in April 2024 sale		—		—		980		—			980
Issuance of common stock warrants in April 2024 sale		—		—		8,756		—			8,756
Issuance of common stock		63,782		—		349		—			349
Issuance of common stock upon exercise of options		2,667		—		15		—			15
Vesting of early exercised stock options		—		—		19		—			19
Net loss		—		—		—		(11,910	)		(11,910	)
Balance at June 30, 2024		6,596,565	$	10	$	153,058	$	(136,290	)	$	16,778

					Additional					Total
	Common Stock				Paid-In		Accumulated			Stockholders’
Three Months Ended June 30, 2025	Shares		Amount		Capital		Deficit			Equity
Balance at March 31, 2025		7,036,475	$	10	$	156,509	$	(153,285	)	$	3,234
Stock-based compensation		—		—		780		—			780
Issuance of common stock		1,264,729		—		848		—			848
Net loss		—		—		—		(3,225	)		(3,225	)
Balance at June 30, 2025		8,301,204	$	10	$	158,137	$	(156,510	)	$	1,637

					Additional					Total
	Common Stock				Paid-In		Accumulated			Stockholders’
Six Months Ended June 30, 2025	Shares		Amount		Capital		Deficit			Equity
Balance at December 31, 2024		6,840,291	$	10	$	155,452	$	(148,107	)	$	7,355
Stock-based compensation		—		—		1,079		—			1,079
Issuance of common stock		1,460,913		—		1,606		—			1,606
Net loss		—		—		—		(8,403	)		(8,403	)
Balance at June 30, 2025		8,301,204	$	10	$	158,137	$	(156,510	)	$	1,637

See accompanying notes to condensed consolidated financial statements.

Movano Inc.

Condensed Consolidated Statements of Cash Flows

(in thousands)

(Unaudited)

	Six Months Ended June 30,
	2025			2024
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(8,403	)	$	(11,910	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		75			79
Stock-based compensation		1,079			2,161
Noncash lease expense		8			121
Changes in operating assets and liabilities:
Payroll tax credit		—			331
Inventory		(433	)		(676	)
Prepaid expenses, vendor deposits and other current assets		144			49
Other assets		(10	)		—
Accounts payable		775			(1,580	)
Deferred revenue		(31	)		(1,252	)
Other current and noncurrent liabilities		(603	)		374
Net cash used in operating activities		(7,399	)		(12,303	)

CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment		—			(6	)
Net cash used in investing activities		—			(6	)

CASH FLOWS FROM FINANCING ACTIVITIES:
Issuance of common stock, pre-funded warrants and common stock warrants in April 2024 sale, net of issuance costs		—			22,695
Issuance of common stock, net of issuance costs		1,606			349
Issuance of common stock upon exercise of stock options		—			15
Net cash provided by financing activities		1,606			23,059

Net increase/(decrease) in cash and cash equivalents		(5,793	)		10,750
Cash and cash equivalents at beginning of period		7,902			6,118
Cash and cash equivalents at end of period	$	2,109		$	16,868

NONCASH INVESTING AND FINANCING ACTIVITIES:
Vesting of common stock issued upon early exercise	$	—		$	19
Unpaid issuance costs recorded in accounts payable and other current liabilities	$	—		$	6
Issuance of common stock warrants in April 2024 sale	$	—		$	8,756
Right of use asset recorded for operating lease liability	$	—		$	544

See accompanying notes to condensed consolidated financial statements.

Movano Inc.

Notes to Condensed Consolidated Financial Statements

For the three and six months ended June 30, 2025 and 2024

(Unaudited)

Note 1 – Business Organization, Nature of Operations

Movano Inc., dba Movano Health (the “Company”, “Movano”, “Movano Health”, “we”, “us” or “our”) was incorporated in Delaware on January 30, 2018 as Maestro Sensors Inc. and changed its name to Movano Inc. on August 3, 2018. The Company is a technology company and is developing a platform to deliver purpose-driven healthcare solutions to bring medical-grade, high-quality data to the forefront of consumer health devices.

The Company’s solutions provide vital health information, including heart rate, heart rate variability (“HRV”), sleep, respiration rate, temperature, blood oxygen saturation (SpO₂), steps, and calories as well as glucose and blood pressure data, in a variety of form factors to meet individual style needs and give users actionable feedback to improve their quality of life.

On April 28, 2021, the Company established Movano Ireland Limited, organized under the laws of Ireland, as a wholly owned subsidiary of the Company. Operations and activity at the wholly owned subsidiary were not significant for the three and six months ended June 30, 2025 and 2024, respectively.

The Company has incurred losses from operations and has generated negative cash flows from operating activities since inception. The Company expects to continue to incur net losses for the foreseeable future as it continues the development of its technology. The Company’s ultimate success depends on the outcome of its research and development and commercialization activities, for which it expects to incur additional losses in the future. Through June 30, 2025, the Company has relied primarily on the proceeds from equity offerings to finance its operations.

Through June 30, 2025, the Company has received gross proceeds of approximately $9.3 million from an at-the-market issuance (ATM) program. The ATM program was terminated in May 2025 upon the expiration of the Company’s Registration Statement on Form S-3 (See Note 7). The Company expects to require additional financing to fund its future planned operations, including research and development and commercialization of its products. The Company will likely raise additional capital through the issuance of equity, borrowings, or strategic alliances with partner companies. However, if such financing is not available at adequate levels, the Company would need to reevaluate its operating plans.

Liquidity and Going Concern

The accompanying condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has incurred significant losses and has an accumulated deficit of $156.5 million as of June 30, 2025. The Company anticipates incurring additional losses until such time, if ever, that it can generate significant sales. The Company’s existence is dependent upon management’s ability to obtain additional funding sources and the Company believes that its cash and cash equivalents as of June 30, 2025 will not be sufficient to fund our projected operating requirements beyond 2025. These circumstances raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date that the financial statements are issued.

Adequate additional financing may not be available to the Company on acceptable terms, or at all. If the Company is unable to raise additional capital and/or enter into strategic alliances when needed or on attractive terms, it would be forced to delay, reduce, or eliminate its product or any commercialization efforts. There can be no assurance that the Company’s efforts will result in the resolution of the Company’s liquidity needs. The accompanying condensed consolidated financial statements do not include any adjustments that might result should the Company be unable to continue as a going concern.

Note 2 – Summary of Significant Accounting Policies

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiary and have been prepared in accordance with U.S. generally accepted accounting principles (GAAP) for interim financial information and in accordance with the instructions to Form 10-Q and Rule 8-01 of Regulation S-X. Accordingly, they do not include all the information and footnotes required by GAAP for complete financial statements. The unaudited condensed consolidated financial statements have been prepared on the same basis as the annual financial statements. In the opinion of management, the accompanying unaudited condensed consolidated financial statements reflect all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair presentation. Intercompany transactions are eliminated in the condensed consolidated financial statements. These financial statements should be read in conjunction with the audited financial statements and notes thereto for the preceding fiscal year contained in the Company’s Annual Report on Form 10-K filed on April 9, 2025 with the United States Securities and Exchange Commission (the “SEC”).

The results of operations for the three and six months ended June 30, 2025 are not necessarily indicative of the results to be expected for the year ending December 31, 2025. The condensed consolidated balance sheet as of December 31, 2024 has been derived from audited financial statements at that date but does not include all the information required by GAAP for complete financial statements.

Movano Inc.

Notes to Condensed Consolidated Financial Statements

For the three and six months ended June 30, 2025 and 2024

(Unaudited)

Use of Estimates

The preparation of condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements, and the reported amounts of revenues and expenses during the reporting periods.

Significant estimates and assumptions reflected in these condensed consolidated financial statements include but are not limited to the fair value of stock options and warrants, and income taxes. Estimates are periodically reviewed considering changes in circumstances, facts, and experience. Changes in estimates are recorded in the period in which they become known. Actual results could differ from those estimates or assumptions.

Segment Information

Operating segments are defined as components of an enterprise about which separate discrete information is available for evaluation by the chief operating decision maker, or decision-making group, in deciding how to allocate resources and in assessing performance. The Company views its operations and manages its business as a single operating and reportable segment. The Company’s chief operating decision maker (“CODM”), the Chief Executive Officer, allocates resources and assesses performance based upon consolidated financial information, which includes net loss and comprehensive loss as the reported measure of segment profit or loss. The CODM reviews and utilizes functional expenses (cost of revenue, research and development, and sales, general and administrative) at the consolidated level to manage the Company’s operations. The other segment item included in net loss and comprehensive loss is interest and other income, net which is reflected in the condensed consolidated statements of operations and comprehensive loss. Revenues from the sale of the Evie Ring have only been generated in the United States.

The following table is a summary of the significant expenses and consolidated net loss provided to the CODM:

	Three Months Ended June 30,						Six Months Ended June 30,
(in thousands)	2025			2024			2025			2024

Revenue	$	103		$	—		$	309		$	852
Less:
Cost of revenue ⁽¹⁾		362			357			1,003			1,561
Research and development ⁽¹⁾		1,115			2,269			3,403			4,972
Sales, general and administrative ⁽¹⁾		1,106			2,227			3,322			4,309
Other segment expenses ⁽²⁾		745			1,337			984			1,920
Consolidated net loss	$	(3,225	)	$	(6,190	)	$	(8,403	)	$	(11,910	)

	⁽¹⁾	Excludes stock-based compensation expense. The significant expense categories align with the information that is regularly provided to the CODM.

	⁽²⁾	Other segment expenses include stock-based compensation expense and interest and other expense, net.

Cash and Cash Equivalents

The Company invests its excess cash primarily in money market funds, commercial paper, and short-term debt securities. The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents.

Concentrations of Credit Risk and Off-Balance Sheet Risk

Cash and cash equivalents are financial instruments that are potentially subject to concentrations of credit risk. Substantially all cash and cash equivalents are held in United States financial institutions. Cash equivalents consist of interest-bearing money market accounts and institutional money market funds. The amounts deposited in the money market accounts exceed federally insured limits. Further, the Company has amounts in excess of federally insured limits as of June 30, 2025 at one financial institution that totaled approximately $0.1 million. The Company has not experienced any losses related to this account and believes the associated credit risk to be minimal due to the financial condition of the depository institutions in which those deposits are held.

The Company is dependent on third-party manufacturers to supply products for manufacturing as well as research and development activities. These programs could be adversely affected by a significant interruption in the supply of such materials.

The Company has no financial instruments with off-balance sheet risk of loss.

Movano Inc.

Notes to Condensed Consolidated Financial Statements

For the three and six months ended June 30, 2025 and 2024

(Unaudited)

Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets were primarily comprised of prepaid expenses and other current receivables.

Inventory

Inventory, which consists of raw materials and finished goods, is stated at the lower of cost or net realizable value. Cost comprises purchase price and incidental expenses incurred in bringing the inventory to its present location and condition. Cost is computed using the weighted-average cost method.

The Company writes down its inventory for estimated obsolescence or unmarketable inventory equal to the difference between the cost of inventory and the estimated net realizable value based upon assumptions about future demand and market conditions. If actual market conditions are less favorable than those projected by management, additional inventory write-downs may be required.

Software Development Costs

Costs related to software development are included in research and development expense until the point that technological feasibility is reached, which, for the Company’s product, will be shortly before the product is released to manufacturing. Once technological feasibility is reached, such costs are capitalized and amortized to cost of revenue over the estimated lives of the product. During the three and six months ended June 30, 2025 and 2024, no software development costs were capitalized, and no amortization was recognized.

Impairment of Long-Lived Assets

The Company reviews the impairment of long-lived assets whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. An impairment loss would be recognized when estimated future cash flows expected to result from the use of the asset and its eventual disposition is less than its carrying amount.

Revenue

The Company recognizes revenue from contracts with customers upon transfer of control of promised goods or services at the transaction price which reflects the consideration the Company expects to be entitled to receive in exchange for those goods or services. The transaction price is calculated as selling price net of variable consideration which may include estimates for future returns and sales incentives related to current period product revenue.

The Company generates revenue from the sale of Evie Rings, portable chargers, charging cables, ring sizers, and mobile applications. As part of the purchase, customers also receive customer support and future unspecified software updates. These items are collectively referred to as the Evie Ring Elements, each of which is distinct and a separate performance obligation. The Company recognizes revenue when control is transferred to the customer in an amount that reflects the net consideration to which the Company expects to be entitled.

In determining how revenue should be recognized, a five-step process is used which includes identifying the contract, identifying the distinct performance obligations, determining the transaction price, allocating the transaction price to each distinct performance obligation, and determining the timing of revenue recognition for each distinct performance obligation.

For each contract, the Company considers the obligation to transfer the Evie Ring Elements, each of which are distinct, to be separate performance obligations.

Transaction price for the Evie Ring Elements reflects the net consideration to which the Company expects to be entitled. Transaction price is based on the sales price. The Company includes an estimate of variable consideration in the calculation of the transaction price at the time of sale. Variable consideration primarily includes product return provisions. The Company classifies the product return provisions as liabilities in the condensed consolidated balance sheet.

Movano Inc.

Notes to Condensed Consolidated Financial Statements

For the three and six months ended June 30, 2025 and 2024

(Unaudited)

The adequacy of the estimates for the variable consideration is reviewed at each reporting date. If the actual amount of consideration differs from the estimates, the Company would adjust the estimates, impacting revenue in the period that such variances become known. If any of the judgments were to change, this change could cause a material increase or decrease in the amount of revenue reported in a particular period.

The Company allocates the transaction price to each performance obligation using the relative stand-alone selling price (“SSP”) for each distinct good or service in the contract. When available, the Company uses observable prices to determine SSP. When observable prices are not available, SSPs are established that reflect the Company’s best estimates of what the selling prices of the performance obligations would be if they were sold regularly on a stand-alone basis. The Company’s process for estimating SSPs without observable prices considers multiple factors that may vary depending upon the unique facts and circumstances related to each performance obligation including, where applicable, prices charged by the Company for similar offerings, market trends in the pricing for similar offerings, product-specific business objectives and the estimated cost to provide the performance obligation.

Revenue associated with the Evie Ring, portable charger, charging cable, ring sizer, and mobile application performance obligations is recognized upon delivery to customers. The performance obligation for the embedded right to receive, on a when-and-if-available basis, customer support and future unspecified software updates, is recognized to revenue on a straight-line basis over the estimated life of the product and is not material in the periods presented. The Company allocates revenue and any related discounts to these performance obligations based on their relative SSPs. Because the Company lacks observable prices for the undelivered performance obligations, the allocation of revenue is based on the Company’s estimated SSPs.

The Company records revenue from the sales of the Evie Ring Elements upon transfer of control of the distinct Evie Ring Elements to the customer. The Company typically determines transfer of control for the Evie Ring Elements based on when the product is delivered, or when the customer has obtained the significant risks and reward of ownership. The future unspecified software updates and customer support that the Company offers are separate performance obligations, and revenue is recognized over time on a ratable basis.

The sales of the Evie Ring Elements include an assurance warranty.

Contract balances represent amounts presented in the condensed consolidated balance sheets when the Company has transferred goods or services to the customer, or the customer has paid consideration to the Company under the contract. Customer payments are made up-front upon the purchase of products and services. The Company has no accounts receivable as of June 30, 2025 or December 31, 2024, respectively. There were no contract assets at June 30, 2025 or December 31, 2024.

The Company records a contract liability for deferred revenue when cash payments from customers are received prior to the transfer of control or satisfaction of the related performance obligations. Deferred revenue at June 30, 2025 and December 31, 2024 was $5,000 and $36,000, respectively. As of June 30, 2025, the Company expects 100% of total deferred revenue to be realized in less than a year.

The Company offers limited rights of return for a 60-day right of return, whereby customers may return the Evie Ring Elements. The Company’s estimate of future returns requires significant judgement. The Company estimates reserves based on data specific to each reporting period and historical trends to date. The estimate is adjusted each period for actual returns received. The returns reserve is recorded as a reduction of revenue and recognized in other current liabilities. As of June 30, 2025 and December 31, 2024, the balance of product return provisions included in other current liabilities is $43,000 and $0.1 million, respectively.

The Company collects sales taxes at the point of sale and remits the taxes to the proper state authorities. Sales tax is excluded from the measurement of the transaction price.

Shipping and handling costs are incurred as part of fulfillment activities with customers and are included as a component of cost of revenue.

Movano Inc.

Notes to Condensed Consolidated Financial Statements

For the three and six months ended June 30, 2025 and 2024

(Unaudited)

Costs of Revenue

Costs of revenue consists primarily of material costs, freight charges, purchasing and receiving costs, inspection costs, customer support, data hosting services and other costs, which are directly attributable to the production of the Company’s product. Write-down of inventory to lower of cost or net realizable value is also recorded in cost of goods sold.

Advertising Costs

The Company expenses advertising costs as they are incurred. Advertising expenses were $0.3 million and $0.2 million for the six months ended June 30, 2025 and 2024, respectively and $38,000 and $25,000 for the three months ended June 30, 2025 and 2024, respectively. These costs are included in “Sales, general and administrative expenses” in the accompanying condensed consolidated statements of operations and comprehensive loss.

Stock-Based Compensation

The Company measures equity classified stock-based awards granted to employees, directors, and nonemployees based on the estimated fair value on the date of grant and recognizes compensation expense of those awards on a straight-line basis over the requisite service period, which is generally the vesting period of the respective award. The fair value of each stock option grant is estimated on the date of grant using the Black-Scholes option pricing model. This valuation model for stock-based compensation expense requires the Company to make assumptions and judgments about the variables used in the calculation including the expected term, the volatility of the Company’s common stock, and an assumed risk-free interest rate. The Company accounts for forfeitures as they occur.

Income Taxes

The Company accounts for income taxes using the asset and liability method. Under this method, deferred tax assets and liabilities are determined based on differences between the financial statement and tax basis of assets and liabilities and net operating loss and credit carryforwards using enacted tax rates in effect for the year in which the differences are expected to reverse. Valuation allowances are established when necessary to reduce deferred tax assets to the amounts expected to be realized. As the Company maintained a full valuation allowance against its deferred tax assets, the changes resulted in no provision or benefit from income taxes during the three and six months ended June 30, 2025 and 2024, respectively.

The Company accounts for unrecognized tax benefits using a more-likely-than-not threshold for financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. The Company establishes a liability for tax-related uncertainties based on estimates of whether, and the extent to which, additional taxes will be due. The Company records an income tax liability, if any, for the difference between the benefit recognized and measured and the tax position taken or expected to be taken on the Company’s tax returns. To the extent that the assessment of such tax positions changes, the change in estimate is recorded in the period in which the determination is made. The liability is adjusted considering changing facts and circumstances, such as the outcome of a tax audit. The provision for income taxes includes the impact of liability provisions and changes to the liability that are considered appropriate. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs.

Movano Inc.

Notes to Condensed Consolidated Financial Statements

For the three and six months ended June 30, 2025 and 2024

(Unaudited)

For interim periods, the Company estimates its annual effective income tax rate and applies the estimated rate to the year-to-date income or loss before income taxes. The Company computes the tax provision or benefit related to items reported separately and recognizes the items net of their related tax effect in the interim periods in which they occur. The Company recognizes the effect of changes in enacted tax laws or rates in the interim periods in which the changes occur. The Company does not have any expected income taxes in any jurisdiction as of June 30, 2025.

Net Loss per Share

Basic net loss per share is calculated by dividing the net loss by the weighted average number of shares of common stock outstanding during the period, without consideration for common stock equivalents. The weighted average number of common shares used in calculating basic and diluted net loss per share includes the weighted-average pre-funded common stock warrants outstanding during the period as they are exercisable at any time for nominal cash consideration. Diluted net loss per share is the same as basic net loss per share, since the effects of potentially dilutive securities are antidilutive.

Recent Accounting Pronouncements

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which expands annual and interim disclosure requirements for reportable segments, primarily through enhanced disclosures about significant segment expenses. The Company adopted this accounting standard on December 31, 2024. The adoption has no impact on our financial statements nor resulted in incremental disclosures within the footnotes to the consolidated financial statements. See Note 2 under “Segment Information” for additional information

In November 2024, the FASB issued 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosure (Subtopic 220-40): Disaggregation of Income Statement Expenses, which requires disaggregated disclosures, in the notes to the financial statements, of certain categories of expenses that are included in expense line items on the face of the income statement. The pronouncement’s amendments are effective for public business entities for annual periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. Early adoption is permitted. The Company will adopt this guidance on a prospective basis in the annual financial statements for the year ending December 31, 2025. As it only requires additional disclosures, this pronouncement will not have a significant impact on the Company’s consolidated financial condition or results of operations.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Subtopic 740): Improvements to Income Tax Disclosures, which includes amendments that further enhance income tax disclosures, primarily through standardization and disaggregation of rate reconciliation categories and income taxes paid by jurisdiction. The pronouncement’s amendments are effective for public business entities for annual periods beginning after December 15, 2024. The Company will adopt this guidance on a prospective basis in the annual financial statements for the year ending December 31, 2025. As it only requires additional disclosures, this pronouncement will not have a significant impact on the Company’s consolidated financial condition or results of operations.

Note 3 – FAIR VALUE MEASUREMENTS

Financial assets and liabilities are recorded at fair value. The Company uses a three-level hierarchy, which prioritizes, within the measurement of fair value, the use of market-based information over entity-specific information for fair value measurements based on the nature of inputs used in the valuation of an asset or liability as of the measurement date. Fair value focuses on an exit price and is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The inputs or methodology used for valuing financial instruments are not necessarily an indication of the risk associated with investing in those financial instruments.

Movano Inc.

Notes to Condensed Consolidated Financial Statements

For the three and six months ended June 30, 2025 and 2024

(Unaudited)

A three-tier fair value hierarchy is used to prioritize the inputs in measuring fair value as follows:

Level 1 –

Quoted prices in active markets for identical assets or liabilities.

Level 2 –

Quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, or other inputs that are observable, either directly or indirectly.

Level 3 –

Significant unobservable inputs that cannot be corroborated by market data.

The asset’s or liability’s fair value measurement level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. The Company’s Level 1 financial assets are money market funds whose fair values are based on quoted market prices. The carrying amounts of prepaid expenses and other current assets, payroll tax credit, vendor deposits, inventory, accounts payable, deferred revenue, and other current liabilities approximate fair value due to the short-term nature of these instruments.

The following tables provide a summary of the assets and liabilities that are measured at fair value on a recurring basis as of June 30, 2025 and December 31, 2024 (in thousands):

Fair Value Measurements

June 30, 2025

Fair Value

Level 1

Level 2

Level 3

SEC Form 10-Q filed by Movano Inc.