PRECISION OPTICS CORPORATION, INC. 10-Q

Table of Contents

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

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

For the quarterly period ended December 31, 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: 001-10647

PRECISION OPTICS CORPORATION, INC.

(Exact name of registrant as specified in its charter)

Massachusetts	04-2795294
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

22 East Broadway, Gardner, Massachusetts 01440-3338

(Address of principal executive offices) (Zip Code)

(978) 630-1800

(Registrants 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, $0.01 par value	POCI	Nasdaq

Securities registered pursuant to Section 12(g) of the Act: None.

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 by Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

The number of shares outstanding of the issuer’s common stock, par value $0.01 per share, at February 12, 2026 was 7,720,229 shares.

PRECISION OPTICS CORPORATION, INC.

Table of Contents

	Page

PART I FINANCIAL INFORMATION	3

Item 1. Financial Statements	3
Balance Sheets at December 31, 2025 and June 30, 2025	3
Statements of Operations for the Three and Six Months Ended December 31, 2025 and 2024	4
Statements of Stockholders’ Equity for the Three and Six Months Ended December 31, 2025 and 2024	5
Statements of Cash Flows for the Six Months Ended December 31, 2025 and 2024	6
Notes to Financial Statements	7
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	14
Item 3. Quantitative and Qualitative Disclosures About Market Risk	19
Item 4. Controls and Procedures	19

PART II OTHER INFORMATION	20

Item 1. Legal Proceedings	20
Item 1A. Risk Factors	20
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	20
Item 3. Defaults Upon Senior Securities	20
Item 4. Mine Safety Disclosures	20
Item 5. Other Information	20
Item 6. Exhibits	21

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements.

PRECISION OPTICS CORPORATION, INC.

BALANCE SHEETS

(UNAUDITED)


	December 31,			June 30,
	2025			2025
ASSETS
Current Assets:
Cash and cash equivalents	$	881,486		$	1,773,735
Accounts receivable, net of allowance for credit losses of $99,258 at December 31, 2025 and $80,192 at June 30, 2025		4,871,494			4,336,730
Inventories, net		4,264,049			3,562,112
Prepaid expenses		404,448			385,390
Total current assets		10,421,477			10,057,967

Fixed Assets:
Machinery and equipment		3,429,689			3,385,958
Leasehold improvements		1,273,875			871,356
Furniture and fixtures		604,473			538,428
Total fixed assets		5,308,037			4,795,742
Less—accumulated depreciation and amortization		4,318,690			4,261,950
Net fixed assets		989,347			533,792

Operating lease right-to-use asset		2,440,552			141,825
Patents, net		219,967			232,493
Goodwill		8,824,210			8,824,210
Total other assets		11,484,729			9,198,528
TOTAL ASSETS	$	22,895,553		$	19,790,287

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current Liabilities:
Current portion of capital lease obligation	$	9,268		$	27,368
Current maturities of long-term debt		577,898			577,898
Accounts payable		6,044,688			2,909,100
Contract liabilities		1,976,816			1,821,929
Accrued compensation and other		1,128,356			764,004
Current portion of operating lease liability		213,734			50,995
Total current liabilities		9,950,760			6,151,294

Long-term debt, net of current maturities		1,000,255			1,289,205
Operating lease liability, net of current portion		2,614,804			90,954
Total liabilities		13,565,819			7,531,453

Stockholders’ Equity:
Common stock, $0.01 par value: 50,000,000 shares authorized; issued and outstanding – 7,720,229 shares at December 31, 2025 and 7,714,701 at June 30, 2025		77,202			77,147
Additional paid-in capital		69,640,983			69,152,317
Accumulated deficit		(60,388,451	)		(56,970,630	)
Total stockholders’ equity		9,329,734			12,258,834

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	22,895,553		$	19,790,287

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

PRECISION OPTICS CORPORATION, INC.

STATEMENTS OF OPERATIONS

FOR THE THREE AND SIX MONTHS ENDED

DECEMBER 31, 2025 AND 2024

(UNAUDITED)


	Three Months Ended December 31,						Six Months Ended December 31,
	2025			2024			2025			2024
Revenues	$	7,367,837		$	4,526,907		$	14,048,660		$	8,723,960

Cost of Goods Sold		7,163,177			3,456,965			12,897,642			6,536,688
Gross Profit		204,660			1,069,942			1,151,018			2,187,272

Research and Development Expenses		249,574			317,747			561,414			718,406

Selling, General and Administrative Expenses		1,697,415			1,662,216			3,927,188			3,625,828

Total Operating Expenses		1,946,989			1,979,963			4,488,602			4,344,234

Operating Income (Loss)		(1,742,329	)		(910,021	)		(3,337,584	)		(2,156,962	)

Interest Expense		(38,462	)		(59,660	)		(80,237	)		(123,966	)

Net Income (Loss)	$	(1,780,791	)	$	(969,681	)	$	(3,417,821	)	$	(2,280,928	)

Income (Loss) Per Share:
Basic and Fully Diluted	$	(0.23	)	$	(0.15	)	$	(0.44	)	$	(0.36	)

Weighted Average Common Shares Outstanding:
Basic and Fully Diluted		7,714,759			6,350,403			7,714,730			6,283,516

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

PRECISION OPTICS CORPORATION, INC.

STATEMENTS OF STOCKHOLDERS’ EQUITY

FOR THE THREE AND SIX MONTHS ENDED

DECEMBER 31, 2025 AND 2024

(UNAUDITED)


	Six Month Period Ended December 31, 2025
	Number of Shares		Common Stock		Additional Paid-in Capital		Accumulated Deficit			Total Stockholders’ Equity
Balance, July 1, 2025		7,714,701	$	77,147	$	69,152,317	$	(56,970,630	)	$	12,258,834
Stock-based compensation		–		–		301,639		–			301,639
Net loss		–		–		–		(1,637,030	)		(1,637,030	)
Balance, September 30, 2025		7,714,701		77,147		69,453,956		(58,607,660	)		10,923,443
Stock-based compensation		–		–		162,082		–			162,082
Issuance of common stock for employee services		5,528		55		24,945		–			25,000
Net loss		–		–		–		(1,780,791	)		(1,780,791	)
Balance, December 31, 2025		7,720,229	$	77,202	$	69,640,983	$	(60,388,451	)	$	9,329,734


	Six Month Period Ended December 31, 2024
	Number of Shares		Common Stock		Additional Paid-in Capital		Accumulated Deficit			Total Stockholders’ Equity
Balance, July 1, 2024		6,073,939	$	60,739	$	61,197,433	$	(51,190,384	)	$	10,067,788
Issuance of common stock in registered direct offering		265,868		2,659		1,201,883		–			1,204,542
Proceeds from exercise of stock option		10,363		104		26,896		–			27,000
Stock-based compensation		–		–		149,364		–			149,364
Net loss		–		–		–		(1,311,247	)		(1,311,247	)
Balance, September 30, 2024		6,350,170		63,502		62,575,576		(52,501,631	)		10,137,447
Stock-based compensation		–		–		278,206		–			278,206
Issuance of common stock for consulting services		5,364		53		29,947		–			30,000
Net loss		–		–		–		(969,681	)		(969,681	)
Balance, December 31, 2024		6,355,534	$	63,555	$	62,883,729	$	(53,471,312	)	$	9,475,972

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

PRECISION OPTICS CORPORATION, INC.

STATEMENTS OF CASH FLOWS

FOR THE SIX MONTHS ENDED

DECember 31, 2025 AND 2024

(UNAUDITED)


	Six Months Ended December 31,
	2025			2024
Cash Flows from Operating Activities:
Net Loss	$	(3,417,821	)	$	(2,280,928	)
Adjustments to reconcile net loss to net cash used in operating activities -
Depreciation and amortization		139,346			97,486
Stock-based compensation expense		488,721			457,570
Non-cash interest expense		9,216			8,918
Non-cash operating lease expense		169,112			–
Loss on disposal of fixed assets		34,506			–
Changes in operating assets and liabilities -
Accounts receivable, net		(534,764	)		39,096
Inventories, net		(701,937	)		(979,727	)
Prepaid expenses		(19,058	)		24,323
Accounts payable		3,135,588			1,340,791
Contract liabilities		154,887			245,583
Accrued compensation and other		364,352			(58,543	)
Net cash used in operating activities		(177,852	)		(1,105,431	)

Cash Flows from Investing Activities:
Purchases of fixed assets		(401,073	)		(54,170	)
Proceeds from sale of fixed assets		3,000			–
Additional patent costs		(58	)		(5,915	)
Net cash used in investing activities		(398,131	)		(60,085	)

Cash Flows from Financing Activities:
Payments of capital lease obligations		(18,100	)		(22,590	)
Payments of long-term debt		(298,166	)		(121,273	)
Payment of debt modification costs		–			(15,000	)
Payment on revolving line of credit		–			(100,000	)
Proceeds from registered direct sale of common stock, net		–			1,204,542
Gross proceeds from the exercise of stock options		–			27,000
Net cash provided by (used in) financing activities		(316,266	)		972,679

Net decrease in cash and cash equivalents		(892,249	)		(192,837	)
Cash and cash equivalents, beginning of period		1,773,735			405,278

Cash and cash equivalents, end of period	$	881,486		$	212,441

Supplemental disclosure of cash flow information:
Operating right-of-use assets obtained in exchange for operating lease liabilities	$	2,632,584		$	–
Lease improvements financed by landlord	$	218,750		$	–
Issuance of common stock for employee services	$	25,000		$	–

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

PRECISION OPTICS CORPORATION, INC.

NOTES TO INTERIM FINANCIAL STATEMENTS (UNAUDITED)

1.	SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Principles of Consolidation and Operations

These financial statements have been prepared by the Company, without audit, and reflect normal recurring adjustments which, in the opinion of management, are necessary for a fair statement of the results of the first six months of the Company’s fiscal year 2026. These financial statements do not include all disclosures associated with annual financial statements and, accordingly, should be read in conjunction with footnotes contained in the Company’s financial statements for the fiscal year ended June 30, 2025, together with the Report of Independent Registered Public Accounting Firm filed under cover of the Company’s 2025 Annual Report on Form 10-K, filed with the Securities and Exchange Commission on September 29, 2025, as amended by Amendment No. 1 on Form 10-K/A filed with the Securities and Exchange Commission on October 28, 2025.

Going Concern and Liquidity

These financial statements have been prepared on a going concern basis, which assumes the Company will continue to realize its assets and discharge its liabilities in the normal course of business. The continuation of the Company as a going concern is dependent upon the ability of the Company to obtain necessary equity financing to continue operations and the attainment of profitable operations. Management anticipates that its cash on hand of $0.9 million as of December 31, 2025 is insufficient to fund its planned operations for a period of at least one year from when these consolidated financial statements are issued. These factors raise substantial doubt regarding the Company's ability to continue as a going concern. These unaudited financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

During fiscal 2026 through the issuance date, the Company has taken the following actions, and implemented the following plans, to improve its operational and financial performance and enhance its liquidity and financial condition:

	·	Through new leadership and improved accountability and process disciplines implemented throughout the organization, improve manufacturing yields and increase production throughput;
	·	Renegotiated pricing and added tariff reimbursement with some of its major manufacturing customers
	·	Improved the quality and depth of its product development pipeline;
	·	Planned increased utilization of engineering resources and the capabilities of its MicroOptics Laboratory;
	·	Planned launch of several maturing development projects into manufacturing in the coming twelve months; and
	·	Planned reductions in its cost structure to better align operating expenses with revenue expectations, including headcount rationalization and optimization.

The Company’s ability to meet future anticipated liquidity needs over the next year beyond the issuance date will largely depend on its ability to execute its operational strategy, generate positive cash inflows from operations, maximize its borrowing capacity and secure additional capital.

The Company intends to seek additional funding through one or more of the following: equity offerings, debt financings, government funding, and delay of planned cash outlays. However, the Company’s ability to do so, and on favorable terms, may be affected by general economic, financial and other factors which are beyond its control. There can be no assurance that such events or a combination thereof can be achieved or achieved on favorable terms.

Use of Estimates

The preparation of these financial statements requires the Company to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates.

Income (Loss) Per Share

Basic income (loss) per share is computed by dividing net income or net loss by the weighted average number of shares of common stock outstanding during the period. Diluted income (loss) per share is computed by dividing net income (loss) by the weighted average number of shares of common stock outstanding during the period, plus the number of potentially dilutive securities outstanding during the period such as stock options. For the three months and six months ended December 31, 2025, potentially dilutive securities outstanding have been excluded from the computations of weighted-average shares outstanding because such securities have an antidilutive impact due to the net loss reported during those periods. The number of shares issuable upon the exercise of outstanding stock options that were excluded from the computation of fully dilutive weighted average shares outstanding was approximately 1,727,069 for the three and six months ended December 31, 2025.

The following is the calculation of income (loss) per share for the three months and six months ended December 31, 2025 and 2024:

Schedule of income (loss) per share
	Three Months Ended December 31,						Six Months Ended December 31,
	2025			2024			2025			2024
Net Income (Loss) Basic and Fully Diluted	$	(1,780,791	)	$	(969,681	)	$	(3,417,821	)	$	(2,280,928	)

Weighted Average Shares Outstanding
Basic and Fully Diluted		7,714,759			6,350,403			7,714,730			6,283,516

Income (Loss) Per Share – Basic and Fully Diluted	$	(0.23	)	$	(0.15	)	$	(0.44	)	$	(0.36	)

Significant Customers and Concentration of Credit Risk

Financial instruments that subject the Company to credit risk consist primarily of cash equivalents and trade accounts receivable. The Company places its investments with highly rated financial institutions. The Company has not experienced any losses on these investments to date.

The allowance for credit losses was $99,258 at December 31, 2025, and $121,901 at December 31, 2024.

Schedule of allowance for credit losses
	Six Months Ended December 31,
	2025			2024
Allowance for credit losses, beginning of period	$	80,192		$	118,872
Change in the provision for expected credit losses		21,289			10,668
Writeoffs charged against the allowance		(2,223	)		(7,639	)
Allowance for credit losses, end of period	$	99,258		$	121,901

During the six months ended December 31, 2025, the Company increased the credit loss reserve by approximately $19,000. Management believes the allowance for credit losses, which is established based upon review of specific account balances and historical experience, is adequate at December 31, 2025.

Income Taxes

Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.

In assessing the likelihood of utilization of existing deferred tax assets, management has considered the historical results of operations and the current operating environment. Based on this evaluation, a full valuation reserve has been provided for the deferred tax assets.

Segment Reporting

Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision maker, or decision-making group, in making decisions about how to allocate resources and assess performance. The Company’s chief decision-maker is its Chief Executive Officer. To date, the Company has viewed its operations and manages its business as principally one segment. The chief operating decision maker assesses performance for the single reporting segment and decides how to allocate resources based on revenues, gross profit, and net income (loss) that also is reported on the income statement as revenues, gross profit, and net income (loss). The measure of segment assets is reported on the balance sheet as total assets.

Goodwill and Patents

Long-lived assets such as goodwill and patents are capitalized when acquired and reviewed for impairment whenever events or changes in circumstances indicate that the book value of the asset may not be recoverable. Impairment of the carrying value of long-lived assets such as goodwill and patents would be indicated if the best estimate of future undiscounted cash flows expected to be generated by the asset grouping is less than its carrying value. If an impairment is indicated, any loss is measured as the difference between estimated fair value and carrying value and is recognized in operating income or loss. Assets to be disposed of are reported at the lower of the carrying amount or fair value less costs to sell. No such impairments of goodwill or patents have been estimated by management as of December 31, 2025. Amortization expense for the six months ended December 31, 2025 and 2024 was $12,584 and $0, respectively.

2.	INVENTORIES

Inventories are stated at the lower of cost (first-in, first-out) or market and consist of the following:

Schedule of inventories
	December 31, 2025		June 30, 2025
Raw Materials	$	2,340,008	$	1,799,624
Work-In-Progress		616,391		598,720
Finished Goods		1,307,650		1,163,768
Total Inventories (Net)	$	4,264,049	$	3,562,112

The inventory reserve was $311,781 and $272,894 at December 31, 2025 and June 2025, respectively.

3.	BANK FINANCING ACTIVITIES

Bank Line of Credit

On October 4, 2021, the Company entered into a Loan Agreement with Main Street Bank of Marlborough, Massachusetts (the “Lender”), which provided for a $2,600,000 Term Loan and a $250,000 Revolving Line of Credit Loan Facility (the “Revolver”), which was increased to $500,000 effective May 17, 2022, and $1,250,000 effective June 2, 2023. Borrowings under the Revolver are limited by the borrowing base comprised of a percentage of accounts receivable and inventory and secured by all assets of the Company. Borrowings under the Revolver bear interest payable monthly at the prime lending rate plus 1.5% per annum and shall not be less than 4.75% per annum. Borrowings under the Revolver are due upon demand. There were no borrowings under the Revolver at December 31, 2025.

The Company’s Loan Agreement with the Lender contains a minimum annual debt service coverage ratio covenant of 1.2x. The Company did not meet this annual debt service coverage ratio for the fiscal year ended June 30, 2024. The Company’s Lender agreed to waive compliance with such debt service ratio covenant for the period ending June 30, 2024. In addition to such waiver, the Lender and the Company entered into an amendment dated September 30, 2024 to that certain Term Loan dated October 4, 2021, as amended and that certain Promissory Note dated June 2, 2023 (collectively, the “Notes”) which amendments provided for a six-month period of interest only payments from October 15, 2024 through March 15, 2025 for the Notes. The Company commenced payments of principal and interest under the Notes beginning with the payments due on April 15, 2025, with a new amortization schedule for the remaining term for such Notes through their maturity date. On February 14, 2025, the Lender agreed to waive compliance with the annual debt service coverage ratio covenant for the fiscal year ending June 30, 2025, subject to a $30,000 waiver fee and the completion of an equity raise of at least $4,500,000 by February 24, 2025, which the Company satisfied on February 21, 2025. Any future advances are contingent on the Company achieving a minimum Debt Service Coverage ratio of 1.20x based on quarterly testing, which the Company was not in compliance with as of December 31, 2025.

There were no other changes to or modifications to the Loan Agreement or the Notes.

Long-Term Debt

Long-term debt consists of the following at December 31, 2025:

Schedule of long-term debt
	Amount
Term Loan Note payable to Main Street Bank with monthly principal payments of $35,271, excluding six months in Fiscal 2025, plus interest at a fixed rate of 7.0% per annum. Secured by all assets of the Company, and subject to certain periodic reporting to the bank and other conditions including an annual minimum EBITDA plus stock-based compensation to debt service coverage ratio of 1.20:1 commencing with the fiscal year ending June 30, 2023. The Term Loan Note matures on October 15, 2028.	$	1,199,225

Permanent Working Capital Loan payable to Main Street Bank with monthly principal payments of $14,423, excluding six months in Fiscal 2025, plus interest at a fixed rate of 8.625% per annum. Secured by all assets of the Company, and subject to certain periodic reporting to the bank and other conditions including an annual minimum EBITDA plus stock-based compensation to debt service coverage ratio of 1.20:1 commencing with the fiscal year ending June 30, 2023. The Permanent Working Capital Loan matures on June 15, 2028.		432,692

Less current maturities		(577,898	)
Less debt issuance and modification costs, net of accumulated amortization of $38,973		(53,764	)
Long-term debt, net of current maturities and debt issuance costs	$	1,000,255

At December 31, 2025 principal payments due on the Term Loan Notes payable are as follows:


Fiscal Year Ending June 30:
2026	$	298,166
2027		596,333
2028		596,333
2029		141,085
Total long-term debt	$	1,631,917

4.	LEASE OBLIGATIONS

In March 2021 the Company entered into a five-year capital lease in the amount of $161,977 and in January 2020, the Company entered into a five-year capital lease for $47,750, both for manufacturing equipment. The net book value of fixed assets under capital lease obligations as of December 31, 2025 is $9,268.

On July 1, 2019 the Company entered into a three-year operating lease for its facility in El Paso, Texas, and in February 2022 the Company entered into an extension of the lease for an additional three years through June 2025. In May 2025, this lease was extended for an additional three years through May 2028. Remaining minimum lease payments at December 31, 2025 total $123,419. Total lease costs including base rent and common area expenses was $39,329 and $33,281 during the six months ending December 31, 2025 and 2024, respectively. Included in the accompanying balance sheet at December 31, 2025 is a right-of-use asset of $110,371 and current and long-term operating lease liabilities of $42,138 and $69,103, respectively.

On May 15, 2025 the Company entered into a eight-year lease in South Portland, Maine with two five-year extension options. Remaining minimum lease payments at December 31, 2025 total $1,112,388. Total lease costs including base rent and common area expenses was $81,653 during the six months ending December 31, 2025. The amount of variable lease payments is immaterial. Included in the accompanying balance sheet at December 31, 2025 is a right-of-use asset of $544,254 and current and long-term operating lease liabilities of $66,374 and $743,173, respectively. The applicable discount rate utilized for this lease at commencement was 9.0%.

On June 2, 2025 the Company entered into a seven-year operating lease in Littleton, Massachusetts with two five-year extension options.

Remaining minimum lease payments at December 31, 2025 total $2,588,721. Total lease costs including base rent and common area expenses was $121,823 during the six months ending December 31, 2025. The amount of variable lease payments is immaterial. Included in the accompanying balance sheet at December 31, 2025 is a right-of-use asset of $1,785,927 and current and long-term operating lease liabilities of $105,222 and $1,802,528, respectively. The applicable discount rate utilized for this lease at commencement was 9.0%.

At December 31, 2025 future minimum lease payments under the capital lease and operating lease obligations are as follows:


Fiscal Year Ending June 30:	Capital Leases		Operating Leases
2026	$	9,335	$	180,716
2027		–		555,198
2028		–		567,327
2029		–		535,107
2030		–		551,240
2031 and thereafter		–		1,434,940
Total Minimum Payments		9,335		3,824,528
Less: amount representing interest		67		995,990
Present value of minimum lease payments		9,268		2,828,538
Less: current portion		9,268		213,734
Future minimum long-term lease liability	$	–	$	2,614,804

The Company’s four facilities in Gardner, Massachusetts, which are used for offices, production and storage spaces are leased primarily on a tenant-at-will basis. Rent expense on these operating leases was $101,918 and $102,540 for the six months ended December 31, 2025, and 2024, respectively.

5.	STOCK-BASED COMPENSATION

Stock Options

The following table summarizes stock-based compensation expense for the three and six months ended December 31, 2025 and 2024:


	Three Months Ended December 31,				Six Months Ended December 31,
	2025		2024		2025		2024
Cost of Goods Sold	$	29,330	$	39,226	$	60,400	$	78,452
Selling, General and Administrative		132,751		268,980		403,321		379,118
Stock Based Compensation Expense	$	162,081	$	308,206	$	463,721	$	457,570

No compensation has been capitalized because such amounts would have been immaterial. There was $25,000 in common stock issued for employee services in the quarter ended December 31, 2025.

The following tables summarize stock option activity for the six months ended December 31, 2025:

Schedule of stock option activity
	Options Outstanding
	Number of Shares			Weighted Average Exercise Price		Weighted Average Contractual Life
Outstanding at June 30, 2025		1,623,576		$	4.85	7.15 years
Granted		180,000			4.33	–
Cancelled, forfeited, or expired		(76,507	)		5.28	–
Outstanding at December 31, 2025		1,727,069		$	4.78	6.92 years

The aggregate intrinsic value of the Company’s in-the-money outstanding and exercisable options as of December 31, 2025 were both $485,181.

6.	REVENUE RECOGNITION

The Company determines revenue recognition for arrangements that we determine are within the scope of Accounting Standards Codification Topic 606, “Revenue from Contracts with Customers,” or ASC 606, by performing the following five steps: (i) identify the contract with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when, or as, the Company satisfies the performance obligations. At contract inception, once the contract is determined to be within the scope of ASC 606, the Company assesses the goods or services promised within the contract and determine those that are performance obligations and assesses whether each promised good or service is distinct based on the contract.

The Company disaggregates revenues by product and service types as it believes best depicts how the nature, amount, timing and uncertainty of revenues and cash flows are affected by economic factors. Revenues are comprised of the following for the three and six months ended December 31, 2025 and 2024:

Schedule of disaggregation of revenues
	Three Months Ended December 31,				Six Months Ended December 31,
	2025		2024		2025		2024
Engineering Design Services	$	962,439	$	1,399,264	$	1,618,540	$	3,013,165
Systems Manufacturing		5,187,032		1,656,137		10,053,738		2,881,315
Micro Optics Lab		171,328		429,773		271,704		857,930
Ross Optical Industries		1,047,038		1,041,733		2,104,678		1,971,550
Total Revenues	$	7,367,837	$	4,526,907	$	14,048,660	$	8,723,960

Other selling costs to obtain and fulfill contracts are expensed as incurred due to the short-term nature of a majority of contracts. The Company extends terms of payment to its customers based on commercially reasonable terms for the markets of its customers, while also considering their credit quality. Shipping and handling costs charged to customers are included in revenue.

Revenue recognition policies for each of the four product and service types appear below.

Engineering Design Services

The Company enters into contractual agreements with its customers, including design services agreements, statements of work and receive purchase orders for development projects. These agreements provide costs on an estimated basis for the services the Company has agreed to provide. Engineering Design Services are rendered on a time and materials basis. The Company recognizes revenue as customers are invoiced for the actual engineering services provided in the period. Revenue is also recognized on materials purchased for development projects at the time of receipt. Engineering Design Services are provided on a best-efforts basis; no warranty is provided as there is no guarantee that the work will result in the attainment of the customer’s project objectives. The Company may obtain customer deposits in advance of rendering engineering design services. Customer deposits are treated as contractual liabilities until the terms of customer agreements are satisfied and are not a component of revenue.

Systems Manufacturing, Micro Optics Laboratory, Ross Optical Industries

The Company provides fixed price quotations to its customers and requires purchase orders for items manufactured and distributed through the Systems Manufacturing, Micro Optics Laboratory and Ross Optical Industries business units. Revenue is recognized at the time title passes to the customer based on the Company’s review of the customer contract, generally at the time of shipment from the Company’s facilities. Occasionally the Company may enter into “bill and hold” contractual arrangements where title is held by its customers while goods are stored at the Company’s facilities for the customer’s convenience.

Contract Assets and Liabilities

The nature of the Company’s products and services does not generally give rise to contract assets as it typically does not incur costs to fulfill a contract before a product or service is provided to a customer. The Company’s costs to obtain contracts are typically in the form of sales commissions paid to employees. The Company has elected to expense sales commissions associated with obtaining a contract as incurred as the amortization period is generally less than one year. These costs have been recorded in selling, general and administrative expenses. As of December 31, 2025, there were no contract assets recorded in the Company’s Balance Sheets.

The Company’s contract liabilities arise from unearned revenue received from customers at inception of contracts or where the timing of billing for services precedes satisfaction of our performance obligations. The Company generally satisfies performance obligations within one year from the contract’s inception date.

Contract liabilities, which are recorded in the Company’s Balance Sheets, and unearned revenue are comprised of the following:

Schedule of contract liabilities
	Three Months Ended December 31,						Six Months Ended December 31,
	2025			2024			2025			2024
Contract liabilities, beginning of period	$	2,030,772		$	1,106,546		$	1,821,929		$	1,172,350
Unearned revenue received from customers		269,333			361,711			1,400,248			833,328
Revenue recognized		(323,289	)		(50,324	)		(1,245,361	)		(587,745	)
Contract liabilities, end of period	$	1,976,816		$	1,417,933		$	1,976,816		$	1,417,933

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

The following discussion of our financial condition and results of operations should be read in conjunction with the unaudited condensed financial statements and notes to those statements included elsewhere in this Quarterly Report on Form 10-Q for the quarter ended December 31, 2025 and with our audited financial statements for the year ended June 30, 2025 included in our Annual Report on Form 10-K, filed with the Securities and Exchange Commission on September 29, 2025, as amended by Amendment No. 1 on Form 10-K/A filed with the Securities and Exchange Commission on October 28, 2025 (our “Annual Report on Form 10-K”) .

This Quarterly Report on Form 10-Q contains forward-looking statements. When used in this report, the words anticipate, suggest, estimate, plan, project, continue, ongoing, potential, expect, predict, believe, intend, may, will, should, could, would and similar expressions are intended to identify forward-looking statements. You should not place undue reliance on these forward-looking statements. Our actual results could differ materially from those anticipated in the forward-looking statements for many reasons, including the risks described in this report, the risks described in our Annual Report on Form 10-K for the year ended June 30, 2025, as amended by Amendment No. 1 on Form 10-K/A and other reports we file with the Securities and Exchange Commission. Although we believe the expectations reflected in the forward-looking statements are reasonable, they relate only to events as of the date on which the statements are made. We do not intend to update any of the forward-looking statements after the date of this report to conform these statements to actual results or to changes in our expectations, except as required by law.

Overview

We have been a developer and manufacturer of advanced optical instruments since 1982, and we operate primarily in two key market segments: medical devices and advanced defense/aerospace products. Within our proprietary optical and imaging technology, our unique custom designs, expert manufacturing capabilities, and advanced engineering and development capabilities have generated traditional endoscopes and endocouplers, digital imaging endoscopes using CMOS sensor technology, some designed and manufactured for single-use, as well as other, more advanced, custom imaging and illumination products for our customers’ use in minimally invasive surgical procedures. We design and manufacture ultra-high precision endoscopes and very small Microprecision lenses, assemblies and complete medical devices to meet the surgical community’s continuing demand for smaller, disposable, and more enhanced imaging systems for minimally invasive surgery. We also apply our unique technologies to applications in the Defense / Aerospace markets including applications supporting satellite network communications.

To support these two critical market categories, our business operations are conducted in four areas: systems manufacturing, engineering and product development, Ross Optical components and assemblies, and our micro-optics laboratory. Our systems manufacturing operations assemble and manufacture components and systems for both medical device and advanced aerospace customers who choose to outsource these services based on our ability to handle high complexity components, specific optical technologies, micro-optical assemblies and other advanced manufacturing challenges. Our engineering and product development team assesses specific customer product needs, designs devices to solve those needs, and creates manufacturing processes that enable higher volume production of these devices and assemblies that can then be executed by our manufacturing operations group.

Effective June 1, 2019, we acquired the operating assets of Ross Optical Industries, Inc. of El Paso, Texas. This acquisition expanded our optics components and assemblies’ business. As Ross Optical Industries we operate as a supplier of custom optical components and assemblies for military and defense, medical and various other industrial applications. All products sold by us under the Ross Optical name include a custom or catalog optic, which is sourced through our extensive domestic and worldwide network of optical fabrication suppliers. Most systems make use of optical lenses, prisms, mirrors and windows and range from individual optical components to complex mechano-optical assemblies. Products often include thin film optical coatings applied using our in-house coating department.

Effective October 1, 2021, we acquired the operating assets of Lighthouse Imaging, LLC of Windham, Maine,which expanded our electrical engineering capabilities in the development of end-to-end medical visualization devices. The acquisition represented a vertical integration of our established product development capabilities with a team with extensive experience developing visualization systems that we believe provides our customers with single-source value-added development services and product offerings. The operations of Lighthouse Imaging have been integrated with other operations of the company, which continue under the POC brand, so that the company now operates with single systems manufacturing and engineering departments, each of which includes historical POC and Lighthouse Imaging resources.

Our website is www.poci.com. The information contained on our website does not constitute part of this report.

General

This management’s discussion and analysis of financial condition and results of operations is based upon our unaudited financial statements, which have been prepared without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses and related disclosures. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions and any such differences may be material.

Critical Accounting Policies and Estimates

There have been no significant changes in our critical accounting policies as disclosed in the Notes to our Financial Statements contained in our Annual Report on Form 10-K for the year ended June 30, 2025 filed with the Securities and Exchange Commission on September 29, 2025, as amended by Amendment No. 1 on Form 10-K/A filed with the Securities and Exchange Commission on October 28, 2025.

Results of Operations

Revenue

	Three Months Ended December 31,
	2025		Percent of Sales		2024		Percent of Sales		Increase (Decrease)			Percent Change
Engineering Design Services		962,439		13.1		1,399,264		30.9		(436,825	)		(31.2	)
Systems Manufacturing		5,187,032		70.4		1,656,137		36.6		3,530,895			213.2
MicroOptics Lab		171,328		2.3		429,773		9.5		(258,445	)		(60.1	)
Ross Optical Industries		1,047,038		14.2		1,041,733		23.0		5,305			0.5
Total Revenues		7,367,837		100.0		4,526,907		100.0		2,840,930			62.8

	Six Months Ended December 31,
	2025		Percent of Sales		2024		Percent of Sales		Increase (Decrease)			Percent Change
Engineering Design Services		1,618,540		11.5		3,013,165		34.6		(1,394,625	)		(46.3	)
Systems Manufacturing		10,053,738		71.6		2,881,315		33.0		7,172,423			248.9
MicroOptics Lab		271,704		1.9		857,930		9.8		(586,226	)		(68.3	)
Ross Optical Industries		2,104,678		15.0		1,971,550		22.6		133,128			6.8
Total Revenues		14,048,660		100.0		8,723,960		100.0		5,324,700			61.0

Total revenues for the quarter ending December 31, 2025 were $7,367,837, as compared to $4,526,907 for the same period in the prior year, an increase of $2,840,930 or 62.8% and for the six months ended December 31, 2025 was $14,048,660 as compared to $8,723,960 for the same period in the prior year, an increase of $5,324,700, or 61.0%.

Revenue from Engineering Design Services decreased 31.2% and 46.3% during the three and six-month periods ending December 31, 2025 from the same periods in the prior fiscal year. During the quarter ending December 31, 2025 revenue decreases in the engineering category resulted from decreased demand for services. Engineering revenue was lower due to the completion of product development engagements in the prior year and delayed revenue opportunities within the product development pipeline for the current quarter.

Revenue from Systems Manufacturing increased 213.2% and 248.9% during the three and six-month periods ending December 31, 2025 from the same periods in the prior fiscal year, due primarily to significant increases in customer demand and the resultant scaling of manufacturing capabilities.

Revenue from the MicroOptics Lab decreased 60.1% and 68.3% during the three and six-month periods ending December 31, 2025 from the same periods in the prior fiscal year, primarily due to delays in receiving new production orders from our defense customer.

Revenue from Ross Optical Industries increased 0.5% and 6.8% during the three and six-month periods ending December 31, 2025 from the same periods in the prior fiscal year. We believe the increase is attributable to the inability of our customers to continue to postpone deliveries that had previously been delayed due to the introduction of new tariffs and the resultant uncertainty.

Gross Profit

Gross margin decreased to 2.8% during the quarter ending December 31, 2025, compared to 23.6% for the quarter ending December 31, 2024. Gross profit decreased to $204,660 during the three months ending December 31, 2025, compared to $1,069,942 for the three months ended December 31, 2024. Within Systems Manufacturing, low gross margins were primarily driven by yield losses within our cystoscope single-use manufacturing line, startup yield issues for a second customer’s single-use manufacturing line, and under-absorption of manufacturing overhead. Costs associated with Engineering Design Services are primarily attributed to our engineering workforce, which we have chosen to keep in place as we focus on increasing revenue, leading to negative margins for the period. Similarly, the MicroOptics Lab workforce requires specialized training, and we have also experienced negative margins resulting from the reorder delays discussed above but have chosen to keep the workforce in place.

Gross margin decreased to 8.2% during the six months ending December 31, 2025, compared to 25.1% for the six months ending December 31, 2024. Gross profit decreased to $1,151,018 during the six months ending December 31, 2025, compared to $2,187,272 for the six months ending December 31, 2024.

Research & Development

R&D expenses decreased $68,173 to $249,574 during the quarter ending December 31, 2025, compared to $317,747 during the quarter ending December 31, 2024. R&D expenses decreased $156,992 to $561,414 during the six months ending December 31, 2025, compared to $718,406 during the six months ended December 31, 2024. R&D expenses for the applicable periods represent employee-related expenses to support product improvements, the development of new technologies and standardized approaches to address the opportunities for an evolving single-use medical device environment.

Selling, General and Administrative Expenses

SG&A expenses increased $35,199, or 2.1% to $1,697,415 during the three months ending December 31, 2025, compared to $1,662,216 during the three months ending December 31, 2024. SG&A expenses increased $301,360, or 8.3% to $3,927,188 during the six months ending December 31, 2025, compared to $3,625,828 during the six months ended December 31, 2024. The increase in SG&A for the six-month period was primarily due to increased stock compensation, executive severance, and consulting expenses.

Liquidity and Capital Resources

These financial statements have been prepared on a going concern basis, which assumes the Company will continue to realize its assets and discharge its liabilities in the normal course of business. The continuation of the Company as a going concern is dependent upon the ability of the Company to obtain necessary equity financing to continue operations and the attainment of profitable operations. Management anticipates that its cash on hand of $0.9 million as of December 31, 2025 is insufficient to fund its planned operations for a period of at least one year from when these financial statements are issued. These factors raise substantial doubt regarding the Company's ability to continue as a going concern. These unaudited condensed consolidated financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

During fiscal 2026 through the date of the filing of this Quarterly Report on Form 10-Q, we have taken the following actions, and implemented the following plans, to improve our operational and financial performance and enhance our liquidity and financial condition:

Through new leadership and improved accountability and process discipline implemented throughout the organization, improved manufacturing yields and increased production throughput;

Renegotiated pricing and added tariff reimbursement with some of our major manufacturing customers

Improved the quality and depth of our product development pipeline;

Planned increased utilization of engineering resources and the capabilities of our MicroOptics Laboratory;

Planned launch of several maturing development projects into manufacturing in the coming twelve months.; and

Planned reductions in our cost structure to better align operating expenses with revenue expectations, including headcount rationalization and optimization.

Our ability to meet future anticipated liquidity needs over the next year beyond the date of this Quarterly Report on Form 10-Q will largely depend on our ability to execute our operational strategy, generate positive cash inflows from operations, maximize our borrowing capacity and secure additional capital.

The Company intends to seek in the near term additional funding through one or more of the following: equity offerings, debt financings, government funding, and delay of planned cash outlays. However, our ability to do so, and on favorable terms, may be affected by general economic, financial and other factors which are beyond our control. There can be no assurance that any such additional capital raises, management of planned cash outlays, or a combination thereof can be achieved or achieved on favorable terms.

Net Cash Used in Operating Activities

During the six months ending December 31, 2025, net cash used in operating activities totaled $177,852 as compared to $1,105,431 during the six months ending December 31, 2024. The decrease in net cash used in operating activities was primarily due to increased accounts payable and accrued expenses during the six months ending December 31, 2025, partially offset by the increase in net loss during such period.

Net Cash Used in Investing Activities

During the six months ending December 31, 2025, net cash used in investing activities was $398,131, consisting of purchases of property and equipment and patent costs. During the six months ending December 31, 2024, net cash used in investing activities was $60,085 consisting of purchases of property and equipment and patent costs.

Net Cash Provided by Financing Activities

During the six months ending December 31, 2025, we made payments of $316,266 on term notes and capital leases. During the six months ending December 31, 2024, we made payments of $158,863 on term notes and capital leases and repaid $100,000 on our revolving line of credit. We raised a net of $1,204,542 through the issuance of new shares in a registered direct common stock offering and $27,000 in proceeds from stock option exercises.

Indebtedness

On October 4, 2021, the Company entered into a Loan Agreement with Main Street Bank of Marlborough, Massachusetts (the “Lender”), which provided for a $2,600,000 Term Loan and a $250,000 Revolving Line of Credit Loan Facility (the “Revolver”), which was increased to $500,000 effective May 17, 2022, and $1,250,000 effective June 2, 2023. Borrowings under the Revolver are limited by the borrowing base comprised of a percentage of accounts receivable and inventory and secured by all assets of the Company. Borrowings under the Revolver will bear interest payable monthly at the prime lending rate plus 1.5% per annum and shall not be less than 4.75% per annum. Borrowings under the Revolver are due upon demand. There were no borrowings under the Revolver at December 31, 2025.

The Company’s Loan Agreement with the Lender contains a minimum annual debt service coverage ratio covenant of 1.2x. As the Company did not meet this annual debt service coverage ratio for the fiscal year ended June 30, 2024, the Company’s Lender agreed to waive compliance with such debt service ratio covenant for the period ending June 30, 2024. In addition to such waiver, the Lender and the Company entered into an amendment dated September 30, 2024 to that certain Term Loan dated October 4, 2021, as amended and that certain Promissory Note dated June 2, 2023 (collectively, the “Notes”) which amendments provided for a six month period of interest only payments from October 15, 2024 through March 15, 2025 for the Notes. The Company commenced payments of principal and interest under the Notes beginning with the payments due on April 15, 2025, with a new amortization schedule for the remaining term for such Notes through their maturity date. On February 14, 2025, the lender agreed to waive compliance with the annual debt service coverage ratio covenant for the fiscal year ending June 30, 2025, subject to a $30,000 waiver fee and the completion of an equity raise of at least $4,500,000 by February 24, 2025, which the Company satisfied on February 21, 2025. Any future advances are contingent on the Company achieving a minimum Debt Service Coverage ratio of 1.20x based on quarterly testing which the company was not in compliance with as of December 31, 2025. There were no other changes to or modifications to the Loan Agreement or the Notes.

Capital equipment expenditures and additional patent costs during the six months ended December 31, 2025 and in the same period in the prior year were $401,131 and $60,085, respectively.

Contractual cash commitments for the fiscal periods subsequent to December 31, 2025, are summarized as follows:

	Fiscal 2026		Thereafter		Total
Capital lease for equipment, including interest	$	9,335	$	–	$	9,335

Minimum operating lease payments	$	180,716	$	3,643,812	$	3,824,528

We have contractual cash commitments related to open purchase orders as of December 31, 2025 of approximately $7,070,000.

Off-Balance Sheet Arrangements

We currently have no off-balance sheet arrangements that have, or are reasonably likely to have, a current or future material effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

As a smaller reporting company, as defined by Rule 12b-2 of the Exchange Act and in Item 10(f)(1) of Regulation S-K, we are electing scaled disclosure reporting obligations and therefore are not required to provide the information requested by this Item.

Item 4. Controls and Procedures.

Management’s Evaluation of Disclosure Controls and Procedures

Our Chief Executive Officer, who is our principal executive officer, and our Chief Financial Officer, who is our principal financial officer, evaluated the effectiveness of our disclosure controls and procedures as of the end of the period covered by this Quarterly Report on Form 10-Q. Based on this evaluation, our Chief Executive Officer and our Chief Financial Officer have concluded that our disclosure controls and procedures, including internal control over financial reporting, were effective as of December 31, 2025, to ensure the information we are required to disclose in reports that we file or submit under the Securities Exchange Act of 1934, as amended (i) is recorded, processed, summarized, and reported within the time periods specified in Securities and Exchange Commission rules and forms, and (ii) is accumulated and communicated to our management, including our Chief Executive Officer and our Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure. Our disclosure controls and procedures are intended to be designed to provide reasonable assurance that such information is accumulated and communicated to our management.

Changes in Internal Control over Financial Reporting

There has been no change in our internal control over financial reporting that occurred during the period covered by this Quarterly Report on Form 10-Q that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II. OTHER INFORMATION

Item 1. Legal Proceedings.

Our Company, on occasion, may be involved in legal matters arising in the ordinary course of our business. While management believes that such matters are currently insignificant, matters arising in the ordinary course of business for which we are or could become involved in litigation may have a material adverse effect on our business, financial condition or results of operations. We are not aware of any pending or threatened litigation against us or our officers and directors in their capacity as such that could have a material impact on our operations or finances.

Item 1A. Risk Factors.

For information regarding factors that could affect our results of operations, financial condition and liquidity, refer to the section entitled “Risk Factors” in Part I, Item 1A in our annual report on Form 10-K for the year ended June 30, 2025, as amended on Form 10-K/A. There have been no material changes from the risk factors previously disclosed in our annual report on Form 10-K for the year ended June 30, 2025 as filed with the SEC on September 29, 2025, as amended by Amendment No. 1 on Form 10-K/A filed with the Securities and Exchange Commission on October 28, 2025.

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

None.

Item 3. Defaults Upon Senior Securities.

Not applicable.

Item 4. Mine Safety Disclosures.

Not applicable.

Item 5. Other Information.

During the period covered by this Quarterly Report on Form 10-Q, no director or officer of the Company adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408(a) of Regulation S-K.

Item 6. Exhibits.

Exhibit		Description

10.1		Stock Option Agreement made effective as of October 1, 2025 by and between Precision Optics Corporation, Inc. and Joseph Traut (included as Exhibit 10.4 to the Registrant’s Quarterly Report on Form 10-Q filed November 13, 2025, and incorporated herein by reference).

31.1*		Certification of the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2*		Certification of the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1*		Certification of Officers pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101.INS*		Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document)

101.SCH*		Inline XBRL Taxonomy Extension Schema Document

101.CAL*		Inline XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF*		Inline XBRL Taxonomy Extension Definition Linkbase Document

101.LAB*		Inline XBRL Taxonomy Extension Label Linkbase Document

101.PRE*		Inline XBRL Taxonomy Extension Presentation Linkbase Document

104*		Cover Page Interactive Data File (embedded within the Inline XBRL document)

Filed Herewith.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	PRECISION OPTICS CORPORATION, INC.

Date: February 17, 2026	By:	/s/ Joseph N. Forkey
		Joseph N. Forkey
		Chief Executive Officer (Principal Executive Officer)


Date: February 17, 2026	By:	/s/ Wayne M. Coll
		Wayne M. Coll
		Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer)

SEC Form 10-Q filed by Precision Optics Corporation Inc.