snes-20240331

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

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

For the quarterly period ended March 31, 2024

o 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: 001-37941

SENESTECH, INC.

(Exact name of registrant as specified in its charter)


Delaware						20-2079805
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)

23460 N 19th Ave, Suite 110
Phoenix, AZ						85027
(Address of principal executive offices)						(Zip Code)

(928) 779-4143

(Registrant’s telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

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, $0.001 par value

SNES

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 x No o

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 x No o

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	o	Accelerated filer	o
Non-accelerated filer	x	Smaller reporting company	x
Emerging growth company	o

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. o

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

The number of shares of common stock outstanding as of May 7, 2024: 5,144,632


	PART I — FINANCIAL INFORMATION
Item 1.	Financial Statements (unaudited)	1
	Condensed Balance Sheets	1
	Condensed Statements of Operations and Comprehensive Loss	2
	Condensed Statements of Cash Flows	3
	Notes to Condensed Financial Statements	4
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	12
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	19
Item 4.	Controls and Procedures	19
	PART II — OTHER INFORMATION
Item 1.	L egal Proceedings	20
Item 1A.	Risk Factors	20
Item 5.	Other Information	20
Item 6.	Exhibits	20
	SIGNATURES	21


	March 31, 2024		December 31, 2023
ASSETS	(unaudited)
Current assets:
Cash and cash equivalents	$	3,562	$	5,395
Accounts receivable, net	161		95
Prepaid expenses	346		388
Inventory, net	874		795
Total current assets	4,943		6,673
Right to use assets, operating leases	154		210
Property and equipment, net	353		388
Other noncurrent assets	22		22
Total assets	$	5,472	$	7,293
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	116	$	150
Accrued expenses	391		368
Current portion of operating lease liability	159		217
Current portion of note payable	34		33
Deferred revenue	15		18
Total current liabilities	715		786

Note payable, less current portion	147		156
Total liabilities	862		942
Commitments and contingencies (see notes)
Stockholders’ equity:
Preferred stock, $0.001 par value, 10,000,000 shares authorized, none issued and outstanding	—		—
Common stock, $0.001 par value, 100,000,000 shares authorized, 5,144,632 shares and 5,140,024 shares issued and outstanding as of March 31, 2024 and December 31, 2023, respectively	5		5
Additional paid-in capital	136,350		136,259
Accumulated deficit	(131,745)		(129,913)
Total stockholders’ equity	4,610		6,351
Total liabilities and stockholders’ equity	$	5,472	$	7,293


	Three Months Ended March 31,
	2024		2023
Revenues, net	$	415	$	233
Cost of sales	280		141
Gross profit	135		92
Operating expenses:
Research and development	370		387
Selling, general and administrative	1,608		1,750
Total operating expenses	1,978		2,137
Loss from operations	(1,843)		(2,045)
Other income (expense):
Interest income	15		8
Interest expense	(4)		—

Other income, net	11		8
Net loss and comprehensive loss	$	(1,832)	$	(2,037)
Weighted average shares outstanding - basic and diluted	5,144,531		171,047
Net loss per share - basic and diluted	$	(0.36)	$	(11.91)


	Three Months Ended March 31,
	2024		2023
Cash flows from operating activities:
Net loss	$	(1,832)	$	(2,037)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	37		36
Stock-based compensation	85		166
Bad debt expense	—		(2)



Changes in operating assets and liabilities:
Accounts receivable	(66)		69

Prepaid expenses	42		28
Inventory	(79)		38
Other assets	(2)		(1)
Accounts payable	(34)		(325)
Accrued expenses	23		24
Deferred revenue	(3)		(11)
Net cash used in operating activities	(1,829)		(2,015)

Cash flows from investing activities:
Purchase of property and equipment	(2)		(1)

Net cash used in investing activities	(2)		(1)

Cash flows from financing activities:

Repayments of notes payable	(8)		—

Proceeds from the exercise of warrants	6		—
Payment of employee withholding taxes related to share based awards	—		(11)
Net cash used in financing activities	(2)		(11)

Decrease in cash and cash equivalents	(1,833)		(2,027)
Cash and cash equivalents, beginning of period	5,395		4,775
Cash and cash equivalents, end of period	$	3,562	$	2,748

Supplemental cash flow information is as follows:
Cash paid for interest	$	4	$	—
Cash paid for income taxes	$	—	$	—


	March 31, 2024		December 31, 2023
Accounts receivable	$	165	$	99
Allowance for uncollectible accounts	(4)		(4)
Accounts receivable, net	$	161	$	95


	March 31, 2024		December 31, 2023
Raw materials	$	797	$	747
Work in progress	11		—
Finished goods	71		53
Total inventory	879		800
Less: reserve for obsolescence	(5)		(5)
Inventory, net	$	874	$	795


	March 31, 2024		December 31, 2023
Software licenses	139		152
Professional services	66		30
Insurance	49		64
Deposit on equipment purchase	25		—
Patents	9		14
Prepaid inventory	8		111

Other	50		17
Total prepaid expenses	$	346	$	388


	March 31, 2024		December 31, 2023
Research and development equipment	$	1,763	$	1,763
Office and computer equipment	808		808
Autos	54		54
Furniture and fixtures	41		41
Leasehold improvements	143		141
Total in service	2,809		2,807
Accumulated depreciation and amortization	(2,456)		(2,419)


Property and equipment, net	$	353	$	388


	March 31, 2024		December 31, 2023
Compensation, severance and related benefits	$	285	$	232
Legal and consulting professional services	27		121
Product warranty	12		15

Other	67		—
Total accrued expenses	$	391	$	368


2024	$	25
2025	36
2026	39
2027	43
2028	38

Total principal payments	181
Less: current portion of notes payable	(34)
Notes payable, less current portion	$	147


	Number of Options		Weighted Average Exercise Price Per Share		Weighted Average Remaining Contractual Term (years)
Three months ended March 31, 2024:
Outstanding as of December 31, 2023	36,708		$	119.70	4.0


Forfeited	(41)		300.62		3.0

Outstanding as of March 31, 2024	36,667	(1)	119.49		3.8


	Shares	Weighted Average Exercise Price Per Share		Weighted Average Remaining Contractual Term (years)
Outstanding as of December 31, 2023	7,775,734	$	2.95	3.4

Exercised	(4,608)	1.30		—

Outstanding as of March 31, 2024	7,771,126	2.95		3.1


	Three Months Ended March 31,				Increase (Decrease)
	2024		2023
Personnel (including stock-based compensation)	$	198	$	242	$	(44)
Facility-related	39		26		13
Depreciation	30		28		2
Supplies and maintenance	28		30		(2)
Professional fees	18		44		(26)
Stability studies, materials and testing	16		3		13
Other	41		14		27
Total	$	370	$	387	$	(17)


	Three Months Ended March 31,				Increase (Decrease)
	2024		2023
Personnel (including stock-based compensation)	$	862	$	903	$	(41)
Professional fees	314		452		(138)
Marketing	73		54		19
Licensed software	69		65		4
Insurance	61		86		(25)
Travel and entertainment	59		74		(15)
Facilities	40		38		2
Other	130		78		52
Total	$	1,608	$	1,750	$	(142)


2024	$	164


Total operating lease payments	164
Less: imputed interest	(5)
Total operating lease liabilities	$	159


	Common Stock			Additional Paid-In Capital		Accumulated Deficit		Total

	Shares	Amount
2024
Balances as of December 31, 2023	5,140,024	$	5	$	136,259	$	(129,913)	$	6,351
Stock-based compensation	—	—		85		—		85
Issuance of common stock upon exercise of warrants	4,608	—		6		—		6


Net loss	—	—		—		(1,832)		(1,832)
Balances as of March 31, 2024	5,144,632	$	5	$	136,350	$	(131,745)	$	4,610










2023
Balances as of December 31, 2022	67,472	$	—	$	127,482	$	(122,203)	$	5,279
Stock-based compensation	—	—		166		—		166
Issuance of common stock upon exercise of warrants	102,500	—		—		—		—
Issuance of shares pursuant to the vesting of restricted stock units, net of shares withheld for taxes	1,102	—		(11)		—		(11)
Issuance of common stock for service	4,539	—		100		—		100
Net loss	—	—		—		(2,037)		(2,037)
Balances as of March 31, 2023	175,613	$	—	$	127,737	$	(124,240)	$	3,497


	Three Months Ended March 31,				% Increase (Decrease)
	2024		2023
Revenues, net	$	415	$	233	78	%
Cost of sales	280		141		99	%
Gross profit	135		92		47	%
Operating expenses:
Research and development	370		387		(4)	%
Selling, general and administrative	1,608		1,750		(8)	%
Total operating expenses	1,978		2,137		(7)	%
Loss from operations	(1,843)		(2,045)		(10)	%
Other income, net	11		8		38	%
Net loss	$	(1,832)	$	(2,037)	(10)	%


Exhibit Number						Description

31.1						Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer.
31.2						Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Officer.
32.1						Section 1350 Certification of Chief Executive Officer.
32.2						Section 1350 Certification of Chief Financial Officer.
101.INS						Inline XBRL Instance 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 (formatted as Inline XBRL and contained in Exhibit 101).


	SENESTECH, INC.

Date: May 9, 2024	By:	/s/ Joel L. Fruendt
		Joel L. Fruendt
		President and Chief Executive Officer

Date: May 9, 2024	By:	/s/ Thomas C. Chesterman
		Thomas C. Chesterman
		Executive Vice President, Chief Financial Officer, Treasurer and Secretary

SEC Form 10-Q filed by SenesTech Inc.