Quantum X Labs Inc 10-Q for FY2026 Q2
Quantum X Labs Inc. (QXL)
About this 10-Q
Quantum X Labs Inc filed this 10-Q on August 13, 2026, covering the quarter ended June 30, 2026 (FY2026 Q2).
Headline figures
Quarter ended June 30, 2026, as reported in this filing, compared with the same period a year earlier where the filing states it.
- Revenue
- $293K
- down 20.8% from $370K a year earlier
- Net income
- $2.49M
- compared with a net loss of $11.66M a year earlier
- Diluted EPS
- $0.12
- compared with -$1.61 a year earlier
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For
the quarterly period ended
or
| 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:
(Exact name of registrant as specified in its charter)
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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 | ||
| The
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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.
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).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer (as defined in Rule 12b-2 of the Exchange Act) or a smaller reporting company.
| Large accelerated filer | ☐ | 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. ☐
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by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No
On August 13, 2026, the Registrant had shares of common stock issued and outstanding.
QUANTUM X LABS INC.
TABLE OF CONTENTS
| Item | Description | Page | ||
| PART I - FINANCIAL INFORMATION | ||||
| ITEM 1. | FINANCIAL STATEMENTS | 3 | ||
| ITEM 2. | MANAGEMENT’S DISCUSSION AND ANALYSIS AND RESULTS OF OPERATIONS | 40 | ||
| ITEM 3. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK | 51 | ||
| ITEM 4. | CONTROLS AND PROCEDURES | 51 | ||
| PART II - OTHER INFORMATION | ||||
| ITEM 1. | LEGAL PROCEEDINGS | 52 | ||
| ITEM 1A. | RISK FACTORS | 52 | ||
| ITEM 2. | UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS | 52 | ||
| ITEM 3. | DEFAULT UPON SENIOR SECURITIES | 52 | ||
| ITEM 4. | MINE SAFETY DISCLOSURE | 52 | ||
| ITEM 5. | OTHER INFORMATION | 52 | ||
| ITEM 6. | EXHIBITS | 53 | ||
| SIGNATURES | 54 |
| -2- |
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
QUANTUM X LABS INC. (formerly known as Viewbix Inc.)
INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
June 30, 2026
CONTENTS
| -3- |
QUANTUM X LABS INC. (formerly known as Viewbix Inc.)
INTERIM CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)
U.S. dollars in thousands (except share data)
As of June 30 | As of December 31 | |||||||||
| Note | 2026 | 2025 | ||||||||
| ASSETS | ||||||||||
| CURRENT ASSETS | ||||||||||
| Cash and cash equivalents | ||||||||||
| Restricted deposits | ||||||||||
| Accounts receivable | ||||||||||
| Related parties | ||||||||||
| Other current assets | ||||||||||
| Total current assets | ||||||||||
| NON-CURRENT ASSETS | ||||||||||
| Deferred taxes | ||||||||||
| Property and equipment, net | ||||||||||
| Investment in equity securities | 6.A | |||||||||
| Intangible assets, net | 5 | |||||||||
| Goodwill | 5 | |||||||||
| Investments accounted for using the equity method | ||||||||||
| Total non-current assets | ||||||||||
| Total assets | ||||||||||
The accompanying notes are an integral part of these Interim Condensed Consolidated financial statements.
| -4- |
QUANTUM X LABS INC. (formerly known as Viewbix Inc.)
INTERIM CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Cont.)
U.S. dollars in thousands (except share data)
As of June 30 | As of December 31 | |||||||||
| Note | 2026 | 2025 | ||||||||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||||
| CURRENT LIABILITIES | ||||||||||
| Accounts payable | ||||||||||
| Government authorities | ||||||||||
| Earn-out payable | 6,8 | |||||||||
| Short-term loans | 7 | |||||||||
| Current maturities of long-term loans | 7 | |||||||||
| Short-term convertible loans | 7 | |||||||||
| Related parties | ||||||||||
| Other payables | ||||||||||
| Total current liabilities | ||||||||||
| NON-CURRENT LIABILITIES | ||||||||||
| Long-term loans, net of current maturities | 7 | |||||||||
| Deferred taxes | ||||||||||
| Earn-out liability | 6,8 | |||||||||
| Total non-current liabilities | ||||||||||
| Commitments and Contingencies | 9 | |||||||||
| SHAREHOLDERS’ EQUITY | ||||||||||
| Common stock of $ par value - Authorized: shares; Issued and outstanding: and shares as of June 30, 2026, and December 31, 2025, respectively. | ||||||||||
| Additional paid-in capital | ||||||||||
| Accumulated deficit | ( | ) | ( | ) | ||||||
| Equity attributed to shareholders of Quantum X Labs Inc. | ||||||||||
| Non-controlling interests | ||||||||||
| Total equity | ||||||||||
| Total liabilities and shareholders’ equity | ||||||||||
The accompanying notes are an integral part of these Interim Condensed Consolidated financial statements.
| -5- |
QUANTUM X LABS INC. (formerly known as Viewbix Inc.)
INTERIM CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
U.S. dollars in thousands (except share data)
| Note | 2026 | 2025 | 2026 | 2025 | ||||||||||||||
| For the six months ended June 30, | For the three months ended June 30, | |||||||||||||||||
| Note | 2026 | 2025 | 2026 | 2025 | ||||||||||||||
| Revenues | ||||||||||||||||||
| Costs and Expenses: | ||||||||||||||||||
| Traffic-acquisition and related costs | ||||||||||||||||||
| Research and development | ||||||||||||||||||
| Selling and marketing | ||||||||||||||||||
| General and administrative | ||||||||||||||||||
| Depreciation and amortization | ||||||||||||||||||
| Other expenses, net | ||||||||||||||||||
| Operating loss | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||
| Gain from deconsolidation of CliniQuantum | 6.D | |||||||||||||||||
| Financial expenses, net | ||||||||||||||||||
| Income (loss) from continuing operations, before taxes | ( | ) | ( | ) | ||||||||||||||
| Tax benefit | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||
| Net income (loss) from continuing operations | ( | ) | ( | ) | ||||||||||||||
| Net loss from discontinued operations | ( | ) | ( | ) | ||||||||||||||
| Net income (loss) | ( | ) | ( | ) | ||||||||||||||
| Less: net loss attributable to non-controlling interests | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||
| Net income (loss) attributable to shareholders of Quantum X Labs Inc. | ( | ) | ( | ) | ||||||||||||||
| Net income (loss) from continuing operations attributable to: | ||||||||||||||||||
| Shareholders of Quantum X Labs Inc. | ( | ) | ( | ) | ||||||||||||||
| Non-controlling interests | ( | ) | ( | ) | ||||||||||||||
| Net loss from continuing operations | ( | ) | ( | ) | ||||||||||||||
| Net loss from discontinued operations attributable to: | ||||||||||||||||||
| Shareholders of Quantum X Labs Inc. | ( | ) | ( | ) | ||||||||||||||
| Non-controlling interests | ( | ) | ( | ) | ||||||||||||||
| Net loss from discontinued operations | ( | ) | ( | ) | ||||||||||||||
| Net income (loss) per share from continuing operations attributed to shareholders: | 11 | |||||||||||||||||
| Basic | ( | ) | ( | ) | ||||||||||||||
| Diluted | ( | ) | ( | ) | ||||||||||||||
| Net loss per share from discontinued operations – Basic and diluted attributed to shareholders: | ) | ) | ||||||||||||||||
| Total net income (loss) per share attributed to shareholders: | 11 | |||||||||||||||||
| Basic | ( | ) | ( | ) | ||||||||||||||
| Diluted | ( | ) | ( | ) | ||||||||||||||
| Weighted average number of shares (*): | ||||||||||||||||||
| Basic | (*) | (*) | (*) | |||||||||||||||
| Diluted | (*) | (*) | (*) | |||||||||||||||
| (*) |
The accompanying notes are an integral part of these Interim Condensed Consolidated financial statements.
| -6- |
QUANTUM X LABS INC. (formerly known as Viewbix Inc.)
INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY (Unaudited)
U.S. dollars in thousands (except share data)
| Number | Amount | capital | Deficit | Shareholders | Interests | Equity | ||||||||||||||||||||||
| Common stock | Additional paid-in | Accumulated | Total Attributed to the company’s | Non- Controlling | Total | |||||||||||||||||||||||
| Number | Amount | capital | Deficit | Shareholders | Interests | Equity | ||||||||||||||||||||||
| Balance as of January 1, 2026 | ( | ) | ||||||||||||||||||||||||||
| Net income (loss) | - | ( | ) | |||||||||||||||||||||||||
| Issuance of shares and warrants in connection with a private placement (see note 10.D) | (* | ) | ||||||||||||||||||||||||||
| Issuance of shares in connection with acquisition of a subsidiary (see note 6.C) | (* | ) | ||||||||||||||||||||||||||
| Deconsolidation of subsidiary upon loss of control (see note 6.D) | - | ( | ) | ( | ) | |||||||||||||||||||||||
| Exercise of warrants (see note 10.F) | ||||||||||||||||||||||||||||
| Balance as of June 30, 2026 | ( | ) | ||||||||||||||||||||||||||
| Common stock | Additional paid-in | Accumulated | Total Attributed to the company’s | Non- Controlling | Total | |||||||||||||||||||||||
| Number | Amount | capital | Deficit | Shareholders | Interests | Equity | ||||||||||||||||||||||
| Balance as of April 1, 2026 | ( | ) | ||||||||||||||||||||||||||
| Net income (loss) | - | ( | ) | |||||||||||||||||||||||||
| Deconsolidation of subsidiary upon loss of control (see note 6.D) | - | ( | ) | ( | ) | |||||||||||||||||||||||
| Exercise of warrants (see note 10.F) | ||||||||||||||||||||||||||||
| Balance as of June 30, 2026 | ( | ) | ||||||||||||||||||||||||||
| -7- |
QUANTUM X LABS INC. (formerly known as Viewbix Inc.)
INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY (Unaudited)
U.S. dollars in thousands (except share data)
| Number | (**) | capital | Deficit | Shareholders | Interests | Equity | ||||||||||||||||||||||
| Common stock (**) | Additional paid-in | Accumulated | Total Attributed to the company’s | Non- Controlling | Total | |||||||||||||||||||||||
| Number | Amount | capital | Deficit | Shareholders | Interests | Equity | ||||||||||||||||||||||
| Balance as of January 1, 2025 | ( | ) | ||||||||||||||||||||||||||
| Net loss | - | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||||||||
| Shares issued in connection with the Reverse Stock Split (see note 10.G) | (* | ) | ||||||||||||||||||||||||||
| Issuance of shares in connection with acquisition of a subsidiary (see note 6.B) | (* | ) | ||||||||||||||||||||||||||
| Issuance of shares and warrants in connection with conversion of loans (see notes 7.D, 7.E, 7.F) | (* | ) | ||||||||||||||||||||||||||
| Exercise of warrants (see notes 7.D, 7.E, 7.F, 10.B) | ||||||||||||||||||||||||||||
| Redeem of loan to parent company (see note 4) | - | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||
| Share-based compensation | (* | ) | ||||||||||||||||||||||||||
| Balance as of June 30, 2025 | ( | ) | ||||||||||||||||||||||||||
| Common stock (**) | Additional paid-in | Accumulated | Total Attributed to the company’s | Non- Controlling | Total | |||||||||||||||||||||||
| Number | Amount | capital | Deficit | Shareholders | Interests | Equity | ||||||||||||||||||||||
| Balance as of April 1, 2025 | ( | ) | ||||||||||||||||||||||||||
| Balance | ( | ) | ||||||||||||||||||||||||||
| Net loss | - | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||||||||
| Net income (loss) | - | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||||||||
| Issuance of shares and warrants in connection with conversion of loans (see notes 7.D, 7.E, 7.F) | (* | ) | ||||||||||||||||||||||||||
| Exercise of warrants (see notes 7.D, 7.E, 7.F, 10.B) | ||||||||||||||||||||||||||||
| Redeem of loan to parent company (see note 4) | - | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||
| Share-based compensation | (* | ) | ||||||||||||||||||||||||||
| Balance as of June 30, 2025 | ( | ) | ||||||||||||||||||||||||||
| Balance | ( | ) | ||||||||||||||||||||||||||
| (*) | |
| (**) |
The accompanying notes are an integral part of these Interim Condensed Consolidated financial statements.
| -8- |
QUANTUM X LABS INC. (formerly known as Viewbix Inc.)
INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
U.S. dollars in thousands (except share data)
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
For the six months ended June 30, | For the three months ended June 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Cash flows from Operating Activities of Continuing Operations | ||||||||||||||||
| Net income (loss) | ( | ) | ( | ) | ||||||||||||
| Less: net loss from discontinued operations | ||||||||||||||||
| Net income (loss) from continuing operations | ( | ) | ( | ) | ||||||||||||
| Adjustments to reconcile net loss from continuing operations to net cash provided by operating activities: | ||||||||||||||||
| Depreciation and amortization | ||||||||||||||||
| Share-based compensation | ||||||||||||||||
| Deferred taxes | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Accrued interest, net | ( | ) | ||||||||||||||
| Interest income | ( | ) | ( | ) | ||||||||||||
| Amortization of loan discounts | ||||||||||||||||
| Change in the fair value of financial assets at fair value through profit or loss (see note 8) | ||||||||||||||||
| Amortization of deferred debt issuance costs (see notes 7.D. 7.E, 7.F) | ||||||||||||||||
| Gain arising from deconsolidation of a subsidiary upon loss of control (see note 6.D) | ( | ) | ( | ) | ||||||||||||
| Changes in assets and liabilities items: | ||||||||||||||||
| Decrease in accounts receivable | ||||||||||||||||
| Increase in other current assets | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Increase in related parties | ||||||||||||||||
| Increase (decrease) in accounts payable | ( | ) | ||||||||||||||
| Decrease (increase) in other payables | ( | ) | ( | ) | ( | ) | ||||||||||
| Net cash used in operating activities from continuing operations | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
The accompanying notes are an integral part of these Interim Condensed Consolidated financial statements.
| -9- |
QUANTUM X LABS INC. (formerly known as Viewbix Inc.)
INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (Cont.)
U.S. dollars in thousands (except share data)
For the six months ended June 30, | For the three months ended June 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Cash flows from Investing Activities of Continuing Operations | ||||||||||||||||
| Purchase of property and equipment | ( | ) | ( | ) | ||||||||||||
| Deconsolidation of a subsidiary upon loss of control (see appendix B and note 6.D) | ( | ) | ( | ) | ||||||||||||
| Net cash from acquisition of subsidiaries (see appendix A and notes 6.B, 6.C) | ||||||||||||||||
| Net cash provided by (used in) investing activities from continuing operations | ( | ) | ( | ) | ||||||||||||
| Cash flows from Financing Activities of Continuing Operations | ||||||||||||||||
| Receipt of short-term convertible loans | ||||||||||||||||
| Repayment of short-term convertible loans | ( | ) | ( | ) | ||||||||||||
| Receipt of short-term bank loans | ||||||||||||||||
| Repayment of short-term bank loans | ( | ) | ( | ) | ( | ) | ||||||||||
| Repayment of long-term bank loans | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Change in loan to former parent company | ( | ) | ( | ) | ||||||||||||
| Proceeds from issuance of shares and warrants in connection with the 2026 Private Placement (see note 10.D) | ||||||||||||||||
| Proceeds from exercise of warrants | ||||||||||||||||
| Net cash provided by financing activities from continuing operations | ||||||||||||||||
| Cash flows of Discontinued Operations | ||||||||||||||||
| Net cash used in operating activities from discontinued operations | ( | ) | ||||||||||||||
| Net cash used in investing activities from discontinued operations | ||||||||||||||||
| Net cash provided by financing activities from discontinued operations | ||||||||||||||||
| Net cash used in discontinued operations | ( | ) | ||||||||||||||
| Increase in cash and cash equivalents and restricted cash | ||||||||||||||||
| Cash and cash equivalents and restricted cash at beginning of period | ||||||||||||||||
| Cash and cash equivalents and restricted cash at end of period | ||||||||||||||||
| Supplemental Disclosure of Cash Flow Activities: | ||||||||||||||||
| Cash paid during the period | ||||||||||||||||
| Taxes paid | ||||||||||||||||
| Interest paid | ||||||||||||||||
| Total cash paid during the period | ||||||||||||||||
| Substantial non-cash activities: | ||||||||||||||||
| Redeem of loan to parent company | ||||||||||||||||
| Conversion of loans into shares and warrants | ||||||||||||||||
| Issuance of warrants in connection with the 2026 Private Placement (see note 10.D) | ||||||||||||||||
| Classification of Earn-out liability to Earn-out payable (see note 8) | ||||||||||||||||
The accompanying notes are an integral part of these Interim Condensed Consolidated financial statements.
| -10- |
QUANTUM X LABS INC. (formerly known as Viewbix Inc.)
INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (Cont.)
U.S. dollars in thousands (except share data)
Appendix A:
As of March 4, 2026 | ||||
| Consolidation of Quantum Israel (see note 6.C): | ||||
| Net working capital other than cash and restricted deposits | ||||
| Property and equipment | ||||
| Goodwill | ||||
| In-process research and development, net of deferred taxes | ||||
| Non-controlling interests | ( | ) | ||
| Total consideration | ( | ) | ||
| Net cash acquired | ( | ) | ||
Appendix B:
As of June 4, 2026 | ||||
| Deconsolidation of subsidiary upon loss of control (see note 6.D): | ||||
| Net working capital other than cash and restricted deposits | ||||
| Recognition of investment accounted for using the equity method | ||||
| Non-controlling interests | ||||
| Gain arising from deconsolidation upon loss of control | ( | ) | ||
| Net cash deconsolidated upon loss of control | ||||
The accompanying notes are an integral part of these Interim Condensed Consolidated financial statements.
| -11- |
QUANTUM X LABS INC. (formerly known as Viewbix Inc.)
NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
U.S. dollars in thousands (except share data)
NOTE 1: GENERAL
A. Organizational Background
Quantum X Labs Inc. (formerly known as Viewbix Inc.) (the “Company”) was incorporated in the State of Delaware on August 16, 1985, under a predecessor name, The InFerGene Company (“InFerGene Company”). On August 25, 1995, a wholly owned subsidiary of InFerGene Company merged with Zaxis International, Inc., an Ohio corporation, which following such merger, the surviving entity, InFerGene Company, changed its name to Zaxis International, Inc. In 2015, the Company changed its name to Emerald Medical Applications Corp., subsequent to which the Company, through its subsidiary, was engaged in the development of technology for use in detection of skin cancer. On January 29, 2018, the Company ceased its business operations in this field.
On
January 17, 2018, the Company formed a new wholly owned subsidiary under the laws of the State of Israel, Virtual Crypto Technologies
Ltd. (“VCT Israel”), to develop and market software and hardware products facilitating and supporting the purchase and/or
sale of cryptocurrencies. Effective as of March 7, 2018, the Company’s name was changed from Emerald Medical Applications Corp.
to Virtual Crypto Technologies, Inc. VCT Israel ceased its business operation in 2019 and prior to consummation of the Recapitalization
Transaction. On January 27, 2020, VCT Israel was sold to a third party for NIS
On February 7, 2019, the Company entered into a share exchange agreement (the “Share Exchange Agreement” or the “Recapitalization Transaction”) with Gix Internet Ltd., a company organized under the laws of the State of Israel (“Gix” or “Former Parent Company”), pursuant to which, Gix assigned, transferred and delivered its % holdings in Viewbix Ltd., a company organized under the laws of the State of Israel (“Viewbix Israel”), to the Company in exchange for shares of the Company, which resulted in Viewbix Israel becoming a subsidiary of the Company. In connection with the Share Exchange Agreement, effective as of August 7, 2019, the Company’s name was changed from Virtual Crypto Technologies, Inc. to Viewbix Inc. Effective April 30, 2026, the Company. changed its name to Quantum X Labs Inc.
B. Reorganization Transaction
On
December 5, 2021, the Company entered into a certain Agreement and Plan of Merger with Gix Media Ltd. (“Gix Media”), an Israeli
company and the majority-owned (
On
September 19, 2022, the Reorganization Transaction was consummated and as a result, all outstanding ordinary shares of Gix Media, having
no par value (the “Gix Media Shares”) were delivered to the Company in exchange for the Company’s shares of common
stock, par value $ per share (“Common Stock”).
| -12- |
QUANTUM X LABS INC. (formerly known as Viewbix Inc.)
NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
U.S. dollars in thousands (except share data)
NOTE 1: GENERAL (Cont.)
B. Reorganization Transaction (Cont.)
In
connection with the closing of the Reorganization Transaction, the Company filed an Amended and Restated Certificate of Incorporation
(the “Amended COI”) with the Secretary of State of Delaware, effective as of August 31, 2022, pursuant to which, concurrently
with the effectiveness of the Amended COI, the Company, among other things, effected a reverse stock split of its common stock at a ratio
of
As the Company and Gix Media were consolidated both by the Former Parent Company and Xylo Technologies Ltd. (formerly known as Medigus Ltd.) (the “Ultimate Parent”), before and after the Reorganization Transaction, the Reorganization Transaction was accounted for as a transaction between entities under common control. Accordingly, the financial information of the Company and Gix Media is presented in these financial statements, for all periods presented, reflecting the historical cost of the Company and Gix Media, as it is reflected in the consolidated financial statements of the Former Parent Company, for all periods preceding March 1, 2022, the date the Ultimate Parent obtained a controlling interest in the Former Parent Company and as it is reflected in the consolidated financial statements of the Ultimate Parent for all periods subsequent to March 1, 2022.
C. Business Overview
The Company and its subsidiaries (the “Group”) are focused on quantum technology, digital advertising and computing and enterprise artificial intelligence (AI) solutions.
The Company, through its subsidiaries Gix Media and the former majority-owned subsidiary of Gix Media, Cortex Media Group Ltd. (“Cortex”), operates in the field of digital advertising. As of November 2025, the Company had two main activities which were reported as separate operating segments: the search segment and the digital content segment. On November 9, 2025, Gix Media sold all of its holdings in Cortex (see note 6.A). Subsequently, the Company ceased its operations in the digital content segment.
The search segment develops a variety of technological software solutions, which perform automation, optimization, and monetization of internet campaigns, for the purposes of obtaining and routing internet user traffic to its customers. The search segment activity is conducted by Gix Media.
The digital content segment was engaged in the creation and editing of content, in different languages, for different target audiences, for the purposes of generating revenues from leading advertising platforms, by utilizing such content to obtain and route internet user traffic for its customers. The digital content segment activity was conducted by Cortex until November 9, 2025 (see note 6.A).
On
March 24, 2025, the Company entered into a securities exchange agreement with Metagramm Software Ltd. (“Metagramm”) and all
of the shareholders of Metagramm, pursuant to which the Company acquired
| -13- |
QUANTUM X LABS INC. (formerly known as Viewbix Inc.)
NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
U.S. dollars in thousands (except share data)
NOTE 1: GENERAL (Cont.)
C. Business Overview (Cont.)
Metagramm specializes in developing advanced writing assistance tools that leverage artificial intelligence, machine learning and natural language processing technologies. Metagramm’s main product, “Bubbl” is a writing tool designed to provide personalized and customized text tailored to the user’s unique expression and can translate various languages into English. Metagramm licenses its products on a subscription basis to businesses and individual customers.
On
March 4, 2026, the Company completed the acquisition of Quantum X Labs Ltd. (“Quantum Israel”), a private company that operates
as a multi-disciplinary quantum technology hub, pursuant to a definitive share purchase agreement dated December 15, 2025 (the “Agreement
Date”). Following the acquisition, Quantum Israel became a wholly owned subsidiary of the Company. In consideration for the acquisition,
the Company issued common stock and pre-funded warrants representing approximately
Quantum Israel is focused on developing and promoting quantum algorithms for the transportation, drug discovery and security segments as well as developing quantum- based GPS replacement and quantum atom accuracy solutions. Its mission is to research, develop, and own quantum technology intellectual property that addresses major challenges emerging as the quantum revolution scales into commercial and industrial use. Quantum Israel combines deep academic research with practical engineering to create deployable quantum solutions.
D. Impact of the War in Israel
On October 7, 2023, Hamas launched a series of attacks on civilian and military targets in Southern Israel and Central Israel, to which the Israel Defense Forces responded. In addition, Iran, Hezbollah and the Houthi movement attacked military and civilian targets in Israel, to which Israel responded, including through increased air and/or ground operations in Lebanon, Syria, Yemen and Iran. Following years of conflict in the region, on October 9, 2025, Israel, Hamas, the United States and other countries in the region agreed to a framework for a ceasefire in Gaza between Israel and Hamas. On February 28, 2026, the United States and Israel launched joint combat operations in Iran to which Iran and Hezbollah responded with ballistic missile and drone attacks on Israel as well as other countries and U.S. military bases in the region. Although the United States and Iran have announced ceasefire and de-escalation arrangements from time to time, including a memorandum of understanding entered into on June 17, 2026 that contemplates the termination of military operations on multiple fronts, hostilities have resumed and may continue or escalate. How long and how severe the current conflicts in Gaza, Northern Israel, Lebanon, Iran or the broader region last and become is unknown at this time and any continued clash among Israel, Hamas, Hezbollah, Iran or other countries or militant groups in the region may escalate in the future into a greater regional conflict. The intensity and duration of the security situation in Israel have been difficult to predict, as are the economic implications on the Company’s business and operations and on Israel’s economy in general
As the Group’s customers are mainly in the U.S. and Europe, its operations, revenues, and profitability are not directly affected by the security situation in Israel. However, this is an ongoing event and there is uncertainty regarding its duration, nature, and scope, management is unable to reasonably estimate the extent of the impact at this time.
| -14- |
QUANTUM X LABS INC. (formerly known as Viewbix Inc.)
NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
U.S. dollars in thousands (except share data)
NOTE 1: GENERAL (Cont.)
E. Cortex Adverse Effect
In
April 2024, the Company was informed by Cortex that a significant customer of Cortex recently notified Cortex it will stop advertising
on Cortex’s sites, as part of its policy decision to cease advertising on Made for Advertising (“MFA”) sites (the “Cortex
Adverse Effect”). The Cortex Adverse Effect, which has materially affected Cortex’s business and operations, has occurred
following certain recent developments relating to publishers that are categorized by a number of on-line advertisers as MFA, including
decisions made by leading media on-line advertisers to prioritize different media categories and implement publishing restrictions in
connection with MFA. Due to the Cortex Adverse Effect and additional circumstances as explained in note 3, the Company recorded impairments
in the goodwill and intangible assets related to the digital content segment of $
F. Filing of Insolvency Petition Against Gix Media
On
March 27, 2025, a petition (the “Petition”) was filed with the District Court of Tel Aviv-Jaffa (the “Court”)
for a court order to commence insolvency proceedings against Gix Media. The Petition was filed by a primary service provider of Gix Media
(the “Service Provider”) alleging that Gix Media owes it approximately $
On
July 16, 2025, the Court approved a settlement agreement entered into between Gix Media, the Service Provider and other creditors of
Gix Media that joined the Petition (collectively, the “Service Providers”) with respect to the debts owed by Gix Media to
the Service Providers. In connection with the settlement agreement, the Company agreed to provide a guarantee for the debts owed by Gix
Media to the Service Providers. On July 22, 2025, pursuant to the terms of the settlement agreement, Gix Media paid approximately $
G. Nasdaq Uplisting
On June 4, 2025, the Company’s shares of common stock were approved for listing on The Nasdaq Capital Market (“Nasdaq”). The Company’s shares began trading under the symbol “VBIX” on the Nasdaq on June 5, 2025 (the “Uplist Date”). The Company’s shares were previously quoted on the OTC Markets, Pink Tier under the symbol “VBIX”, and ceased to be quoted on the OTC Markets, Pink Tier at the close of business on June 4, 2025 (the “Uplist”).
As
a result of the Uplist, the Company received during June and July 2025, aggregate gross proceeds of $
Effective April 30, 2026, the Company changed its name from “Viewbix Inc.” to “Quantum X Labs Inc.” and its trading symbol on the Nasdaq from “VBIX” to “QXL.”
| -15- |
QUANTUM X LABS INC. (formerly known as Viewbix Inc.)
NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
U.S. dollars in thousands (except share data)
NOTE 1: GENERAL (Cont.)
H. Going Concern
During the years ended December 31, 2024, and 2025 and the six months ended June 30, 2026, the Company experienced a decrease in its revenues from the digital content as a result of the Cortex Adverse Effect (see note 1.E). The Company also experienced a decrease in its revenues from the search segment, as a result of a decrease in user traffic acquired from third party advertising platforms, an industry-wide decrease in advertising budget, changes and updates to internet browsers’ technology, which adversely impacted the Company’s ability to acquire traffic in the search segment and a decrease in revenues from routing of traffic acquired from third-party strategic partners in the search segment, following the lack of availability of suppliers credit from such third party strategic partners.
As
a result of the foregoing, during the six months ended June 30, 2026, the Company recorded an operating loss from continuing operations
of $
The decline in revenues and other circumstances described above raise substantial doubts about the Company’s ability to continue as a going concern during the 12-month period following the issuance date of these financial statements.
Management’s response to these conditions included reduction of salaries and related expenses and reduction of professional services in the research and development and selling and marketing functions, reduction of other operational expenses, such as lease costs and overheads, as well as creation of new partnerships and other new income sources.
In
addition, the Company raised funds during 2025, increasing its cash balance, as follows: (1) pursuant to the consummation of the Uplist
(as described in note 1.G above), the Company received during June and July 2025, aggregate gross proceeds of $
Moreover,
on March 4, 2026, the Company closed a private placement transaction with certain accredited investors, pursuant to which the Company
received gross proceeds of $
Notwithstanding the foregoing, there remains uncertainty as to whether the Company will be able to secure additional funding when needed. Such conditions raise substantial doubts about the Company’s ability to continue as a going concern for at least a year after the issuance date of the accompanying financial statements.
These financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.
| -16- |
QUANTUM X LABS INC. (formerly known as Viewbix Inc.)
NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
U.S. dollars in thousands (except share data)
NOTE 2: SIGNIFICANT ACCOUNTING POLICIES
A. Unaudited Interim Financial Statements
The accompanying unaudited interim condensed financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of U.S. Securities and Exchange Commission Regulation S-X. Accordingly, they do not include all the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments considered necessary for a fair presentation have been included (consisting only of normal recurring adjustments except as otherwise discussed). For further information, reference is made to the consolidated financial statements and footnotes thereto included in the Group’s Annual Report on Form 10-K for the year ended December 31, 2025.
B. Principles of Consolidation
The accompanying condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation.
C. Use of estimates
The preparation of 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 consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. The Company evaluates on an ongoing basis its assumptions, including those related to contingencies, deferred taxes, inventory impairment, stock-based compensation, as well as in estimates used in applying the revenue recognition policy. Actual results may differ from those estimates.
| -17- |
QUANTUM X LABS INC. (formerly known as Viewbix Inc.)
NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
U.S. dollars in thousands (except share data)
NOTE 2: SIGNIFICANT ACCOUNTING POLICIES (Cont.)
D. Significant Accounting Policies
The significant accounting policies followed in the preparation of these unaudited interim condensed consolidated financial statements are identical to those applied in the preparation of the latest annual financial statements.
E. Recent Accounting Pronouncements
Management does not believe that any recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the Group’s interim condensed consolidated financial statements.
NOTE 3: DISCONTINUED OPERATIONS
On November 9, 2025, Gix Media sold all of its holdings in Cortex (see note 6.A), following which the Group ceased its operations in the digital content segment activity. The Company has determined that the sale of Cortex has a major effect on the Company’s operations and financial results. In this respect, the results of operations and cash flows of the digital content segment, as well as its assets and liabilities, are reported as discontinued operations. The comparative figures in these consolidated financial statements have been adjusted on the basis of presenting separately the discontinued operations’ figures.
The components of the loss from discontinued operations for the six and three months ended June 30, 2025, in the consolidated statements of income consisted of the following:
SCHEDULE OF DISCONTINUED OPERATIONS
For the six June 30, | For the three June 30, | |||||||
| Revenues | ||||||||
| Costs and Expenses: | ||||||||
| Traffic-acquisition and related costs | ||||||||
| Research and development | ||||||||
| Selling and marketing | ||||||||
| General and administrative | ||||||||
| Depreciation and amortization | ||||||||
| Impairment of intangible assets and goodwill (a) | ||||||||
| Operating loss | ||||||||
| Financial income, net | ( | ) | ( | ) | ||||
| Loss from discontinued operations before taxes | ||||||||
| Income tax benefit | ( | ) | ( | ) | ||||
| Net loss from discontinued operations | ||||||||
| (a) |
| -18- |
QUANTUM X LABS INC. (formerly known as Viewbix Inc.)
NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
U.S. dollars in thousands (except share data)
NOTE 4: LOAN TO FORMER PARENT COMPANY
On March 22, 2020, Gix Media entered into a loan agreement with the Former Parent Company. The loan bore interest at a rate determined from time to time in accordance with Section 3(j) of the Income Tax Ordinance, new version, and the Income Tax Regulations (Determination of Interest Rate for the purposes of Section 3(j), 1986).
On
April 10, 2025, the Company’s board of directors approved the redemption of the loan between Gix Media and the Former Parent Company.
As a result, Gix Media and the Former Parent Company entered into a redemption agreement, effective as of May 27, 2025, pursuant to which
the outstanding loan was redeemed in consideration for the transfer to Gix Media of all of the Former Parent Company’s intangible
assets, including, inter alia, intellectual property rights, trademarks, software, algorithms, domains, technological know-how and any
other intangible asset (the “Redemption”). Since this transaction is between entities under common control, the intangible
assets received from the Former Parent Company were recorded at their historical carrying amount as they were recorded at the Former
Parent Company’s financial statements which is $
As
a result, the outstanding loan amount including accrued interest, totaling $
For
the six months ended June 30, 2025, Gix Media recognized interest income in the amount of $
NOTE 5: GOODWILL AND INTANGIBLE ASSETS, NET
| A. | Composition: |
SCHEDULE OF GOODWILL AND INTANGIBLE ASSETS
| In-process research and development | Internal-use Software | Customer Relations | Technology | Goodwill | Total | |||||||||||||||||||
| Cost: | ||||||||||||||||||||||||
| Balance as of January 1, 2026 | ||||||||||||||||||||||||
| Consolidation of Quantum Israel (note 6.C) | ||||||||||||||||||||||||
| Balance as of June 30, 2026 | ||||||||||||||||||||||||
| Accumulated amortization: | ||||||||||||||||||||||||
| Balance as of January 1, 2026 | ||||||||||||||||||||||||
| Amortization recognized during the period | ||||||||||||||||||||||||
| Balance as of June 30, 2026 | ||||||||||||||||||||||||
| Amortized cost: | ||||||||||||||||||||||||
| As of June 30, 2026 | ||||||||||||||||||||||||
| Internal-use Software | Customer Relations | Technology | Goodwill | Total | ||||||||||||||||
| Cost: | ||||||||||||||||||||
| Balance as of January 1, 2025 | ||||||||||||||||||||
| Cost, beginning balance | ||||||||||||||||||||
| Consolidation of Metagramm (note 6.B) | ||||||||||||||||||||
| Balance as of December 31, 2025 | ||||||||||||||||||||
| Cost, ending balance | ||||||||||||||||||||
| Accumulated amortization: | ||||||||||||||||||||
| Balance as of January 1, 2025 | ||||||||||||||||||||
| Accumulated amortization, beginning balance | ||||||||||||||||||||
| Amortization recognized during the period | ||||||||||||||||||||
| Balance as of December 31, 2025 | ||||||||||||||||||||
| Accumulated amortization, ending balance | ||||||||||||||||||||
| Amortized cost: | ||||||||||||||||||||
| As of December 31, 2025 | ||||||||||||||||||||
| Amortized cost | ||||||||||||||||||||
| -19- |
QUANTUM X LABS INC. (formerly known as Viewbix Inc.)
NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
U.S. dollars in thousands (except share data)
NOTE 5: GOODWILL AND INTANGIBLE ASSETS, NET (Cont.)
B. Impairment of intangible assets and goodwill:
As of December 31, 2025, the Company performed a quantitative impairment test of the search reporting unit. The Company did not recognize impairment losses regarding this reporting unit for the year ended December 31, 2025.
NOTE 6: BUSINESS COMBINATION
A. Cortex Acquisition and Sale
On
October 13, 2021,
On November 9, 2025 (the “Cortex Closing Date”), Gix Media, Cortex, and certain founders of Cortex entered into a share purchase agreement (the “Cortex Sale Agreement”) with Pro Sportority (Israel) Ltd. (the “Purchaser”), a subsidiary of Minute Media Inc. (the “Parent”). Pursuant to the Cortex Sale Agreement, the Purchaser acquired from Gix Media all of its holdings in Cortex, representing % of Cortex’s issued and outstanding share capital.
The aggregate consideration paid to Gix Media was $, consisting of (i) $ in cash, and (ii) $ in the form of newly issued Preferred J Shares of the Parent (the “Parent Shares”), the most senior class of preferred shares of the Parent.
The Parent retains a call option to repurchase the Parent Shares from Gix Media under certain conditions, including insolvency or a change of control of Gix Media. In addition, Gix Media is subject to a two-year non-compete and non-solicitation covenant following the Cortex Closing Date.
B. Metagramm Acquisition:
On
March 24, 2025 (the “Closing Date”), the Company entered into a securities exchange agreement with Metagramm and all of the
shareholders of Metagramm (the “2025 SEA”). Pursuant to the 2025 SEA, the Company acquired
In
addition, the Company agreed to pay Metagramm’s shareholders cash earn-out payments on a pro rata basis of up to a cumulative sum
of $
| -20- |
QUANTUM X LABS INC. (formerly known as Viewbix Inc.)
NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
U.S. dollars in thousands (except share data)
NOTE 6: BUSINESS COMBINATION (Cont.)
B. Metagramm Acquisition: (Cont.)
Fair Value of Metagramm’s Identifiable Assets and Liabilities:
SCHEDULE OF FAIR VALUE OF ASSETS AND LIABILITIES
| Cash and cash equivalents | ||||
| Other current assets | ||||
| Net working capital other than cash and restricted deposits | ||||
| Property and equipment | ||||
| Goodwill arising from the acquisition | ||||
| Technology, net of deferred taxes | ||||
| In-process research and development, net of deferred taxes | ||||
| Non-controlling interests | ||||
| Customer Relations, net of deferred taxes | ||||
| Total cost of the acquisition | ||||
| Earn-out liability arising from the acquisition | ||||
| Total liabilities | ||||
| Consideration paid in Company’s shares and pre-funded warrants | ||||
| Contingent consideration to be paid in Earn-Out Securities | ||||
| Consideration paid in Company’s shares |
The total consideration has been allocated between assets acquired and liabilities assumed based on estimated fair values, with the residual of the total consideration recorded as goodwill.
The goodwill that arose from the acquisition consists of synergies expected from the activities of the Company and Metagramm. The estimation of the fair value of these intangible assets was determined using the income approach, which is based on the present value of the future cash flows attributable to each identifiable intangible asset. The estimation of the fair value of the earn-out liability was calculated based on Monte Carlo method.
Other current assets were estimated to have fair values that approximate their carrying values due to the short-term maturities of these instruments.
The
estimated useful lives for the acquired technology and customer relations of Metagramm Acquisition are
C. Quantum Israel Acquisition:
On
December 15, 2025, the Company entered into a securities exchange agreement (the “Quantum Exchange Agreement”) with Quantum
Israel and certain shareholders of Quantum Israel (the “Quantum Israel Shareholders”) pursuant to which the Company agreed
to issue to the Quantum Israel Shareholders an aggregate amount of up to % of the Company’s issued and outstanding capital
stock as of December 15, 2025, inclusive of shares of the Company’s common stock issuable by the Company in a private placement
offering (the “Private Placement Shares”) that the Company entered into in January 2026 (see also note 10.D), consisting
of (i) up to shares of the Company’s common stock, representing % of the Company’s issued and outstanding
capital stock (the “Exchange Shares”), inclusive of the Private Placement Shares, and (ii) pre-funded warrants to purchase
up to
| -21- |
QUANTUM X LABS INC. (formerly known as Viewbix Inc.)
NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
U.S. dollars in thousands (except share data)
NOTE 6: BUSINESS COMBINATION (Cont.)
C. Quantum Israel Acquisition: (Cont.)
In addition, pursuant to the Quantum Exchange Agreement, the Company may issue to the Quantum Israel Shareholders up to additional shares of the Company’s common stock or pre-funded warrants to purchase shares of the Company’s common stock (collectively, the “Earn-Out Securities”), only following the 12-month anniversary of the closing date of the Quantum Israel Acquisition and upon the achievement of specified post-closing milestones as defined in the Quantum Exchange Agreement.
On
March 4, 2026, the Company closed the Quantum Israel Acquisition (the “Quantum Closing Date”), pursuant to which the Company
acquired
Fair Value of Quantum Israel’s Identifiable Assets and Liabilities:
SCHEDULE OF FAIR VALUE OF ASSETS AND LIABILITIES
| Cash and cash equivalents and restricted deposits | ||||
| Net working capital other than cash and restricted deposits | ||||
| Property and equipment | ||||
| Goodwill arising from the acquisition | ||||
| In-process research and development, net of deferred taxes | ||||
| Non-controlling interests | ( | ) | ||
| Total cost of the acquisition | ||||
| Consideration paid in Company’s shares and pre-funded warrants | ||||
| Contingent consideration to be paid in Earn-Out Securities | ||||
| Total Consideration |
The total consideration was allocated to the fair value of assets acquired and liabilities assumed as of the Quantum Closing Date, with the excess purchase price recorded as goodwill. The goodwill will not be deductible for income tax purposes.
Management’s estimate of the fair value of the acquired in-process research and development and the contingent consideration to be paid upon achieving certain milestones assumed as of the Quantum Closing Date is preliminary and subject to change and is based on established and accepted valuation techniques performed with the assistance of third-party valuation specialists. Changes to amounts will be recorded as adjustments to the provisional amounts recognized as of the Quantum Closing Date and may result in a corresponding adjustment to goodwill during the remainder of the measurement period, which will not exceed twelve months from the Quantum Closing Date.
The
estimation of the fair value of in-process research and development was determined using the income approach, which is based on the
present value of the future cash flows attributable to the identifiable intangible asset. The contingent consideration of $
| -22- |
QUANTUM X LABS INC. (formerly known as Viewbix Inc.)
NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
U.S. dollars in thousands (except share data)
NOTE 6: BUSINESS COMBINATION (Cont.)
D. Deconsolidation of CliniQuantum
As of the Quantum Closing Date, CliniQuantum Ltd. (“CliniQuantum”) was a subsidiary of Quantum Israel. On June 3, 2026, a third-party completed the acquisition of 54.01% of the issued and outstanding ordinary shares of CliniQuantum from certain CliniQuantum shareholders, following which Quantum Israel lost control of CliniQuantum.
Upon loss of control, Quantum
Israel determined that it exercised significant influence over CliniQuantum. Accordingly, the investment in CliniQuantum was
accounted for under the equity method and measured at its fair value of $
Quantum Israel is in the process of allocating the difference between the carrying amount of its investment in CliniQuantum and its proportionate share of CliniQuantum’s underlying net assets to the identifiable assets and liabilities of CliniQuantum. While Quantum Israel used its best estimates and assumptions as part of this allocation process to accurately value the CliniQuantum’s assets and liabilities, these estimates are inherently uncertain and subject to refinement as the guidance allows a measurement period of up to one year from June 3, 2026, to make adjustments to this preliminary allocation. Since Quantum Israel elected to recognize the proportionate share of its equity method, there was no impact from these allocations on the Company’s condensed consolidated statements of operations for the six months ended June 30, 2026.
NOTE 7: LOANS
A. Composition of long-term loans, short-term loans, and credit lines of the Group:
The following is the composition of the balance of the Group’s loans according to their nominal value:
SCHEDULE OF COMPOSITION OF BALANCE OF GROUP’S LOANS
| Interest rate | As of June 30, 2026 | As of December 31, 2025 | ||||||||||
| Short-term bank loans – Gix Media | % | |||||||||||
| Short-term bank loans | % | |||||||||||
| Long-term bank loan, including current maturity – Gix Media (received on July 10, 2025) | % | |||||||||||
| Long-term loan | % | |||||||||||
| Short-term convertible loans – June 2024 Facility Agreement – Quantum X Labs Inc. | % | |||||||||||
B. Gix Media’s Financing Agreement and short-term loans:
On
October 13, 2021, Gix Media entered into a financing agreement with Bank Leumi Le Israel Ltd (“Leumi”), an Israeli bank,
for the provision of a line of credit in the total amount of up to $
On February 4, 2025, Gix Media and Leumi entered into a fifth addendum to the Financing Agreement, which was effective as of January 29, 2025, according to which, inter alia: (i) the Gix Media Credit Line was extended to March 31, 2025; (ii) the repayment the outstanding principal amounts of the long term bank loans of Gix Media under the Financing Agreement, was deferred until the actual deposit by the Company in Gix Media’s account of an investment account equal to the amounts of the deferred long term bank loans owned by Gix Media (the “Investment Amount”), which in any event shall be no later than March 31, 2025 (the “Deposit Date”); (iii) upon such Deposit Date, all deferred payments will be immediately repaid using the deposited amounts and any remaining amounts from any other sources; (iv) all remaining future due payments will be repaid as scheduled until the end of the updated terms of each long term bank loan.
On March 30, 2025, Gix Media and Leumi entered into a sixth additional addendum to the Financing Agreement, which extended the Deposit Date until May 20, 2025.
On
June 18, 2025, Gix Media received a short-term loan of $
On
July 3, 2025, Gix Media received a short-term loan of $
On
July 8, 2025, Gix Media and Leumi entered into an agreement in respect of the Financing Agreement, (the “July 2025 Repayment and
Financing Agreement”) according to which, inter alia: (i) the Deposit Date was extended until October 1, 2025 (ii) Gix Media agreed
to repay $
| -23- |
QUANTUM X LABS INC. (formerly known as Viewbix Inc.)
NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
U.S. dollars in thousands (except share data)
NOTE 7: LOANS (Cont.)
B. Gix Media’s Financing Agreement and short-term loans: (Cont.)
In
July 2025, Gix Media repaid a total of $
As
of June 30, 2026, Gix Media has drawn $
C. Long term loan and issuance of warrants:
On
November 15, 2023, Viewbix Israel entered into a loan agreement with certain lenders, pursuant to which Viewbix Israel received aggregate
loans of $
The terms of the 2023 Loan were substantially amended on June 18, 2024, by the June 2024 Facility Agreement (see note 7.D). These amendments represented a substantial modification in accordance with ASC Topic 470. Accordingly, the terms modification was accounted for as an extinguishment of the original financial liability and the initial recognition of new financial instruments issued at their fair value as of the effective date of the June 2024 Facility Agreement.
On December 31, 2025, all 2023 Warrants were expired.
D. June 2024 Facility Agreement:
On
June 18, 2024, the Company entered into a credit facility agreement with a group of lenders including a lead lender (the “June
2024 Lead Lender”, and collectively, the “June 2024 Lenders”) for an amount of up to $
The
Total Credit Facility Amount will accrue interest at a rate of
| -24- |
QUANTUM X LABS INC. (formerly known as Viewbix Inc.)
NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
U.S. dollars in thousands (except share data)
NOTE 7: LOANS (Cont.)
D. June 2024 Facility Agreement (Cont.):
The
interest for the first year of the June 2024 Facility Agreement, which was equal to $
Immediately
following the effectiveness of the Uplist, $
During
the term of the June 2024 Facility Agreement, some of the June 2024 Lenders whose portion of the Total Credit Facility Amount is not
automatically converted as part of the Uplist will have the right to convert their portion of the Total Credit Facility Amount within
12 months from the Uplist Date into units, which will include shares of common stock of the Company at a conversion rate of $
In
addition, the Company paid to the June 2024 Lead Lender a commission consisting of: (a) shares of common stock of the Company,
(b)
The June 2024 Lead Lender Fee Warrants, which were exercisable immediately after the closing of the June 2024 Facility Agreement, were allocated subject to certain ownership restrictions, adjustments, and anti-dilution protections.
In
July 2024, following the closing of the 2024 Private Placement (as defined in note 10.B), the exercise price of the June 2024 Lead Lender
Fee Warrants was adjusted to $
The conversion related features of the June 2024 Facility Agreement were bifurcated from their host debt contract and recognized as liabilities measured at fair value at each balance sheet date. Loans received in connection with the June 2024 Facility Agreement were initially recorded at their fair value and subsequently measured at cost. The shares and warrants issued as prepayment of interest and as commission to the June 2024 Lead Lender were initially recognized at fair value and classified in equity.
| -25- |
QUANTUM X LABS INC. (formerly known as Viewbix Inc.)
NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
U.S. dollars in thousands (except share data)
NOTE 7: LOANS (Cont.)
D. June 2024 Facility Agreement (Cont.):
In
connection with the June 2024 Facility Agreement, the Company incurred deferred debt issuance costs of $
The
June 2024 Lead Lender Fee Warrants were initially recognized in fair value at the amount of $
On
June 5, 2025, upon completion of the Uplist, the Company drew additional $
In
addition, immediately following the Uplist, $
During
June and July 2025, out of warrants granted under the June 2024 Facility Agreement, warrants were exercised into
shares of common stock. The Company received total proceeds of $
In
June 2026, of the June 2024 Lead Lender Fee Warrants were exercised into shares of common stock. The Company received
total proceeds of $
In
April 2026, the Company repaid $
In
July 2026, $
E. First July 2024 Facility Agreement
On
July 4, 2024, the Company entered into a credit line agreement with a certain lender (the “First July 2024 Facility Agreement”).
Under the First July 2024 Facility Agreement and amendments from July 22, 2024, and July 25, 2024, the lender will provide a total credit
line of $
The
First July 2024 Facility Agreement will remain available until the earliest of: (a)(1) full utilization of the First July 2024 Facility
Loan Amount, (a)(2) after 36 months from the date of the First July 2024 Facility Agreement, and (b) upon such date that the Company
completes a $
| -26- |
QUANTUM X LABS INC. (formerly known as Viewbix Inc.)
NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
U.S. dollars in thousands (except share data)
NOTE 7: LOANS (Cont.)
E. First July 2024 Facility Agreement (Cont.)
The
First July 2024 Facility Agreement Amount accrued interest at a rate of
Immediately
after the Uplist, $
Furthermore,
the Company paid the lender of the First July 2024 Facility Agreement a one-time fee consisting of: (a)
shares of common stock of the Company, which representing a fee of five percent (
The conversion related features of the First July 2024 Facility Agreement were bifurcated from their host debt contract and recognized as liabilities measured at fair value at each balance sheet date.
In
connection with the First July 2024 Facility Agreement, the Company incurred deferred debt issuance costs of $
Under
the terms of the First July 2024 Facility Agreement, the Company received in July 2024 a loan of $
During
June 2025, all warrants granted under the First July 2024 Facility Agreement were exercised into shares of common stock.
The Company received total proceeds of $
On July 14, 2025, following the closing of the July 2025 Private Placement and the proceeds received by the Company (see note 10.C), the First July 2024 Facility Agreement was terminated.
| -27- |
QUANTUM X LABS INC. (formerly known as Viewbix Inc.)
NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
U.S. dollars in thousands (except share data)
NOTE 7: LOANS (Cont.)
F. Second July 2024 Facility Agreement
On
July 28, 2024, the Company entered into a credit line agreement with certain lenders (the “Second July 2024 Facility Agreement”)
for a total amount of $
The
Second July 2024 Facility Loan Amount will remain available until the earliest of: (a) (1) full utilization of the Second July 2024 Facility
Loan Amount, (a)(2) after 40 months from the date of Second July 2024 Facility Agreement, and (b) upon such date that the Company completes
a $
The
Second July 2024 Facility Loan Amount accrued interest at a rate of
Immediately
after the Uplist, $
Furthermore,
the Company paid the lenders of the Second July 2024 Facility Agreement a one-time fee consisting of shares of common stock of
the Company, which represents a fee of five percent (
The conversion related features of the Second July 2024 Facility Agreement were bifurcated from their host debt contract and recognized as liabilities measured at fair value at each balance sheet date.
In
connection with the Second July 2024 Facility Agreement, the Company incurred deferred debt issuance costs of $
| -28- |
QUANTUM X LABS INC. (formerly known as Viewbix Inc.)
NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
U.S. dollars in thousands (except share data)
NOTE 7: LOANS (Cont.)
F. Second July 2024 Facility Agreement (Cont.)
Under
the terms of the Second July 2024 Facility Agreement, the Company received in July 2024 a loan of $
During
June 2025, all warrants granted under the Second July 2024 Facility Agreement were exercised into shares of common stock.
The Company received total proceeds of $
On July 14, 2025, following the closing of the July 2025 Private Placement and the proceeds received by the Company (see note 10.C), the Second July 2024 Facility Agreement was terminated.
NOTE 8: FINANCIAL INSTRUMENTS AT FAIR VALUE
Financial instruments:
The Company has level 3 financial instruments that were recognized at fair value upon initial recognition of each financial instrument and subsequently measured at fair value at each balance sheet date, consisting of: (i) the earn-out liability arising from the Metagramm Acquisition (see note 6.B); and (ii) embedded derivatives arising from the June 2024 Facility Agreement, the First July 2024 Facility Agreement and the Second July 2024 Facility Agreement (see notes 7.D, 7.E, 7.F).
On June 5, 2025, following the Uplist, the Company converted all embedded derivatives into equity. Prior to the conversion, and as of the Uplist Date, these embedded derivatives were measured at their intrinsic value through profit or loss.
The following table presents the financial instruments that were measured at fair value through profit or loss:
SCHEDULE OF FINANCIAL INSTRUMENTS
| Earn-out liability | ||||
| Balance as of January 1, 2026 | ||||
| Earn-out liability recorded in connection with Metagramm Acquisition (see note 6.B) | ||||
| Net changes at fair value recognized through profit or loss | ||||
| Embedded derivatives converted to equity | ||||
| Earn-out payable amounts upon achieving financing milestone in connection with Metagramm Acquisition (see notes 6.B, 10.D) | ( | ) | ||
| Balance as of June 30, 2026 | ||||
Embedded derivatives | Earn-out liability | |||||||
| Balance as of January 1, 2025 | ||||||||
| Beginning balance | ||||||||
| Earn-out liability recorded in connection with Metagramm Acquisition (see note 6.B) | ||||||||
| Earn-out payable amounts upon achieving financing milestone in connection with Metagramm Acquisition (see note 6.B) | ( | ) | ||||||
| Net changes at fair value recognized through profit or loss | ( | ) | ||||||
| Embedded derivatives converted to equity | ( | ) | ||||||
| Balance as of December 31, 2025 | ||||||||
| Ending balance | ||||||||
| -29- |
QUANTUM X LABS INC. (formerly known as Viewbix Inc.)
NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
U.S. dollars in thousands (except share data)
NOTE 9: COMMITMENTS AND CONTINGENCIES
Liens:
On September 19, 2022, as part of the Reorganization Transaction terms, the Company has provided several liens under Gix Media’s Financing Agreement with Leumi in connection with the Cortex Transaction, as follows: (1) a guarantee to Leumi of all of Gix Media’s obligations and undertakings to Leumi unlimited in amount; (2) a subordination letter signed by the Company to Leumi; (3) A first ranking all asset charge over all of the assets of the Company; and (4) a Deposit Account Control Agreement over the Company’s bank accounts.
In connection with the Cortex Transaction, Gix Media has provided several liens under the Financing Agreement with Leumi, as follows: (1) a floating lien on Gix Media’s assets; (2) a lien on Gix Media’s bank account in Leumi; (3) a lien on Gix Media’s rights under the Cortex Transaction; (4) a fixed lien on Gix Media’s intellectual property; and (5) a lien on Gix Media’s full holdings in Cortex.
On November 9, 2025, under the Cortex Sale Agreement (see note 6.A), Gix Media provided Leumi a lien on the consideration received in the form of shares and Leumi released its lien on the shares of Cortex sold by Gix Media.
Gix
Media and Quantum Israel’s restricted deposits, in the amounts of $
NOTE 10: SHAREHOLDERS’ EQUITY
A. Shares of Common Stock:
Shares of Common Stock confer the rights to: (i) participate in the general meetings, to one vote per share for any purpose, to an equal part, on share basis, (ii) in distribution of dividends and (iii) to equally participate, on share basis, in distribution of excess of assets and funds from the Company and will not confer other privileges.
On March 24, 2025, the Company entered into the 2025 SEA with Metagramm and all of the shareholders of Metagramm, pursuant to which the Company issued to Metagramm’s shareholders of the Company’s shares representing % of its issued and outstanding share capital in exchange for % of Metagramm’s issued and outstanding share capital (see note 6.B).
On
June 5, 2025, following the Uplist and as part of the June 2024 Facility Agreement, $
On
June 5, 2025, following the Uplist and as part of the First July 2024 Facility Agreement, $
| -30- |
QUANTUM X LABS INC. (formerly known as Viewbix Inc.)
NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
U.S. dollars in thousands (except share data)
NOTE 10: SHAREHOLDERS’ EQUITY (Cont.)
A. Shares of Common Stock: (Cont.)
On
June 5, 2025, following the Uplist and as part of the Second July 2024 Facility Agreement, $
On June 15, 2025, the Company issued shares of common stock to a consultant as consideration for services provided in connection with the Uplist. The Company recognized $ of share-based compensation expense, recorded in other expenses, net, during the year ended December 31, 2025.
In
June 2026, out of
B. 2024 Private Placement
On
July 3, 2024, the Company entered into a definitive securities purchase agreement with a certain investor (the “Lead
Investor”) for the purchase and sale in a private placement (the “2024 Private Placement”) of units consisting of
(i)
shares of the Company’s common stock at a purchase price of $
per share and (ii)
The
aggregate gross proceeds received by the Company from the 2024 Private Placement were $
Following
the Uplist Date, out of
C. July 2025 Private Placement
On
July 11, 2025, the Company entered into a securities purchase agreement with certain accredited investors pursuant to which the Company
issued and sold in a private placement, (the “July 2025 Private Placement”) an aggregate of shares of common stock,
pre-funded warrants to purchase up to
The
pre-funded warrants were immediately exercisable upon issuance at an exercise price of $
In
connection with the July 2025 Private Placement, the Company also entered into a letter agreement with a placement agent on July 11,
2025, according to which the Company paid a cash placement fee equal to
The
July 2025 Private Placement closed on July 14, 2025. The aggregate gross proceeds received by the Company on the closing date were $
| -31- |
QUANTUM X LABS INC. (formerly known as Viewbix Inc.)
NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
U.S. dollars in thousands (except share data)
NOTE 10: SHAREHOLDERS’ EQUITY (Cont.)
C. July 2025 Private Placement (Cont.)
In connection with the closing of the July 2025 Private Placement and the related proceeds, the First July 2024 Facility Agreement and the Second July 2024 Facility Agreement were terminated. In addition, the shareholders of Metagramm became entitled to partial earn-out payments on a pro rata basis pursuant to the 2025 SEA (see note 6.B).
On September 5, 2025, pre-funded warrants were exercised into shares of common stock.
In
June 2026, common warrants were exercised into shares of common stock. The Company received total proceeds of $
D. 2026 Private Placement
On
January 1, 2026, the Company entered into an amended and restated securities purchase agreement with certain accredited investors pursuant
to which the Company agreed to sell and issue in a private placement, an aggregate amount of shares of common stock (the “2026
Private Placement”) and common warrants to purchase up to an aggregate amount of
In
connection with the 2026 Private Placement, the Company also entered into an advisory agreement, as amended, with L.I.A. Pure Capital
Ltd. (“the Advisor”) pursuant to which the Company agreed to pay the Advisor a commission consisting of (i) a cash fee of
$
The
2026 Private Placement closed on March 4, 2026, pursuant to which the Company issued shares of its common stock and warrants
to purchase
In connection with the closing of the 2026 Private Placement and the related proceeds, the shareholders of Metagramm became entitled to partial earn-out payments on a pro rata basis pursuant to the 2025 SEA (see note 6.B).
In April 2026, the Company paid the Advisor the Fee and repaid the Loan Repayment.
In
June 2026, out of
E. Quantum Israel Acquisition
On
March 4, 2026, pursuant to the Quantum Israel Acquisition (see not 6.C), the Company issued to the Quantum Israel Shareholders
shares of its common stock and pre-funded warrants to purchase
| -32- |
QUANTUM X LABS INC. (formerly known as Viewbix Inc.)
NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
U.S. dollars in thousands (except share data)
NOTE 10: SHAREHOLDERS’ EQUITY (Cont.)
F. Warrants:
The following table summarizes information of outstanding warrants as of June 30, 2026:
SCHEDULE OF OUTSTANDING WARRANTS
| Warrants | Warrant Term | Exercise Price | Exercisable | |||||||||||
| Class J Warrants | ||||||||||||||
| Class K Warrants | ||||||||||||||
| June 2024 Facility Agreement Warrants (note 7.D) | ||||||||||||||
| June 2024 Lead Lender Fee Warrants (note 7.D) | ||||||||||||||
| 2024 PIPE Warrants (note 10.B) | ||||||||||||||
| 2025 July Private Placement - pre-funded warrants (note 10.C) | ||||||||||||||
| 2025 July Private Placement – common warrants (note 10.C) | ||||||||||||||
| 2026 Private Placement - common warrants (note 10.D) | ||||||||||||||
| Quantum Israel Acquisition - pre-funded warrants (note 10.E) | ||||||||||||||
| Total | ||||||||||||||
The following table summarizes the activity in outstanding warrants during the six months ended June 30, 2026:
| Warrants outstanding as of January 1, 2026 | Warrants granted | Warrants Exercised | Warrants outstanding as of June 30, 2026 | |||||||||||||
| Class J Warrants | ||||||||||||||||
| Class K Warrants | ||||||||||||||||
| June 2024 Facility Agreement Warrants (note 7.D) | ||||||||||||||||
| June 2024 Lead Lender Fee Warrants (note 7.D) | ( | ) | ||||||||||||||
| 2024 PIPE Warrants (note 10.B) | ||||||||||||||||
| 2025 July Private Placement - pre-funded warrants (note 10.C) | ||||||||||||||||
| 2025 July Private Placement – common warrants (note 10.C) | ( | ) | ||||||||||||||
| 2026 Private Placement - common warrants (note 10.D) | ( | ) | ||||||||||||||
| Quantum Israel Acquisition - pre-funded warrants (note 10.E) | ( | ) | ||||||||||||||
| Total | ( | ) | ||||||||||||||
G. Reverse Stock Split:
On
July 15, 2024, the Company filed an amendment to its Amended COI to effect a
As
a result of the Reverse Stock Split,
Share and per share data in these financial statements have been retrospectively adjusted to reflect the Reverse Stock Split for periods presented prior to the Reverse Stock Split.
| -33- |
QUANTUM X LABS INC. (formerly known as Viewbix Inc.)
NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
U.S. dollars in thousands (except share data)
NOTE 10: SHAREHOLDERS’ EQUITY (Cont.)
H. Share option plan:
On
March 2, 2023, the Board approved the adoption of the 2023 Stock Incentive Plan (the “2023 Plan”). The 2023 Plan permits
the issuance of up to (i) shares of Common Stock, plus (ii) an annual increase equal to the lesser of (A)
The 2023 Plan provides for the grant of stock options, restricted stock, restricted stock units, stock or other stock-based awards, under various tax regimes, including, without limitation, in compliance with Section 102 and Section 3(i) of the Israeli Income Tax Ordinance (New Version) 5271-1961, and for awards granted to United States employees or service providers, including those who are deemed to be residents of the United States for tax purposes, Section 422 and Section 409A of the United States Internal Revenue Code of 1986.
In connection with the adoption of the 2023 Plan, on March 7, 2023, the Company entered into certain intercompany reimbursement agreements with two of its subsidiaries, Viewbix Israel and Gix Media (the “Recharge Agreements”). The Recharge Agreements provide for the offer of awards under the 2023 Plan to employees or service providers of Viewbix Israel and Gix Media (the “Affiliates”) under the 2023 Plan. Under the Recharge Agreements, the Affiliates will each bear the costs of awards granted to its employees or its service providers under the 2023 Plan and will reimburse the Company upon the issuance of shares of Common Stock pursuant to an award, for the costs of shares issued, but in any event not prior to the vesting of an award. The reimbursement amount will be equal to the lower of (a) the book expense for such award as recorded on the financial statements of one of the respective Affiliates, determined and calculated according to U.S. GAAP, or any other financial reporting standard that may be applicable in the future, or (b) the fair value of the shares of Common Stock at the time of exercise of an option or at the time of vesting of an RSU, as applicable.
On July 11, 2025, in accordance with the terms of the 2023 Plan, the Company’s board of directors approved an increase in the number of shares of common stock reserved for issuance under the 2023 Plan by up to shares.
| -34- |
QUANTUM X LABS INC. (formerly known as Viewbix Inc.)
NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
U.S. dollars in thousands (except share data)
Basic net earnings (loss) per share is computed by dividing net earnings (loss) attributable to ordinary shareholders of Quantum X Labs Inc. by the weighted average number of shares of common stock outstanding for the reporting periods.
Diluted net earnings (loss) per share is computed by dividing net earnings (loss) attributable to ordinary shareholders of Quantum X Labs Inc including adjustment of the interest expenses on the Company’s convertible loans, by the weighted-average number of shares of common stock and the potential dilutive common shares outstanding during the period. Diluted shares outstanding include the dilutive effect of in-the-money warrants using the treasury stock method and the potential conversion of the Company’s convertible loans into shares.
For the six and three months ended June 30, 2025, the Company reported a net loss, therefore did not take into account dilutive effect. As a result, the basic net loss per share was equal to the dilutive net loss per share.
SCHEDULE OF BASIC AND DILUTED NET LOSS PER SHARE
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
For the six months ended June 30, | For the three months ended June 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Numerator: | ||||||||||||||||
| Numerator for basic earnings per share: | ||||||||||||||||
| Net income (loss) attributable to Quantum X Labs Inc shareholders | ( | ) | ( | ) | ||||||||||||
| Effect of dilutive securities: | ||||||||||||||||
| Interest expenses on convertible loans | ||||||||||||||||
| Numerator for diluted earnings per share: | ||||||||||||||||
| Adjusted net income (loss) | ( | ) | ( | ) | ||||||||||||
| Denominator: | ||||||||||||||||
| Denominator for basic earnings per share: | ||||||||||||||||
| Weighted average shares | ||||||||||||||||
| Effect of dilutive securities: | ||||||||||||||||
| Warrants and converted loans | ||||||||||||||||
| Dilutive potential common shares | ||||||||||||||||
| Denominator for diluted earnings per share: | ||||||||||||||||
| Adjusted weighted average shares | ||||||||||||||||
| Basic earnings (loss) per share attributable to Quantum X Labs Inc shareholders | ( | ) | ( | ) | ||||||||||||
| Diluted earnings (loss) per share attributable to Quantum X Labs Inc shareholders | ( | ) | ( | ) | ||||||||||||
| -35- |
QUANTUM X LABS INC. (formerly known as Viewbix Inc.)
NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
U.S. dollars in thousands (except share data)
NOTE 12: SEGMENT REPORTING
The
Group operates in such a way that each company in the Group represents a
Search segment - the search segment develops a variety of technological software solutions, which perform automation, optimization and monetization of internet campaigns, for the purposes of obtaining and routing internet user traffic to its customers. The search segment activity is conducted by Gix Media.
Digital content segment - the digital content segment was engaged in the creation and editing of content, in different languages, for different target audiences, for the purposes of generating revenues from leading advertising platforms, including Google, Facebook, Yahoo and Apple, by utilizing such content to obtain internet user traffic for its customers. The digital content segment activity was conducted by Cortex until November 9, 2025 (see note 6.A), after which the Group ceased operations in this segment and continued to operate solely in the search segment (see note 3).
Quantum technology segment – the quantum technology segment generally comprises three principal areas: quantum computing, quantum communication, and quantum sensing. Quantum computing applies principles of quantum mechanics to perform certain computational tasks more efficiently than classical systems and to address problems that are not practically solvable using conventional computing. Quantum communication focuses on the transmission of information using quantum methods and is designed to enhance the security of data exchange. Quantum sensing involves the use of quantum-based systems to measure physical phenomena, such as electromagnetic fields, gravity, and time, with significantly greater sensitivity than traditional sensors. The quantum technology segment activity is conducted by Quantum Israel.
The segments’ results include items that directly serve and/or are used by the segment’s business activity and are directly allocated to the segment. As such they do not include depreciation and amortization expenses for intangible assets created at the time of the purchase of those companies and financing expenses incurred on loans taken for the purpose of purchasing those companies. Therefore, these items are not allocated to the various segments.
The chief executive officer, who is the Company’s chief operating decision maker (“CODM”), assesses performance for these segments and decides how to allocate resources based the segments’ operating income or loss and income or loss before tax. Segments’ assets and liabilities are not reviewed by the CODM and therefore were not reflected in the segment reporting. The significant expense categories comprising segments profit and loss regularly reviewed by the CODM for the periods ended June 30, 2026 and 2025 are set forth in the table below.
| -36- |
QUANTUM X LABS INC. (formerly known as Viewbix Inc.)
NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
U.S. dollars in thousands (except share data)
NOTE 12: SEGMENT REPORTING (Cont.)
A substantial portion of non-current assets is derived from Israel and a substantial portion of revenues is derived from the United States.
Segments revenues and operating results:
SCHEDULE OF SEGMENTS REVENUES AND OPERATING RESULTS
Search segment | Quantum technology segment | Adjustments and eliminations (See below) | Total | |||||||||||||
| For the six months ended June 30, 2026 | ||||||||||||||||
Search segment | Quantum technology segment | Adjustments and eliminations (See below) | Total | |||||||||||||
| Revenues from external customers | ||||||||||||||||
| Traffic-acquisition and related | ||||||||||||||||
| Research and development expenses | ||||||||||||||||
| Sales and marketing expenses | ||||||||||||||||
| General and administrative expenses | ||||||||||||||||
| Depreciation and amortization | ||||||||||||||||
| Other expenses (income), net | ( | ) | ||||||||||||||
| Segment operating income (loss) | ( | ) | ( | ) | ( | ) | ||||||||||
| Gain from deconsolidation of a subsidiary | ||||||||||||||||
| Financial expenses (income), net | ( | ) | ( | ) | ( | ) | ||||||||||
| Segment income (loss), before income taxes | ( | ) | ||||||||||||||
Search Segment | Adjustments and eliminations (See below) | Total | ||||||||||
| For the six months ended June 30, 2025 | ||||||||||||
Search Segment | Adjustments and eliminations (See below) | Total | ||||||||||
| Revenues from external customers | ||||||||||||
| Traffic-acquisition and related costs | ||||||||||||
| Research and development expenses | ||||||||||||
| Sales and marketing expenses | ||||||||||||
| General and administrative expenses | ||||||||||||
| Depreciation and amortization | ||||||||||||
| Other expenses, net | ||||||||||||
| Segment operating income (loss) | ( | ) | ( | ) | ||||||||
| Financial expenses, net | ( | ) | ( | )(*) | ( | ) | ||||||
| Segment income (loss), before income taxes | ( | ) | ( | ) | ||||||||
Search segment | Quantum technology segment | Adjustments and eliminations (See below) | Total | |||||||||||||
| For the three months ended June 30, 2026 | ||||||||||||||||
Search segment | Quantum technology segment | Adjustments and eliminations (See below) | Total | |||||||||||||
| Revenues from external customers | ||||||||||||||||
| Traffic-acquisition and related | ||||||||||||||||
| Research and development expenses | ||||||||||||||||
| Sales and marketing expenses | ||||||||||||||||
| General and administrative expenses | ||||||||||||||||
| Depreciation and amortization | ||||||||||||||||
| Other expenses (income), net | ( | ) | ||||||||||||||
| Segment operating income (loss) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Gain from deconsolidation of a subsidiary | ||||||||||||||||
| Financial expenses (income), net | ( | ) | ( | ) | ( | ) | ||||||||||
| Segment income (loss), before income taxes | ( | ) | ( | ) | ||||||||||||
Search Segment | Adjustments and eliminations (See below) | Total | ||||||||||
| For the three months ended June 30, 2025 | ||||||||||||
Search Segment | Adjustments and eliminations (See below) | Total | ||||||||||
| Revenues from external customers | ||||||||||||
| Traffic-acquisition and related costs | ||||||||||||
| Research and development expenses | ||||||||||||
| Sales and marketing expenses | ||||||||||||
| General and administrative expenses | ||||||||||||
| Depreciation and amortization | ||||||||||||
| Other expenses, net | ||||||||||||
| Segment operating income (loss) | ( | ) | ( | ) | ||||||||
| Financial expenses, net | ( | ) | ( | )(*) | ( | ) | ||||||
| Segment income (loss), before income taxes | ( | ) | ( | ) | ||||||||
| -37- |
QUANTUM X LABS INC. (formerly known as Viewbix Inc.)
NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
U.S. dollars in thousands (except share data)
NOTE 12: SEGMENT REPORTING (Cont.)
The “adjustments and eliminations” column for segment operating income includes unallocated selling, general, and administrative expenses and certain items which management excludes from segment results when evaluating segment performance, as follows:
SCHEDULE OF RECONCILIATION BETWEEN SEGMENTS OPERATING RESULTS
For the six June 30, | For the six June 30, | |||||||
| Depreciation and amortization expenses not attributable to segments (**) | ( | ) | ( | ) | ||||
| Revenues, research and development expenses, sales and marketing expenses, general and administrative expenses and other expenses, net not attributable to the segments (***) | ( | ) | ( | ) | ||||
| Gain from deconsolidation of a subsidiary | ||||||||
| ( | ) | |||||||
For the three June 30, | For the three June 30, | |||||||
| Depreciation and amortization expenses not attributable to segments (**) | ( | ) | ( | ) | ||||
| Revenues, research and development expenses, sales and marketing expenses, general and administrative expenses and other expenses, net not attributable to the segments (***) | ( | ) | ( | ) | ||||
| Gain from deconsolidation of a subsidiary | ||||||||
| ( | ) | |||||||
| (*) | Mainly consist of financial expenses arising from changes in the fair value of financial assets measured at fair value through profit or loss (see note 8). |
| (**) | ||
| (***) |
| -38- |
QUANTUM X LABS INC. (formerly known as Viewbix Inc.)
NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
U.S. dollars in thousands (except share data)
NOTE 13: SUBSEQUENT EVENTS
The Company has evaluated subsequent events from June 30, 2026, through August 13, 2026, the date of issuance of these financial statements:
| A. | On July 8, 2026, the Company issued shares of common stock to a former consultant as settlement of amounts owed for services previously provided. | |
| B. | On July 9, 2026, warrants of the 2026 PIPE Warrants (see note 10.D) were exercised into shares of
common stock. The Company received total proceeds of $ | |
| C. | During July 2026,
of the June 2024 Lead Lender Fee Warrants (see note 7.D) were exercised into shares of common stock. The Company received
total proceeds of $ | |
| D. | On July 29, 2026, $ |
| -39- |
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS AND RESULTS OF OPERATIONS
Special Note Regarding Forward-Looking Statements
The following management’s discussion and analysis section should be read in conjunction with the Company’s unaudited financial statements as of June 30, 2026 and 2025, and the related statements of statement operation, statement of changes in shareholders’ equity and statements of cash flows for the three months then ended, and the related notes thereto contained in this Quarterly Report on Form 10-Q (this “Quarterly Report”).
Our reporting currency and functional currency is the U.S. dollar. Unless otherwise expressly stated or the context otherwise requires, references in this prospectus to “NIS” are to New Israeli Shekels, and references to “dollars” or “$” mean U.S. dollars.
Forward-Looking Statements
This Quarterly Report on Form 10-Q contains “forward-looking statements,” which include information relating to future events, future financial performance, strategies, expectations, competitive environment and regulation, including revenue growth. Words such as “may,” “will,” “should,” “could,” “would,” “predicts,” “potential,” “continue,” “expects,” “anticipates,” “future,” “intends,” “plans,” “believes,” “estimates,” and similar expressions, as well as statements in future tense, identify forward-looking statements. Forward-looking statements should not be read as a guarantee of future performance or results and may not be accurate indications of when such performance or results will be achieved. Forward-looking statements are based on information we have when those statements are made or our management’s good faith belief as of that time with respect to future events and are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in or suggested by the forward-looking statements. Important factors that could cause such differences include, but are not limited to:
| ● | our ability to achieve milestones, and/or technological advancements, including with respect to executing on our technology roadmap and developing practical applications; |
| ● | the potential of quantum computing and estimated market size and market growth including with respect to our long-term business strategies for quantum computing as a service; |
| ● | the early-stage and rapidly evolving nature of the quantum computing industry; |
| ● | uncertainty regarding the scalability, reliability and practical application of quantum technologies; |
| ● | our expectations regarding the development, commercialization and adoption of quantum computing technologies; |
| ● | our ability and timeline to monetize our investments in quantum computing, if at all, |
| ● | the continued demand of digital advertising as an integral part of corporate marketing and internal communications plans and the continued growth and acceptance of digital advertising as effective alternatives to traditional offline marketing products and service; |
| ● | our ability to generate enough cash flow to meet our debt obligations or fund our other liquidity needs, and substantial doubt regarding our ability to continue as a going concern; |
| ● | our need to raise additional capital to meet our business requirements in the future and such capital raising may be costly or difficult to obtain and could dilute out shareholders’ ownership interests; |
| ● | our ability to receive credit facility to fund our operations, at favorable terms, or at all; |
| ● | our ability to pay our obligations when they become due, including the contemplated debt restructuring program currently under negotiation with our credit and debtholders; |
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| ● | our subsidiaries’ future performance, including our ability to instill potential measures to assist Gix Media Ltd. (“Gix Media”), Metagramm Software Ltd. (“Metagramm”) and Quantum X Labs Ltd. (“Quantum Israel”) in mitigating future economic harm; |
| ● | our ability to realize the benefits of our acquisitions of Quantum Israel and Metagramm; |
| ● | our research and development efforts, anticipated technological advancements, strategic partnerships, market opportunities, competitive positioning, and our future financial performance, including revenue growth, operating expenses and capital requirements; |
| ● | entry of new competitors and products, including competition from larger, more established technology companies, the impact of large and established internet and technology companies and potential technological obsolescence of our offered platforms; and |
| ● | our ability to implement our strategic initiatives, expansion plans and continue to innovate our existing products and services; |
| ● | our ability to grow and manage growth profitably, maintain relationships with customers and suppliers and retain our management and key employees; |
| ● | our ability to maintain the listing of our common stock on the Nasdaq Capital Market; |
| ● | changes in tariffs, trade barriers, price and exchange controls and other regulatory requirements and the impact of such policies on us, our customers and suppliers, and the global economic environment; |
| ● | the fact that we conduct business in multiple foreign jurisdictions, exposing us to foreign currency exchange rate fluctuations, logistical and communications challenges, burdens and costs of compliance with foreign laws and political and economic instability in each jurisdiction; |
| ● | adverse federal, state and local government regulation, in the United States, Europe or Israel and other foreign jurisdictions, including, but not limited to changes in governmental policies, regulations or funding priorities related to quantum computing and advanced technologies; |
| ● | macroeconomic conditions, including global economic and geopolitical conditions, military conflicts, government shutdowns, disruptions to and volatility and uncertainty in the credit and financial markets, uncertainty in levels of future economic activity, inflation and interest rates; |
| ● | political, economic and military conditions in Israel, including the current security situation in Israel, as well as the war’s potential impact on our business and operation. |
The foregoing does not represent an exhaustive list of matters that may be covered by the forward-looking statements contained herein or risk factors that we are faced with which may cause our actual results to differ from those anticipated in our forward-looking statements. For a discussion of these and other risks that relate to our business and investing in our common stock, you should carefully review the risks and uncertainties described in this Quarterly Report, and those contained in section captioned “Risk Factors” of our Annual Report on Form 10-K for the fiscal year ended December 31, 2025, filed with the Securities and Exchange Commission (the “SEC”) on March 27, 2026 (the “Annual Report”). The Company’s actual results could differ materially from those contemplated in these forward-looking statements as a result of these factors. The Company does not undertake any obligation to update forward-looking statements to reflect events or circumstances occurring after the date of this Quarterly Report.
Overview and Background
Quantum X Labs Inc. (the “Registrant”, “Quantum X Labs” or the “Company”) and its subsidiaries are focused on quantum technology, digital advertising and computing and enterprise artificial intelligence (AI) solutions. Quantum Israel is focused on developing and promoting quantum algorithms for the transportation, drug discovery and security segments as well as developing quantum- based GPS replacement and quantum atom accuracy solutions. Gix Media develops a variety of technological software solutions, which perform automation, optimization and monetization of internet campaigns, for the purposes of acquiring and routing internet user traffic to its customers. Metagramm is a developer of grammatical error correction software and offers tools for writing and reviewing, grammar, spelling, punctuation and style features, as well as translation and multilingual dictionaries, using artificial intelligence and machine learning technology.
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Quantum Technology
The Company, through its subsidiary Quantum Israel, is focused on developing foundational and applied innovations across quantum computing, sensing, navigation, and security. Its mission is to research, develop, and own quantum technology intellectual property that addresses major challenges emerging as the quantum revolution scales into commercial and industrial use. Quantum Israel combines deep academic research with practical engineering to create deployable quantum solutions.
Quantum Israel maintains a portfolio of five dedicated operating subsidiaries, each targeting distinct applications in quantum technology — a structure that allows for focused research and development, faster innovation cycles, and clearer path to potential commercialization across markets that range from defense navigation to biomedical computing. Through its multi-subsidiary structure, it simultaneously tackles multiple markets while retaining shared intellectual property and research advantages with an aim to bridge cutting-edge research with real-world impact.
Quantum technology generally comprises three principal areas: quantum computing, quantum communication, and quantum sensing. Quantum computing applies principles of quantum mechanics to perform certain computational tasks more efficiently than classical systems and to address problems that are not practically solvable using conventional computing. Quantum communication focuses on the transmission of information using quantum methods and is designed to enhance the security of data exchange. Quantum sensing involves the use of quantum-based systems to measure physical phenomena, such as electromagnetic fields, gravity, and time, with significantly greater sensitivity than traditional sensors
Quantum X Labs benefits from strong ties to leading Israeli academic institutions, which support a multidisciplinary approach combining advanced theoretical research with applied engineering. Members of its team and management have academic backgrounds and research affiliations with institutions, such as Tel Aviv University, Hebrew University of Jerusalem, Technion – Israel Institute of Technology, and the Weizmann Institute of Science. These academic connections contribute to its ability to integrate research across mathematics, physics, and computer science, and to translate foundational quantum concepts into practical algorithms, intellectual property, and technology development relevant to next-generation quantum computing platforms.
Strategy
Quantum X Labs’ model of distinct subsidiaries under one umbrella is designed to:
| ● | Isolate technical risk: Each quantum domain has unique challenges and development cycles. The portfolio approach mitigates risk by diversifying across applications rather than concentrating in a single technology stack. | |
| ● | Improve potential commercialization velocity: Dedicated operating companies can focus on tailored product roadmaps, partnerships, and market entry strategies, accelerating potential path to market for each line. | |
| ● | Build reusable IP: Core innovations, such as quantum error correction cores, quantum algorithms, and foundational processing toolchains, can be shared across subsidiaries, creating cross-domain synergies. | |
| ● | Enable strategic partnerships: Structuring teams as independent operating entities facilitates collaborations with academic institutions, government labs, and industry partners across different verticals. |
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Portfolio Companies and Segments
| ● | Quantum Transportation |
Focus: quantum error correction and decoding infrastructure for quantum hardware.
Quantum Transportation, a 30%-owned affiliate of Quantum X Labs, develops tools that help quantum hardware teams accelerate research and choose efficient quantum error correction schemes tailored to their systems. The subsidiary supports labs and smaller companies that lack in-house quantum error correction expertise. Its platform includes simulators and research environments that improve error tolerance and robustness in quantum processors.
| ● | Quantum Computing- Cold Atom Architecture |
Focus: A quantum computer based on cold atom architecture for high-performance quantum processing unit.
A Quantum X Labs activity whose platform leverages advanced laser cooling technology combined with dynamically reconfigurable optical tweezer arrays. This architecture enables rapid, high-fidelity loading of large- scale qubit registers, extended coherence times, and native support for high-performance Rydberg-mediated two-qubit gates.
| ● | CliniQuantum |
Focus: quantum-enhanced algorithmic platforms for biomedical research and clinical trials.
CliniQuantum, a 46%-owned affiliate of Quantum X Labs, is developing quantum-accelerated computing methods, including a provisional patent filed for quantum-enhanced Markov Chain Monte Carlo (MCMC) sampling to improve complex probability sampling in clinical research. This technology aims to reveal hidden structures in biological and patient data, enabling faster and more efficient clinical trial modeling, personalization of treatment response, and broader insights across high-dimensional biological datasets
| ● | Quantum Gyro |
Focus: quantum inertial navigation systems and gyroscope technologies.
Quantum Gyro, a 40%-owned affiliate of Quantum X Labs, focuses on developing chip-scale nuclear magnetic resonance (NMR) gyroscope sensors that detect rotation based on shifts in quantum precession frequencies. These systems aim for ultra-low drift and high stability, crucial for navigation where GPS signals are unavailable or jammed (e.g., subterranean, underwater, or defense environments).
| ● | QuantumQ Security |
Focus: next-generation quantum-based cyber and communication security.
QuantumQ Security, a 40%-owned affiliate of Quantum X Labs, builds quantum-native security technologies that leverage quantum principles to enhance protections for communications, data systems, and critical infrastructure. The subsidiary operates from a foundation of Quantum X Labs’ error correction IP and broader quantum algorithm knowledge, aiming to strengthen cybersecurity against both classical and future quantum threats.
| ● | Quantum Atom Accuracy |
Focus: high-precision quantum timing and sensing systems.
Quantum Atom Accuracy, a 40%-owned affiliate of Quantum X Labs, concentrates on quantum-level measurement and timing technologies — platforms that push beyond classical limits in precision and stability. While details on products are emerging, this unit contributes to timing, synchronization, and high-resolution measurement capabilities that can be applied in communications, sensing systems, and advanced research
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| ● | Nuclear Quantum |
Focus: quantum centric supercomputing for advanced nuclear engineering.
Nuclear Quantum, a 40%-owned subsidiary of Quantum X Labs, integrates quantum algorithms into established nuclear engineering workflows to overcome the computational bottlenecks that slow reactor design, licensing, and long term operation. Nuclear Quantum develops quantum ready algorithms and hybrid frameworks that accelerate the core numerical problems inside nuclear simulation and optimization.
Digital Advertising
Quantum X Labs also operates a digital advertising platform that develops and markets a variety of technological platforms that automate, optimize and monetize digital online campaigns. The Company, through its subsidiary, Gix Media, is focused on digital advertising operations for ad search (the “Search Platform”). Gix Media develops and markets a variety of technological software solutions that automate, optimize and monetize online campaigns. These technological tools enable advertisers and website owners to earn more from their advertising campaigns and generate additional profits from their sites. Through the Search Platform, the Company provides services to leading Search Engines worldwide by developing, marketing and distributing software products to internet users. The operations and activity on this platform are powered by Gix Media.
Until November 2025, in addition to Gix Media’s Search Platform, the Company, through a previous majority-owned subsidiary of Gix Media, Cortex, operated a digital content platform, which produced engaging content and marketing material in various languages to various target audiences, in order to generate revenues from advertisements displayed together with the content, which are posted on digital content, marketing and advertising platforms. Following the Cortex Sale (as defined below), the Company only operates the Search Platform.
Enterprise AI
The Company, through its wholly-owned subsidiary, Metagramm, specializes in developing advanced writing assistance tools that leverage artificial intelligence, machine learning, and natural language processing technologies. Their flagship product, Bubbl, is an innovative writing tool designed to provide personalized and customized text tailored to the user’s unique expression. Unlike common AI writing tools that often produce machine-like results, Bubbl offers a more human-like writing experience. It supports various modes, including an interactive re-write floating window mode, interactive inline mode, and a grammar-only mode. Additionally, Bubbl caters to different writing needs with specialized profiles for business, medical, academic, and blogging, each incorporating tailored assistance tools to facilitate the writing process.
Recent Developments
Name and Ticker Symbol Change
Effective April 30, 2026, the Company changed its name from “Viewbix Inc.” to “Quantum X Labs Inc.” and its trading symbol on the Nasdaq Capital Market from “VBIX” to “QXL.”
Quantum Israel Acquisition
On December 15, 2025, we entered into a securities exchange agreement (the “Quantum Exchange Agreement”) with Quantum Israel and certain of the shareholders of Quantum Israel (the “Quantum Israel Shareholders”) pursuant to which we agreed to issue to the Quantum Israel Shareholders an aggregate of up to 40.0% of our issued and outstanding capital stock as of December 15, 2025, inclusive of the 800,000 shares of our common stock issuable by us in a private placement offering that we entered into in November 2025 (the “Private Placement Shares”), consisting of (i) up to 2,666,000 shares of our common stock, representing 19.99% of our issued and outstanding capital stock (the “Exchange Shares”), inclusive of the Private Placement Shares, and (ii) pre-funded warrants to purchase up to 4,447,595 shares of our common stock, representing the balance of up to the 40.0%, as of December 15, 2025, less the Exchange Shares (the “Exchange Pre-Funded Warrants”), in exchange for up to 100%, but not less than 85%, of Quantum Israel’s issued and outstanding share capital on a fully diluted and post-closing basis, equal to an amount up to 589,319 of Quantum Israel’s ordinary shares.
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In addition, pursuant to the Quantum Exchange Agreement, we may issue up to 12,702,847 additional shares of our common stock or pre-funded warrants to purchase shares of our common stock (collectively, the “Earn-Out Securities”), upon the achievement of certain milestones as follows: (i) the issuance of up to 1,975,998 Earn-Out Securities upon the submission of five (5) patent applications including provisional applications in total, across at least three (3) distinct sub-fields within the quantum sector, by Quantum Israel or any of its Portfolio Companies (as defined in the Quantum Exchange Agreement) during the 18-month period following the Quantum Closing Date (as defined below), (ii) the issuance of up to 3,436,519 Earn-Out Securities upon the closing of listing, public offering, or an M&A Transaction (as defined in the Quantum Exchange Agreement) of any Portfolio Company of Quantum Israel, at a pre-money valuation of no less than $20 million during the twenty four-month period following the Quantum Closing Date, and (iii) the issuance of up to 7,290,330 Earn-Out Securities upon the earlier of: (1) a capital raise of at least $10 million into either the Company or Quantum Israel at a pre-money valuation of no less than $250 million; or (2) closing of any M&A Transaction of Quantum Israel, at a pre-money valuation not less than $250 million during the 48-month period following the Quantum Closing Date. Pursuant to the Quantum Exchange Agreement, the Earn-Out Securities may become issuable to the Quantum Israel Shareholders only following the 12-month anniversary of the Quantum Closing Date, and only upon achievement of the applicable earn-out milestones set forth above.
The Exchange Shares and the shares of common stock issuable upon the exercise of the Exchange Pre-Funded Warrants issuable to the Quantum Israel Shareholders will be subject to a 12-month lock-up period following the Quantum Closing Date, subject to certain exceptions. The Exchange Pre-Funded Warrants and the pre-funded warrants issuable as Earn-Out Securities are, or will be, immediately exercisable upon issuance at an exercise price of $0.0001 per share and will not expire until exercised in full.
The transaction closed on March 4, 2026 (the “Quantum Closing Date”) and resulted in us acquiring 100% of Quantum Israel’s issued and outstanding share capital on a fully diluted and post-closing basis and Quantum Israel becoming a wholly-owned subsidiary of the Company.
As of June 30, 2026, 2,438,088 Exchange Pre-Funded Warrants were exercised into 2,438,087 shares of our common stock.
November 2025 PIPE
On November 5, 2025, we entered into a securities purchase agreement (the “Original SPA”) with certain accredited investors (the “Investors”) in connection with a private placement (the “November 2025 Private Placement”). The Original SPA as a closing condition had that we shall have entered into a definitive and binding agreement to acquire 100% of the share capital on a fully diluted basis of Quantum Israel. As of January 1, 2026, we had entered into a definitive and binding agreement to acquire only 85.01% of the share capital on a fully diluted basis of Quantum Israel. Accordingly, we and the Investors have amended certain terms of the November 2025 Private Placement.
On January 1, 2026, we entered into an amended and restated securities purchase agreement (the “November 2025 Purchase Agreement”) with the Investors pursuant to which we issued and sold an aggregate of 800,000 shares of our common stock (the “November 2025 Private Placement Shares”). Each November 2025 Private Placement Share was sold together with a number of warrants equal to the 80% of the total number of November 2025 Private Placement Shares sold in the November 2025 Private Placement, or in total warrants to purchase up to an aggregate of 640,000 shares of our common stock (the “November 2025 Common Warrants” and together with the November 2025 Private Placement Shares, the “November 2025 PIPE Securities”), at a combined purchase price of $1.75 per November 2025 Private Placement Share and accompanying November 2025 Common Warrant. The November 2025 Private Placement closed on March 4, 2026 (the “Closing Date”).
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The November 2025 Common Warrants are immediately exercisable upon issuance at an exercise price of $2.625 per share, subject to adjustment as set forth therein, and will expire five years from the issuance date. The November 2025 Common Warrants may be exercised on a cashless basis if there is no effective registration statement registering the shares of our common stock underlying the November 2025 Common Warrants. A holder of the November 2025 Common Warrants will not have the right to exercise any portion of its November 2025 Common Warrants if the holder (together with such holder’s affiliates, and any persons acting as a group together with such holder or any of such holder’s affiliates or any other persons whose beneficial ownership of shares of our common stock would be aggregated with the holder’s or any of the holder’s affiliates), would beneficially own shares of common stock in excess of 4.99% of the number of shares of common stock outstanding immediately after giving effect to such exercise.
In connection with the November 2025 Purchase Agreement, we entered into a registration rights agreement on November 5, 2025 (the “November 2025 Registration Rights Agreement”) with the Investors. Pursuant to the November 2025 Registration Rights Agreement, we are required to file a resale registration statement (the “November 2025 Registration Statement”) with the SEC to register for resale the November 2025 Private Placement Shares and the shares of our common stock issuable upon exercise of the November 2025 Common Warrants within thirty (30) calendar days after the Closing Date (the “Filing Date”), and to have such Registration Statement declared effective within sixty (60) calendar days after the Filing Date in the event the Registration Statement is not reviewed by the SEC, or ninety (90) calendar days of the Filing Date in the event the November 2025 Registration Statement is reviewed by the SEC. If, due to a shutdown or suspension of operations of the U.S. federal government or the SEC, the Registration Statement cannot be declared effective, the Corporation shall not be deemed to be in breach of the Registration Rights Agreement for failure to cause such Registration Statement to be declared effective during such period.
We also entered into an advisory agreement (the “Advisory Agreement”) with L.I.A. Pure Capital Ltd. (“the Advisor”) pursuant to which the Advisor provided advisory services in connection with the November 2025 Private Placement. We paid a commission to the Advisor of (i) a cash fee of $70,000 and (ii) a warrant to purchase 32,000 shares of our common stock (the “Advisor Warrant”), which was conditioned upon the closing of the November 2025 Private Placement. The Advisor Warrant has the same terms as the November 2025 Common Warrants. In addition, in connection with the closing of the November 2025 Private Placement, we repaid $200,000 of the outstanding loan amount owed to the Advisor pursuant to that certain Amended and Restated Facility Agreement, dated July 22, 2024, by and between the Company and by and between certain lenders including the Advisor.
Aggregate gross proceeds to us in respect of the November 2025 Private Placement were approximately $1.4 million, before deducting fees payable to the Advisor and other offering expenses payable by us. If the November 2025 Common Warrants are exercised in cash in full this would result in an additional $1.68 million of gross proceeds.
As of June 30, 2026, 297,143 November 2025 Common Warrants were exercised for aggregate gross proceeds of approximately $0.78 million.
Conversion of June 2024 Credit Facility
On July 29, 2026, we issued 588,553 shares of our common stock and warrants to purchase 588,553 shares of our common stock to certain lenders in connection with the conversion of an aggregate of $589 thousand of outstanding principal under a credit facility agreement entered into in June 2024. As a result of the conversion and issuance of the shares, $73 thousand remains outstanding under the credit facility. The warrants have an exercise price of $1.00 per share and a term of three years from the date of issuance.
Corporate Information
We were incorporated in the State of Delaware on August 16, 1985, under a predecessor name, The InFerGene Company (“InFerGene Company”). On August 25, 1995, a wholly owned subsidiary of InFerGene Company merged with Zaxis International, Inc., an Ohio corporation, which following such merger, the surviving entity, InFerGene Company, changed its name to Zaxis International, Inc. On February 7, 2019, the Company entered into a share exchange agreement (the “Recapitalization Transaction”) with Gix Internet Ltd. (formerly known as Algomizer Ltd.) (“Gix Internet”), pursuant to which, Gix Internet assigned, transferred and delivered 99.83% of its holdings in Viewbix Ltd. (“Viewbix Israel”), to the Company in exchange for shares of restricted common stock of the Company, which resulted in Viewbix Israel becoming a subsidiary of the Company. In connection with the Recapitalization Transaction, effective as of July 26, 2019, the Company’s name was changed from Virtual Crypto Technologies, Inc. to Viewbix Inc. On December 15, 2025, the Company entered into a securities exchange agreement with Quantum X Labs Ltd. and certain of the shareholders of Quantum Israel pursuant to which the Company acquired 100% of Quantum’s issued and outstanding share capital on a fully diluted, post-closing basis and Quantum Israel became a wholly owned subsidiary of the Company. The transaction closed on March 4, 2026. On April 30, 2026, the Company changed its name to Quantum X Labs Inc.
Our principal executive offices are located at: 2 Jabotinsky St, Atrium Tower, 18th floor, Ramat Gan, Israel 5252903 and our telephone number is +972-9-774-1505. Our website address is https://quantumxlabs.xyz/. The information contained on, or that can be accessed through, our websites is not incorporated by reference into this prospectus and is intended for informational purposes only.
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Results of Operations
Results of Operations During the Three Months Ended June 30, 2026 as Compared to the Three Months Ended June 30, 2025
Our revenues were $293 thousand for the three months ended June 30, 2026, as compared to $370 thousand during the same period in the prior year.
Our revenues from Gix Media’s Search Platform for the three months ended June 30, 2026, totaled $283 thousand, as compared to $354 thousand during the same period in the prior year.
During the three months ended June 30, 2026, our revenues from the direct model were $207 thousand, as compared to $354 thousand during the three months ended June 30, 2025. The decrease in revenues from the direct model is primarily due to changes and updates in internet browsers’ technology, which have reduced the scale of distribution of the Company’s products through the direct model. The Company anticipates that its revenues from add-ons to internet browsers will continue to decrease due to changes and updates in internet browsers’ technology. During the three months ended June 30, 2026, our revenues from the indirect model were $76 thousand, as compared to $0 thousand during the three months ended June 30, 2025. The increase in revenues from the indirect model is due to an increase in our revenues from third party strategic partners.
Our traffic-acquisition and related costs were $134 thousand for the three months ended June 30, 2026, as compared to $50 thousand during the same period in the prior year. The increase in the traffic-acquisition and related costs is primarily due to the increase in our revenues from third party strategic partners and search to search model.
Our research and development expenses were $185 thousand for the three months ended June 30, 2026, as compared to $20 thousand during the same period in the prior year. The reason for the increase in the three months ended June 30, 2026 is due to the consolidation of Quantum Israel’s financial statements following our acquisition of Quantum Israel in March 2026.
Our selling and marketing expenses were $26 thousand for the three months ended June 30, 2026, a slight decrease as compared to $30 thousand during the same period in the prior year.
Our general and administrative expenses were $1,015 thousand for the three months ended June 30, 2026, as compared to $558 thousand during the same period in the prior year. The reason for the increase is due to higher professional services expenses in the period following the uplisting to the Nasdaq Capital Market in June 2025 (the “Uplist”) in the three months ended June 30, 2026, as compared to the same period in the prior year and the consolidation of Quantum Israel’s financial statements following our acquisition of Quantum Israel in March 2026.
Our depreciation and amortization expenses for the three months ended June 30, 2026, were $228 thousand a slight decrease as compared to $235 thousand during the same period in the prior year.
Our other expenses for the three months ended June 30, 2026, were $100 thousand compared to $500 thousand during the three months ended June 30, 2025. Other expenses for the three months ended June 30, 2026, were primarily related to costs incurred in connection with the Quantum Israel acquisition. Other expenses for the three months ended June 30, 2025, were primarily related to costs incurred in connection with the Uplist and registrations for the resale of the Company’s common stock with the SEC.
Our gain from deconsolidation of a subsidiary for the three months ended June 30, 2026, was $3,831 thousand as compared to $0 thousand during the same period in the prior year. The gain from deconsolidation of a subsidiary recognized during the three months ended June 30, 2026, resulted from the loss of control of CliniQuantum following the sale by certain CliniQuantum shareholders of approximately 54.01% of CliniQuantum’s outstanding equity to a third party in June 2026. For further details please refer to note 6.D to our interim consolidated financial statements for the six months ended June 30, 2026.
Our net financial expenses were $113 thousand for the three months ended June 30, 2026, as compared to $7,661 thousand net financial expenses during the same period in the prior year. The decrease during the three months ended June 30, 2026, is mainly attributable to financing expenses during the three months ended June 30, 2025, related to financial instruments arising from the Company’s facility agreements, which are measured at fair value.
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Our tax benefit was $94 thousand for the three months ended June 30, 2026, as compared to $67 thousand during the same period in the prior year. The reason for the increase in our tax benefit during the three months ended June 30, 2026, is due to the decrease in income before tax in the Search Platform.
Net loss from discontinued operations was $0 thousand for the three months ended June 30, 2026, as compared to $3,801 thousand for the three months ended June 30, 2025. For further details regarding the amounts recorded in respect of discontinued operations in the three months ended June 30, 2025, please refer to note 3 to our interim consolidated financial statements for the six months ended June 30, 2026.
Results of Operations During the Six Months Ended June 30, 2026 as Compared to the Six Months Ended June 30, 2025
Our revenues were $646 thousand for the six months ended June 30, 2026, as compared to $899 thousand during the same period in the prior year.
Our revenues from Gix Media’s Search Platform for the six months ended June 30, 2026, totaled $626 thousand, as compared to $883 thousand during the same period in the prior year.
During the six months ended June 30, 2026, our revenues from the direct model were $453 thousand, as compared to $883 thousand during the six months ended June 30, 2025. The decrease in revenues from the direct model is primarily due to changes and updates in internet browsers’ technology, which have reduced the scale of distribution of the Company’s products through the direct model. The Company anticipates that its revenues from add-ons to internet browsers will continue to decrease due to changes and updates in internet browsers’ technology. During the six months ended June 30, 2026, our revenues from the indirect model were $173 thousand, as compared to $0 thousand during the six months ended June 30, 2025. The increase in revenues from the indirect model is due to an increase in our revenues from third party strategic partners.
Our traffic-acquisition and related costs were $266 thousand for the six months ended June 30, 2026, as compared to $184 thousand during the same period in the prior year. The increase in the traffic-acquisition and related costs is primarily due to the increase in our revenues from third party strategic partners and search to search mode.
Our research and development expenses were $185 thousand for the six months ended June 30, 2026, as compared to $36 thousand during the same period in the prior year. The reason for the increase in the six months ended June 30, 2026, is due to the consolidation of Quantum Israel’s financial statements following our acquisition of Quantum Israel in March 2026.
Our selling and marketing expenses slightly increased to $51 thousand for the six months ended June 30, 2026, as compared to $50 thousand during the same period in the prior year.
Our general and administrative expenses were $1,515 thousand for the six months ended June 30, 2026, as compared to $755 thousand during the same period in the prior year. The reason for the increase is due to higher professional services expenses in the period following the Uplist in the six months ended June 30, 2026, as compared to the same period in the prior year and the consolidation of Quantum Israel’s financial statements following our acquisition of Quantum Israel in March 2026.
Our depreciation and amortization expenses for the six months ended June 30, 2026, were $452 thousand as compared to $408 thousand during the same period in the prior year. The increase in depreciation and amortization expenses is attributable to the increase in depreciation and amortization related to the acquisition of Metagramm on March 24, 2025. During the six months ended June 30, 2026, the depreciation and amortization expenses were recorded in full, compared to partial recognition during the same period prior year.
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Our other expenses for the six months ended June 30, 2026, were $122 thousand compared to $544 thousand during the six months ended June 30, 2025. Other expenses for the six months ended June 30, 2026, were primarily related to costs incurred in connection with the Quantum Israel acquisition. Other expenses for the six months ended June 30, 2025, were primarily related to costs incurred in connection with the Uplist and registrations for the resale of the Company’s common stock with the SEC.
Our gain from deconsolidation of a subsidiary for the six months ended June 30, 2026, was $3,831 thousand as compared to $0 thousand during the same period in the prior year. The gain from deconsolidation of a subsidiary recognized during the six months ended June 30, 2026 resulted from the loss of control of CliniQuantum following the sale by certain CliniQuantum shareholders of approximately 54.01% of CliniQuantum’s outstanding equity to a third party in June 2026. For further details please refer to note 6.D to our interim consolidated financial statements for the six months ended June 30, 2026.
Our net financial expenses were $184 thousand for the six months ended June 30, 2026, as compared to $10,528 thousand net financial expenses during the same period in the prior year. The decrease during the six months ended June 30, 2026, is mainly attributable to financing expenses during the six months ended June 30, 2025, related to financial instruments arising from the Company’s facility agreements, which are measured at fair value.
Our tax benefit was $110 thousand for the six months ended June 30, 2026, as compared $25 thousand during the same period in the prior year. The reason for the increase in our tax benefit during the six months ended June 30, 2026, is due to the decrease in income before tax in the Search Platform.
Net loss from discontinued operations was $0 thousand for the six months ended June 30, 2026, as compared to $4,681 thousand for the six months ended June 30, 2025. For further details regarding the amounts recorded in respect of discontinued operations in the six months ended June 30, 2025, please refer to note 3 to our interim consolidated financial statements for the six months ended June 30, 2026.
Liquidity and Capital Resources
As of June 30, 2026, we had current assets of $3,497 thousand, consisting of $2,435 thousand in cash and cash equivalents, $48 thousand restricted deposits, $281 thousand in accounts receivable, $394 thousand in other current assets and $339 thousand in related parties.
As of June 30, 2026, we had non-current assets of $27,670 thousand, consisting of $5 thousand in deferred taxes, $205 thousand in property and equipment net, $2,299 thousand in intangible assets net, $600 thousand in investment in equity securities and $20,721 thousand in goodwill and $3,840 thousand arose from Investments accounted for using the equity method.
As of June 30, 2026, we had $4,047 thousand in current liabilities consisting of $1,146 thousand in accounts payable, $368 thousand in government authorities, $268 thousand in earn-out payable, $472 thousand in other payables, $1,043 thousand in short term loans and current maturities of long-term loans, $83 thousand in related parties and $667 thousand in short-term convertible loans.
As of June 30, 2026, we had $1,337 thousand in non-current liabilities consisting of $416 thousand in deferred taxes, $195 thousand in long term loans and $726 thousand in earn-out liability which arose from the acquisition of Metagramm.
As of December 31, 2025, we had current assets of $1,652 thousand consisting of $1,018 thousand in cash and cash equivalents, $20 thousand in restricted deposits, $315 thousand in accounts receivable and $299 thousand in other current assets.
As of December 31, 2025, we had non-current assets of $9,105 thousand consisting of $12 thousand in deferred taxes, $56 thousand in property and equipment net, $600 thousand in investment in equity securities, $2,045 thousand in intangible assets net and $6,392 thousand in goodwill.
As of December 31, 2025, we had $4,063 thousand in current liabilities consisting of $1,204 thousand in accounts payable, $355 thousand in government authorities, $201 thousand in earn-out payable, $395 thousand in other payables, $1,041 thousand in short term loans and current maturities of a long-term loans and $867 thousand in short-term convertible loans.
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As of December 31, 2025, we had $1,705 thousand in non-current liabilities consisting of $586 thousand long-term loans, $793 thousand in earn out liability and $326 thousand in deferred taxes.
We had a negative working capital of $550 thousand as compared to a negative working capital of $2,411 thousand as of June 30, 2026, and December 31, 2025, respectively.
During the three months ended June 30, 2026, we had a negative cash flow from operating activities from continuing operations of $1,062 thousand as compared to $480 thousand during the same period in the prior year. The increase during the three months ended June 30, 2026, is mainly attributable to higher payments of accounts payable, as compared to the same period in the prior year.
During the six months ended June 30, 2026, we had a negative cash flow from operating activities from continuing operations of $1,666 thousand as compared to $289 thousand during the same period in the prior year. The increase during the six months ended June 30, 2026, is mainly attributable to higher payments of accounts payable, as compared to the same period in the prior year.
During the three months ended June 30, 2026, we had a negative cash flow from investment activities from continuing operations of $306 thousand, mainly used for the purchase of property and equipment, as compared to $0 during the same period in the prior year.
During the six months ended June 30, 2026, we had a negative cash flow from investment activities from continuing operations of $113 thousand, primarily due to the purchase of property and equipment, partially offset by the acquisition of Quantum Israel, as compared to a positive cash flow from investment activities from continuing operations of $12 thousand during the same period in the prior year, which arose from the Metagramm Acquisition.
During the three months ended June 30, 2026, we had $2,013 thousand positive cash flow from financing activities from continuing operations as compared to $2,321 thousand during the same period in the prior year. The decrease during the three months ended June 30, 2026, was primarily due to lower amount of net bank loans receipt during the three months period ended June 30, 2026, as compared to the same period prior year.
During the six months ended June 30, 2026, we had $3,224 thousand positive cash flow from financing activities from continuing operations as compared to $2,133 thousand during the same period in the prior year. The increase during the six months ended June 30, 2026, was primarily due to $1,400 thousand received under the November 2025 Purchase Agreement.
There are no limitations in the Company’s Amended and Restated Certificate of Incorporation on the Company’s ability to borrow funds or raise funds through the issuance of shares of its common stock to affect a business combination.
Gix Media has provided several liens under the Financing Agreement with Leumi in connection with the Cortex Transaction, as follows: (1) a floating lien on Gix Media’s assets; (2) a lien on Gix Media’s bank account in Leumi; (3) a lien on Gix Media’s rights under the Cortex Transaction; (4) a fixed lien on Gix Media’s intellectual property; and (5) a lien on all of Gix Media’s holdings in Cortex.
The Company has also provided several liens under the Financing Agreement with Leumi in connection with the Cortex Transaction, as follows: (1) a guarantee to Leumi of all of Gix Media’s obligations and undertakings to Leumi unlimited in amount; (2) a subordination letter signed by the company to Leumi; (3) A first ranking all asset charge over all of the assets of the Company; and (4) a Deposit Account Control Agreement over the Company’s bank accounts.
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In addition, in connection with the Cortex Sale, Gix Media provided Leumi a lien on the Minute Media Shares and Leumi released its lien on the shares of Cortex sold by Gix Media.
According to the Financing Agreement, Gix Media undertook to meet a financial covenant over the life of the loans. As of June 30, 2026, Gix Media is in compliance with the financial covenant in connection with the Financing Agreement.
Going Concern
During the years ended December 31, 2024, and 2025 and the six months ended June 30, 2026, we experienced a decrease in our revenues from the Search Platforms and Cortex’s digital content platform as a result of the Cortex Adverse Effect, a decrease in user traffic acquired from third party advertising platforms, an industry-wide decrease in advertising budget, changes and updates to internet browsers’ technology, which adversely impacted the Company’s ability to acquire traffic in the Search Segment and a decrease in revenues from routing of traffic acquired from third-party strategic partners in the Search Segment, following the lack of availability of suppliers credit from such third party strategic partners. As a result of the foregoing, the Company’s operations were adversely affected.
As a result of such decreases, for the six months ended June 30, 2026, we recorded an operating loss from continuing operations of $1,945 thousand compared to $1,078 thousand during the six months ended June 30, 2025. As of June 30, 2026, we had cash and cash equivalents of $2,435 thousand, bank loans and convertible loans of $1,905 thousand and an accumulated deficit of $44,167 thousand. Such a decline in revenues raises a substantial doubt about our ability to continue as a going concern during the 12-month period following the issuance date of this Quarterly Report.
Management’s response to these conditions included reduction of salaries and related expenses and reduction of professional services in the research and development, selling and marketing functions, reduction of other operational expenses, such as lease costs and overheads, as well as creation of new partnerships and other new income sources. In addition, the Company raised funds during 2025, increasing its cash balance, as follows: (1) pursuant to the consummation of the Uplist , the Company received during June and July 2025, aggregate gross proceeds of $2,852 thousand in connection with a private placement and three facility agreements, consisting of $630 thousand from the receipt of additional loans and $2,222 thousand from the exercise of warrants and (2) on July 14, 2025, the Company closed an additional private placement transaction with certain accredited investors, pursuant to which the Company received gross proceeds of $4.5 million. Moreover, on March 4, 2026, the Company closed a private placement transaction with certain accredited investors, pursuant to which the Company received gross proceeds of $1.4 million and during June and July 2026, the Company received total proceeds of $2,413 thousand and $1,505 thousand, respectively from the exercise of warrants. However, there is significant uncertainty as to whether the Company will be able to secure additional funds when needed.
Our Interim consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.
Availability of Additional Capital
Our potential financing transactions may include the issuance of equity and/or debt securities including convertible debt, obtaining credit facilities, or other financing mechanisms. In the event that we seek to raise funds through additional private placements of equity or convertible debt, the trading price of our common stock could be adversely affected. Further, any adverse conditions in the financial markets could make it more difficult to obtain future financing through the issuance of equity or debt securities when and if needed. Even if we are able to raise a sufficient amount of funds that may be required, it is possible that we way incur unexpected costs and expenses or experience unexpected cash requirements that would force us to seek additional and/or alternative financing. Further, if we issue additional equity or debt securities, stockholders may experience additional dilution or the new equity securities may have rights, preferences or privileges senior to those of existing holders of our common stock. If additional financing is not available or is not available on acceptable terms, we may have to curtail our plan of operations.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Not required for smaller reporting companies.
ITEM 4. CONTROLS AND PROCEDURES
| A. | Evaluation of Disclosure Controls and Procedures |
As of June 30, 2026, the Company’s co-chief executive officers and chief financial officer, conducted an evaluation (the “Evaluation”) regarding the effectiveness of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) or 15d-15(e) under the Exchange Act). Based upon the Evaluation, as required by Rules 13a-15 or 15d-15, the Company’s co-chief executive officers and chief financial officer concluded that, and pursuant to the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control-Integrated Framework (2013), the Company’s disclosure controls and procedures were effective as of the end of June 30, 2026.
| B. | Changes in Internal Control over Financial Reporting |
With the inclusion of the financial information of Quantum Israel beginning in our interim financial statements included in Form 10-Q for the quarterly period ended March 31, 2026, we will be required to implement internal controls over financial reporting with respect to processes and procedures underlying the financial information of Quantum Israel. Other than the aforesaid, there were no changes in our internal control over financial reporting or in other factors identified in connection with the evaluation required by paragraph (d) of Exchange Act Rules 13a-15 or 15d-15 that occurred during the quarter ended June 30, 2026, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
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PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
We are currently not involved in any litigation that we believe could have a material adverse effect on our financial condition or results of operations. There is no action, suit, proceeding, inquiry or investigation before or by any court, public board, government agency, self-regulatory organization or body pending or, to the knowledge of the executive officers of the Company, threatened against or affecting the Company, our common stock, our officers or directors in their capacities as such, in which an adverse decision could have a material adverse effect.
ITEM 1A. RISK FACTORS
Our business faces many risks, a number of which are described under the caption “Risk Factors” in our Annual Report. Other than as set forth below, there have been no material changes from the risk factors previously disclosed in our Annual Report. The risks described in our Annual Report and below may not be the only risks we face. Other risks of which we are not yet aware, or that we currently believe are not material, may also materially and adversely impact our business operations or financial results. If any of the events or circumstances described in the risk factors contained in our Annual Report or described below occurs, our business, financial condition or results of operations could be adversely impacted and the value of an investment in our securities could decline. Investors and prospective investors should consider the risks described in our Annual Report and below, and the information contained under the caption “Forward-Looking Statements” and elsewhere in this Quarterly Report on Form 10-Q before deciding whether to invest in our securities.
Management has concluded that there is substantial doubt about our ability to continue as a going concern, and our consolidated financial statements for the quarter ended June 30, 2026 include a going concern disclosure as to our ability to continue as a going concern, which could prevent us from obtaining new financing on reasonable terms or at all.
Because we have had recurring losses and negative cash flows from operating activities, substantial doubt exists regarding our ability to remain as a going concern at the same level at which we are currently performing. Accordingly, our consolidated financial statements for the quarter ended June 30, 2026 include an explanatory paragraph as to our potential inability to continue as a going concern. The doubts regarding our potential ability to continue as a going concern may adversely affect our ability to obtain new financing on reasonable terms or at all.
We may not realize the anticipated benefits of the acquisitions of Quantum X Labs Ltd. or Metagramm.
In March 2026, we acquired Quantum Israel, a company that focuses on developing and promoting quantum algorithms for the transportation, drug discovery and security segments as well as developing quantum- based GPS replacement and quantum atom accuracy solutions, and security whose mission is to research, develop, and own quantum technology intellectual property that addresses major challenges emerging as the quantum revolution scales into commercial and industrial use. In March 2025, we acquired Metagramm, a company that specializes in developing advanced writing assistance tools and licenses its products on a subscription basis. Quantum Israel’s and Metagramm’s products and revenue models differ from those of our current platforms. We may not be able to assimilate or integrate the acquired personnel, operations, products, services, and technologies of Quantum Israel or Metagramm successfully or effectively manage the business of Quantum Israel or Metagramm and our management may be distracted from operating our business. We also may not achieve the anticipated benefits from the acquisition of Quantum Israel or Metagramm due to a number of factors, including, without limitation, unanticipated costs or liabilities associated with the acquisition and difficulty of incorporating Quantum Israel’s or Metagramm’s technologies into our platforms. If the acquisition of Quantum Israel or Metagramm fails to meet our expectations, our operating results, business, and financial condition may suffer.
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
None.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4. MINE SAFETY DISCLOSURE
Not applicable.
ITEM 5. OTHER INFORMATION
None.
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ITEM 6. EXHIBITS
(a) The following documents are filed as exhibits to this Quarterly Report or incorporated by reference herein.
| * | Filed herewith. |
| ** | Furnished herewith. |
| -53- |
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.
| QUANTUM X LABS INC. | ||
| By: | /s/ Amihay Hadad | |
| Name: | Amihay Hadad | |
| Title: | Co-Chief Executive Officer | |
| Date: August 13, 2026 | (Co-Principal Executive Officer) | |
| By: | /s/ Yakov Baranes | |
| Name: | Yakov Baranes | |
| Title: | Co-Chief Executive Officer | |
| Date: August 13, 2026 | (Co-Principal Executive Officer) |
| By: | /s/ Shahar Marom | |
| Name: | Shahar Marom | |
| Title: | Chief Financial Officer | |
| Date: August 13, 2026 | (Principal Financial Officer) |
| -54- |
Exhibit 31.1
CERTIFICATION PURSUANT TO
RULE 13a-14(a) UNDER THE SECURITIES EXCHANGE ACT OF 1934,
AS ADOPTED PURSUANT TO
SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
I, Amihay Hadad, certify that:
1. I have reviewed this Quarterly Report on Form 10-Q for the quarter ended June 30, 2026 of Quantum X Labs Inc.;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period end covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the period end presented in this report;
4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period end in which this report is being prepared;
b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c. Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period end covered by this report based on such evaluation;
d. Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
| Date: August 13, 2026 | |
| /s/ Amihay Hadad | |
| Amihay Hadad | |
| Co-Chief Executive Officer | |
| (co-principal executive officer) | |
| Quantum X Labs Inc. |
Exhibit 31.2
CERTIFICATION PURSUANT TO
RULE 13a-14(a) UNDER THE SECURITIES EXCHANGE ACT OF 1934,
AS ADOPTED PURSUANT TO
SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
I, Yakov Baranes, certify that:
1. I have reviewed this Quarterly Report on Form 10-Q for the quarter ended June 30, 2026 of Quantum X Labs Inc.;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period end covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the period end presented in this report;
4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period end in which this report is being prepared;
b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c. Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period end covered by this report based on such evaluation;
d. Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
| Date: August 13, 2026 | |
| /s/ Yakov Baranes | |
| Yakov Baranes | |
| Co-Chief Executive Officer | |
| (co-principal executive officer) | |
| Quantum X Labs Inc. |
Exhibit 31.3
CERTIFICATION PURSUANT TO
RULE 13a-14(a) UNDER THE SECURITIES EXCHANGE ACT OF 1934,
AS ADOPTED PURSUANT TO
SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
I, Shahar Marom, certify that:
1. I have reviewed this Quarterly Report on Form 10-Q for the quarter ended June 30, 2026 of Quantum X Labs Inc.;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period end covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the period end presented in this report;
4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period end in which this report is being prepared;
b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c. Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period end covered by this report based on such evaluation;
d. Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
| Date: August 13, 2026 | |
| /s/ Shahar Marom | |
| Shahar Marom | |
| Chief Financial Officer | |
| (principal financial and accounting officer) | |
| Quantum X Labs Inc. |
Exhibit 32.1
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report of Quantum X Labs Inc. (the “Company”) on Form 10-Q for the quarter ended June 30, 2026, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Amihay Hadad, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge:
(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
| /s/ Amihay Hadad | |
| Amihay Hadad | |
| Co-Chief Executive Officer | |
| (co-principal executive officer) | |
| Quantum X Labs Inc. | |
| August 13, 2026 |
Exhibit 32.2
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report of Quantum X Labs Inc. (the “Company”) on Form 10-Q for the quarter ended June 30, 2026, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Amihay Hadad, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge:
(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
| /s/ Yakov Baranes | |
| Yakov Baranes | |
| Co-Chief Executive Officer | |
| (co-principal executive officer) | |
| Quantum X Labs Inc. | |
| August 13, 2026 |
Exhibit 32.3
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report of Quantum X Labs Inc. (the “Company”) on Form 10-Q for the quarter ended June 30, 2026, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Shahar Marom, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge:
(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
| /s/ Shahar Marom | |
| Shahar Marom | |
| Chief Financial Officer | |
| (principal financial and accounting officer) | |
| Quantum X Labs Inc. | |
| August 13, 2026 |