USAQ 10-Q
QHSLab, Inc. (USAQ)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
For
the quarterly period ended
For the period from ______________ to_______________
Commission
file number
(Exact Name Of Registrant As Specified In Its Charter)
(State of Incorporation) |
(I.R.S. Employer Identification No.) |
| (Address of Principal Executive Offices) | (ZIP Code) |
Registrant’s
Telephone Number, Including Area Code:
Securities Registered Pursuant to Section 12(g) of The Act:
| Title of Each Class | Trading Symbol(s) | Name of each Exchange on Which Registered | ||
| NA |
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, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| Large accelerated filer ☐ | Accelerated filer ☐ |
| Smaller
Reporting Company | |
| Emerging
Growth Company |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate
by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No
On August 12, 2026, the Registrant had shares of common stock outstanding.
TABLE OF CONTENTS
| Item | Description | Page | ||
| PART I - FINANCIAL INFORMATION | ||||
| ITEM 1. | FINANCIAL STATEMENTS. | 4 | ||
| ITEM 2. | MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS. | 19 | ||
| ITEM 4. | CONTROLS AND PROCEDURES. | 23 | ||
| PART II - OTHER INFORMATION | ||||
| ITEM 6. | EXHIBITS. | 24 |
| 2 |
Cautionary Note Regarding Forward-Looking Statements
This report contains forward-looking statements. Certain of the matters discussed herein concerning, among other items, our operations, cash flows, financial position and economic performance including, in particular, future sales, product demand, competition and the effect of economic conditions, include forward-looking statements.
Forward-looking statements are predictive in nature and do not relate strictly to historical or current facts and generally include words such as “expects,” “anticipates,” “intends,” “plans,” “believes,” “estimates” and similar expressions. Although we believe that the forward-looking statements contained in this report are based upon reasonable assumptions, these statements and other projections contained herein expressing opinions about future outcomes and non-historical information, are subject to uncertainties and, therefore, there is no assurance that the outcomes expressed in these statements will be achieved.
Investors are cautioned that forward-looking statements are not guarantees of future performance and actual results or developments may differ materially from the expectations expressed in forward-looking statements contained herein. Given these uncertainties, you should not place any reliance on these forward-looking statements which speak only as of the date hereof. We undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws. You are advised, however, to consult any additional disclosures we make in our reports filed with the Securities and Exchange Commission (“SEC”).
| 3 |
PART I – FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS (unaudited)
| 4 |
QHSLab, Inc.
Condensed Consolidated Balance Sheets
| June 30, 2026 | December 31, 2025 | |||||||
| (Unaudited) | ||||||||
| Assets | ||||||||
| Current Assets: | ||||||||
| Cash and cash equivalents | $ | $ | ||||||
| Accounts receivable, net | ||||||||
| Inventory | ||||||||
| Prepaid expenses and other current assets | ||||||||
| Total current assets | ||||||||
| Non-current assets: | ||||||||
| Intangible assets, net | ||||||||
| Total assets | $ | $ | ||||||
| Liabilities and Stockholders’ Equity (Deficit) | ||||||||
| Current Liabilities: | ||||||||
| Accounts payable | $ | $ | ||||||
| Other current liabilities | ||||||||
| Due to related party | ||||||||
| Loans payable | ||||||||
| Convertible notes payable | ||||||||
| Total current liabilities | ||||||||
| Non-current Liabilities: | ||||||||
| Loans payable, non-current portion | ||||||||
| Total non-current liabilities | ||||||||
| Total liabilities | ||||||||
| Commitments and contingencies (Note 14) | ||||||||
| Stockholders’ Equity (Deficit): | ||||||||
| Preferred stock, shares authorized | ||||||||
| Preferred stock Series A, $ par value; shares issued and outstanding | ||||||||
| Preferred stock Series A-2, $ par value; shares issued and outstanding | ||||||||
| Common stock, shares authorized, $ par value; shares issued and outstanding | ||||||||
| Additional paid-in capital | ||||||||
| Accumulated deficit | ( | ) | ( | ) | ||||
| Total stockholders’ equity | ||||||||
| Total liabilities and stockholders’ equity | $ | $ | ||||||
See accompanying notes to the unaudited condensed consolidated financial statements.
| 5 |
QHSLab, Inc.
Condensed Consolidated Statements of Operations
| Three Months | Three Months | Six Months | Six Months | |||||||||||||
| Ended | Ended | Ended | Ended | |||||||||||||
| June 30, 2026 | June 30, 2025 | June 30, 2026 | June 30, 2025 | |||||||||||||
| (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | |||||||||||||
| Revenue | $ | $ | $ | $ | ||||||||||||
| Cost of revenue | ||||||||||||||||
| Gross profit | ||||||||||||||||
| Operating expenses: | ||||||||||||||||
| General and administrative | ||||||||||||||||
| Sales and marketing | ||||||||||||||||
| Research and development | ||||||||||||||||
| Amortization | ||||||||||||||||
| Total Operating expenses | ||||||||||||||||
| Net operating income (loss) | ( | ) | ( | ) | ||||||||||||
| Other income (expense): | ||||||||||||||||
| Interest expense | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Income (loss) before income taxes | ( | ) | ( | ) | ( | ) | ||||||||||
| Provision on income taxes | ||||||||||||||||
| Net income (loss) | $ | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||||
| Basic net income (loss) per share | $ | $ | ) | $ | ) | $ | ) | |||||||||
| Diluted net income (loss) per share | $ | $ | ) | $ | ) | $ | ) | |||||||||
| Weighted average shares outstanding: | ||||||||||||||||
| Basic | ||||||||||||||||
| Diluted | ||||||||||||||||
See accompanying notes to the unaudited condensed consolidated financial statements.
| 6 |
QHSLab, Inc.
Condensed Consolidated Statements of Stockholders’ Equity (Deficit)
(Unaudited)
Preferred Stock - Series A | Preferred Stock - Series A-2 | Common Stock | Additional Paid-In | Accumulated | Total Stockholders’ Equity | |||||||||||||||||||||||||||||||
| Shares | Amount | Shares | Amount | Shares | Amount | Capital | Deficit | (Deficit) | ||||||||||||||||||||||||||||
| Balance at January 1, 2026 | $ | $ | $ | $ | $ | ( | ) | $ | ||||||||||||||||||||||||||||
| Net loss | - | - | - | ( | ) | ( | ) | |||||||||||||||||||||||||||||
| Balance at March 31, 2026 | $ | $ | $ | $ | $ | ( | ) | $ | ||||||||||||||||||||||||||||
| Net income | - | - | - | |||||||||||||||||||||||||||||||||
| Balance at June 30, 2026 | $ | $ | $ | $ | $ | ( | ) | $ | ||||||||||||||||||||||||||||
| Balance at January 1, 2025 | $ | $ | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||||||||||||||||
| Shares issued for services | - | - | ||||||||||||||||||||||||||||||||||
| Conversion of notes payable | - | - | ||||||||||||||||||||||||||||||||||
| Net loss | - | - | - | ( | ) | ( | ) | |||||||||||||||||||||||||||||
| Balance at March 31, 2025 | $ | $ | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||||||||||||||||
| Net loss | - | - | - | ( | ) | ( | ) | |||||||||||||||||||||||||||||
| Balance at June 30, 2025 | $ | $ | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||||||||||||||||
See accompanying notes to the unaudited condensed consolidated financial statements.
| 7 |
QHSLab, Inc.
Condensed Consolidated Statements of Cash Flows
(Unaudited)
| Six Months Ended | Six Months Ended | |||||||
| June 30, 2026 | June 30, 2025 | |||||||
| Operating activities | ||||||||
| Net loss | $ | ( | ) | $ | ( | ) | ||
| Adjustments to reconcile net loss to net cash from operating activities: | ||||||||
| Allowance for credit losses | ||||||||
| Amortization | ||||||||
| Shares issued for services | ||||||||
| Changes in assets and liabilities: | ||||||||
| Accounts receivable | ( | ) | ||||||
| Inventory | ( | ) | ||||||
| Prepaid expenses and other current assets | ( | ) | ||||||
| Accounts payable | ( | ) | ||||||
| Other current liabilities | ||||||||
| Cash flows from (used by) operating activities | ( | ) | ||||||
| Financing activities: | ||||||||
| Repayments of loan borrowings | ( | ) | ( | ) | ||||
| Cash flows from financing activities | ( | ) | ( | ) | ||||
| Net change in cash | ( | ) | ||||||
| Cash and cash equivalents – beginning of year | ||||||||
| Cash and cash equivalents - end of period | $ | $ | ||||||
| Supplemental disclosures of cash flow activity: | ||||||||
| Cash paid for interest | $ | $ | ||||||
| Cash paid for taxes | $ | $ | ||||||
| Supplemental noncash investing and financing activity: | ||||||||
| Debt and accrued interest converted to shares of common stock | $ | $ | ||||||
See accompanying notes to the unaudited condensed consolidated financial statements.
| 8 |
QHSLab, Inc.
Notes to the Unaudited Condensed Consolidated Financial Statements
June 30, 2026
Note 1. The Company
QHSLab, Inc. (the “Company”) was incorporated in Delaware on September 1, 1983. In 2019, the Company became engaged in value-based healthcare, informatics and algorithmic personalized medicine including digital therapeutics, behavior based remote patient monitoring, chronic care and preventive medicine. On September 23, 2021, the Company changed its state of incorporation from Delaware to Nevada. On April 19, 2022, the Company changed its name to QHSLab, Inc.
The Company is a medical device technology and software-as-a-service (“SaaS”) company focused on enabling primary care physicians (“PCPs”) to increase their revenues by providing them with relevant, value-based tools to evaluate and treat chronic disease as well as provide preventive care through reimbursable procedures and providing physicians’ offices with agreed-upon clinical decision support, digital health assessments, administrative workflow, and reimbursement support services.
Note 2. Going Concern
The
accompanying condensed consolidated financial statements have been prepared assuming the Company will continue as a going concern. The
Company had an accumulated deficit of $
Note 3. Basis of Presentation
The condensed consolidated financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”). In the opinion of management, the accompanying unaudited condensed consolidated financial statements include all adjustments, consisting of only normal recurring accruals, necessary for a fair statement of financial position, results of operations, and cash flows. The information included in this Quarterly Report on Form 10-Q should be read in conjunction with the consolidated financial statements and the accompanying notes included in the Annual Report on Form 10-K for the year ended December 31, 2025.
The accounting policies are described in the “Notes to the Consolidated Financial Statements” in the 2025 Annual Report on Form 10-K and updated, as necessary, in this Form 10-Q. The year-end balance sheet data presented for comparative purposes was derived from audited consolidated financial statements but does not include all disclosures required by U.S. GAAP. The results of operations for the three and six months ended June 30, 2026 are not necessarily indicative of the operating results for the full year or for any other subsequent interim period.
Segment Information
The Company operates as a single operating segment and single reportable segment. Operating segments are defined as components of a business that can earn revenue and incur expenses and for which discrete financial information is evaluated regularly by the chief operating decision maker (“CODM”) in deciding how to allocate resources and assess performance. The Company’s CODM, the Chief Executive Officer (“CEO”), allocates resources and assesses performance based upon condensed consolidated financial information due to the interconnected relationship of the Company’s products to the same customers, therefore manages its business as a single operating segment. See Note 13 - Segment Information for additional information.
Reclassification of Prior Period Amounts
Certain prior-period amounts have been reclassified to conform to the current-period presentation. Specifically, certain expenses previously classified as Sales and Marketing Expenses have been reclassified to General and Administrative Expenses to better reflect the nature of the underlying costs. These reclassifications had no effect on total operating expenses, loss from operations, net loss, or stockholders’ equity as previously reported.
Accounting Policies
Use of Estimates: The preparation of condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from the estimates.
| 9 |
Principles of Consolidation: The condensed consolidated financial statements include the accounts of QHSLab, Inc. and its wholly owned subsidiaries USAQ Corporation, Inc., and Medical Practice Income, Inc. All significant inter-company balances and transactions have been eliminated.
Cash and Cash Equivalents: For financial statement presentation purposes, the Company considers those short-term, highly liquid investments with original maturities of three months or less to be cash or cash equivalents. Cash and cash equivalents are maintained at banks believed to be stable, occasionally at amounts in excess of federally insured limits, which represents a concentration of credit risk. The Company has not experienced any losses on deposits of cash and cash equivalents to date.
Accounts
Receivable: The Company extends unsecured credit to its customers on a regular basis. Management monitors the payments on outstanding
balances and estimates future expected credit losses over the life of the receivables based on past experience, current information and
forward-looking economic considerations and adjusts the reserve for uncollectible balances as necessary based on experience. The Company
controls its credit risk related to accounts receivable through credit approvals and monitoring. The Company had no customers that generated
10% or more of its revenue during either the three or six-month periods ended June 30, 2026, or the three or six month periods ended June 30, 2025. As of June 30, 2026, three customers each
comprised greater than 10% of the outstanding accounts receivable balance at
Inventories: Inventories are stated at the lower of cost or estimated net realizable value, on a first-in, first-out, or FIFO, basis. The Company uses actual costs to determine its cost basis for inventories. Inventories consist of only finished goods. Management monitors inventory based on forecasted sales and existing inventory levels. Based on inventory turnover and low on-hand inventory levels, management has determined there was no need for a reserve for slow-moving and obsolete inventories as of June 30, 2026 and December 31, 2025.
Capitalized Software Development Costs: Software development costs for internal-use software are accounted for in accordance with Accounting Standards Codification (“ASC”) 350-40, Internal-Use Software. Development costs that are incurred during the application development stage begin to be capitalized when two criteria are met: (i) the preliminary project stage is completed and (ii) it is probable that the software will be completed and used for its intended function. Capitalization ceases once the software is substantially complete and ready for its intended use.
Costs incurred during the preliminary project stage of software development and post-implementation operating stages are expensed as incurred. Amortization is calculated on a straight-line basis over three years which is the estimated economic life of the software and is included in the cost of revenue on the condensed consolidated statements of operations.
The estimated useful lives of software are reviewed at least annually and the software will be tested for impairment whenever events or changes in circumstances occur that could impact the recoverability of the assets.
Intangible Assets: Intangible assets represent the value the Company paid to acquire assets including a trademark, patent and web domain on June 23, 2021. The allocation of the purchase price to each of these assets was determined based on ASC 805-50-30, Business Combination, Related Issues, Initial Measurement. These assets are accounted for in accordance with ASC 350-30, Intangibles, General Intangibles Other Than Goodwill. The cost of the assets is amortized over the remaining useful life of the assets as follows:
| U.S. Method Patent | |
| Web Domain | |
| Trademark |
The estimated useful lives and carrying value of the assets are reviewed at least annually or whenever events or circumstances occur which may result in an impact to the value of the assets.
| 10 |
Convertible Notes Payable: The Company accounts for convertible notes deemed conventional and conversion options embedded in non-conventional convertible notes which qualify as equity under Accounting Standards Update (“ASU”) No. 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity (“ASU 2020-06”), which simplifies the accounting for certain financial instruments with characteristics of liabilities and equity, including certain convertible instruments and contracts on an entity’s own equity. ASU 2020-06 removes the separation models required for convertible debt with cash conversion features and convertible instruments with beneficial conversion features. It also removes certain settlement conditions that were required for equity contracts to qualify for the derivative scope exception and simplifies the diluted earnings per share calculation for convertible instruments. Accordingly, the Company records, as a discount to convertible notes, the intrinsic value of such conversion options based upon the differences between the fair value of the underlying common stock at the commitment date of the note transaction and the effective conversion price embedded in the note. Debt discounts under these arrangements are amortized over the term of the related debt.
Revenue Recognition: Pursuant to ASC Topic 606, Revenue from Contracts with Customers (“ASC 606”) the Company recognizes revenue upon transfer of control of goods, in an amount that reflects the consideration that is expected to be received in exchange for those goods. The Company does not allow for the return of products and therefore does not establish an allowance for returns.
To determine the revenue to be recognized for transactions that the Company determines are within the scope of ASC 606, the Company follows the established five-step framework as follows:
| (i) | identify the contract(s) with a customer; | |
| (ii) | identify the performance obligations in the contract(s); | |
| (iii) | determine the transaction price; | |
| (iv) | allocate the transaction price to the performance obligations in the contract(s); and | |
| (v) | recognize revenue when (or as) the Company satisfies a performance obligation. |
The Company sells allergy diagnostic-related products and immunotherapy treatments to physicians. Revenue is recognized once the Company satisfies its performance obligation which occurs at the point in time when title and possession of products have transitioned to the customer. Beginning April 1, 2025, the Company changed its policy of when title transitions to its customers from upon delivery to upon shipment. Delivery typically occurred within one or two days of shipment, and the Company limited shipping ahead of the end of each reporting period to allow time for delivery. Revenue continues to be recorded when title passes to the customer and, as a result, the change did not have a material impact on the Company’s previously issued consolidated financial statements.
The Company includes shipping and handling fees billed to customers in revenue.
The Company also generates revenue through SaaS agreements whereby the Company provides physicians’ practices access to its proprietary internally-developed software that provides clinical decision support and patient monitoring. The agreements provide for either monthly or annual access to the software. The access to the system begins immediately and revenue is recognized over the agreement term.
The Company provides administrative, billing and clinical decision support services utilizing the Company’s internally-developed software. Revenue is recognized each month based on actual services provided during that month.
The Company has an agreement with a third party to provide clinical research services utilizing its proprietary internally-developed software. The agreement details the performance obligations of the Company and revenue is recognized as those obligations are met.
There are several practical expedients and exemptions allowed under ASC 606 that impact timing of revenue recognition and disclosures. The Company elected to treat similar contracts as a portfolio of contracts, as allowed under ASC 606. The contracts that fall within the portfolio have the same terms and management has the expectation that the result will not be materially different from the consideration of each individual contract.
| 11 |
The Company’s revenues consisted of the following:
| For the Three Months Ended | For the Six Months Ended | |||||||||||||||
| June 30, | June 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Allergy Diagnostic Kit Sales | $ | $ | $ | $ | ||||||||||||
| Integrated Service Program | ||||||||||||||||
| Immunotherapy Treatment Sales | ||||||||||||||||
| Clinical Study Revenue | ||||||||||||||||
| Subscription Revenue | ||||||||||||||||
| Shipping and handling | ||||||||||||||||
| Training and Other Revenue | ||||||||||||||||
| Total revenue | $ | $ | $ | $ | ||||||||||||
Research
and Development: Research and development expense is primarily related to developing and improving methods related to the Company’s
SaaS platform. Research and development expenses are expensed when incurred. For the three months ended June 30, 2026 and 2025, there
was $
Income Taxes: The Company accounts for income taxes in accordance with ASC 740, Income Taxes, which requires recognition of estimated income taxes payable or refundable on income tax returns for the current year and for the estimated future tax effect attributable to temporary differences and carry-forwards. Measurement of deferred income tax is based on enacted tax laws including tax rates, with the measurement of deferred income tax assets being reduced by available tax benefits not expected to be realized.
The
Company has net operating loss carry forwards of $
Recently Issued Accounting Standards
In July 2025, the FASB issued ASU 2025-05, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets (“ASU 2025-05”), which simplifies the estimation of credit losses on current accounts receivable and contract assets arising from transactions accounted for under ASC 606 through the use of a practical expedient. ASU 2025-05 is effective for annual periods beginning after December 15, 2025, and interim reporting periods within that annual period, with early adoption permitted. The Company adopted this standard in 2026 and determined that it did not have a material impact on the Company’s financial statements.
In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (“ASU 2023-09”), which requires enhanced income tax disclosures, including specific categories and disaggregation of information in the effective tax rate reconciliation, disaggregated information related to income taxes paid, income or loss from continuing operations before income tax expense or benefit, and income tax expense or benefit from continuing operations. ASU 2023-09 is effective for annual periods beginning after December 15, 2024, with early adoption permitted. The Company adopted ASU 2023-09 beginning with the Form 10-Q for the period ending March 31, 2025 with minimal impact. See Note 12 – Income Taxes.
This Quarterly Report on Form 10-Q does not discuss recent pronouncements that are not anticipated to have a current and/or future impact on or are unrelated to the Company’s financial condition, results of operations, cash flows or disclosures.
| 12 |
Note 4. Accounts Receivable
Accounts receivable is recorded in the condensed consolidated balance sheets when customers are invoiced for revenue to be collected and there is an unconditional right to receive payment. Timing of revenue recognition may differ from the timing of invoicing customers resulting in deferred revenue until the Company satisfies its performance obligation.
Accounts receivable is presented net of an allowance for credit losses that represents future expected credit losses over the life of the receivables based on past experience, current information and forward-looking economic considerations. The beginning and ending balances of accounts receivable, net of allowance, are as follows:
| June 30, 2026 | December 31, 2025 | |||||||
| Accounts receivable | $ | $ | ||||||
| Allowance for credit losses | ( | ) | ( | ) | ||||
| Accounts receivable, net | $ | $ | ||||||
Note 5. Capitalized Software and Intangible Assets
Non-current assets consist of the following at June 30, 2026 and December 31, 2025:
| Estimated Useful Life (in years) | June 30, 2026 | December 31, 2025 | ||||||||||
| Capitalized software | $ | $ | ||||||||||
| Accumulated amortization | ( | ) | ( | ) | ||||||||
| Capitalized software, net | $ | $ | ||||||||||
| Intangible Assets: | ||||||||||||
| U.S. Method Patent | $ | $ | ||||||||||
| Web Domain | N/A | |||||||||||
| Trademark | N/A | |||||||||||
| Total Intangible assets | $ | $ | ||||||||||
| Accumulated amortization | ( | ) | ( | ) | ||||||||
| Intangible assets, net | $ | $ | ||||||||||
Capitalized
software represents the development costs for the Company’s internal-use QHSLab platform software. The Company completed testing
of its QHSLab platform software application at the end of the first quarter of 2022 and began to amortize the capitalized expenses on
a straight-line basis over the useful life of the software. Amortization related to the QHSLab platform was $
The
intangible assets represent the value the Company paid to acquire the trademark “AllergiEnd”, the web domain “AllergiEnd.com”
along with the U.S. Method Patent registration relating to the allergy testing kit and related materials the Company distributes to physician
clients. The Company acquired the intangible assets from MedScience Research Group, Inc. (“MedScience”) as of June 23, 2021
for total consideration of $
The
Company evaluates intangible assets with infinite lives for impairment at least annually and evaluates intangible assets with finite
lives when events or circumstances indicate an impairment may exist.
| 13 |
Note 6. Loans Payable
On
November 12, 2025, the Company entered into a fixed-fee short-term loan with its merchant bank and received $
See additional discussion of loans payable in Note 11 – Related Party Transactions.
Note 7. Convertible Notes Payable
Convertible notes payable at June 30, 2026 and December 31, 2025 consist of the following:
| June 30, 2026 | December 31, 2025 | |||||||
| Shareholder | $ | $ | ||||||
| Less: current portion | ||||||||
| Non-current portion | $ | $ | ||||||
Effective May 7, 2021, the Company issued a Convertible Promissory Note in the original principal amount of $
On
December 31, 2025, the Company entered into a Promissory Note Modification and Partial Conversion Agreement (“Modification Agreement”)
with the holder of the Note. As of that date, the outstanding balance of the Note, including accrued interest, was $
Following
the partial conversion, a remaining balance of $
The balance of the Note was paid off in February 2026. The balance of the Note, including accrued interest, was $ and $ as of June 30, 2026 and December 31, 2025, respectively, and were included in other current liabilities on the accompanying condensed consolidated balance sheets.
| 14 |
Note 8. Preferred Stock and Private Placement Offering of Common Stock
Issuance of Common Stock and Warrants in a Private Placement Offering
On
December 26, 2025, the Company accepted subscription agreements from two accredited investors for the purchase of $
Issuance of Series A Preferred Stock
The
shares of Series A Preferred Stock have a stated value of $ per share and are initially convertible into shares of common stock at
a price of $
Issuance of Series A-2 Preferred Stock
The
shares of Series A-2 Preferred Stock have a stated value of $
Holders of the Series A-2 Convertible Preferred Stock will vote on an as converted basis with the holders of the Company’s common stock and Series A Preferred Stock as to all matters to be voted on by the holders of the common stock. Each Series A-2 Preferred Share shall be entitled to a number of votes equal to five times the number of shares of common stock into which it is then convertible on the applicable record date.
Holders
of the Series A-2 Convertible Preferred Stock are entitled to receive cumulative dividends at an annual rate of
The Company calculates net income or loss per common share in accordance with ASC 260, Earnings Per Share. Basic and diluted net income (loss) per common share were determined by dividing net income (loss) applicable to common stockholders by the weighted average number of common shares outstanding during the period.
The Company’s potentially dilutive shares include shares issuable upon exercise or conversion of outstanding common stock options, common stock warrants, convertible debt and preferred shares, if those options, warrants, debt and preferred shares are exercisable or convertible and at prices below the average share price for the period.
For the year ended December 31, 2025, of common equivalent shares related to Preferred Shares A and A-2 were added to the basic weighted average shares outstanding to arrive at the diluted weighted average shares outstanding while other potentially dilutive shares were excluded from the calculation based on the exercise prices for those shares.
| 15 |
For the three months ended June 30, 2026, of common equivalent shares related to Preferred Shares A and A-2 were included in the computation of diluted income per share while others were excluded from the calculation based on the exercise prices for those shares. For the six months ended June 30, 2026 as well as the three and six months ended June 30, 2025, the Company’s potentially dilutive shares were excluded from the computation of diluted loss per share, as inclusion would be anti-dilutive since the Company incurred a loss in such period.
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Common equivalent shares | ||||||||||||||||
| Stock options | ||||||||||||||||
| Stock warrants | ||||||||||||||||
| Total shares excluded from calculation | ||||||||||||||||
During
the six-month periods ended June 30, 2026 and 2025, there was stock-based compensation associated with stock options. The Company issued shares of common stock for services during each of the years ended December 31, 2025
and 2024. A portion of these shares related to services that had not yet been performed at the time of issuance and were recorded as
prepaid expenses. Such prepaid amounts were subsequently recognized as expense as the related services were performed. Accordingly, the
Company recognized $
There were options granted during the six months ended June 30, 2026 and 2025. There were options exercised, forfeited or cancelled during either period but all options expired during the year ended December 31, 2025.
| Date Issued | Number Outstanding | Number Exercisable | Exercise Price | Expiration Date | ||||||||||
| $ | ||||||||||||||
| Total | ||||||||||||||
During the quarter ended June 30, 2025, outstanding options expired and outstanding options expired during the six months ended June 30, 2025.
Warrants outstanding at June 30, 2026 consist of:
| Date Issued | Number Outstanding | Number Exercisable | Exercise Price | Expiration Date | ||||||||||
| $ | ||||||||||||||
| Total | ||||||||||||||
Warrants outstanding at June 30, 2025 consist of:
| Date Issued | Number Outstanding | Number Exercisable | Exercise Price | Expiration Date | ||||||||||
| $ | ||||||||||||||
| Total | ||||||||||||||
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Note 11. Related Party Transactions
Due
to Related Parties: Amounts due to related parties consist of cash advances received from the Company’s principal shareholder.
Some advances bear no interest and are due on demand while a portion has been converted into a loan to the principal shareholder that
provides interest at a rate of
The Company’s CEO and principal shareholder is a shareholder of MedScience. In addition, the CEO provides services to MedScience for which he is compensated.
Note 12. Income Taxes
The Company accounts for income taxes in accordance with ASC 740, Income Taxes, which requires recognition of estimated income taxes payable or refundable on income tax returns for the current year and for the estimated future tax effect attributable to temporary differences and carry-forwards. Measurement of deferred income tax is based on enacted tax laws including tax rates, with the measurement of deferred income tax assets being reduced by available tax benefits not expected to be realized. Given its history of net operating losses, the Company has determined that it is more likely than not that it will not be able to realize the tax benefit of its net operating loss carryforwards. Accordingly, the Company has not recognized a deferred tax asset for this benefit.
The
valuation allowance at June 30, 2026 and December 31, 2025 was $
Reconciliation
between the provision for income taxes and the expected tax benefit using the federal statutory rate of
June 30, 2026 | December 31, 2025 | |||||||
| Income tax at federal statutory rate | % | % | ||||||
| Valuation allowance | ( | )% | ( | )% | ||||
| Income tax expense | ||||||||
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The
Company has net operating loss carry forwards of $
For the six-month period ended June 30, 2026, the Company did not record a tax provision. The Company continues to maintain a valuation allowance against its net deferred tax assets, which will be reassessed as additional information becomes available.
Note 13. Segment Information
The Company operates as one operating segment. The Company’s Chief Operating Decision Maker (“CODM”) is its Chief Executive Officer, who reviews financial information presented on a consolidated basis. The CODM used consolidated sales, gross margin and net income (loss) to assess financial performance and allocate resources. These financial metrics are used by the CODM to make key operating decisions, such as the need to allocate its budget to operating expenses and invest in additional resources. The segment assets are equal to the assets presented in the condensed consolidated balance sheets.
The significant expenses that are regularly provided to the CODM are disclosed in the condensed consolidated statements of operations as a part of the condensed consolidated net income (loss). See the condensed consolidated financial statements for all financial information regarding the Company’s operating segment.
Note 14. Commitments and Contingencies
There are no pending or threatened legal proceedings as of June 30, 2026. The Company has no non-cancellable operating leases.
Note 15. Subsequent Events
Management has evaluated subsequent events through the date of this filing.
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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
The following discussion provides information which management believes is relevant to an assessment and understanding of our results of operations and financial condition. The discussion should be read along with our unaudited condensed consolidated financial statements for the three and six months ended June 30, 2026 and 2025 and notes thereto contained elsewhere in this Report, and our annual report on Form 10-K for the twelve months ended December 31, 2025 including the consolidated financial statements and notes thereto contained in such Report. The following discussion and analysis contains forward-looking statements, which involve risks and uncertainties. Our actual results may differ significantly from the results, expectations and plans discussed in these forward-looking statements. See “Cautionary Note Concerning Forward-Looking Statements.”
Overview
We are a medical device technology and SaaS company focused on enabling primary care physicians (“PCPs”) and other healthcare providers to increase their revenues by providing them with relevant, value-based tools to evaluate and treat chronic disease as well as provide preventive care through reimbursable procedures. In some cases, the products we provide our physician clients will enable them to diagnose and treat patients with chronic diseases which they historically have referred to specialists, allowing them to increase their practice revenue. As part of our mission, we are providing PCPs and other healthcare providers with the software, training and devices necessary to allow them to treat their patients using value-based healthcare, informatics and personalized medicine. Our digital healthcare, clinical decision support and point of care solutions also support non face to face remote patient and therapeutic monitoring, to address chronic care and preventive medicine and are reimbursable to the medical practice.
Increasingly, regulators and insurance companies recognize what health care technologists have been saying for nearly 20 years, which is that most chronic conditions are better managed with more frequent and short encounters often without a physician’s direct participation, rather than infrequent visits. More health insurers have realized that Artificial Intelligence (“AI”) enabled digital medicine technologies such as those provided through our proprietary internally-developed Quality Health System Lab Expert System software (“QHSLab”) can provide the necessary encounters to foster patient compliance in between face to face visits to a physician.
Based on the success of PCPs using our QHSLab allergy diagnostics combined with the products acquired from MedScience Research Group, Inc. (“MedScience”), we are increasing our revenues by charging physicians a monthly subscription fee for the use of QHSLab and soliciting additional PCPs to increase their revenues by using our proven revenue generating QHSLab and AllergiEnd® line of products. We also plan to introduce additional point of care diagnostics and treatments, and digital medicine programs that PCPs can use and prescribe in their practices. In all cases, PCPs will be paid under existing government and private insurance programs, based upon analyses conducted utilizing QHSLab and treatments provided as a result of such analyses.
Our ability to operate profitably is determined by our ability to generate revenues from the licensing of our QHSLab software and the sale of diagnostic related products and treatment protocols and the provision of services through our QHSLab system. Our ability to generate a profit from these sales is determined by our ability to increase the number of physicians using these products. We will continue to upgrade QHSLab in an effort to increase the number of products sold based upon the services it can provide and for which we are able to charge a fee.
We operate as a single operating segment and single reportable segment. Our CODM, the Chief Executive Officer, allocates resources and assesses performance based upon condensed consolidated financial information and due to the interconnected relationship of our products which are predominately offered to the same class of customer, manages our business as a single operating segment.
During the fourth quarter of 2020 we began to sell the AllergiEnd® Products, consisting of AllergiEnd® Allergy Diagnostics and Allergen Immunotherapy treatments, to physicians. During the second quarter of 2022, we began to enter into SaaS subscription agreements to provide physicians with access to our proprietary internally-developed QHSLab platform software that provides clinical decision support and patient monitoring for numerous chronic conditions seen in primary care settings including allergy, asthma, anxiety, depression, chronic pain, and sleep disorders for example. During the fourth quarter of 2022, we began entering into Integrated Service Program (ISP) agreements to provide physicians’ offices with agreed-upon clinical decision support, digital health assessments, administrative workflow, and reimbursement support services utilizing our QHSLab platform.
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Results of Operations during the three and six months ended June 30, 2026 as compared to the three and six months ended June 30, 2025
Revenues
For the three months ended June 30, 2026, we generated revenues of $847,490 compared to $605,446 of revenues for the three months ended June 30, 2025 which was driven by an 86.4% increase in our Integrated Service Program (ISP) revenues during the period.
For the six months ended June 30, 2026, we generated revenues of $1,576,175 compared to $1,250,865 of revenues for the six months ended June 30, 2025. The increase in revenues for the first half of 2026, is attributed to a 103.2% increase in revenues generated from ISP services to $865,900 compared to $426,130 in the first half of 2025. Revenues for the first half of 2026 were also affected by an 8.2% decrease in sales of Allergy Diagnostic Kits to $424,828 compared to $462,557 for the six months ended June 30, 2025.
A significant portion of our revenue growth during the first half of 2026 was driven by recurring service-based revenue generated through ISP. Unlike traditional medical product sales, these services are provided on an ongoing basis as physicians continue utilizing the Company’s software platform and clinical support services. Management believes continued growth in recurring revenue improves the predictability of future operating results, supports expansion of gross margins, and enhances long-term shareholder value.
Our revenues consisted of the following:
| For the Three Months Ended | For the Six Months Ended | |||||||||||||||
| June 30, | June 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Allergy Diagnostic Kit Sales | $ | 196,058 | $ | 197,644 | $ | 424,828 | $ | 462,557 | ||||||||
| Integrated Service Program | 491,399 | 263,628 | 865,900 | 426,130 | ||||||||||||
| Immunotherapy Treatment Sales | 93,972 | 119,885 | 185,042 | 217,214 | ||||||||||||
| Clinical Study Revenue | 29,700 | - | 29,700 | 89,100 | ||||||||||||
| Subscription Revenue | 6,666 | 9,252 | 18,614 | 18,537 | ||||||||||||
| Shipping and handling | 10,914 | 10,091 | 22,554 | 20,061 | ||||||||||||
| Training and Other Revenue | 18,781 | 4,946 | 29,537 | 17,266 | ||||||||||||
| Total revenue | $ | 847,490 | $ | 605,446 | $ | 1,576,175 | $ | 1,250,865 | ||||||||
Cost of Revenues and Gross Profit
Cost of revenues consists of the cost of the AllergiEnd® test kits and allergen immunotherapy pharmacy prepared treatment sets, shipping costs to our customers as well as administrative services and labor expenses directly related to ISP sales and the amortization of our capitalized software.
For the three months ended June 30, 2026 and 2025, cost of revenues was $257,706 and $206,431, respectively.
The Company generated a gross profit of $589,784 during the three months ended June 30, 2026 compared to $399,015 for the three months ended June 30, 2025. Gross margin increased to 69.6% for the quarter compared to 65.9% during the three months ended June 30, 2025.
For the six months ended June 30, 2026 and 2025, cost of revenues was $515,588 and $421,906, respectively.
The Company generated a gross profit of $1,060,587 during the six months ended June 30, 2026 compared to $828,959 for the six months ended June 30, 2025. Gross margin increased from 66.3% during the six months ended June 30, 2025 to 67.3% during the six months ended June 30, 2026. The increase in gross margin was driven by several factors, including a favorable shift in revenue mix, highlighted by a $439,770 (103.2%) increase in ISP revenue, which represented a larger proportion of total revenues during the period, as well as operating synergies across our core product lines.
As we continue to introduce new products at an early stage in our development cycle, the gross margins may vary significantly between periods, due, among other things, to differences among our customers and products sold, customer negotiating strengths, and product mix.
Sales and Marketing
Sales and marketing expenses consist primarily of costs associated with selling and marketing our products to PCPs, principally ongoing sales efforts to recruit new PCPs and maintain our relationships with PCPs already using our software and products. These expenses include employee compensation and costs of consultants.
For the three months ended June 30, 2026, sales and marketing expenses totaled $156,474 compared to $107,279 for the three months ended June 30, 2025, an increase of $49,195.
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For the six months ended June 30, 2026, sales and marketing expenses totaled $313,914 compared to $202,109 for the six months ended June 30, 2025, an increase of $111,805.
The increase in sales and marketing expenses for the periods ended June 30, 2026 compared to the same periods in 2025 relate to an increase in payroll-related and strategic marketing expenses as we were investing in more sales and marketing activities to support our increasing ISP revenue. We expect our sales and marketing expenses to increase as we seek to build our customer base and launch additional products. Nevertheless, if we are successful in onboarding a sufficient number of PCPs and maintaining our relationships with these PCPs once they begin to fully utilize our products, sales and marketing expenses could decrease as a percentage of revenues, though we may increase our marketing efforts as funds become available.
General and Administrative
General and administrative expenses consist primarily of costs associated with operating a business including accounting, legal and management consulting fees.
For the three months ended June 30, 2026, general and administrative expenses totaled $255,416, an increase of $105,598, compared to $149,818 for the three months ended June 30, 2025.
For the six months ended June 30, 2026, general and administrative expenses totaled $524,222 an increase of $169,312, compared to $354,910 for the six months ended June 30, 2025.
The increase is primarily due to increased payroll-related expenses associated with expanding strategic and operational roles to support growing operations along with increases in other operational expenses such as rent, insurance and accounting fees.
Research and Development
Research and development (“R&D”) includes expenses incurred in connection with the research and development of our medical device technology solution, including software development and costs related to our clinical study. R&D costs are expensed as they are incurred.
For the three months ended June 30, 2026, R&D expenses totaled $114,621 which is an increase of $2,257 compared to $112,364 for the three months ended June 30, 2025.
For the six months ended June 30, 2026, R&D expenses totaled $235,530 which is a decrease of $867 compared to $236,397 for the six months ended June 30, 2025.
Research and development expenses for the period ended June 30, 2026 remained generally consistent with the comparable period in 2025, reflecting the Company’s continued investment in software development to support the commercialization and enhancement of the QHSLab platform. While maintaining a disciplined level of investment in research and development, the Company continued to expand its sales and marketing activities during the period to support revenue growth. Management expects research and development expenses to increase over time as the Company continues to invest in expanding its operations and developing new products, services and technologies as part of its long-term growth strategy.
Other Income and Expense
For the three months ended June 30, 2026, interest expense decreased by $57,269 to $7,215 from $64,484 for the three months ended June 30, 2025.
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For the six months ended June 30, 2026, interest expense decreased by $115,313 to $16,741 from $132,054 for the six months ended June 30, 2025.
The decrease is driven by the conversion and settlement of multiple loans during the fourth quarter of 2025 including the elimination of default interest associated with certain of the notes.
Net Operating Income (Loss); Net Income (Loss)
Although revenue increased approximately 26% during the six months ended June 30, 2026, we reported an operating loss of approximately $49,000, compared to an operating loss of approximately $500 during the comparable prior-year period. The increase in our operating loss primarily reflects continued strategic investment in expanding our sales and marketing initiatives and investment in the commercial infrastructure and administrative capabilities necessary to support future growth as well as our continued dedication to research and development necessary to develop new products. Management believes these investments position the Company for continued expansion of its physician network and recurring revenue base. Management believes continued growth in recurring revenue will improve the scalability of the Company’s business model and is expected to reduce operating expenses as a percentage of revenue over time. While the Company anticipates benefiting from increased operating leverage as revenues expand, it expects to continue making disciplined investments in personnel, technology and commercialization initiatives to support long-term growth. Accordingly, future operating results will depend on both the pace of revenue growth and the timing of these strategic investments.
Liquidity and Capital Resources
Liquidity is a measure of a company’s ability to generate funds to support its current and future operations, satisfy its obligations, and otherwise operate on an ongoing basis. On June 30, 2026, we had current assets totaling $682,933, including $317,392 of cash, $342,886 of accounts receivable, $8,814 of inventory, and $13,841 related to prepaid expenses and other current assets. At such date, we had total current liabilities of $375,822 consisting of $248,485 in accounts payable, $31,789 in other current liabilities, and $95,548 representing the due to related party balance. There were no balances classified as long-term liabilities on our condensed consolidated balance sheets.
On December 31, 2025, we had current assets totaling $883,009, including $636,157 of cash, $190,610 of accounts receivable, $35,790 of inventory, and $20,452 related to prepaid expenses and other current assets. At such date we had total current liabilities of $449,860 consisting of $326,431 in accounts payable, $17,858 in other current liabilities and $105,571 representing the current portions of outstanding loans and convertible notes. There was $96,218 of outstanding loan balances classified as long-term liabilities on our condensed consolidated balance sheets.
Cash and cash equivalents were approximately $317,000 at June 30, 2026, compared to approximately $636,000 at December 31, 2025, as we used approximately $208,061 to support operations and pay off debt obligations in the first half of 2026. The use of cash during this period primarily resulted from funding working capital requirements associated with our continued revenue growth, including increased accounts receivable balances. The use of cash in our operations reflects continued strategic investment in expanding our sales and marketing initiatives and investment in the commercial infrastructure and administrative capabilities necessary to support future growth as well as our continued dedication to research and development necessary to develop new products. These investments position us for continued expansion of our physician network and increasing our recurring revenue base. As revenue continues to increase and the portion of such increase represented by recurring revenues increases, management expects operating expenses to represent a lower percentage of revenue over time; however, future operating results will continue to depend upon the pace of revenue growth and our ongoing investment strategy.
Management believes our current cash position, anticipated collections of outstanding accounts receivable, and expected cash generated from future operations will provide sufficient liquidity to fund current operating requirements. Moreover, by substantially reducing our debt, we improved our ability to borrow funds should it become necessary. During the current quarter, the Company achieved profitability for the first time following a period of operating losses, and management's plans are focused on sustaining profitable operations and positive cash flows in future periods. However, because this return to profitability is recent and has not yet been demonstrated over an extended period, there can be no assurance that future operating results, cash flows, or profitability will continue at current levels or progress as planned. Accordingly, uncertainty remains regarding the Company's ability to sustain these improvements, and additional financing, if required, may not be available on favorable terms or at all. Management will continue to evaluate opportunities to strengthen liquidity and capital resources as it executes its long-term growth strategy.
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Plan of Operation and Funding
The accompanying condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. We had an accumulated deficit of $3,969,427 at June 30, 2026, generated a net loss of $65,876 for the six months ended June 30, 2026 and generated net income of $457,417 for the year ended December 31, 2025, principally as a result of a gain of $1,145,695 on the extinguishment of debt. We used cash in operations of $208,061 in the six months ended June 30, 2026, and generated cash from operations of $178,118 in the year ended December 31, 2025. Despite the extinguishment of much of our debt, our history of losses combined with the amount of our revenues, raise substantial doubt about our ability to continue as a going concern for a reasonable period of time. Our continuation as a going concern is dependent upon our ability to generate positive cash flow from operations or obtain necessary equity or debt financing. The condensed consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might be necessary should we be unable to continue as a going concern.
Our working capital requirements are expected to increase in line with the growth of our business, expansion of our physician network and increases in our recurring revenue platform. Growth in service-based revenue generally results in higher accounts receivable balances during periods of rapid expansion due to normal billing and collection cycles. We will likely increase our debt levels as we seek to expand our business and believe any temporary increases in working capital requirements are consistent with our growth strategy and expect cash collections to improve as recently generated receivables convert to cash. Existing working capital, anticipated receivable collections, and expected operating cash flows are expected to be adequate to fund our operations over the next twelve months. However, because the Company’s return to profitability is recent, there can be no assurance that the future cash flows and operating results will be sustained. If necessary, we would seek to supplement the amounts available to fund our operations through the issuance of debt or equity.
While we are focused on expanding our business we intend to remain focused on maintaining disciplined expense management, improving operating cash flow, and expanding higher-margin recurring revenue streams while continuing to invest strategically in initiatives expected to drive long-term shareholder value. As we seek to grow, we intend to continually explore our options to raise additional capital or, when available, borrow additional funds on terms which we believe are favorable to us. Additional issuances of equity or convertible debt securities will result in dilution to our current shareholders, could require the issuance of equity securities at prices we believe are below our true value and could cause the price of our common stock to decrease. Further, such securities might have rights, preferences or privileges senior to our common stock. Additional borrowings could require that we grant the lenders a security interest or other rights that impede our ability to operate as we deem best for our shareholders. Further, any default under a loan agreement could result in an action which could force us to seek bankruptcy protection. Additional financing may not be available upon acceptable terms, or at all. If adequate funds are not available or are not available on acceptable terms, we may not be able to maintain or expand our existing operations, take advantage of prospective new business endeavors or opportunities, which could significantly and materially restrict our business and adversely impact our financial results.
Our ability to obtain funds through the issuance of debt or equity is dependent upon the state of the financial markets at such time as we may seek to raise funds. The state of the capital markets may be adversely impacted by various risks and uncertainties, including, but not limited to future and current impacts of global events such as wars in Ukraine, Israel and Iran, increases in inflation and other risks detailed in the risk factors sections detailed in our Annual Report on Form 10-K for the year ended December 31, 2025.
ITEM 4. CONTROLS AND PROCEDURES
Evaluation of disclosure controls and procedures.
As of June 30, 2026, our chief executive officer, who is also our chief financial officer conducted an evaluation regarding the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) or 15d-15(e) under the Exchange Act). Based upon the evaluation of these controls and procedures as provided under the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control-Integrated Framework (2013), our chief executive officer/ chief financial officer concluded that our disclosure controls and procedures were ineffective as of the end of the period covered by this report. Many of these deficiencies stem from a lack of adequate personnel, including individuals with experience in financial reporting. Management has identified corrective actions for the weakness and will periodically reevaluate our ability to add personnel and implement improved review procedures as they can be supported by the growth in our business.
Changes in internal controls.
During the quarterly period covered by this report, no changes occurred in our internal control over financial reporting that materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
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PART II - OTHER INFORMATION
In addition to the other information set forth in this report, you should carefully consider the factors discussed in Part I, “Item 1. Description of Business, subheading Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2025, which could materially affect our business, financial condition or future results.
ITEM 6. EXHIBITS.
(a) The following documents are filed as exhibits to this report on Form 10-Q or incorporated by reference herein. Any document incorporated by reference is identified by a parenthetical reference to the SEC filing that included such document.
| 101.INS | Inline XBRL Instance Document | |
| 101.SCH | Inline XBRL Taxonomy Extension Schema Document | |
| 101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document | |
| 101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document | |
| 101.LAB | Inline XBRL Taxonomy Extension Label Linkbase Document | |
| 101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the date indicated.
| QHSLab, Inc. | ||
| By: | /s/ Troy Grogan | |
| Troy Grogan | ||
| Chief Executive Officer and Chief Financial Officer | ||
| Date: | August 12, 2026 | |
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