Wetouch Technology Inc.: Form 10-Q for the period ended Sep 30, 2025

The discussion should be read in conjunction with the Company’s consolidated financial statements and the notes presented herein. In addition to historical information, the following Management’s Discussion and Analysis of Financial Condition and Results of Operations contains forward-looking statements that involve risks and uncertainties. Actual results could differ significantly from those expressed, implied or anticipated in these forward-looking statements as a result of certain factors discussed herein and any other periodic reports filed and to be filed with the Securities and Exchange Commission. See “Cautionary Note Regarding Forward Looking Statement.”

Overview

The Company is a Nevada holding company with no material operations of its own. We conduct substantially all of our operations through our subsidiary in mainland China, which we control through BVI Wetouch. See “Item 1. Business – Corporate History and Structure” for more details.

Because our operations are primarily in China, we are subject to complex and evolving PRC laws and regulations. These include restrictions on capital flows, dividend payments, currency conversion, cybersecurity and data privacy, and governmental discretion over overseas securities offerings. These risks could materially affect our ability to transfer funds, conduct offerings, or continue operations in their current form. See “Item 1A. Risk Factors—Risks Related to Doing Business in China.”

As of September 30, 2025, the Company has contributed RMB 348.0 million (US$47.7 million) to its PRC subsidiary through intermediate holding companies, which were accounted for as long-term investments. These funds have been used by our PRC subsidiary in its operations. To date, no dividends or other distributions have been made by our PRC subsidiary to the Company. We may rely on future distributions from our PRC subsidiary to fund our holding company obligations, subject to PRC law and restrictions. For more details, see “Item 1A. Risk Factors—Risks Related to Doing Business in China—As a holding company, we conduct our operations primarily through our PRC subsidiary and face risks and uncertainties associated with this structure.”

Under current PRC law, dividend payments by our PRC subsidiary are limited to accumulated profits determined in accordance with PRC accounting standards and are subject to statutory reserve requirements. Dividends to the Company are also subject to withholding tax, generally 10%, but reduced to 5% if treaty conditions are met. There is no assurance that the reduced rate will apply. For more details, see “Item 1A. Risk Factors—Risks Related to Doing Business in China—Uncertainties with respect to the PRC legal system, including the enforcement of laws and changes in laws and regulations, could adversely affect us and limit the legal protections available.”

We currently do not have cash management policies dictating how funds are transferred between the Company and its subsidiaries. Most of our cash is maintained in Renminbi in mainland China and may be subject to PRC restrictions on outbound transfers. For details, see “Item 1A. Risk Factors - Risks Related to Doing Business in China - Governmental control of currency conversion may limit our ability to utilize our revenues effectively and affect the value of your investment.”

Through our wholly owned subsidiaries, BVI Wetouch, HK Wetouch, and Sichuan Vtouch, we are engaged in the research, development, manufacturing, sales and servicing of medium- to large-sized projected capacitive touchscreens. We are specialized in large-format touchscreens, which are developed and designed for a wide variety of markets and used in the financial terminals, automotive, POS, gaming, lottery, medical, HMI, and other specialized industries. Our product portfolio comprises medium- to large-sized projected capacitive touchscreens ranging from 7.0 inch to 42 inch screens.

We generate revenues through sales of our various touchscreen products. We sell our touchscreen products both domestically in China and internationally, covering major areas in Mainland China, including but not limited to the eastern, southern, northern and southwest regions of Mainland China, Taiwan, South Korea, and Germany. We believe that we have established a strong and diversified client base. For the three months ended September 30, 2025 and 2024, our domestic sales accounted for approximately 68.9% and 64.3%, respectively, of our revenues, and our international sales accounted for approximately 31.1% and 35.7%, respectively, of our revenues. For the nine months ended September 30, 2025 and 2024, our domestic sales accounted for approximately 67.9% and 64.0%, respectively, of our revenues, and our international sales accounted for approximately 32.1% and 36.0%, respectively, of our revenues.

Since our incorporation, we have effected two reverse stock splits of our common stock, including a 1-for-70 reverse split in 2020 and a 1-for-20 reverse split in 2023, and all share and per share information in this Quarterly Report has been retroactively adjusted to reflect these actions. For more details, see “Item 1. Business - Corporate History and Structure - Reverse Stock Splits” of the 2024 Form 10-K.

Construction of our new facility

We have been actively engaged in the construction of our new production facilities and office buildings in Chengdu Medicine City (Technology Park), Wenjiang District, Chengdu, Sichuan Province, People’s Republic of China since the summer of 2023. The Company has planned to increase the scope of facility construction by adding a touch machine construction area, to be completed by the end of 2025.

As of the date of this Quarterly Report, we estimate to finish the building construction by the end of 2025 and commence production in the second quarter of 2026. In consideration of the capital requirements for the new facility construction, we plan to fund the project primarily with our existing cash on hand, which totaled approximately $113.2 million as of September 30, 2025, and cash flows generated from operations, and we may seek additional financing if needed to support the timely completion of the project.

Highlights for the three months ended September 30, 2025 include:

• Revenues were $12.2 million, an increase of 6.1% from $ 11.5 million in the third quarter of 2024
• Gross profit was $4.0 million, a decrease of 9.1% from $ 4.4 million in the third quarter of 2024
• Gross profit margin was 32.7% as compared to 38.4% in the third quarter of 2024
• Net income was $2.5 million, a decrease of 7.4% from $ 2.7 million in the third quarter of 2024
• Total volume shipped was 597,470 units, an increase of 9.0% from 548,335 units in the third quarter of 2024

Results of Operations

The following table sets forth, for the periods indicated, statements of income data:

3

Three Months Ended September 30, 2025 Compared to Three Months Ended September 30, 2024

Revenues

We generated revenue of $12.2 million for the three months ended September 30, 2025, an increase of $0.7 million, or 6.1%, compared to $11.5 million in the same period of last year. This was due to an increase of 9.0% in sales volume, 0.1% positive impact from exchange rate due to appreciation of RMB against US dollars, partially offset by a decrease of 3.3% in the average selling price of our products, compared with that of the same period of last year.

(i) PRC market

For the three months ended September 30, 2025, we recorded revenue of $8.4 million in the domestic market, an increase of $1.0 million of 13.5%, as compared to $7.4 million of the same period of 2024. The increase was primarily due to (i) an increase of 15.5% in sales volume due to higher sales volume of automotive touchscreens, industrial control computer touchscreens, POS touchscreens, medical touchscreens and multi-functional printer touchscreens, (ii) 0.1% positive impact from exchange rate due to appreciation of RMB against US dollars, partially offset by a decrease of 2.6% in the average RMB selling price of our products, compared with those of the same period of last year.

As for the RMB selling price, the decrease of 2.6% was mainly due to due to the lower demand of higher selling priced products of touchscreen machines in the PRC domestic market, including the decreased average RMB selling price of 13.4% in medical touchscreens and 0.9% in automotive touchscreens during the three months ended September 30, 2025.

The Company has taken proactive efforts to market new models and efforts to obtain new customers in existing markets, our sales increased by 14.1% in South China, 13.4 in East China, and 10.5% in Southwest China during the three months ended September 30, 2025.

(ii) Overseas market

For the three months ended September 30, 2025, revenues from the overseas market were $3.8 million as compared to $4.1 million of the same period of 2024, representing a decrease by $0.3 million, or 7.3%, mainly due to i) a decrease of 2.5% in sales volume mainly in gaming touchscreens and automotive touchscreens, ii) a decrease of 5.1% in average selling price in RMB due to the lower demand on touchscreen machines in industrial control computer touchscreens and automotive touchscreens, partially offset by iii) the 0.1% positive impact from exchange rate due to appreciation of RMB against US dollars, compared with those of the same period of last year.

The following table summarizes the breakdown of revenues by categories in US dollars:

The Company continued to shift production mix from traditional lower-end products to high-end products such as medical touchscreens and automotive touchscreens, primarily due to (i) greater growth potential of computer screen models in China and overseas market, and (ii) the stronger demand on higher-end touch screens made with better materials and better quality.

Gross Profit and Gross Profit Margin

(in millions, except percentage)

Gross profit was $4.0 million in the third quarter ended September 30, 2025, compared to $4.4 million in the same period of 2024. Our gross profit margin decreased to 32.7% for the third quarter ended September 30, 2025, as compared to 38.4% for the same period of 2024, primarily due to the increase of cost of goods sold by 13.8% resulting from the increase of 14.2% in costs of raw materials, and 2.7% in labor cost, partially offset by the increased sales of 6.1% during the quarter ended September 30, 2025.

Selling Expenses

(in millions, except percentage)

Selling expenses were $0.1 million for the three months ended September 30, 2025, compared to $0.2 million in the same period in 2024, representing a decrease of $0.1 million, or 50.0%. The decrease was primarily due to the decrease of traveling expenses because of sales department utilizing more online communications for sales forecast and marketing evaluations during the three months ended September 30, 2025.

General and Administrative Expenses

(in millions, except percentage)

General and administrative expenses were $0.8 million and $0.7 million for the three months ended September 30, 2025 and 2024, respectively, the increase of $0.1 million was primarily due to the professional fees.

Research and Development Expenses

Research and development expenses were nil and $43,859 for the three months ended September 30, 2025 and 2024, respectively.

Operating Income

Total operating income was $3.1 million for the three months ended September 30, 2025 as compared to $3.5 million of the same period of last year, primarily due to lower gross margin for the three months ended September 30, 2025.

Gain on Changes in Fair Value of Common Stock Purchase Warrants

(in millions, except percentage)

Gain on changes in fair value of common stock purchase warrants for the three months ended September 30, 2024 was $0.1 million (See Note 10 (b) of the accompanying financial statements).

Income Taxes

(in millions, except percentage)

The effective income tax rates for the three months ended September 30, 2025 and 2024 were 20.1% and 26.9%, respectively.

Net Income

As a result of the above factors, we had a net income of $2.5 million in the third quarter of 2025 compared to a net income of $2.7 million in the same quarter of 2024.

Results of Operations - Nine Months Ended September 30, 2025 Compared to Nine Months Ended September 30, 2024

Revenues

We generated revenue of $39.9 million for the nine months ended September 30, 2025, an increase of $1.3 million, or 3.4%, compared to $38.6 million in the same period of last year. This was mainly due to an increase of 8.8% in sales volume, partially offset by a decrease of 4.9% in the average RMB selling price of our products, and 0.3% negative impact from exchange rate due to depreciation of RMB against US dollars, compared with those of the same period of last year.

(i) PRC market

For the nine months ended September 30, 2025, revenue from PRC market increased by $2.4 million or 9.7% as a combined result of (i) an increase of 14.8% in sales volume, particularly in industrial control computer touchscreens, automotive touchscreens, POS touchscreens and multi-functional printer touchscreens, partially offset by (ii) a decrease of 4.1% in the average RMB selling price of our products, and (iii) 0.3% negative impact from exchange rate due to depreciation of RMB against US dollars, compared with those of the same period of last year.

As for the RMB selling price, the decrease of 4.1% was mainly due to the lower demand of higher selling priced products of touchscreen machines in the PRC domestic market, including the decreased average RMB selling price of 18.3% in medical touchscreens and 1.2% in automotive touchscreens during the nine-month period ended September 30, 2025.

The Company has taken proactive efforts to market new models and efforts to obtain new customers in existing markets, our sales increased by 14.2% in South China, and 13.1% in East China, and 4.0% in Southwest China during the nine-month period ended September 30, 2025.

(ii) Overseas market

For the nine months ended September 30, 2025, revenues from overseas market was $12.8 million as compared to $13.9 million of the same period of 2024, representing a decrease by $1.1 million, or 7.9%, mainly due to i) a decrease of 6.6% in average selling price in RMB due to the lower demand on touchscreen machines in medical touchscreens, industrial control computer touchscreens, and automotive touchscreens, ii) a decrease of 1.6% in sales volume due to decreased sales in medical touchscreens, industrial control computer touchscreens and gaming touchscreens, and iii) 0.3% negative impact from exchange rate due to depreciation of RMB against US dollars, compared with those of the same period of last year.

The following table summarizes the breakdown of revenues by categories in US dollars:

The Company continued to shift production mix from traditional lower-end products such as touchscreens used in industrial control computer industries to high-end products such as industrial control computer touchscreens and POS touchscreens, primarily due to (i) greater growth potential of computer screen models in China, (ii) the stronger demand on higher-end touch screens made with better materials and better quality.

Gross Profit and Gross Profit Margin

(in millions, except percentage)

Gross profit was $13.7 million during the nine months ended September 30, 2025, compared to $12.6 million in the same period of 2024. Our gross profit margin increased to 34.4% for the nine months ended September 30, 2025, as compared to 32.7% for the same period of 2024, primarily due to the increase of revenue by 3.4%, particularly high-end products such as industrial control computer touchscreens, POS touchscreens and automotive touchscreens, and the decreased cost of materials by 1.2%, partially offset by the increased labor cost by 5.1% for the nine months ended September 30, 2025.

Selling Expenses

(in millions, except percentage)

Selling expenses were $0.4 million for the nine months ended September 30, 2025, compared to $0.9 million in the same period in 2024, representing a decrease of $0.5 million, or 55.6%. The decrease was primarily due to the less traveling expenses as the selling team using online communications to market the products during the nine-month period ended September 30, 2025

General and Administrative Expenses

(in millions, except percentage)

General and administrative (G&A) expenses were $3.1 million for the nine months ended September 30, 2025, compared to $2.2 million in the same period in 2024, representing an increase of $0.9 million or 40.9%. The increase was primarily due to the increase of $0.6 million professional fees, $0.2 million credit loss of receivables, and $0.1 million amortization of right-of-use assets, and $0.1 million of payroll expenses, partially offset by the decrease of $0.4 million of amortization of prepaid marketing research fees (see Note 3 of the accompanying financial statements).

Research and Development Expenses

Research and development (R&D) expenses were nil and $129,808 for the nine months ended September 30, 2025 and 2024, respectively.

Operating Income

Total operating income was $10.2 million for the nine months ended September 30, 2025 as compared to $9.5 million of the same period of last year, due to higher gross profit, less selling expenses and research and development expenses, partially offset by higher general & administration expenses.

Gain on changes in fair value of Common Stock Purchase Warrants

(in millions, except percentage)

Gain on changes in fair value of common stock purchase warrants was $0.2 million for the nine months ended September 30, 2024. (See Note 10 (b)).

Interest Expenses

(in millions, except percentage)

For the nine months ended September 30, 2024, the Company recognized interest expenses of convertible promissory notes in the amount of $1,169,974 (mainly the default interest charges of $1,145,995 upon the repayment of the notes payable (See Note 9 (a) of the accompanying financial statements).

Income Taxes

(in millions, except percentage)

The effective income tax rates for the nine months ended September 30, 2025 and 2024 were 28.9% and 31.6%, respectively.

Net Income

As a result of the above factors, we had a net income of $7.3 million for the nine months ended September 30, 2025 compared to a net income of $5.9 million in the same period of 2024.

Liquidity and Capital Resources

Historically, our primary uses of cash have been to finance working capital needs. We expect that we will be able to meet our needs to fund operations, capital expenditures and other commitments in the next 12 months primarily with our cash and cash equivalents, operating cash flows and bank borrowings.

We may, however, require additional cash resources due to changes in business conditions or other future developments. If these sources are insufficient to satisfy our cash requirements, we may seek to sell additional equity or debt securities or obtain a credit facility. The sale of additional equity or equity-linked securities could result in additional dilution to stockholders. The incurrence of indebtedness would result in increased debt service obligations and could result in operating and financial covenants that would restrict operations. Financing may not be available in amounts or on terms acceptable to us, or at all.

As of September 30, 2025, we had current assets of $125.2 million, consisting of $113.2 million in cash, $10.8 million in accounts receivable, $0.1 million in inventories, and $1.1 million in prepaid expenses and other current assets Our current liabilities as of September 30, 2025 were $4.7 million, which is comprised of $1.3 million in accounts payable, $0.6 million in amounts due to a related party, $0.7 million in income tax payable, $1.5 million in accrued expenses and other current liabilities. and $0.6 million in operating lease liabilities, current portion. We also had $51,503 in operating lease liabilities, non- current as of September 30, 2025.

The following is a summary of our cash flows provided by (used in) operating, investing, and financing activities for the nine months ended September 30, 2025 and 2024:

Operating Activities

The positive cash flow of $8.5 million for the nine months ended September 30, 2025 was primarily due to i) $7.3 million net income, ii) $0.2 million of credit loss for receivable and $0.5 million of amortization of operating right-of-use assets, iii) the decrease of $1.4 million in prepaid expenses and current assets, iii) the increase of $0.5 million due to related parties, $0.7 million in income tax payable, $0.5 million in accrued expenses and current liabilities, and $0.5 million in operating lease liabilities, partially offset by iv) the increase of $3.1 million in accounts receivable.

The negative cash flow of 0.7 million for the nine months ended September 30, 2024 was primarily due to i) increase of $2.1 million in accounts receivable, $2.3 million in prepaid expenses and current assets, ii) the decrease of $3.7 million in accrued expenses and current liabilities, partially offset by iii) net income of $5.9 million and iv) the increase of $0.6 million in accounts payable and $1.0 million in income tax payable.

Investing Activity

There was no cash flow in investing activities for the nine months ended September 30, 2025.

Net cash used in investing activity for the nine months ended September 30, 2024 was $0.1 million for the purchase of property, plant and equipment.

Financing Activities

There was no cash flow in financing activities for the nine months ended September 30, 2025.

Net cash provided by financing activities for the nine months ended September 30, 2024 was $8.0 million, including $9.0 million in net proceeds from the 2024 Public Offering and $0.4 million in proceeds of interest-free advances from a related party, partially offset by $1.4 million repayment of convertible promissory notes.

As of September 30, 2025, our cash and cash equivalents were $113.2 million, as compared to $103.8 million at December 31, 2024.

Days Sales Outstanding (“DSO”) has decreased to 62 days for the nine months ended September 30, 2025 from 64 days for the year ended December 31, 2024.

The majority of the Company’s revenues and expenses were denominated in Renminbi (“RMB”), the currency of the People’s Republic of China. There is no assurance that exchange rates between the RMB and the U.S. Dollar will remain stable. Inflation has not had a material impact on the Company’s business.

Based on past performance and current expectations, we believe our cash and cash equivalents provided by operating activities and financing activities will satisfy our working capital needs, capital expenditures and other liquidity requirements associated with our operations for at least the next 12 months.

The majority of the Company’s revenues and expenses were denominated in Renminbi (“RMB”), the currency of the People’s Republic of China. There is no assurance that exchange rates between the RMB and the U.S. Dollar will remain stable. Inflation has not had a material impact on the Company’s business.

Holding Company Structure

There have been no changes to the Company’s holding company structure during the nine months ended September 30, 2025. For more details, refer to the Company’s holding company structure disclosures set forth in Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations- Holding Company Structure” of the 2024 Form 10-K.

Cash and Other Assets Transfers between the Holding Company and Its Subsidiaries

Please see “ITEM 7- Management’s Discussion and Analysis of Financial Condition and Results of Operations- Cash and Other Assets Transfers between the Holding Company and Its Subsidiaries” of the 2024 Form 10-K for more details.

Capital Expenditure Commitment

As of September 30, 2025, the Company had commitment of RMB4.6 million (equivalent to $0.7 million) for construction in progress.

Off-Balance Sheet Arrangements

We had no off-balance sheet arrangements as of September 30, 2025.

Critical Accounting Policies

The preparation of financial statements and related disclosures in conformity with GAAP and the Company’s discussion and analysis of its financial condition and operating results require the Company’s management to make judgments, assumptions and estimates that affect the amounts reported. Note 2, “SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES” of the Notes to Condensed Consolidated Financial Statements in Part I, Item 1 of this Form 10-Q and in the Notes to Consolidated Financial Statements in Part II, Item 8 of the 2024 Form 10-K describe the significant accounting policies and methods used in the preparation of the Company’s condensed consolidated financial statements. There have been no material changes to the Company’s critical accounting estimates since the 2024 Form 10-K.

Evaluation of Disclosure Controls and Procedures

Under supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer (our “Certifying Officers”), we evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of September 30, 2025. Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were not effective as of September 30, 2025, as a result of the material weakness identified below.

In light of this material weakness, we performed additional analysis as deemed necessary to ensure that our financial statements were prepared in accordance with U.S. GAAP. Based on such analysis and notwithstanding the identified material weakness, management, including our Chief Executive Officer and Chief Financial Officer, believe the unaudited condensed consolidated financial statements included in this Quarterly Report fairly represent in all material respects our financial condition, results of operations and cash flows at and for the periods presented in accordance with U.S. GAAP.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. All internal control systems, no matter how well designed, have inherent limitations. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. Because of the inherent limitations of internal control, there is a risk that material misstatements may not be prevented or detected on a timely basis by internal control over financial reporting. However, these inherent limitations are known features of the financial reporting process. Therefore, it is possible to design into the process safeguards to reduce, though not eliminate, this risk.

Material Weakness

In connection with the audit of the financial year ended December 31, 2024, we identified certain control deficiencies in the design and operation of our internal controls over our financial reporting that constituted a material weakness in aggregation. A “material weakness” is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of our company’s annual or interim financial statements will not be prevented or detected on a timely basis.

The material weaknesses related to internal control over financial reporting that was identified during the annual report of 2024 and still applied as of September 30, 2025 were:

• Lack of competent financial reporting and accounting personnel with appropriate understanding of U.S. GAAP and financial reporting requirements to design and implement key controls over financial reporting process;
• Lack of risk assessment procedures on internal controls to detect financial reporting risks in a timely manner.

Management believes that the material weaknesses that were identified did not have an effect on our financial results. However, management believes that these weaknesses, if not properly remediated, could result in a material misstatement in our financial statements in future periods.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. All internal control systems, no matter how well designed, have inherent limitations. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. Because of the inherent limitations of internal control, there is a risk that material misstatements may not be prevented or detected on a timely basis by internal control over financial reporting. However, these inherent limitations are known features of the financial reporting process. Therefore, it is possible to design into the process safeguards to reduce, though not eliminate, this risk.

Management’s Plan to Remediate the Material Weakness

Management has been implementing and continues to implement measures designed to ensure that control deficiencies contributing to the material weakness are remediated, such that these controls are designed, implemented, and operating effectively. The remediation actions planned include:

• Identify gaps in the Company’s skills base and the expertise of its staff required to meet the financial reporting requirements of a public company; and
• Continue to cooperate with operation teams to ensure a control environment in place, and monitor the effectiveness of operations on existing controls and procedures.
• Establish procedures to assess compliance requirements under the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”) and improve overall internal control.

During the three and nine months ended September 30, 2025, the management has not addressed the material weaknesses on internal control and will continue to implement the above improvement plans to ensure our financial reporting in compliance with US GAAP and SEC filing requirements.

The Company recognizes that the material weaknesses in its internal control over financial reporting will not be considered remediated until the remediated controls operate for a sufficient period of time and can be tested and concluded by management to be designed and operating effectively. Because the Company’s remediation efforts are ongoing, it cannot provide any assurance that these remediation efforts will be successful or that its internal control over financial reporting will be effective as a result of these efforts.

The Company will continue to evaluate and work to improve its internal control over financial reporting related to the identified material weaknesses, and management may determine to take additional measures to address control deficiencies or determine to modify the remediation plan described above. The Company will report the progress and status of the above remediation efforts to the Audit Committee on a periodic basis.

Changes in Internal Control over Financial Reporting

As described above, the Company is taking steps to remediate the material weakness noted above. Other than in connection with these remediation steps, there have been no changes in our internal control over financial reporting during the three and nine months ended September 30, 2025, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

As a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934, as amended, and in item 10(f)(1) of Regulation S-K, we are electing scaled disclosure reporting obligations and therefore are not required to provide the information requested by this item.