# Originclear, Inc.: Form 10-Q for the period ended Sep 30, 2025 - Company: [Originclear, Inc.](/companies/ocln.md) (CIK 1419793) - Form: 10-Q - Filed: 2025-11-19 - Accepted by EDGAR: Nov 19, 2025, 16:45 ET - Period: 2025-09-30 - Accession: 0001213900-25-112670 - Inline XBRL: yes - Main document: https://www.sec.gov/Archives/edgar/data/1419793/000121390025112670/ea0265420-10q_origin.htm - All documents and exhibits: https://www.sec.gov/Archives/edgar/data/1419793/000121390025112670/ ## Figures reported in this filing Standardized XBRL line items for the period ended 2025-09-30. | Line item | Period | Value | XBRL concept | | --- | --- | ---: | --- | | Revenue | 3 months, 2025-07-01 to 2025-09-30 | $1.7m | us-gaap:Revenues | | Revenue | 9 months, 2025-01-01 to 2025-09-30 | $4.1m | us-gaap:Revenues | | Cost of revenue | 3 months, 2025-07-01 to 2025-09-30 | $1.2m | us-gaap:CostOfGoodsAndServicesSold | | Cost of revenue | 9 months, 2025-01-01 to 2025-09-30 | $3.7m | us-gaap:CostOfGoodsAndServicesSold | | Gross profit | 3 months, 2025-07-01 to 2025-09-30 | $481.6k | us-gaap:GrossProfit | | Gross profit | 9 months, 2025-01-01 to 2025-09-30 | $328.3k | us-gaap:GrossProfit | | Operating income | 3 months, 2025-07-01 to 2025-09-30 | −$319.4k | us-gaap:OperatingIncomeLoss | | Operating income | 9 months, 2025-01-01 to 2025-09-30 | −$3.0m | us-gaap:OperatingIncomeLoss | | Interest expense | 3 months, 2025-07-01 to 2025-09-30 | $129.3k | us-gaap:InterestExpenseNonoperating | | Interest expense | 9 months, 2025-01-01 to 2025-09-30 | $1.1m | us-gaap:InterestExpenseNonoperating | | Net income | 3 months, 2025-07-01 to 2025-09-30 | −$13.2m | us-gaap:NetIncomeLoss | | Net income | 9 months, 2025-01-01 to 2025-09-30 | −$31.4m | us-gaap:NetIncomeLoss | | Diluted shares (weighted) | 3 months, 2025-07-01 to 2025-09-30 | 15,559,587,074 shares | us-gaap:WeightedAverageNumberOfDilutedSharesOutstanding | | Diluted shares (weighted) | 9 months, 2025-01-01 to 2025-09-30 | 10,970,799,374 shares | us-gaap:WeightedAverageNumberOfDilutedSharesOutstanding | | Operating cash flow | 9 months, 2025-01-01 to 2025-09-30 | −$2.3m | us-gaap:NetCashProvidedByUsedInOperatingActivities | | Cash and equivalents | at 2025-09-30 | $756.7k | us-gaap:CashAndCashEquivalentsAtCarryingValue | | Current assets | at 2025-09-30 | $2.1m | us-gaap:AssetsCurrent | | Total assets | at 2025-09-30 | $2.7m | us-gaap:Assets | | Current liabilities | at 2025-09-30 | $25.1m | us-gaap:LiabilitiesCurrent | | Total liabilities | at 2025-09-30 | $27.5m | us-gaap:Liabilities | | Long-term debt | at 2025-09-30 | $2.0m | us-gaap:LongTermDebt | | Shareholders' equity | at 2025-09-30 | −$32.2m | us-gaap:StockholdersEquityIncludingPortionAttributableToNoncontrollingInterest | ## Management's discussion and analysis As filed, 13,651 characters. This Quarterly Report on Form 10Q includes forward-looking statements (e.g., “believes,” “expects,” “may”) as defined under the Securities Act of 1933 and the Exchange Act of 1934. These are based on current expectations and are subject to risks and uncertainties that could cause actual outcomes to differ materially. The statements speak only as of the date of this report, and the Company undertakes no obligation to update them unless required by law. This discussion should be read in conjunction with the unaudited condensed consolidated financial statements and related notes included elsewhere in this report. ### Overview OriginClear, Inc. (“OriginClear,” “OCLN,” or the “Company”) was incorporated in Nevada on June 1, 2007, and now operates as the Clean Water Innovation Hub™, with a primary focus on supporting the growth and development of its majority-owned subsidiary, Water on Demand, Inc. (“WODI”). WODI holds Progressive Water Treatment, Inc. (“PWT”), headquartered in Sherman, Texas, as its sole active revenue-producing business. PWT designs, manufactures, and services custom-engineered water treatment systems for commercial and industrial applications. During the second quarter of 2025, the WODI Board of Directors approved the wind-down of Modular Water Systems (“MWS”), a previously active design-build unit within WODI. As of September 30, 2025, MWS is no longer in operation, and its financial results are presented as discontinued operations in this report. Concurrently, WODI formally shifted its strategic focus from manufacturing operations to organization of a financial technology, specifically the development of its infrastructure Fund. This fund will be organized as an Opportunity Zone Fund (“OZF”) designed to finance decentralized water treatment systems in underserved communities while leveraging federal tax incentives to attract private capital. The fund has been formed but had not yet raised external capital as of September 30, 2025. ### Recent Developments On October 14, 2025, the Company announced its intent to form a strategic joint venture with Georgetown, Texas-based Enviromaintenance to deploy and operate mobile wastewater treatment plants throughout Texas. The partnership is designed to serve industrial customers with immediate water treatment needs, particularly in areas where centralized services are limited or unavailable. This new venture builds on prior collaboration plans for the sale of standardized systems within the Greater Central Texas Region, spanning from Waco to San Antonio. Under the proposed structure, Water On Demand, through its affiliate, will provide capital for the acquisition of waste removal and recycling mobile vacuum trucks, while Enviromaintenance will purchase, operate, and manage these units utilizing its proprietary wastewater treatment technology within an exclusive Texas territory. On May 8, 2025, WODI executed a transition agreement with the former President of MWS to terminate the IP license, eliminate all accrued royalty obligations, and complete the MWS wind-down. In July 2024, PWT relocated to a 12,000-square-foot production facility at 5225 W. Houston Street, Sherman, Texas, under a triple-net lease with monthly base rent of $13,313. The Company, Water on Demand Inc., is a C-Corporation and is in the process of qualifying as a Qualified Opportunity Zone Business (“QOZB”). It also intends to create a wholly owned WODI LLC, which pays the Company to operate the business, such as administrative and contract management fees. Capital for WODI LLC is intended to be contributed by WODI QOZ Fund, designed to become a Qualified Opportunity Fund, in exchange for membership interests. The Company is also the General Partner of the fund, WODI Sponsorship LLC (“WODIS”), which is designed to earn a portion of prospective Fund distributions. The Company is currently selling and/or granting memberships in WODIS to accredited investors, while Regulation A+ investors receive common shares in The Company itself. The WOD QOZ Fund is currently authorized to raise up to $100 million, with plans underway to increase this cap to $200 million to support expanded project demand. The diagram below illustrates the organizational relationships and capital flow among OriginClear’s QOZB entities, including Water on Demand, Inc. (the QOZB), its wholly owned subsidiary (WODI LLC), the external capital-raising vehicle (WODI QOZ Fund), and the carried-interest sponsor (WODI Sponsorship LLC). ### Joint Venture On September 16, 2025, the Company entered into a joint venture with Block40X Inc. to form a Wyoming limited liability company (the “Block40X JV”) to develop and manage Bitcoin mining facilities in the United States. Each party holds a 50% membership interest. In connection with the agreement, the Company granted Block40X restricted stock equal to approximately 5% of the Company’s outstanding common shares. The Block40X JV had no material operations, assets, or liabilities as of September 30, 2025 and will be accounted for under the equity method of accounting. On September 26, 2025, the Company entered into a joint venture agreement with Bitmern Investments LLC, a subsidiary of Bitmern Technologies LLC, to form a Florida limited liability company (the “Bitmern JV”). Under the agreement, Bitmern holds a 60% ownership interest, and the Company holds 40%. The purpose of the Bitmern JV is to finance, develop, construct, and manage large-scale Bitcoin mining hosting facilities, beginning with a pilot project of up to 500 MW in the United States, with potential expansions. Bitmern will contribute technical expertise, project management, hosting operations, and related intellectual property, while the Company will contribute financing capabilities, capital markets strategy, and compliance support. The Bitmern JV will be governed by a three-member board of managers, with each party appointing one representative and jointly selecting an independent member. Bitmern appoints the Chair and Chief Executive Officer of the JV. The Bitmern JV had not commenced operations or recorded any material assets or liabilities as of September 30, 2025, and will be accounted for under the equity method of accounting. ### Results of Operations for the three months ended September 30, 2025, and 2024. ### Revenue and Cost of Goods Sold Revenue for the three months ended September 30, 2025, was $1,708,782, compared to $583,491 for the same period in 2024, increased $1,125,291 (193%). The incline was primarily driven by higher equipment contract revenue. Cost of goods sold increased to $1,227,164 in 2025, from $512,352 in 2024, an increase of $714,812 (140%). As a result, the Company recorded a gross profit of $481,618 compared to a profit of $71,139 in the third quarter of 2024. ### Selling and Marketing Selling and marketing expenses were $332,513 for the quarter ended September 30, 2025, a decrease of $464,798 (589%) from $797,311 in 2024. The decrease reflects reduced advertising and commissions, as well as fewer project-specific marketing initiatives compared to the prior-year period. ### General and Administrative Expenses General and administrative expenses totaled $468,468 for the quarter, compared to $1,472,994 in 2024, a decrease of $1,004,526 (68%). Lower legal and professional fees contributed to the decrease, partially offset by increased payroll and benefit costs in the current period. ### Other Income and (Expenses) Other income (expense) for the three months ended September 30, 2025 was $(2,746,436), compared $(304,140) in 2024, a change of $(2,445,296). The swing was driven by a $1,699,058 gain on preferred stock conversion in 2024 (nil in 2025). A $1,255,178 loss on redemption of common stock in 2024 (nil in 2025). Lastly, a $1,716,476 loss on change in derivative liability and debt conversion in 2025 vs. a $756,395 gain in 2024. ### Net Loss Net loss for the three months ended September 30, 2025, was $(3,332,820) compared with net loss of $(2,774,472) for the same period in 2024, a change of $558,348. This also includes loss from discontinued operations of $(264,021) vs a loss of $(271,166) in the prior period. The change was driven by lower gross profit and swing in other income (expense), including reduced derivative gains and the absence of one-time favorable items recorded in the prior period. Derivative values are highly sensitive to the Company’s stock price, volatility, interest rates, and other contractual terms: shifts in these inputs can produce significant period-to-period fluctuations in reported results. ### Results of Operations for the nine months ended September 30, 2025, and 2024. ### Revenue and Cost of Sales Revenue for the nine months ended September 30, 2025, was $4,055,252, compared to $2,577,468 in 2024, an increase of $1,477,784 (57%). The increase was driven by higher sales volumes in certain product lines. Cost of goods sold rose to $3,726,983 from $1,976,412, an increase of $1,750,571 (89%), reflecting the higher cost base associated with the increased volume and project mix. As a result, gross profit was $328,269 compared to a profit of $601,056 in 2024, and gross margin declined from 23% to (8%). ### Selling and Marketing Expenses Selling and marketing expenses for the nine months ended September 30, 2025, and 2024, were $984,084, compared to $2,024,434 in 2024, a decrease of $1,040,350 (51%). The decrease was attributable to lower commissions, and decreased spending on advertising and promotional campaigns. ### General and Administrative Expenses General and administrative expenses totaled $2,320,659 for the nine months ended September 30, 2025, compared to $3,598,920 in 2024, a decrease of $1,278,261. The decline was driven by lower legal and professional services, partially offset by increases in payroll and benefit related costs. ### Other Income and (Expenses) Other expense for the nine months ended September 30, 2025, was $(9,104,175), compared with $(10,694,301) in 2024, an improvement of $1,590,126. The change was driven by a $2,035,246 gain on remeasurement of derivative liabilities in 2025, compared to a $(5,837,116) loss in 2024, and a $(513,345) loss on extinguishment of payables in the current period versus a $30,646 gain in the prior year. The 2024 period also included a $(1,580,508) SPAC receivable impairment and a $(1,679,349) debt conversion adjustment that did not recur in 2025. ### Net Loss Net loss for the nine months ended September 30, 2025, was $(11,617,118) compared with $(16,329,231) for the same period in 2024, an improvement of $4,712,113. The reduction in net loss was largely due to lower total operating expenses and the swing in fair value adjustments to derivative liabilities, partially offset by higher cost of goods sold and interest expense. Derivative values are highly sensitive to the Company’s stock price, volatility, interest rates, and other contractual terms: shifts in these inputs can produce significant period-to-period fluctuations in reported results. ### Liquidity and Capital Resources ### Overview Liquidity reflects the Company’s ability to fund operations and meet obligations. The Company has historically relied on capital raises and continues to pursue financing through convertible notes, equity offerings, and strategic partnerships. The financial statements were prepared assuming the Company will continue as a going concern. The Company has incurred recurring losses and held cash of $756,729 as of September 30, 2025. Management believes continued investor support and access to capital markets will be necessary to sustain operations. ### Summary of Cash Flows for the Nine Months Ended September 30 | Category | 2025 | 2024 | | --- | ---: | ---: | | Net cash used in operating activities | $(2,332,836) | $(3,145,013) | | Net cash used in investing activities | $(33,020) | $(1,495,008) | | Net cash provided by financing activities | $2,751,070 | $4,395,719 | | Net increase (decrease) in cash and cash equivalents | $385,214 | $(244,301) | ### Capital Expenditures Apart from modest tenant improvements at the Sherman facility, the Company does not anticipate significant capital expenditure over the next twelve months. However, Growth initiatives for the anticipated OZ-fund model will require external capital, which may be raised through equity or debt offerings. ### Critical Accounting Policies The Company’s critical accounting policies, as described in its 2024 Form 10-K, remain unchanged. They include revenue recognition under ASC 606, expected-credit-loss measurement under ASC 326, fair-value accounting for derivatives under ASC 815, impairment testing for long-lived and indefinite-lived assets under ASC 360 and ASC 350, stock-based compensation under ASC 718, warranty-reserve estimation, and valuation-allowance assessment for deferred tax assets. Management’s judgments and estimates in applying these policies could materially affect the financial statements. ### Trends and Outlook Management expects revenue for the remainder of 2025 to be driven by PWT’s backlog. The wind-down of MWS eliminates a low-margin manufacturing line and allows resources to be redirected to financing activities. The Company’s ability to raise additional capital on reasonable terms will be critical to funding operations and executing its decentralized water-finance strategy. ### Off-Balance Sheet Arrangements We do not have any off-balance sheet arrangements that are reasonably likely to have a current or future effect on our financial condition, revenues, and results of operations, liquidity or capital expenditure. ## Market risk As filed, 976 characters. As of the date of this filing, the Company remains in default on four preferred stock series that have reached their contractual redemption dates. The defaults comprise of the following: 50 shares of Series F Preferred Stock with an aggregate redemption price of $50,000 that became due on September 1 2020; 25 shares of Series G Preferred Stock with an aggregate redemption price of $25,000 that became due on April 30 2021; 25 shares of Series I Preferred Stock with an aggregate redemption price of $25,000 that became due between May 2 2021 and June 10 2021; and 297 shares of Series K Preferred Stock with an aggregate redemption price of $297,150 that became due between August 5 2021 and March 26 2022. The cumulative unpaid redemption obligation is $397,150. No penalties have been assessed, and no waivers or amended terms have been negotiated to date. Management plans to address these in connection with its ongoing capital-raising and liability-management efforts. ## Controls and procedures As filed, 1,247 characters. ### Evaluation of Disclosure Controls and Procedures Under the supervision and with the participation of our management, including our Principal Executive Officer and Principal Financial Officer, we conducted an evaluation of the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act) as of the end of the period covered by this report. Based on this evaluation, management concluded that our disclosure controls and procedures were not effective as of that date. This conclusion reflects the constraints of a small finance team and the complexity and timing of certain non-routine transactions this quarter, including debt and equity conversions. ### Changes in Internal Control Over Financial Reporting There were no changes in our internal control over financial reporting (as defined in Rule 13a-15(f) of the Exchange Act) during the fiscal quarter ending September 30, 2025, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. ### Limitations on Internal Controls Internal controls provide reasonable, not absolute, assurance and, due to inherent limitations may not prevent or detect all misstatements. Filed Nov 19, 2025. Source: SEC EDGAR, the filing index for accession 0001213900-25-112670. Last ingested by Listed: Oct 24, 2026, 15:09 ET. No prices; not investment advice.