Sintx Technologies, Inc.: Form 10-Q for the period ended Jun 30, 2025

You should read the following discussion and analysis of our financial condition and results of operations in conjunction with our consolidated financial statements for the year ended December 31, 2024 and the notes thereto, along with Management’s Discussion and Analysis of Financial Condition and Results of Operations, included in our Annual Report on Form 10-K for the year ended December 31, 2024, filed separately with the U.S. Securities and Exchange Commission. This discussion and analysis contains forward-looking statements based upon current beliefs, plans, expectations, intentions and projections that involve risks, uncertainties and assumptions, such as statements regarding our plans, objectives, expectations, intentions and projections. Our actual results and the timing of selected events could differ materially from those anticipated in these forward-looking statements as a result of several factors, including those set forth under the “Risk Factors” section of our Annual Report on Form 10-K for the year ended December 31, 2024, and any updates to those risk factors filed from time to time in our Quarterly Reports on Form 10-Q and in other filings with the Securities and Exchange Commission we may make from time-to-time.

Overview

SINTX Technologies is an advanced ceramics company formed in December 1996, that develops and commercializes materials, components, and technologies for medical and agribiotech applications. SINTX provides biomedical solutions for medical devices specializing in silicon nitride (Si₃N₄) for musculoskeletal and antipathogenic applications. SINTX is a global leader in the research, development, and manufacturing of silicon nitride, and its products have been implanted in humans since 2008.

SINTX Core Business

Biomedical Applications: Since its inception, SINTX has been focused on medical grade silicon nitride. SINTX biomedical products have been shown to be biocompatible, bioactive, antipathogenic, and to have superb bone affinity. Spinal implants made from SINTX silicon nitride have been successfully implanted in humans since 2008 in the U.S., Europe, South America and Asia. This established use, along with its inherent resistance to bacterial adhesion and bone affinity suggests that it may also be suitable in other fusion device applications such as arthroplasty implants, foot wedges, and dental implants. More recently, in July 2025, SINTX submitted a 510(k) premarket notification to the U.S. Food and Drug Administration (FDA) for its novel silicon nitride osteotomy wedges, marking its official entry into the foot and ankle reconstruction market. These next-generation implants blend cutting-edge biomaterials science with surgical precision and are designed to elevate standards in orthopedic procedures. SINTX silicon nitride products can be polished to a smooth and wear-resistant surface for articulating applications, such as bearings for hip and knee replacements.

We believe that silicon nitride has a superb combination of properties that make it suited for long-term human implantation. Other biomaterials are based on bone grafts, metal alloys, and polymers- all of which have well-known practical limitations and disadvantages. In contrast, silicon nitride has a legacy of success in the most demanding and extreme industrial environments. Bacterial infection of any biomaterial implants is always a concern. SINTX silicon nitride has been shown to be resistant to bacterial colonization and biofilm formation, making it antibacterial. As a human implant material, silicon nitride offers bone ingrowth, resistance to bacterial and viral infection, ease of diagnostic imaging, resistance to corrosion, and superior strength and fracture resistance, all of which claims are validated in our large and growing inventory of peer-reviewed, published literature reports. We believe that our versatile silicon nitride manufacturing expertise positions us favorably to introduce new and innovative devices in the medical and non-medical fields.

Antipathogenic Applications: Today, there is a global need to improve protection against pathogens in everyday life. SINTX believes that by incorporating its unique composition of silicon nitride antipathogenic powder into products such as face masks, drapes, filters, sutures, and wound care devices, it is possible to manufacture surfaces that inactivate pathogens, thereby limiting the spread of infection and disease. The discovery in 2020 that SINTX silicon nitride inactivates SARS-CoV-2, the virus which causes the disease COVID-19, has opened new markets and applications for our material. We presently manufacture advanced ceramic powders and components in our manufacturing facilities based in Salt Lake City, Utah.

The SINTX Salt Lake City facility is registered with the FDA, is cGMP and ANVISA RDC 665 compliant, as well as being ISO 9001:2015, ISO 13485:2016 certified, and ASD9100D certified. The Company’s products are primarily sold in the United States.

Components of our Results of Operations

We manage our business within one reportable segment, which is consistent with how our management reviews our business, makes investment and resource allocation decisions, and assesses operating performance.

Revenue

Our product revenue is derived from the manufacture and sale of products. These revenue sources primarily include coatings, materials, and components for aerospace and medical device markets, toll processing services, and government contracts and grants. We generally recognize revenue from sales where control transfers at a point in time as the title and risk of loss passes to the customer, which is at the time the product is shipped. In general, our customer does not have rights of return or exchange.

We believe our product revenue will increase as we complete development and obtain regulatory clearance for our product candidates and secure opportunities to manufacture third party products with silicon nitride.

We also derive grant and contract revenue from awards provided by governmental agencies.

Cost of revenue

The expenses that are included in cost of revenue include all in-house manufacturing costs for the products we manufacture.

Gross profit

Our gross profit measures our product revenue relative to our cost of revenue.

Research and development expenses

Our research and development costs are expensed as incurred. Research and development costs consist of engineering, product development, clinical trials, test-part manufacturing, testing, developing and validating the manufacturing process, manufacturing, facility and regulatory-related costs. Research and development expenses also include employee compensation, employee and non-employee stock-based compensation, supplies and materials, consultant services, and travel and facilities expenses related to research and development activities.

We expect to incur additional research and development costs as we continue to develop new medical devices, related product candidates for antipathogenic applications, and other products which may increase our total research and development expenses.

General and administrative expenses

General and administrative expenses consist primarily of salaries, benefits and other related costs, including stock-based compensation for certain members of our executive team and other personnel employed in finance, legal, compliance, administrative, information technology, customer service, executive and human resource departments. General and administrative expenses also include other expenses not part of the other cost categories mentioned above, including facility expenses and professional fees for accounting and legal services.

RESULTS OF OPERATIONS

The following is a tabular presentation of our unaudited condensed consolidated operating results for the three and six months ended June 30, 2025 and 2024 (in thousands):

Revenue

For the three months ended June 30, 2025, product revenue decreased $0.3 million, or 74%, compared to the same period in 2024. During the three months ended June 30, 2025, grant and contract revenue decreased $0.4 million, or 89% as compared to the same period in 2024.

For the six months ended June 30, 2025, product revenue decreased $0.3 million, or 43%, compared to the same period in 2024. During the six months ended June 30, 2025, grant and contract revenue decreased $0.7 million, or 85% as compared to the same period in 2024.

Revenue trends and strategic focus

The decrease in total revenue for the two periods was primarily due to the Company’s ongoing strategic repositioning away from non-core, low-margin OEM technical manufacturing contracts that did not support long-term profitability. This planned reduction in OEM-related revenue is consistent with our corporate shift toward commercializing proprietary silicon nitride-based biomedical devices, which we believe offer stronger margins, a more defensible competitive position, and better long-term value for shareholders.

While this strategic realignment has led to a temporary minor decline in reported revenue, we believe it is a necessary step in positioning the Company for sustainable growth. During this transitional period, we continue to invest in the development and regulatory advancement of silicon nitride-based orthopedic and surgical implants, as evidenced by our recently submitted 510(k) for osteotomy wedges used in foot and ankle fusion procedures. We believe that these products will serve as key revenue drivers in the future.

Cost of revenue and Gross profit

For the three months ended June 30, 2025, cost of revenue decreased $0.1 million, or 58%, compared to the same period in 2024 primarily due to the decrease in revenue mentioned above.

For the six months ended June 30, 2025, cost of revenue decreased $0.1 million, or 24%, compared to the same period in 2024 primarily due to the decrease in revenue mentioned above.

Research and development expenses

For the three months ended June 30, 2025, research and development expenses decreased $0.4 million, or 26%, compared to the same period in 2024, primarily due to a decrease in payroll related costs.

For the six months ended June 30, 2025, research and development expenses decreased $1.3 million, or 36%, compared to the same period in 2024, primarily due to a decrease in payroll related costs, patent expenses, protypes, and outside consulting costs.

General and administrative expenses

For the three months ended June 30, 2025, general and administrative expenses increased $0.2 million, or 22%, compared to the same period in 2024, primarily due to fees paid to departing members of the Board of Directors, higher accounting expenses, partially offset by lower legal expenses.

For the six months ended June 30, 2025, general and administrative expenses increased $0.3 million, or 13%, compared to the same period in 2024, primarily due to fees paid to departing members of the Board of Directors, partially offset by lower legal expenses.

Sales and marketing expenses

For the three months ended June 30, 2025, sales and marketing expenses decreased $0.1 million, or 51%, compared to the same period in 2024, primarily due to an overall decrease in payroll related costs.

For the six months ended June 30, 2025, sales and marketing expenses decreased $0.2 million, or 39%, compared to the same period in 2024, primarily due to an overall decrease in payroll related costs.

Grant and contract expenses

For the three months ended June 30, 2025, grant and contract expenses decreased $0.3 million, or 86%, compared to the same period in 2024, primarily due to the decrease in grant and contract revenue associated with the sale of the TA&T subsidiary.

For the six months ended June 30, 2025, grant and contract expenses decreased $0.5 million, or 84%, compared to the same period in 2024, primarily due to the decrease in grant and contract revenue associated with the sale of the TA&T subsidiary.

Other income, net

For the three months ended June 30, 2025, other income decreased $0.2 million, or -31%, compared to the same period in 2024, primarily due to a $0.5 million decrease in the change in value of derivative liabilities, partially offset by a $0.3 million gain on disposal of property and equipment associated with SINTX Armor.

For the six months ended June 30, 2025, other income decreased $2.4 million, or -84%, compared to the same period in 2024, primarily due to a $2.7 million decrease in the change in value of derivative liabilities, partially offset by a $0.3 million gain on disposal of property and equipment associated with SINTX Armor.

Liquidity and capital resources

The condensed consolidated financial statements have been prepared assuming the Company will continue to operate as a going concern, which contemplates the realization of assets and settlement of liabilities in the normal course of business, and does not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classifications of liabilities that may result from uncertainty related to its ability to continue as a going concern within one year from the date of issuance of these condensed consolidated financial statements.

For the six months ended June 30, 2025, and 2024, the Company incurred a net loss of $4.6 million and $3.1 million, respectively, and used cash in operating activities of $3.7 million and $4.9 million, respectively. The Company had an accumulated deficit of $286 million and $282 million as of June 30, 2025, and December 31, 2024, respectively. We will require substantial future capital in order to continue operating our business, conduct research and development and regulatory clearance and approval activities necessary to bring our products to market, and to establish effective marketing and sales capabilities. Our existing capital resources are not sufficient to enable us to fund the completion of the development and commercialization of all our product candidates.

To date, the Company’s operations have been principally financed from proceeds from the issuance of preferred and common stock and, to a lesser extent, cash generated from product sales. It is anticipated that the Company will continue to generate operating losses and use cash in operations. The Company’s continuation as a going concern is dependent upon its ability to increase sales, decrease expenses and raise additional funding. Whether and when the Company can attain profitability and positive cash flows from operations or obtain additional financing is uncertain.

We are actively seeking opportunities to raise additional equity and/or debt financing. However, such funding is not guaranteed and may not be available to the Company on favorable or acceptable terms and may involve significant restrictive covenants. Any additional equity financing, if available to the Company, will most likely be dilutive to its current stockholders. If the Company is not able to obtain additional debt or equity financing on a timely basis, the impact on the Company will be material and adverse.

The Board of Directors, together with management, is performing an ongoing evaluation of the Company’s business strategy and focus.

The Company’s strategic emphasis is focused on utilizing its technology in making advancements in the biomedical sector. Historically engaged in both industrial and biomedical applications, SINTX has prioritized the development and commercialization of innovative medical devices, leveraging its expertise in advanced ceramics and biomaterials. This renewed focus aligns with a commitment to improving patient outcomes through the creation of products designed for surgical, orthopedic, and other specialized medical applications. We are concentrating our resources on high-growth areas within the healthcare sector where our proprietary materials and technologies—such as silicon nitride—provide a distinct competitive advantage due to their unique strength, durability, and biocompatibility.

Through this transformation, SINTX’s aim is to deliver meaningful innovations to the medical community. Our current research and development pipeline is centered on medical-grade devices that incorporate antimicrobial properties, enhanced imaging capabilities, and durability under physiological conditions, which are critical for orthopedic implants, spinal fusion devices, and other surgical tools. As we transition our focus away from industrial applications, we anticipate this strategic shift will enable us to better serve the medical sector, address critical unmet needs, and position SINTX as a leading provider in the medical device market. By focusing on partnerships and collaborations with healthcare institutions and industry leaders, SINTX is positioned to expand its footprint in the medical device sector and drive shareholder value through sustainable, high-impact innovations.

On August 8, 2024, the Board of Directors approved a plan to implement a Company-wide reduction in the workforce. This decision was part of the Company’s ongoing strategic review of its operations aimed at improving operational efficiency and reducing costs.

On August 12, 2024, the Board of Directors approved a plan to cease efforts to make the armor plant operational. This decision was made to streamline operations and focus on core business areas that align with the Company’s long-term strategic goals. The armor plant has not been fully operational since the acquisition of the armor equipment in July 2021 and has been completely shut down since October 2023 due to the malfunctioning of the sintering furnace. In connection with this decision, the Company incurred an impairment charge of approximately $4.6 million during the year ended December 31, 2024. This charge primarily relates to the write-down of certain long-lived assets associated with the armor plant to their estimated fair value.

As explained in Note 2, on February 19, 2025, the Company entered into an Entity Acquisition Agreement (the “Agreement”) with Tethon Corporation (“Tethon”), pursuant to which the Company sold to Tethon all of the issued and outstanding shares of TA&T in exchange for the assumption by Tethon of the outstanding liabilities of TA&T.

As a result of these uncertainties, management has concluded that substantial doubt exists about the Company’s ability to continue as a going concern for 12 months from the date these condensed consolidated financial statements are issued. The condensed consolidated financial statements do not include any adjustments that might result from the outcome of these uncertainties.

Cash Flows

The following table summarizes, for the periods indicated, cash flows from operating, investing and financing activities (in thousands) – unaudited:

22

Net cash used in operating activities

Net cash used in operating activities was $3.7 million during the six months ended June 30, 2025, compared to $4.9 million used during the six months ended June 30, 2024, a decrease of $1.2 million. Decrease in net loss of $1.5 million, combined with adjustments of non-cash items of $2.9 million, and an increase in other liabilities of $0.8 million, contributed positively to our net cash used in operating activities, partially offset by increases in accounts receivable of $0.2 million and prepaid expenses of $0.7 million.

Net cash provided by (used in) investing activities

Net cash provided by investing activities was $0.3 million during the six months ended June 30, 2025, compared to net cash used in investing activities of $0.2 million during the six months ended June 30, 2024, an increase of $0.5 million. The increase in cash provided by investing activities during 2025 was primarily due to a $0.5 million decrease in purchase of property and equipment and a $0.3 million increase in proceeds from the sale of property and equipment, partially offset by a $0.3 million decrease in proceeds from notes receivable.

Net cash provided by financing activities

There was $4.1 million in cash provided by financing activities during the six months ended June 30, 2025, compared to $6.3 million in cash provided by financing activities during the same period in 2024. The $2.2 million decrease to net cash provided by financing activities was primarily attributable to a decrease in proceeds from issuance of warrant derivative liabilities of $3.4 million offset by an increase in proceeds from issuance of common stock and prefunded warrants of $1.3 million.

Indebtedness

Information with respect to Indebtedness may be found in Note 7 to the condensed consolidated financial statements included in Item 1 of Part I of this report.

Off-Balance Sheet Arrangements

We do not have any off-balance sheet arrangements, as defined in Item 303(a)(4) of Regulation S-K.

Critical Accounting Policies and Estimates

A summary of our significant accounting policies and estimates is discussed in Management’s Discussion and Analysis of Financial Condition and Results of Operations and in Note 1 to our consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2024. There have been no material changes to those policies for the six months ended June 30, 2025.

Recent Accounting Pronouncements

Information with respect to Recent Accounting Pronouncements may be found in Note 1 to the condensed consolidated financial statements included in Item 1 of Part I of this report.

This Report includes the certifications of our Chief Executive Officer and Principal Financial Officer required by Rule 13a-14 of the Securities Exchange Act of 1934 (the “Exchange Act”). See Exhibits 31.1 and 31.2. This Item 4 includes information concerning the controls and control evaluations referred to in those certifications.

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures, as such term is defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934 (the “Exchange Act”), that are designed to ensure that information required to be disclosed in the reports filed or submitted under the Exchange Act, is recorded, processed, summarized, and reported within the time periods specified by the Commission’s rules and forms. Disclosure controls and procedures include controls and procedures designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act are properly recorded, processed, summarized and reported within the time periods required by the Commission’s rules and forms.

We carried out an evaluation, under the supervision and with the participation of our management, including our Chief Executive Officer (principal executive officer and principal financial officer), of the effectiveness of the design and operation of these disclosure controls and procedures, as such term is defined in Exchange Act Rule 13a-15(e), as of June 30, 2025. Based on this evaluation, the Chief Executive Officer concluded that our disclosure controls and procedures were effective as of June 30, 2025, the end of the period covered by this Quarterly Report on Form 10-Q.

There were no changes in our internal control over financial reporting that occurred during the second quarter of 2025 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Information regarding risk factors appears in Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2024, which was filed with the SEC on March 19, 2025. There have been no material changes from the risk factors previously disclosed in the Annual Report on Form 10-K.