cv-20250630

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

_________________________

FORM 10-Q

_________________________

(Mark One)


x			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2025


o			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ____________ and ____________

Commission file number 001-42705

_________________________

CAPSOVISION, INC.

(Exact name of registrant as specified in its charter)

_________________________


Delaware			20-3369494
(State or other jurisdiction of incorporation or organization)			(I.R.S. Employer Identification No.)
18805 Cox Avenue, Suite 250			95070
Saratoga, CA
(Address of Principal Executive Offices)			(Zip Code)

(408) 624 1488

Registrant’s telephone number, including area code

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
common stock, $0.001 par value per share	CV	The Nasdaq Stock Market LLC

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.

Yes o No x

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).

Yes x No o

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

Non-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 Act).

Yes o No x

As of August 11, 2025, the registrant had 46,774,067 shares of common stock, $0.001 par value per share, outstanding.

TABLE OF CONTENTS


			Page(s)
Part I - Financial Information			1
Item 1. Financial Statements (unaudited)			1
Condensed Balance Sheets as of June 30, 2025 and December 31, 2024			1
Condensed Statements of Operations and Comprehensive Loss for the six months ended June 30, 2025 and 2024			3
Condensed Statements of Convertible Preferred Stock and Stockholders’ Deficit for the six months ended June 30, 2025 and 2024			4
Condensed Statements of Cash Flows for the six months ended June 30, 2025 and 2024			5
Notes to Condensed Financial Statements			6
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations			28
Item 3. Quantitative and Qualitative Disclosures About Market Risk			39
Item 4. Controls and Procedures			40

Part II - Other Information			42
Item 1. Legal Proceedings			42
Item 1A. Risk Factors			42
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds			87
Item 3. Defaults Upon Senior Securities			87
Item 4. Mine Safety Disclosures			88
Item 5. Other Information			88
Item 6. Exhibits			89
Signatures			90

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

Certain statements in this Quarterly Report on Form 10-Q constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. We base these forward-looking statements on our expectations and projections about future events, which we derive from the information currently available to us. Such forward-looking statements relate to future events or our future performance, including: our financial performance and projections; our growth in revenue and earnings; and our business prospects and opportunities. You can identify forward-looking statements by those that are not historical in nature, particularly those that use terminology such as “may,” “should,” “expects,” “anticipates,” “contemplates,” “estimates,” “believes,” “plans,” “projected,” “predicts,” “potential,” or “hopes” or the negative of these or similar terms. In evaluating these forward-looking statements, you should consider various factors, including: our ability to change the direction of the Company; our ability to keep pace with new technology and changing market needs; and the competitive environment of our business. These and other factors may cause our actual results to differ materially from any forward-looking statement. Forward-looking statements are only predictions. The forward-looking events discussed in this Quarterly Report on Form 10-Q may not occur, and actual events and results may differ materially and are subject to risks, uncertainties and assumptions about us. We are not obligated to publicly update or revise any forward-looking statement, whether as a result of uncertainties and assumptions, the forward-looking events discussed in this Quarterly Report on Form 10-Q might not occur.

While we believe we have identified material risks, these risks and uncertainties are not exhaustive. The outcome of the events described in these forward-looking statements is subject to risks, uncertainties, and other factors described in the section titled “Risk Factors” and elsewhere in this Quarterly Report on Form 10-Q. New risks and uncertainties emerge from time to time, and it is not possible to predict all risks and uncertainties, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements.

Although we believe the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, level of activity, performance or achievements. Moreover, neither we nor any other person assumes responsibility for the accuracy or completeness of any of these forward-looking statements. You should not rely upon forward-looking statements as predictions of future events. We are under no duty to update any of these forward-looking statements after the date of this Quarterly Report on Form 10-Q to conform our prior statements to actual results or revised expectations, and we do not intend to do so.

Forward-looking statements include, but are not limited to, statements about:

•our expectations regarding the acceptance of our products by patients and doctors;

•our expectations regarding the potential market size for our current CapsoCam Plus capsule and CapsoCam Colon (once FDA cleared) and those markets that we may pursue;

•our plans to increase small bowel capsule sales following recent 510(k) clearance for pediatric use and telehealth supervision and related products currently under development;

•our expected receipt of and related timing for FDA 501(k) clearance of our CapsoCam Colon and related sales;

•our plans and efforts to expand into new indications in terms of new GI pathologies and expanded patient populations;

•our plans and efforts to introduce enhancements and improvements to our products and technologies, including the AI capabilities incorporated into our products;

•our commercialization capabilities and strategies, including our plans to increase revenues and sales capabilities in and outside the United States (the “U.S.”);

•the implementation of our strategic plan for our business and products and technology;

•our relationships with, and capabilities of, our assembly manufacturers and component suppliers;

•the protection of our intellectual property (including our AI capabilities) including through patents and trade secret protections;

•the expected performance of our products;

•our ability to manage our growth;

•the anticipated use of proceeds from this offering;

•our expectations regarding the time during which we will be an emerging growth company under the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”) or smaller reporting company under U.S. securities laws;

•estimates of our expenses, future revenue, capital requirements, our needs for additional financing, and our ability to obtain additional capital;

•our ability to continue as a going concern; and

•our future financial performance.

We caution you not to place undue reliance on the forward-looking statements, which speak only as of the date of this Quarterly Report on Form 10-Q in the case of forward-looking statements contained in this Quarterly Report on Form 10-Q.

iii

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

CAPSOVISION, INC.

CONDENSED BALANCE SHEETS (UNAUDITED)

(in thousands, except par value and share amounts)


	June 30, 2025		December 31, 2024
ASSETS
Current Assets
Cash	$	1,066	$	9,319
Accounts receivable, net	1,854		2,001
Inventory	3,042		2,629
Prepaid expenses and other current assets	1,837		898
Total current assets	7,799		14,847
Property and equipment, net	683		720
Operating lease right-of-use assets	1,024		1,195
Other long-term assets	41		41
TOTAL ASSETS	$	9,547	$	16,803

LIABILITIES, CONVERTIBLE PREFERRED STOCK, AND STOCKHOLDERS’ DEFICIT
Current Liabilities
Accounts payable	$	1,157	$	749
Accrued expenses and other current liabilities	1,588		569
Deferred revenue	97		132
Note payable, current	1,000		—
Operating lease liabilities – current	379		351
Total current liabilities	4,221		1,801

Operating lease liabilities – long-term	687		887
Total liabilities	4,908		2,688

Commitments and contingencies - Note 9

Convertible Preferred Stock (each Series: $0.001 par value)
Series A: 17,962,675 shares authorized, 5,394,197 issued and outstanding, and liquidation preference of $4,850	4,850		4,850
Series B: 6,000,000 shares authorized, 1,801,802 issued and outstanding, and liquidation preference of $4,319	4,319		4,319
Series C: 5,747,127 shares authorized, 880,187 issued and outstanding, and liquidation preference of $2,550	2,550		2,550
Series C-1: 3,876,405 shares authorized, 848,599 issued and outstanding, and liquidation preference of $2,515	2,515		2,515


			The accompanying notes are an integral part of these condensed financial statements.			1

CAPSOVISION, INC.

CONDENSED BALANCE SHEETS (UNAUDITED) (continued)

(in thousands, except par value and share amounts)


	June 30, 2025		December 31, 2024
Convertible Preferred Stock (each Series: $0.001 par value) (continued)
Series D: 2,222,222 shares authorized, 520,519 issued and outstanding, and liquidation preference of $1,560	$	1,560	$	1,560
Series D-1: 6,766,666 shares authorized, 166,833 issued and outstanding, and liquidation preference of $500	500		500
Series D-2: 11,083,333 shares authorized, 2,920,649 issued and outstanding, and liquidation preference of $17,506	8,753		8,753
Series E: 14,000,000 shares authorized, 4,151,977 issued and outstanding, and liquidation preference of $15,900	15,900		15,900
Series F-1: 13,043,479 shares authorized, 1,201,203 issued and outstanding, and liquidation preference of $4,600	4,600		4,600
Series F-2: 12,000,000 shares authorized, 2,498,498 issued and outstanding, and liquidation preference of $10,400	10,400		10,400
Series G: 5,926,000 shares authorized, 1,779,559 issued and outstanding, and liquidation preference of $8,000	8,000		8,000
Series G-1: 6,896,552 shares authorized, 2,039,756 issued and outstanding, and liquidation preference of $9,849	9,849		9,849
Series H: 48,157,821 shares authorized, 14,461,804 issued and outstanding, and liquidation preference of $69,829	69,829		69,829
Total convertible preferred stock	143,625		143,625

Stockholders’ Deficit
Common stock, $0.001 par value: 190,000,000 and 190,000,000 shares authorized; 2,459,183 and 2,090,945 issued and outstanding as of June 30, 2025 and December 31, 2024, respectively	2		2
Additional paid-in capital	1,362		838
Accumulated deficit	(140,350)		(130,350)
Total stockholders’ deficit	(138,986)		(129,510)
TOTAL LIABILITIES, CONVERTIBLE PREFERRED STOCK, AND STOCKHOLDERS’ DEFICIT	$	9,547	$	16,803


			The accompanying notes are an integral part of these condensed financial statements.			2

CAPSOVISION, INC.

CONDENSED STATEMENTS OF OPERATIONS

AND COMPREHENSIVE LOSS (UNAUDITED)

(in thousands, except share and per-share amounts)


	Three Months Ended June 30,				Six Months Ended June 30,
	2025		2024		2025		2024


Net revenue	$	3,315	$	2,843	$	6,098	$	5,338


Costs of revenue	1,504		1,251		2,793

SEC Form 10-Q filed by CapsoVision Inc.