UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

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

For the quarterly period ended June 30, 2026

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

For the transition period from _____________ to _____________

Commission file number: 001-37960

POLAR POWER, INC.

(Exact name of registrant as specified in its charter)

Delaware

33-0479020

(State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer

Identification Number)

249 E. Gardena Blvd., Gardena, California		90248
(Address of principal executive offices)		(Zip Code)

(310) 830-9153

(Registrant’s telephone number, including area code)

Not Applicable

(Former name, former address and former fiscal year, if changed since last report)

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, par value $0.0001 per share		POLA		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 registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.05 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company or emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):

	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 Exchange Act). Yes ☐ No ☒

The number of shares outstanding of the Registrant’s common stock, $0.0001 par value, as of August 17, 2026 was 3,851,684.

TABLE OF CONTENTS

PART I – FINANCIAL INFORMATION	1

ITEM 1. Condensed Financial Statements	1

ITEM 2. Management’s Discussion And Analysis Of Financial Condition And Results Of Operations	19

ITEM 3. Quantitative and Qualitative Disclosures About Market Risk	26

ITEM 4. Controls and Procedures	26

PART II – OTHER INFORMATION	27

ITEM 1. Legal Proceedings	27

ITEM 1A. Risk Factors	27

ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds	43

ITEM 3. Defaults Upon Senior Securities	43

ITEM 4. Mine Safety Disclosure	43

ITEM 5. Other Information	43

ITEM 6. Exhibits	43

FORWARD LOOKING AND CAUTIONARY STATEMENTS

All statements included or incorporated by reference in this Quarterly Report on Form 10-Q, other than statements or characterizations of historical fact, are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, or the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act. Examples of forward-looking statements include, but are not limited to, statements concerning projected net sales, costs and expenses and gross margins; our accounting estimates, assumptions and judgments; the demand for our products; the effect and consequences a pandemic and recovery on matters including U.S., local and foreign economies, wars and international conflicts including the current military actions involving the Iran and Israel, our business operations, the ability of financing and the health and productivity of our employees; the competitive nature of and anticipated growth in our industry; production capacity and goals; our ability to consummate acquisitions and integrate their operations successfully; and our prospective needs for additional capital. These forward-looking statements are based on our current expectations, estimates, approximations and projections about our industry and business, management’s beliefs, and certain assumptions made by us, all of which are subject to change. Forward-looking statements can often be identified by words such as “anticipates,” “expects,” “intends,” “plans,” “predicts,” “believes,” “seeks,” “estimates,” “may,” “will,” “should,” “would,” “could,” “potential,” “continue,” “ongoing,” similar expressions and variations or negatives of these words. These statements are not guarantees of future performance and are subject to risks, uncertainties and assumptions that are difficult to predict. Therefore, our actual results could differ materially and adversely from those expressed in any forward-looking statements as a result of various factors, some of which are listed under “Risk Factors” in Part II, Item 1A, and in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part I, Item 2 of this Quarterly Report on Form 10-Q. These forward-looking statements speak only as of the date of this Quarterly Report on Form 10-Q. We undertake no obligation to revise or update publicly any forward-looking statement for any reason, except as otherwise required by law.

References in this Quarterly Report on Form 10-Q to “Polar,” the “Company,” “we,” “us,” and “our” refer to Polar Power, Inc., a Delaware corporation, and its consolidated subsidiaries.

FINANCIAL PRESENTATION

All dollar amounts in this Quarterly Report on Form 10-Q are presented in thousands, except share and per share data and where otherwise noted. Share and per share data have been retroactively adjusted to reflect the decreased number of shares resulting from a 1 for 7 reverse stock split which took effect on November 18, 2024.

PART I – FINANCIAL INFORMATION

ITEM 1. Condensed Financial Statements

POLAR POWER, INC.

CONDENSED BALANCE SHEETS

(in thousands, except share and per share data)

	June 30, 2026			December 31, 2025
	(Unaudited)
ASSETS
Current assets
Cash and cash equivalents	$	183		$	200
Accounts receivable		566			330
Inventories		9,232			9,425
Prepaid expenses		60			76
Total current assets		10,041			10,031

Other assets:
Operating lease right-of-use assets		66			278
Property and equipment, net		96			128
Deposits					-

Total assets	$	10,203		$	10,437

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
Accounts payable	$	2,465		$	2,506
Customer deposits		1,096			764
Accrued liabilities and other current liabilities		1,080			1,462
Line of credit		2,730			4,036
Notes payable-related party		771			612
Notes payable, current		179			438
Convertible notes payable, net of discount		186			—
Derivative liabilities		763
Operating lease liabilities		76			475
Total liabilities		9,346			10,293

Commitments and Contingencies		-

Stockholders’ Equity
Preferred stock, $0.0001 par value, 5,000,000 shares authorized, no shares issued and outstanding		—			—
Common stock, $0.0001 par value, 50,000,000 shares authorized, 3,814,181 shares issued and 3,811,684 shares outstanding on June 30, 2026, and 2,680,156 shares issued and 2,677,659 shares outstanding on December 31, 2025		—			—
Additional paid-in capital		42,375			39,653
Accumulated deficit		(41,478	)		(39,469	)
Treasury Stock, at cost (2,497 shares)		(40	)		(40	)
Total stockholders’ equity		857			144

Total liabilities and stockholders’ equity	$	10,203		$	10,437

See Accompanying Notes to the Condensed Financial Statements

POLAR POWER, INC.

UNAUDITED CONDENSED STATEMENTS OF OPERATIONS

(in thousands, except share and per share data)

	2026			2025			2026			2025
	Three Months Ended June 30,						Six Months Ended June 30,
	2026			2025			2026			2025
Net Sales	$	1,019		$	2,708		$	2,747		$	4,431
Cost of Sales		1,356			1,778			1,948			3,183
Gross profit (loss)		(337	)		930			799			1,248

Operating Expenses
Sales and marketing		126			184			285			443
Research and development		128			146			297			305
General and administrative		1,080			710			1,863			1,711
Total operating expenses		1,334			1,040			2,445			2,459

Loss from operations		(1,671	)		(110	)		(1,646	)		(1,211	)

Other income (expenses)
Interest expense and finance costs		(447	)		(171	)		(650	)		(335	)
Change in derivative liability valuation		287			—			287			—
Other Income		—			10			—			10
Total other income (expenses), net		(160	)		(161	)		(363	)		(325	)

Net loss	$	(1,831	)	$	(271	)	$	(2,009	)	$	(1,536	)

Net loss per share – basic and diluted	$	(0.49	)	$	(0.11	)	$	(0.56	)	$	(0.61	)
Weighted average shares outstanding, basic and diluted		3,721,209			2,511,103			3,580,977			2,511,103

See Accompanying Notes to the Condensed Financial Statements

POLAR POWER, INC.

UNAUDITED CONDENSED STATEMENTS OF STOCKHOLDERS’ EQUITY

(in thousands, except share data)

Three months Ended June 30, 2026

	Number		Amount		capital		Deficit)			Stock			Equity
	Common Stock				Additional paid-in		(Accumulated			Treasury			Total Stockholders’
	Number		Amount		capital		Deficit)			Stock			Equity
Balance, March 31, 2026 (unaudited)		3,642,656	$	—	$	42,077	$	(39,647	)	$	(40	)	$	2,390
Issuance of common stock for compensation to consultant		171,525		—		298		—			—			298
Net loss		—		—		—		(1,831	)		—			(1,831	)
Balance, June 30, 2026 (unaudited)		3,814,181	$	—	$	42,375	$	(41,478	)	$	(40	)	$	857

Six months ended June 30, 2026

	Common Stock				Additional paid-in		(Accumulated			Treasury			Total Stockholders’
	Number		Amount		capital		Deficit)			Stock			Equity
Balance, December 31, 2025		2,680,156	$	—	$	39,653	$	(39,469	)	$	(40	)	$	144
Shares of common stock issued for cash, net of offering costs		962,500		—		2,424		—			—			2,424
Issuance of common stock for compensation to consultant		171,525		—		298		—			—			298
Net loss		—		—		—		(2,009	)		—			(2,009	)
Balance, June 30, 2026 (unaudited)		3,814,181	$	—	$	42,375	$	(41,478	)	$	(40	)	$	857

Three months Ended June 30, 2025

	Common Stock				Additional paid-in		(Accumulated			Treasury			Total Stockholders’
	Number		Amount		capital		Deficit)			Stock			Equity
Balance, March 31, 2025 (unaudited)		2,514,029	$	—	$	38,896	$	(31,601	)	$	(40	)	$	7,255
Net loss		—		—		—		(271	)		—			(271	)
Balance, June 30, 2025 (unaudited)		2,514,029	$	—	$	38,896	$	(31,872	)		(40	)	$	6,984

Six months ended June 30, 2025

	Common Stock					Additional paid-in		(Accumulated			Treasury			Total Stockholders’
	Number		Amount			Capital		Deficit)			Stock			Equity
Balance, December 31, 2024		2,511,350	$	2		$	38,886	$	(30,336	)	$	(40	)	$	8,512
Adjustment of common stock for reverse stock split		—		(2	)		2		—			—			—
Issuance of common stock to director for accrued fees		2,679		—			8		—			—			8
Net loss		—		—			—		(1,536	)		—			(1,536	)
Balance, June 30, 2025 (unaudited)		2,514,029	$	—		$	38,896	$	(31,872	)	$	(40	)	$	6,984

See Accompanying Notes to the Condensed Financial Statements

POLAR POWER, INC.

UNAUDITED CONDENSED STATEMENTS OF CASH FLOW

(in thousands)

	2026			2025
	Six Months Ended June 30,
	2026			2025
Cash flows from operating activities:
Net loss	$	(2,009	)	$	(1,536	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		32			34
Issuance of common stock as compensation for services		298			—
Changes in warranty reserve		(450	)		—
Amortization of debt discount of convertible notes		100			—
Change in fair value of derivative liabilities		(287	)		—
Changes in operating assets and liabilities
Accounts receivable		(236	)		122
Inventories		193			(99	)
Prepaid expenses		16			11
Operating lease right-of-use asset		212			609
Accounts payable		(41	)		458
Accrued interest added to notes payable-related party		—			7
Customer deposits		332			31
Accrued expenses and other current liabilities		68			39
Operating lease liability		(399	)		(664	)
Net cash provided by (used in) operating activities		(2,171	)		(988	)

Cash flows from financing activities:
Net proceeds from issuance of common stock under ATM facility		2,424			—
Proceeds from advances from credit facility		—			505
Proceeds from notes payable-related party		159			160
Proceeds from convertible notes payable, net of original issue discounts		1,136			—
Repayment of credit facility		(1,306	)
Repayment of notes payable		(259	)		—
Net cash provided by financing activities		2,154			665

Net decrease in cash and cash equivalents		(17	)		(323	)
Cash and cash equivalents, beginning of period		200			498
Cash and cash equivalents, end of period	$	183		$	175

Supplemental Cash Flow Information:
Interest paid	$	650		$	381
Supplemental non-cash investing and financing activities:
Issuance of common stock to director for accrued fees	$	—		$	8
Fair value of embedded conversion feature recognized as derivative liabilities with corresponding debt discount upon issuance of convertible notes	$	1,050			—

See Accompanying Notes to the Condensed Financial Statements

POLAR POWER, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS

FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2026 AND 2025

(In thousands, except for share and per share data and where otherwise noted)

(UNAUDITED)

NOTE 1 – ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The Company

Polar Power, Inc. was incorporated in the State of Washington as Polar Products, Inc. and in 1991 reincorporated in the State of California under the name Polar Power, Inc. In December 2016, Polar Power, Inc. reincorporated in the State of Delaware (the “Company”, “we” or “us”). The Company designs, manufactures and sells direct current, or DC, power systems to supply reliable and low-cost energy to off-grid, bad-grid and backup power, electric vehicle (“EV”) charging, and nano-grid applications. The Company’s products integrate DC generator, proprietary electronic control systems, lithium batteries and solar photovoltaic (“PV”) technologies to provide low operating cost and emissions for telecommunications, Defense, automotive, nano-grid, EV charging and industrial markets.

Going concern

The accompanying financial statements have been prepared under the assumption that the Company will continue as a going concern. In accordance with Accounting Standards Codification (“ASC”) 205-40, Going Concern, the Company’s management has evaluated whether there are conditions and events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date the accompanying financial statements were issued. For the six months ended June 30, 2026, the Company recorded a net loss of $2,009 and used cash in operations of $2,171. In addition, our independent registered public accounting firm, in its audit report to the financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2025, expressed substantial doubt about our ability to continue as a going concern. The financial statements do not include any adjustments related to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

The Company manufactures and assembles its DC power systems at two production facilities located in Gardena, California. It is currently delinquent in rent payments to its landlords for its headquarters and warehouse facilities. The landlord for its headquarters facility at 249 E. Gardena Blvd., Gardena, California filed a summons for eviction on October 24, 2025. On February 23, 2026, the landlord stopped the actions for eviction and continued discussions with the Company to resolve the delinquent rents and expired lease agreement. The landlord for the other warehouse for which the Company is delinquent on rent, has not served the Company any legal documents. However, they may do so in the future.

On May 11, 2026, the Company entered into a Settlement Agreement with the landlord for each of its headquarters facility and its warehouse facility that became effective as of May 7, 2026. The Settlement Agreement addressed the matter of delinquent rents and an expired lease. Regarding the Company’s headquarters facility, the Company agreed to make immediate payment of $400 towards past due rents, and the landlord agreed to cease eviction procedures. The landlord also agreed to extend the property lease commencing June 1, 2026, to April 1, 2027, and reduce the monthly rent from $84 to $55. Regarding the warehouse facility, the Company agreed to vacate the facility by August 31, 2026 and leave the premises in the condition required by the relevant lease agreement; in exchange, the landlord agreed to waive rents for the months of June, July, and August 2026. Each landlord reserved the right to charge for any waived rents or continue with eviction action should the Company fail to meet the requirements listed in the Settlement Agreement. The Company also may have to pay liquidated damages if it fails to vacate the properties in the event either or both landlords decide to exercise their rights for eviction.

As of May 19, 2026, the Company had not made a payment per the Settlement Agreement, and on May 19, 2026, the landlord for the Company’s headquarters facility evicted the Company from that facility.

On May 22, 2026, the Company entered into a new settlement agreement under which the Company paid the landlords a combined $755 and regained access to its headquarters facility. The new settlement agreement provides for a schedule of monthly payments through April 2027 in exchange for the landlord’s agreement not to seek to evict us from