twav20260331

twav20260331_10q.htm

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

☒ Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the quarterly period ended March 31, 2026.

☐ Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.

Commission file number: 001-35376

TAOWEAVE, INC.

(Exact Name of Registrant as Specified in its Charter)

Delaware			77-0312442
(State or Other Jurisdiction of Incorporation or Organization)			(I.R.S. Employer Identification No.)

110 16th Street, Suite 1400-1024, Denver, CO 80202

(Address of Principal Executive Offices, including Zip Code)

(213) 683-8863 ext. 5

(Registrant’s Telephone Number, including Area Code)

(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		TWAV		Nasdaq Capital Market

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 ☒ No ☐

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 during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Yes ☒ No ☐

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 Exchange Act). Yes ☐ No ☒

The number of shares outstanding of the registrant’s common stock as of May 14, 2026, was 3,456,149.

Table of Contents

TAOWEAVE, INC.

Index

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements	1

Condensed Consolidated Balance Sheets at March 31, 2026 (unaudited) and December 31, 2025	1

Unaudited Condensed Consolidated Statements of Operations for the three months ended March 31, 2026, and 2025	2

Unaudited Condensed Consolidated Statements of Changes in Stockholders’ Equity for the three months ended March 31, 2026, and 2025	3

Unaudited Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2026, and 2025	5

Notes to unaudited Condensed Consolidated Financial Statements	6

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	17

Item 3. Quantitative and Qualitative Disclosures About Market Risk	25

Item 4. Controls and Procedures	25


PART II - OTHER INFORMATION

Item 1. Legal Proceedings	26

Item 1A. Risk Factors	26

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	27

Item 3. Defaults Upon Senior Securities	27

Item 4. Mine Safety Disclosures	27

Item 5. Other Information	27

Item 6. Exhibits	28

Signatures	29

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CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

This quarterly report on Form 10-Q (this “Report”) contains statements that are considered forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and its rules and regulations (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended, and its rules and regulations (the “Exchange Act”). These forward-looking statements include, but are not limited to, statements about the plans, objectives, expectations and intentions of TaoWeave, Inc. (“TaoWeave” or “we” or “us” or the “Company”). All statements other than statements of current or historical fact contained in this Report, including statements regarding TaoWeave’s future financial position, business strategy, budgets, projected costs and plans and objectives of management for future operations, are forward-looking statements. The words “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “plan,” and similar expressions, as they relate to TaoWeave, are intended to identify forward-looking statements. These statements are based on TaoWeave’s current plans, and TaoWeave’s actual future activities and results of operations may be materially different from those set forth in the forward-looking statements. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from the statements made. Any or all of the forward-looking statements in this Report may turn out to be inaccurate. TaoWeave has based these forward-looking statements largely on its current expectations and projections about future events and financial trends that it believes may affect its financial condition, results of operations, business strategy, and financial needs. The forward-looking statements can be affected by inaccurate assumptions or by known or unknown risks, uncertainties, and assumptions. There are important factors that could cause actual results to differ materially from those expressed or implied by these forward-looking statements, including our plans, objectives, expectations and intentions and other factors that are discussed under the section entitled “Part I. Item 1A. Risk Factors” and in our consolidated financial statements and the footnotes thereto for the fiscal year ended December 31, 2025, each included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025, filed with the Securities and Exchange Commission (the “SEC”) on March 20, 2026, as well as under “Part II. Item 1A. Risk Factors” in this report. TaoWeave undertakes no obligation to publicly revise these forward-looking statements to reflect events occurring after the date hereof. All subsequent written and oral forward-looking statements attributable to TaoWeave or persons acting on its behalf are expressly qualified in their entirety by the cautionary statements contained in this Report. Forward-looking statements in this Report include, among other things: the Company's plans to explore partnerships within the Bittensor ecosystem, demand for our product offerings, future revenues, expenses, capital expenditures and cash flows; our ability to fund operations and continue as a going concern; our liquidity projection; expectations regarding adjustments to our cost of revenue and other operating expenses; the future exercise of warrants; our ability to raise capital through sales of additional equity or debt securities and/or loans from financial institutions; our beliefs about the ongoing performance of our Managed Services business; statements relating to market need and evolution of the industry, our solutions and our service platforms; our beliefs about employee relations; adequacy of our internal controls; and statements regarding our information systems and ability to prevent cybersecurity incidents.

Important factors that could cause actual results to differ materially from those in the forward-looking statements include, but are not limited to, those summarized below:

•	our ability to raise capital in one or more debt and/or equity offerings in order to fund operations or any growth initiatives, and our ability to continue as a going concern;

•	the impact of conversions of our Series F Preferred Stock to Common Stock, exercises of the Series F Preferred Stock warrants and Common Warrants, Pre-Funded Warrants, and sales of the underlying conversion shares;

•	the rewards and costs of staking transactions on blockchains;
•	fluctuations in the price of our digital assets;
•	potential decreases in the value of our digital assets and rewards;
•	risks related to the loss or theft of private withdrawal keys, resulting in the complete loss of digital assets and rewards;

•	the ongoing performance of our Managed Services business;

•	our ability to grow revenue;

•	risks related to the concentration of our customers and the degree to which our sales, now or in the future, depend on certain large client relationships;

•	increases in labor costs;

•	our ability to attract and retain highly skilled personnel;

•	our reliance on open-source software and technology;

•	use of cash related to potential repurchases under our Stock Repurchase Program;

•	the costs, disruption, and diversion of management’s attention associated with campaigns commenced by activist investors; and

•	our management’s ability to execute its plans, strategies, and objectives for future operations.

Table of Contents

PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

TAOWEAVE, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except shares, par value, and stated value)

	March 31, 2026			December 31, 2025
	(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	2,130		$	2,258
Digital assets		7,209			5,395
Accounts receivable, net		135			138
Prepaid expenses and other current assets		500			424
Total current assets		9,974			8,215
Other assets		3			4
Total assets	$	9,977		$	8,219
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	272		$	112
Accrued expenses and other current liabilities		973			1,061
Deferred revenue		6			13
Total current liabilities		1,251			1,186
Total liabilities		1,251			1,186
Commitments and contingencies (see Note 10)
Stockholders’ equity:
Preferred stock Series F, convertible; $0.0001 par value; $176,000 stated value; 42,000 shares authorized, 150 shares issued and outstanding as of March 31, 2026 and December 31, 2025		—			—
Common stock; $0.0001 par value; 150,000,000 shares authorized, 3,327,399 shares issued, and 3,327,210 outstanding as of March 31, 2026 and December 31, 2025		—			—
Treasury Stock, 189 common shares		(181	)		(181	)
Additional paid-in capital		245,839			245,843
Accumulated deficit		(236,932	)		(238,629	)
Total stockholders’ equity		8,726			7,033
Total liabilities and stockholders’ equity	$	9,977		$	8,219

See accompanying notes to condensed consolidated financial statements.

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TAOWEAVE, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except share and per share data)

(Unaudited)

	Three Months Ended
	March 31,
	2026			2025
Revenue	$	707		$	622
Cost of revenue		237			373
Gross profit		470			249

Operating expenses:
Research and development		—			3
Sales and marketing		7			8
General and administrative		1,022			929
Total operating expenses		1,029			940
Operating loss		(559	)		(691	)
Other income, net
Interest income, net		6			26
Realized gain on digital assets		52			—
Unrealized gain on digital assets		2,198			—
Total other income, net		2,256			26
Income (loss) before income taxes		1,697			(665	)
Income tax expense		—			7
Net income (loss)		1,697			(672	)
Preferred stock dividends		4			12
Net income (loss) attributable to common stockholders	$	1,693		$	(684	)

Net loss attributable to common stockholders per share:
Basic net income (loss) per share	$	0.43		$	(0.59	)
Diluted net income (loss) per share	$	0.43		$	(0.59	)
Weighted-average number of shares of Common Stock:
Basic		3,913,471			1,151,482
Diluted		3,913,471			1,151,482

See accompanying notes to condensed consolidated financial statements.

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TAOWEAVE, INC.

CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY

Three Months Ended March 31, 2026

(In thousands, except shares data)

(Unaudited)

	Series F Preferred Stock				Common Stock				Treasury Stock
														Additional			Accumulated
	Shares		Amount		Shares		Amount		Shares		Amount			Paid-In Capital			Deficit			Total
Balance on December 31, 2025		150	$	—		3,327,399	$	—		189	$	(181	)	$	245,843		$	(238,629	)	$	7,033
Net income		—		—		—		—		—		—			—			1,697			1,697
Series F Preferred Stock dividends		—		—		—		—		—		—			(4	)		—			(4	)
Balance on March 31, 2026		150	$	—		3,327,399	$	—		189	$	(181	)	$	245,839		$	(236,932	)	$	8,726

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TAOWEAVE, INC.

CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY

Three Months Ended March 31, 2025

(In thousands, except shares data)

(Unaudited)

	Series F Preferred Stock				Common Stock				Treasury Stock
														Additional			Accumulated
	Shares		Amount		Shares		Amount		Shares		Amount			Paid-In Capital			Deficit			Total
Balance on December 31, 2024		545	$	—		1,144,926	$	—		189	$	(181	)	$	236,458		$	(232,274	)	$	4,003
Net loss		—		—		—		—		—		—			—			(672	)		(672	)
Common warrant exercise, net of fees		—		—		10,000		—		—		—			31			—			31
Series F Preferred Stock dividends		—		—		—		—		—		—			(12	)		—			(

SEC Form 10-Q filed by TaoWeave Inc.