Quarterly Report for Quarter Ending March 31, 2026 (Form 10-Q)

Management's Discussion and Analysis of Financial Condition and Results of Operations

This quarterly report contains forward-looking statements. Forward-looking statements are projections of events, revenues, income, future economic performance or management's plans and objectives for our future operations. In some cases, you can identify forward-looking statements by terminology such as "may", "should", "expects", "plans", "anticipates", "believes", "estimates", "predicts", "potential" or "continue" or the negative of these terms or other comparable terminology. These statements are only predictions and involve known and unknown risks, uncertainties and other factors, including the risks in the section entitled "Risk Factors" and the risks set out below, any of which may cause our or our industry's actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. These risks include, by way of example and not in limitation:

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risks related to our outstanding secured and unsecured loans, certain of which are in default, and our ability to service debt;

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risks related to failure to obtain adequate financing on a timely basis and on acceptable terms to continue as going concern;

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the uncertainty of profitability based upon our history of losses;

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legislative or regulatory changes concerning regenerative medicine and therapies;

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risks related to our operations and uncertainties related to our business plan and business strategy;

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changes in economic conditions;

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uncertainty with respect to intellectual property rights, protecting those rights and claims of infringement of other's intellectual property;

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competition; and

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cybersecurity concerns.

This list is not an exhaustive list of the factors that may affect any of our forward-looking statements. These and other factors should be considered carefully, including those contained in our Annual Report on Form 10-K under "Risk Factors" for the year ended December 31, 2025, and readers should not place undue reliance on our forward-looking statements. Forward looking statements are made based on management's beliefs, estimates and opinions on the date the statements are made, and we undertake no obligation to update forward-looking statements if these beliefs, estimates and opinions or other circumstances should change. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results.

Our financial statements are stated in United States dollars (US$) and are prepared in accordance with United States Generally Accepted Accounting Principles.

Overview

Regenerative Medical Technology Group Inc. (the "Company," "RMTG," "we," "us," or "our"), through its flagship operating platform Global Stem Cells Group (GSCG), has become one of the most comprehensively vertically integrated organizations in regenerative medicine worldwide. We combine physician education and global influence through the International Society for Stem Cell Applications (ISSCA), advanced biologics manufacturing and product innovation via Cellgenic, a premium clinical network delivering high-end patient care via Cellular Institute while generating real-world data, and a disciplined global expansion strategy. This closed-loop ecosystem enables us to drive demand, supply quality-controlled biologics and therapeutics, validate protocols and deliver world class patient procedures through clinical applications, and leverage digital technologies for scalable, recurring revenue and continuous innovation

During the three months ended March 31, 2026, we continued to execute on the 2026 strategic priorities outlined in our Annual Report on Form 10-K for the year ended December 31, 2025. We made meaningful progress across our core pillars, including advancing ISSCA's position as the leading global education platform in regenerative medicine, scaling Cellgenic's manufacturing output and product portfolio (including next-generation exosome formulations, peptides, and combination therapies), advancing development of our standardized clinical network and franchise model with Cellular Institute, and strengthening regulatory alignment and market presence in key geographies such as Argentina. Early digital initiatives, including development of the ISSCA AI Platform and mobile application, also progressed as planned.

These Q1 accomplishments reflect the strength of our synergistic business model - where education drives physician adoption, Cellgenic supplies high-margin recurring products, and our clinical network generates both revenue and valuable real-world data. We remain focused on disciplined execution of our full-year 2026 plan, which centers on ecosystem optimization, accelerated clinical network franchising, deeper AI-driven personalization, continued product innovation, and targeted expansion into additional regulated markets. We will maintain disciplined capital allocation toward manufacturing capacity enhancements, R&D pipeline advancement, and strategic partnerships and affiliates that reinforce our global category leadership. Management believes the foundational platform built in 2025 positions the Company for accelerated revenue growth, margin expansion, and platform maturation throughout the remainder of 2026.

Results of Operations

Below is a summary of the results of operations for the three months ended March 31, 2026, and 2025.

		For the Three Months Ended March 31,
		2026				2025				$ Change				% Change
Revenue		$	2,639,353			$	1,364,341			$	1,275,012				93.45	%
Cost of revenue			872,862				420,447				452,415				107.60	%
Gross profit			1,766,491				943,894				822,597				87.15	%
Operating expenses
Advertising and marketing			391,047				157,321				233,726				148.57	%
Professional fees			528,155				331,733				196,422				59.21	%
Officer compensation			22,500				22,500				-				0.00	%
Depreciation and amortization expense			97,694				51,814				45,880				88.55	%
Investor relations			21,500				-				21,500				0.00	%
General and administrative			475,812				245,566				230,246				93.76	%
Total operating expenses			1,536,708				808,934				727,774				89.97	%
Net income from operation			229,783				134,960				94,823				70.26	%
Other income (expense)
Interest expense			(2,190,549	)			(895,850	)			(1,296,699	)			145.07	%
Change in the fair value of derivative liability			1,084,492				(1,149	)			1,085,641				-94485.73	%
Total other income (expense)			(1,106,057	)			(894,999	)			(211,058	)			23.58	%
Net loss		$	(876,274	)		$	(760,039	)		$	(116,235	)			15.29	%

Revenue

Revenue increased by 93.45% in the amount of $1,275,012 for the three months ended March 31, 2026, compared to the same period in 2025. . The increase in revenue was across all categories of revenue and a result of marketing and sales efforts to increase brand recognition and exposure in the industry. The strategic plans for 2025 were to seek and attract more Affiliates. Investing heavily in ISSCA events global presence, and brand positioning for ISSCA was intentional and aligned with our objective of accelerating affiliate expansion. During 2025, the Company signed three new affiliate partners through its ISSCA education and training programs.

Growth came from expanded product distribution networks, including new sales channels and increased volume in stem cell-related products. This reflects market demand for our biologic solutions. Revenue increased due to higher patient volumes, a shift toward premium treatment mixes (e.g., advanced regenerative therapies), operational efficiencies in clinic operations, more international live conferences, expanded certification programs, multi-day events to reach global audiences and on-line training.

The Company believes it's strategic plans for 2025 to invest heavily in ISSCA events global presence, and brand positioning for ISSCA in 2025 to seek and attract more Affiliates will result in increased revenue in future quarters. The first quarter of 2026 shows a 69% increase in revenue compared with the fourth quarter of 2025.

The following table presents our revenue by product category for the three months ended March 31, 2026, and 2025:

		For the Three Months Ended March 31,
		2026				2025
Training		$	772,005			$	144,920
Product supplies			1,267,076				626,656
Equipment			-				-
Patient procedures			600,273				592,765
Total revenue		$	2,639,353			$	1,364,341

Operating expenses

Operating expenses increased by 89.97% in the amount of $727,774 for the three months ended March 31, 2026, compared to the same period in 2025. Listed below are the major changes to operating expenses:

Advertising and marketing fees increased by $233,726 for the three months ended March 31, 2026, compared to the same period in 2025, primarily due to an increase by Global Stem Cells Group in international campaigns and promotions across divisions, including digital efforts for Cellgenic products, Cellular treatments, and ISSCA events.

Professional fees increased by $196,422for the three months ended March 31, 2026, compared to the same period in 2025, primarily due to an increase by Global Stem Cells Group related to legal structuring, international contracts, compliance (e.g., regulatory for Cellgenic and Cellular), accounting expansion, corporate advisory, and lease advisory.

Depreciation and amortization decreased by $45,880 for the three months ended March 31, 2026, compared to the same period in 2025, primarily due to expanding facilities to support increased operations in Cellular and Cellgenic, plus ISSCA logistics.

Investor relations decreased by $21,500 for the three months ended March 31, 2026, compared to the same period in 2025, primarily due to an agreement with an investor relation firm in May 2025.

General and administrative expenses increased by $230,246 for the three months ended March 31, 2026, compared to the same period in 2025, primarily due to expenses associated with expansion of clinic and travel due to more international events.

We expect our overall operating expenses to increase into 2026 as we further implement our business plan. We expect increases in future quarters over all major categories as we engage in efforts to increase brand awareness with our products and services, including advertising campaigns and investor relation services. We also expect an increase in general operating costs and growth initiatives as we ramp up operations and seek to expand them.

Other expenses

Other expenses decreased by $211,058 for the three months ended March 31, 2026, compared to the same period in 2025, primarily as a result of an increase in amortization of discount of $729,897 and an increase of $566,802 of interest on promissory notes offset by $1,084,492 change in the fair value of derivative liability.

We had interest expense of $2,190,549 and $895,850 for the three months ended March 31, 2026, and 2025, respectively.

We expect to continue to experience high interest payments in the future as a result of our outstanding liabilities. If we are unable to generate sufficient revenues and/or additional financing to service this debt, there is a risk the lenders will call the notes, and we will be unable to repay the loans. If this happens, we could go out of business.

Net Loss

We recorded a net loss of $876,274 for the three months ended March 31, 2026, as compared with a net loss of $760,039 for the same period in 2025.

Liquidity and Capital Resources

Since inception, the Company has financed its operations through private placements, convertible notes, and unsecured and secured debt.

The following is a summary of the cash and cash equivalents as of March 31, 2026, and December 31, 2025.

		March 31, 2026				December 31, 2025				$ Change				% Change
Cash and cash equivalents		$	1,061,448			$	956,718			$	104,730				10.95	%

Summary of Cash Flows

Below is a summary of our cash flows for the three months ended March 31, 2026, and 2025.

		For the Three Months Ended March 31,
		2026				2025
Net cash provided by operating activities		$	102,124			$	57,109
Net cash used in investing activities			(315,394	)			-
Net cash provided by financing activities			318,000				-
Net increase in cash and cash equivalents		$	104,730			$	57,109

Operating activities

Net cash provided by operating activities was $102,124 during the three months ended March 31, 2026, and consisted of a net change in operating assets and liabilities of $1,235,300 offset by non-cash items of 256,901 and a net loss of $876,274 The non-cash items for the three months ended March 31, 2026, consisted of depreciation and amortization expenses of $729,897, amortization of debt discount of $97,694 offset by change in fair value of derivative liabilities of $1,084,492.

Net cash provided by operating activities was $57,109 during the three months ended March 31, 2025, and consisted of a net change in operating assets and liabilities of $764,186 and non-cash items of $52,963, offset by a net loss of $760,040 The non-cash items for the three months ended March 31, 2025, consisted of depreciation and amortization expenses of $51,814 and change in derivative liabilities of $1,149.

Investing activities

Net cash used in investing activities was $315,394 and consisted of the purchase of property and equipment associated with the Cancun facility for the three months ended March 31, 2026.

We had no financing activities for the three months ended March 31, 2025.

Financing activities

Net cash provided by financing activities was $318,000 and consisted of a Promissory Debentures with a lender in the amount of $350,000 net discount in the amount of $32,000 for the three months ended March 31, 2026.

We had no financing activities for the three months ended March 31, 2025.

Since our inception, we have financed our operations through private placements, convertible notes, and unsecured debt, and we have also issued debt in our company secured by all of our assets. We expect to continue to experience high interest payments in the future as a result of our outstanding liabilities. Additionally, as of the date of this report, there are a number of unsecured promissory notes with an aggregate principal amount of $1,157,935 that have matured and are currently in default, but the Company has received no notice of default, demand for payment, or acceleration from any lender. The Company has insufficient cash on hand to repay these notes. The company is currently in debt restructuring talks, and there are also other lenders as well who have demonstrated interest in assuming this debt. However, if we are unable to generate sufficient revenues and/or additional financing to service this debt, there is a risk the lenders will call the notes, secure our assets, as to those applicable secured notes, and demand payment. While management believes the risk of acceleration is low based on historical lender forbearance, a formal demand on any defaulted note could trigger acceleration of up to $16.6 million in secured debt. If after all these recourses are exhausted and the debt becomes unresolvable, like any other company, there's a risk we could go out of business.

At March 31, 2026, we had limited cash of $1,061,448, a substantial working capital deficit, and although our revenues have increased, future losses are anticipated. Based upon the current financial condition, we do not have sufficient cash to operate our business at the current level for the next twelve months. We intend to fund operations through increased sales and debt and/or equity financing arrangements, which may be insufficient to fund expenditures or other cash requirements. We plan to seek additional financing in a private equity offering to secure funding for operations. There can be no assurance that we will be successful in raising additional funding. If we are not able to secure additional funding, the implementation of our business plan will be impaired, and we could go out of business. There can be no assurance that such additional financing will be available to us on acceptable terms or at all.

Going Concern

The financial statements have been prepared assuming the Company will continue as a going concern. The Company has incurred losses since inception, resulting in an accumulated deficit of approximately $76,241,785 and a working capital deficit of $36,639,004 as of March 31, 2026, and future losses are anticipated. These factors, among others, raise substantial doubt about the Company's ability to continue as a going concern.

The ability of the Company to continue its operations as a going concern is dependent on management's plans, which include the raising of capital through debt and/or equity markets with some additional funding from other traditional financing sources, including term notes, until such time that funds provided by operations are sufficient to fund working capital requirements.

The Company will require additional funding to finance the growth of its current and expected future operations as well to achieve its strategic objectives. There can be no assurance that financing will be available in amounts or terms acceptable to the Company, if at all. The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. These financial statements do not include any adjustments relating to the recovery of the recorded assets or the classification of the liabilities that might be necessary should the Company be unable to continue as a going concern.

Off-Balance Sheet Arrangements

As of March 31, 2026, the Company had no off-balance sheet arrangements.

Critical Accounting Policies

Our critical accounting policies have not materially changed during the quarter ended March 31, 2026. Furthermore, the preparation of our financial statements is in conformity with generally accepted accounting principles in the United States of America, or GAAP. The preparation of our financial statements requires management to make judgments and estimates that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of expenses during the reporting period. Our management believes that we consistently apply these judgments and estimates, and the financial statements fairly represent all periods presented. However, any differences between these judgments and estimates and actual results could have a material impact on our statements of income and financial position.

Derivative Instruments

The derivative instruments are accounted for as liabilities, the derivative instrument is initially recorded at its fair market value and is then re-valued at each reporting date, with changes in fair value recognized in operations for each reporting period. The Company uses the Monte Carlo model to determine the fair values of the embedded convertible notes derivatives and tainted convertible notes and the Binomial Option model to determine the fair values of the derivatives on warrants.

Stock Based Compensation

Share-based compensation issued to employees is measured at the grant date, based on the fair value of the award, and is recognized as an expense over the requisite service period. The Company measures the fair value of the share-based compensation issued to non-employees at the grant date using the stock price observed in the trading market (for stock transactions) or the fair value of the award (for non-stock transactions), which were considered to be more reliably determinable measures of fair value than the value of the services being rendered.

New Accounting Pronouncements

Recently adopted accounting pronouncements require public companies to disclose the impact of new standards on their financial statements, including details about the standard, the adoption date, method of adoption, and expected effects. These disclosures help investors understand how changes in accounting principles will affect a company's financial performance and position.

Segment Reporting

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280). The amendments in this update expand segment disclosure requirements, including new segment disclosure requirements for entities with a single reportable segment among other disclosure requirements. This update is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Adoption of this standard is on a modified retrospective basis and had no impact on the Company's financial position, results of operations, cash flows or net income per share. As of 2026 and 2025 the Company had one reporting segment, all revenue is reported under this segment Global Stem Cells Group.

Other accounting standards and amendments to existing accounting standards that have been issued and have future effective dates are not applicable or are not expected to have a significant impact on the Company's consolidated financial statements.

Revenue Recognition

In accordance with FASB ASC 606, Revenue from Contracts with Customers, the Company recognizes revenue when it satisfies a performance obligation by transferring control of a promised good or service to a customer. Revenue is measured based on the consideration the Company expects to receive in exchange for those goods or services.

The Company's primary revenue streams are as follows:

Training

The Company offers stem cell and exosome certification training programs for physicians and healthcare professionals. The performance obligation is satisfied upon completion of the training seminar and delivery of the related certification and materials. Revenue is recognized at the point in time the seminar is completed and control of the training services has been transferred to the customer.

Products

The Company sells regenerative medicine and related products directly to physicians and clinics. Products are generally sold at the point of sale, shipped directly to customers, or provided in connection with patient procedures and training events. Revenue is recognized at the point in time control transfers to the customer, which generally occurs upon shipment or customer pickup.

Equipment

The Company sells medical and regenerative medicine equipment to physicians and clinics. Equipment is shipped either directly from the manufacturer or by the Company to the customer. Revenue is recognized at the point in time control transfers to the customer, which generally occurs upon shipment or customer pickup.

Patient Procedures

The Company provides regenerative medicine procedures at its clinic locations. Customers may remit deposits in advance of scheduled procedures, which are recorded as deferred revenue until the related services are performed. Revenue is recognized at the point in time the medical procedures are completed and the related performance obligations have been satisfied.

Use of Estimates

The preparation of these financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The significant estimates included in these financial statements are associated with accounting for the goodwill, derivative liability valuations, valuation of preferred stock, fair value estimates, valuation of assets and liabilities in business combination and in its going concern analysis.

Fair Value of Financial Instruments

The fair value of financial instruments, which include cash, accounts payable and accrued expenses and advances from related parties were estimated to approximate their carrying values due to the immediate or short-term maturity of these financial instruments. Management is of the opinion that the Company is not exposed to significant interest, currency or credit risks arising from financial instruments.

Fair value is defined as the price which would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. A three-tier fair value hierarchy which prioritizes the inputs used in the valuation methodologies, as follows:

Level 1

Inputs - Unadjusted quoted prices in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date.

Level 2

Inputs - Inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. These might include quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability (such as interest rates, volatilities, prepayment speeds, credit risks, etc.) or inputs that are derived principally from or corroborated by market data by correlation or other means.

Level 3

Inputs - Unobservable inputs for determining the fair values of assets or liabilities that reflect an entity's own assumptions about the assumptions that market participants would use in pricing the assets or liabilities.

At March 31, 2026, and December 31, 2025, the carrying amounts of the Company's financial instruments, including cash, account payables, and accrued expenses, approximate their respective fair value due to the short-term nature of these instruments.

At March 31, 2026, and December 31, 2025, the Company does not have any assets or liabilities except for derivative liabilities related to convertible notes payable required to be measured at fair value in accordance with FASB ASC Topic 820, Fair Value Measurement.