Quarterly Report for Quarter Ending September 30, 2025 (Form 10-Q)

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

The following discussion and analysis of our financial condition and results of operations should be read together with our unaudited consolidated financial statements and the related notes included elsewhere in this Quarterly Report on Form 10-Q. Our financial statements have been prepared in accordance with accounting principles generally accepted in the United States ("U.S. GAAP") and reflect our current corporate structure and organization as if such structure had been in place throughout all periods presented.

This discussion contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These statements involve known and unknown risks, uncertainties, and other factors that may cause our actual results, performance, or achievements to differ materially from those expressed or implied by the forward-looking statements. Such factors include, among others, the risks described under "Risk Factors" in Part II, Item 1A of this Quarterly Report on Form 10-Q and elsewhere herein. Except as required by law, we undertake no obligation to revise or update any forward-looking statements to reflect events or circumstances occurring after the date of this report.

Overview

CS Diagnostics Corp. (the "Company") is a Wyoming-based corporation focused on improving therapeutic outcomes and minimizing side effects through innovative medical technologies. The Company collaborates with universities, research institutions, and healthcare professionals to develop, license, and commercialize diagnostic and therapeutic products. In addition, the Company provides international firms in the medical sector with regulatory approval services and market access throughout Europe and the MENA regions.

During the nine months ended September 30, 2025, the Company continued transitioning from its development stage to an operational phase, emphasizing cost management, operational efficiency, and the expansion of its intellectual property portfolio.

Results of Operations

Revenues.

Total revenues for the nine months ended September 30, 2025, were $94,200, compared to $106,381 for the same period in 2024, representing a decrease of approximately 11%. This decline was primarily attributable to reduced diagnostic service activity and lower one-time licensing income relative to the prior year. The Company anticipates that the implementation of new service agreements and the expansion of its diagnostic offerings will stabilize and potentially increase revenues during the remainder of 2025.

Operating Expenses.

Total operating expenses decreased significantly to $62,119 for the nine-month period ended September 30, 2025, from $92,933 for the same period in 2024. The reduction was mainly due to lower professional fees as several one-time legal, audit, and consulting engagements were completed in 2024. Research and development expenses were minimal as the Company shifted resources from product development to commercialization. General and administrative expenses rose modestly to $22,424, reflecting increases in compliance-related and reporting costs associated with the Company's OTCQB listing status.

Net Income.

For the nine months ended September 30, 2025, the Company recorded net income of $32,081, compared with $13,448 in the prior-year period. The improvement resulted primarily from the reduction in operating expenses and the absence of any significant financing or debt-related costs.

Liquidity and Capital Resources

As of September 30, 2025, the Company had total assets of $499,431,013, compared to $499,400,501 at December 31, 2024. The asset base consists primarily of intangible assets of approximately $499.4 million and additional paid-in capital contributed by shareholders. Cash and cash equivalents totaled $13 as of September 30, 2025, compared to $501 at year-end 2024.

The Company reported outstanding liabilities of $ 1,609 as of September 30, 2025, compared to $1,428 in accounts payable as of December 31, 2024, reflecting a temporary increase in the company liabilities position.

Cash flow activities for the nine-month period ended September 30, 2025, were as follows:

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Net cash used in operating activities: $(528)

Management believes that the Company's capital requirements will continue to be met through shareholder support and, if necessary, through external financing arrangements. While liquidity remains limited, management expects ongoing operational revenues and capital infusions to support continuing operations through 2026.

Capital Structure

As of September 30, 2025, the Company's capital structure was as follows:

Common Stock: 137,340,200 shares issued and outstanding

Preferred Stock Series A: 10 shares issued and outstanding

Preferred Stock Series B: 19,992,575 shares issued and outstanding

Preferred Stock Series C: 4,000,000 shares issued and outstanding

Total additional paid-in capital amounted to $504,161,878, with an accumulated deficit of $(4,735,847).

Going Concern Considerations

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. The Company's continuation depends upon its ability to achieve profitability and obtain additional financing to fund its operations. Although management believes that current shareholders and potential investors will continue to provide financial support, there can be no assurance that such funding will be available on acceptable terms. These conditions raise substantial doubt about the Company's ability to continue as a going concern. The financial statements do not include any adjustments that may result from this uncertainty.

Outlook and Strategic Initiatives

Management remains committed to executing its growth strategy, which focuses on:

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Expansion of Diagnostic Services: Increasing market penetration in the United States, Europe, and MENA regions.

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Product Development: Advancing proprietary technologies through research collaborations and internal R&D.

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Licensing and IP Commercialization: Leveraging existing and newly acquired intellectual property to generate recurring revenues.

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Operational Efficiency: Maintaining disciplined cost control and improving internal processes to sustain profitability.

The Company anticipates moderate revenue growth and improved cash flow in the second half of 2025 as newly executed licensing agreements begin to yield results and operational efficiencies continue to strengthen.

Conclusion

For the quarter ended September 30, 2025, CS Diagnostics Corp. demonstrated notable improvements in operational efficiency and cost control despite a reduction in revenues. The Company achieved positive net income and maintains a strong equity position supported by substantial intangible assets and shareholder funding.

Management remains focused on achieving sustainable growth through innovation, strategic partnerships, and prudent financial management to enhance long-term shareholder value.