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

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

This Form 10-Q contains "forward-looking statements" relating to the Company which represent the Company's current expectations or beliefs including, but not limited to, statements concerning the Company's operations, performance, financial condition and growth. For this purpose, any statements contained in this Form 10-Q that are not statements of historical fact are forward-looking statements. Without limiting the generality of the foregoing, words such as "may", "anticipate", "intend", "could", "estimate" or "continue" or the negative or other comparable terminology are intended to identify forward-looking statements. These statements by their nature involve substantial risks and uncertainties, such as credit losses, dependence on management and key personnel, variability of quarterly results, and the ability of the Company to continue its growth strategy and the Company's competition, certain of which are beyond the Company's control. Should one or more of these risks or uncertainties materialize or should the underlying assumptions prove incorrect, or any of the other risks set out under the caption "Risk Factors" in the Company's Annual Report on Form 10-K for the year ended December 31, 2024 occur, actual outcomes and results could differ materially from those indicated in the forward-looking statements.

Any forward-looking statement speaks only as of the date on which such statement is made, and the Company undertakes no obligation to update any forward-looking statement or statements to reflect events or circumstances after the date on which such statement is made or to reflect the occurrence of unanticipated events. New factors emerge from time to time, and it is not possible for management to predict all such factors, nor can it assess the impact of each such factor on the 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.

All dollar amounts in the tables and discussion below are rounded to the nearest thousand, except per share data; thus, they are approximate.

FINANCIAL RESULTS BY COMPANY

The following table shows, for the periods indicated, the financial results (dollar amounts in thousands) attributable to each of our consolidated companies.

		Nine months ended September 30, 2025
		OmniMetrix				Acorn				Total
Revenue		$	9,101			$	-			$	9,101
COGS			2,191				-				2,191
Gross profit			6,910				-				6,910
Gross profit margin			76	%							76	%
R&D expenses			823				-				823
SG&A expenses			3,245				1,132				4,377
Operating income (loss)		$	2,842			$	(1,132	)		$	1,710

		Nine months ended September 30, 2024
		OmniMetrix				Acorn				Total
Revenue		$	7,457			$	-			$	7,457
COGS			2,014				-				2,014
Gross profit			5,443				-				5,443
Gross profit margin			73	%							73	%
R&D expenses			698				-				698
SG&A expenses			2,882				771				3,653
Operating income (loss)		$	1,863			$	(771	)		$	1,092

		Three months ended September 30, 2025
		OmniMetrix				Acorn				Total
Revenue		$	2,478			$	-			$	2,478
COGS			533				-				533
Gross profit			1,945				-				1,945
Gross profit margin			78	%							78	%
R&D expenses			267				-				267
SG&A expenses			1,072				447				1,519
Operating income (loss)		$	606			$	(447	)		$	159

		Three months ended September 30, 2024
		OmniMetrix				Acorn				Total
Revenue		$	3,050			$	-			$	3,050
COGS			863				-				863
Gross profit			2,187				-				2,187
Gross profit margin			72	%							72	%
R&D expenses			234				-				234
SG&A expenses			960				237				1,197
Operating income (loss)		$	993			$	(237	)		$	756

BACKLOG

As of September 30, 2025, OmniMetrix had a backlog of $3,575,000, primarily comprised of deferred revenue, of which $3,158,000 is expected to be recognized as revenue in the next twelve months. This compares to a backlog of $4,384,000 at September 30, 2024. Now that we are selling hardware units that are capable of operating distinctly from our monitoring and control software, the hardware backlog will no longer continue to grow and will be fully amortized by August 31, 2026, while the monitoring backlog will continue to be deferred and amortized over the period of service.

RECENT DEVELOPMENTS

On July 23, 2025, we announced that we had received formal approval from The Nasdaq Stock Market LLC to uplist our common stock from the OTCQB to the Nasdaq Capital Market. Our common stock commenced trading on the Nasdaq Capital Market under the ticker symbol "ACFN" on July 24, 2025. The uplisting reflects our ongoing efforts to enhance shareholder value, improve liquidity, and increase visibility within the investment community. The application fee we paid was $50,000 and the pro-rated annual listing fee for the remainder of 2025 is $26,500.

On June 1, 2024, we entered into a contract (the "Material Contract") with one of the nation's largest cell phone providers to provide monitoring hardware and services. Under the contract, OmniMetrix will provide monitoring devices and related remote monitoring and control services for between 5,000 to 10,000 cell tower backup generators in the U.S. The hardware and monitoring services, which are being deployed over a one-to-two-year period. Shipping of hardware commenced in the third quarter of 2024 and installation and monitoring services commenced in the fourth quarter of 2024. During the nine- and three-month periods ended September 30, 2025, we recognized $2,214,000 and $0 in hardware revenue, respectively, and $319,000 and $148,000 in monitoring revenue, respectively, from this contract. During the nine- and three-month periods ended September 30, 2024, we recognized $724,000 in hardware revenue in both the nine- and three-month periods, and $0 in monitoring revenue in both the nine- and three-month periods, from this contract.

OVERVIEW AND TREND INFORMATION

Acorn Energy, Inc. ("Acorn" or "the Company") is a holding company focused on technology-driven solutions for energy infrastructure asset management. We provide the following services and products through our OmniMetrix^TM, LLC ("OmniMetrix") subsidiary:

	●	Power Generation ("PG"). OmniMetrix's PG services provide wireless remote monitoring and control systems and IoT applications for residential and commercial/industrial power generation equipment. This includes OmniMetrix's TrueGuard power generator monitors and AIRGuard product, which remotely monitors and controls industrial air compressors, and its Smart Annunciator product, which is typically sold to commercial customers that require a visual representation of the generator's status and has a touchscreen display that indicates the current state of that generator.
	●	Cathodic Protection ("CP"). OmniMetrix's CP services provide remote monitoring and control products for cathodic protection systems on gas pipelines serving the gas utilities market and pipeline operators. The CP product lineup includes solutions to remotely monitor and control rectifiers, test stations and bonds. OmniMetrix also offers the industry's first RADTM (Remote AC Mitigation Disconnect) that mounts onto existing Solid-state Decouplers in the field and can remotely disconnect/connect these AC mitigation tools, which can drastically reduce a company's expense while increasing employee safety.

Each of our PG and CP activities represents a reportable segment. The following analysis should be read together with the segment and revenue information provided in Notes 10 and 11 to the unaudited condensed consolidated financial statements included in this quarterly report.

OmniMetrix

OmniMetrix is a Georgia limited liability company based in Buford, Georgia that develops and markets wireless remote monitoring and control systems and services for multiple markets in the Internet of Things ("IoT") ecosystem: critical assets (including stand-by power generators, pumps, pumpjacks, light towers, turbines, compressors, and other industrial equipment) as well as cathodic protection for the pipeline industry (gas utilities and pipeline companies). Acorn owns 99% of OmniMetrix with 1% owned by the former CEO of OmniMetrix.

Following the emergence of machine-to-machine (M2M) and IoT applications, whereby companies aggregate multiple sensors and monitors into a simplified dashboard for customers, OmniMetrix believes it plays a key role in this new economic ecosystem. In addition, OmniMetrix sees a rapidly growing need for backup power infrastructure to secure critical military, government, and private sector assets against emergency events including terrorist attacks, natural disasters, cybersecurity threats, and other issues related to the reliability of the electric power grid. As residential and industrial standby generators, turbines, compressors, pumps, pumpjacks, light towers and other industrial equipment are part of the critical infrastructure increasingly monitored in IoT applications and given that OmniMetrix monitors all major brands of critical equipment, OmniMetrix believes it is well-positioned as a competitive participant in this market.

OmniMetrix sells monitoring hardware devices and data monitoring services. On September 1, 2023, we launched an updated version of our products that includes new functionality in our TrueGuard, AIRGuard, Patriot and Hero products that allows our customers to have options as it relates to obtaining and utilizing the data that is provided by our hardware devices. This new functionality allows for SIM card options, configuration options regarding IP address endpoints and DNS routes, and access to our over-the-air data protocol. This product update allows customers to have the option to purchase our monitoring service, monitor the products themselves if they have the ability in-house, or choose another monitoring provider if they so desire, whereas, historically, our standard products only functioned with our monitoring services. The modification to the circuit boards and embedded firmware of hardware enclosures in stock as of August 31, 2023 were made such that only the new version of these products was sold subsequent to that date. Prior to such product modification, revenue (and related costs) associated with sale of equipment was recorded to deferred revenue (and deferred charges) upon shipment for PG and CP monitoring units. This deferred revenue and the deferred cost of the hardware with respect to the sale of new equipment was recognized over the life of the units, which was estimated to be three years. Revenue from hardware sales subsequent to August 31, 2023 is recognized upon shipment or upon acceptance (specific to the Material Contract), instead of being deferred. Revenues from the payment of monitoring fees (generally paid in advance) are initially recorded as deferred revenue upon receipt of payment from the customer and then amortized to revenue over the monitoring service period (typically twelve-month, renewable periods).

Critical Accounting Estimates

In preparing the financial statements, management is required to make estimates and assumptions that have an impact on the asset, liability, revenue and expense amounts reported. These estimates can also affect our supplemental information disclosures, including information about contingencies, risk and financial condition. We believe, given current facts and circumstances, that our estimates and assumptions are reasonable, adhere to U.S. GAAP, and are consistently applied. Inherent in the nature of an estimate or assumption is the fact that actual results may differ from estimates and estimates may vary as new facts and circumstances arise. We make routine estimates and judgments in determining net realizable value of accounts receivable, inventories, property and equipment, prepaid expenses, product warranties and other reserves as well as the amortization period for deferred commissions payable. Management believes our most critical accounting estimates and assumptions are in the area of valuation allowance.

Valuation Allowance

We regularly review our deferred tax assets for recoverability considering historically profitability, projected future taxable income, the expected timing of the reversals of existing temporary differences and tax planning strategies. In assessing the need for a valuation allowance, we consider both positive and negative evidence related to the likelihood of realization of the deferred tax assets. The weight given to the positive and negative evidence is commensurate with the extent to which the evidence may be objectively verified.

We record a valuation allowance to reduce our deferred tax assets to the net amount that we believe is more likely than not to be realized. The net carrying amount of the Company's deferred tax assets is based on the Company's belief that it is more likely than not that the Company will generate sufficient future taxable income in certain jurisdictions to realize these deferred tax assets. The ultimate realization of the deferred tax assets depends upon our ability to generate sufficient taxable income in the future. In forecasting future taxable income, management uses estimates and makes assumptions regarding significant future events, including the timing and number of new hardware sales contracts and associated monitoring revenue. In evaluating our ability to recover our deferred tax assets, we consider and weigh all available positive and negative evidence, including our past operating results, the existence of cumulative losses in the most recent years and our forecast of future taxable income. When the likelihood of the realization of existing deferred tax assets changes, adjustments to the valuation allowance are charged in the period in which the determination is made. If our estimates and assumptions change in the future, the Company may be required to record additional valuation allowances against its deferred tax assets, resulting in additional income tax expense in the Company's Consolidated Statements of Operations, or conversely to reduce the existing valuation allowance resulting in less income tax expense.

The Company generated a three-year cumulative positive income through December 31, 2024. Based on its earnings, the Company released a portion of its valuation allowance on its deferred tax assets during the year ended December 31, 2024. As of September 30, 2025, we believe, based on our projections, that a partial valuation allowance of $10,963,000, continues to be necessary against our deferred tax assets. Uncertainty exists related to the generation of future hardware and monitoring revenue, nonetheless the Company believes sufficient positive evidence exists which supports the partial reversal of the valuation allowance. In recent years, the Company executed new contracts, growing hardware and monitoring revenue which resulted in cumulative pre-tax earnings over the prior three years which we believe is significant positive evidence to support the reversal of valuation allowance during 2024. At this time, however, we cannot assure you that we will be successful in doing so. Accordingly, our management will continue to assess the need for this valuation allowance and will make adjustments when appropriate.

The utilization of the Company's federal and state net operating losses may be subject to a limitation due to the "change in ownership provisions" under Section 382 of the Internal Revenue Code, as well as similar state provisions. Such limitations may result in the expiration of net operating loss (NOL) carryforwards before their utilization. Future changes in the Company's stock ownership, which may be outside of the Company's control, may trigger an "ownership change." In addition, future equity offerings or acquisitions that have equity as a component of the purchase price could result in an "ownership change. During Q3 of 2025 the Company completed a Section 382 study and determined that no change of control occurred and the NOLs, other than acquired NOLs, will not be subject to limitation. It is possible that a limitation could still apply, however the Company does not anticipate any limitation would impact the company's income tax expense.

Results of Operations

The following table sets forth certain information with respect to the unaudited condensed consolidated results of operations of the Company for the nine-month periods ended September 30, 2025 and 2024, including the percentage of total revenues during each period attributable to selected components of the operations statements data and for the period-to-period percentage changes in such components. For segment data, see Notes 10 and 11 to the unaudited condensed consolidated financial statements included in this quarterly report.

		Nine months ended September 30,
		2025								2024								Change
		($,000)				% of revenues				($,000)				% of revenues				From 2024 to 2025
Revenue		$	9,101				100	%		$	7,457				100	%			22	%
COGS			2,191				24	%			2,014				27	%			9	%
Gross profit			6,910				76	%			5,443				73	%			27	%
R&D expenses			823				9	%			698				9	%			18	%
SG&A expenses			4,377				48	%			3,653				49	%			20	%
Operating income			1,710				19	%			1,092				15	%			57	%
Interest income, net			85				1	%			53				1	%			60	%
Income before income taxes			1,795				20	%			1,145				15	%			57	%
Income tax expense			331				4	%			67				1	%			491	%
Net income			1,464				16	%			1,078				14	%			31	%
Non-controlling interest share of net income			(28	)			*	%			(17	)			*	%			65	%
Net income attributable to Acorn Energy, Inc.		$	1,436				16	%		$	1,061				14	%			35	%

*Result is less than 1% or not meaningful.

The following table sets forth certain information with respect to the unaudited condensed consolidated results of operations of the Company for the three-month periods ended September 30, 2025 and 2024, including the percentage of total revenues during each period attributable to selected components of the operations statement data and for the period-to-period percentage changes in such components. For segment data, see Notes 10 and 11 to the unaudited condensed consolidated financial statements included in this quarterly report.

		Three months ended September 30,
		2025								2024								Change
		($,000)				% of revenues				($,000)				% of revenues				from 2024 to 2025
Revenue		$	2,478				100	%		$	3,050				100	%			(19	)%
COGS			533				22	%			863				28	%			(38	)%
Gross profit			1,945				78	%			2,187				72	%			(11	)%
R&D expenses			267				11	%			234				8	%			14	%
SG&A expense			1,519				61	%			1,197				39	%			27	%
Operating income			159				6	%			756				25	%			(79	)%
Interest income, net			34				1	%			20				1	%			70	%
Income before income taxes			193				8	%			776				25	%			(75	)%
Benefit from (provision for) income taxes			(65	)			(3	)%			42				1	%			(255	)%
Net income			258				10	%			734				24	%			(65	)%
Non-controlling interest share of net income			(6	)			*%				(9	)			*%				(33	)%
Net income attributable to Acorn Energy, Inc.		$	252				10	%		$	725				24	%			(65	)%

*Result is less than 1%.

Revenue for the nine- and three-month periods ended September 30, 2025 and 2024

Revenue increased by $1,644,000, or 22.0%, from $7,457,000 in the nine-month period ended September 30, 2024 to $9,101,000 in the nine-month period ended September 30, 2025. Hardware revenue increased by $845,000, or 20.6%, from $4,107,000 in the nine-month period ended September 30, 2024 to $4,952,000 in the nine-month period ended September 30, 2025. See the reconciliation of hardware revenue below. Monitoring revenue increased by $799,000, or 23.9%, from $3,350,000 in the nine-month period ended September 30, 2024 to $4,149,000 in the nine-month period ended September 30, 2025. The increase in monitoring revenue was due to an increase in the number of connections being monitored.

As discussed above, OmniMetrix has two reportable segments, PG and CP. Of the $9,101,000 in revenue recognized in the nine-month period ended September 30, 2025, $8,507,000 was generated by PG activities and $594,000 was generated by CP activities. This represents an increase in revenue from PG activities of $1,826,000, or 27.3%, from $6,681,000 in the nine-month period ended September 30, 2024, and a decrease in revenue from CP activities of $182,000, or 23.5%, from $776,000 in the nine-month period ended September 30, 2024. The increase in PG revenue was due to sales under our Material Contract described above under "Recent Developments." The decrease in CP revenue was due to fewer Hero2 units being sold in the current-year period

Revenue decreased by $572,000, or 18.8%, from $3,050,000 in the three-month period ended September 30, 2024 to $2,478,000 in the three-month period ended September 30, 2025. Of the $2,478,000 in revenue recognized in the three-month period ended September 30, 2025, $2,260,000 was generated by PG activities and $218,000 was generated by CP activities. In the three-month period ended September 30, 2025, as compared to the three-month period ended September 30, 2024, revenue from PG activities decreased $566,000, or 20.0%, from $2,826,000, and revenue from CP activities decreased $6,000, or 2.7%, from $224,000. The decrease in revenue from PG activities was primarily due to the fact that there were no hardware sales under the Material Contract in the three months ended September 30, 2025 compared to $724,000 in hardware sales under the Material Contract in the three months ended September 30, 2024.

Hardware revenue during the nine- and three-month periods ended September 30, 2025 and 2024 is further detailed in the table below (in thousands):

		Nine months ended September 30,								Three months ended September 30,
Reconciliation of Hardware Revenue		2025				2024				2025				2024
Amortization of deferred revenue		$	800			$	1,463			$	215			$	436
Sales of custom designed units and related accessories			58				-				-				-
Hardware sales (new product versions)			3,708				2,297				548				1,342
Other accessories, services, shipping and miscellaneous charges			386				347				155				134
Total hardware revenue		$	4,952			$	4,107			$	918			$	1,912

Gross profit for the nine- and three-month periods ended September 30, 2025 and 2024

Gross profit for the nine-month period ended September 30, 2025 was $6,910,000, reflecting a gross margin of 75.9%, compared with a gross profit of $5,443,000, reflecting a gross margin of 73.0%, for the nine-month period ended September 30, 2024.

Gross margin on hardware revenue for the nine-month period ended September 30, 2025 was 60.2% compared to 55.5% for the nine-month period ended September 30, 2024. The increase in gross margin on hardware was a result of the product and customer mix of sales during the period. Gross margin on monitoring revenue for the nine-month period ended September 30, 2025 was 94.7% compared to gross margin of 94.5% for the nine-month period ended September 30, 2024.

Gross profit for the three-month period ended September 30, 2025 was $1,945,000, reflecting a gross margin of 78.5%, compared with a gross profit for the three-month period ended September 30, 2024 of $2,187,000, reflecting a gross margin of 71.7%. Gross margin on hardware revenue for the three-month period ended September 30, 2025 was 50.0% compared to 58.1% for the three-month period ended September 30, 2024. The decrease in gross margin on hardware during the three-month period was a result of the same drivers as described above for the nine-month period. Gross margin on monitoring revenue for the three-month period ended September 30, 2025 was 95.3% compared to 94.5% for the three-month period ended September 30, 2024.

Operating expenses for the nine- and three-month periods ended September 30, 2025 and 2024

R&D expense. During the nine-month periods ended September 30, 2025 and 2024, R&D expense was $823,000 and $698,000, respectively. During the three-month period ended September 30, 2025, OmniMetrix recorded $267,000 of R&D expense as compared to $234,000 in the three-month period ended September 30, 2024. The increase in R&D expense is related to salary increases granted to our engineering personnel effective October 1, 2024, engineering team additions in the fourth quarter of 2024, and the expenses and materials paid to third-party consultants in the continued development of next-generation PG and CP products and exploration into potential new product lines. We expect a moderate increase in R&D expense during the remainder of 2025 for continued investment in product enhancements and expanding product lines to continue to increase our level of innovation ahead of our competitors.

Selling, general and administrative expense. SG&A expense of the consolidated entities in the nine-month period ended September 30, 2025 reflected an increase of $724,000, or 19.8%, as compared to the nine-month period ended September 30, 2024. OmniMetrix's SG&A expense increased $363,000, or 12.6%, from $2,882,000 in the nine-month period ended September 30, 2024 to $3,245,000 in the nine-month period ended September 30, 2025. This increase was primarily due to an increase of (i) $175,000 in personnel expenses due to staff additions and increases in compensation to our team, (ii) $68,000 in commission expense primarily driven by sales under the Material Contract, (iii) $52,000 in technology fees and expenses, (iv) $30,000 in facilities expense , and (v) a net increase of $62,000 in other operating expenses in the aggregate, offset by a decrease of (vi) $24,000 in travel and trade show expenses. Corporate SG&A expense increased $361,000, or 46.8%, from $771,000 in the nine-month period ended September 30, 2024 to $1,132,000 in the nine-month period ended September 30, 2025. This increase was due to an increase of (i) $124,000 in tax professional fees from the preparation of the 2024 and 2025 income tax provision, the calculations related to the release of the income tax valuation allowance, and the preparation of an updated 382 Study, (ii) $115,000 in expenses related to uplisting to NASDAQ which includes the NASDAQ application fee, the prorated listing fee and the legal fees associated with the uplisting process, (iii) $78,000 in stock compensation expense, (iv) $29,000 in audit fees primarily related to the work on the release of the income tax valuation allowance at December 31, 2024, and (vi) a net increase of $15,000, in the aggregate, of other public company expenses.

SG&A expense of the consolidated entities in the three-month period ended September 30, 2025 reflected an increase of $322,000, or 26.9%, as compared to the three-month period ended September 30, 2024. OmniMetrix's SG&A expense increased $112,000, or 11.7%, from $960,000 in the three-month period ended September 30, 2024 to $1,072,000 in the three-month period ended September 30, 2025. This increase was primarily due to an increase of (i) $86,000 in personnel expenses due to staff additions and increases in compensation to our team, (ii) $35,000 in technology consulting fees and other expenses, and (iii) a net decrease of $9,000 in other operating expenses in the aggregate. Corporate SG&A expense increased $210,000, or 88.6%, from $237,000 in the three-month period ended September 30, 2024 to $447,000 in the three-month period ended September 30, 2025. This increase was due to an increase of (i) $60,000 in tax professional fees from the preparation of the 2025 income tax provision, the calculations related to the release of the income tax valuation allowance, and the preparation of an updated 382 Study, (ii) $110,000 in expenses related to uplisting to NASDAQ which includes the NASDAQ application fee, the prorated listing fee and the legal fees associated with the uplisting process, (iii) $19,000 in stock compensation expense, and (iv) a net increase of $21,000, in the aggregate, of other public company expenses.

Net income attributable to Acorn Energy. We recognized net income attributable to Acorn stockholders of $1,436,000 in the nine-month period ended September 30, 2025, compared to net income attributable to Acorn stockholders of $1,061,000 in the nine-month period ended September 30, 2024. For the three-month period ended September 30, 2025, we recognized net income attributable to Acorn stockholders of $252,000, compared to a net income attributable to Acorn stockholders of $725,000 for the three- month period ended September 30, 2024. Our net income during the nine- and three-month periods ended September 30, 2025 and 2024 is comprised of the components listed in the table below:

		Nine months ended September 30,								Three months ended September 30,
Net Income Attributable to Acorn Energy, Inc. Stockholders		2025				2024				2025				2024
Income before income taxes - OmniMetrix		$	2.924			$	1,915			$	639			$	1,012
Corporate expense, net of interest income			(1,129	)			(770	)			(446	)			(236	)
Provision for (benefit from) income taxes - federal			(253	)			-				84				-
Provision for income taxes - states			(78	)			(67	)			(19	)			(42	)
Non-controlling interest share of net income			(28	)			(17	)			(6	)			(9	)
Net income attributable to Acorn Energy, Inc stockholders		$	1,436			$	1,061			$	252			$	725

Liquidity and Capital Resources

At September 30, 2025, we had working capital of $2,789,000. Our working capital includes $4,167,000 of cash and deferred revenue of $3,158,000. Such deferred revenue does not require a significant cash outlay for the revenue to be recognized.

During the nine-month period ended September 30, 2025, our OmniMetrix subsidiary provided cash flow from operations of $2,893,000, while our corporate headquarters used $1,098,000 for operations during the same period.

During the nine-month period ended September 30, 2025, we invested (i) $13,000 in technology, (ii) $7,000 in equipment, (iii) $4,000 in leasehold improvements and (iv) $1,000 in patent acquisition.

During the nine-month period ended September 30, 2025, we recognized $71,000 from financing activities which included $87,000 in proceeds from the exercise of stock options net of $16,000 used to repurchase Company stock.

Liquidity

As of November 4, 2025 we had cash of $4,372,000. We believe that such cash, plus the cash expected to be generated from operations, will provide sufficient liquidity to finance the corporate activities of Acorn and the operating activities of OmniMetrix at their current level of operations for at least the twelve-month period from the issuance of the unaudited condensed consolidated financial statements contained in this Quarterly Report. We may, at some point, elect to obtain a new line of credit or other source of financing to fund additional investments in the business. If we decide to pursue additional financing in the future, it may be in the form of a bank line, a new loan or investment by others, an equity raise by Acorn, which could then facilitate a loan by Acorn to OmniMetrix, or any combination thereof. Whether alternative funds, such as third-party loans or investments, will be available at the time required and on terms acceptable to Acorn and OmniMetrix cannot be determined at this time.

Contractual Obligations and Commitments

The table below provides information concerning obligations under certain categories of our contractual obligations as of September 30, 2025.

CASH PAYMENTS DUE TO CONTRACTUAL OBLIGATIONS

		Twelve-Month Periods Ending September 30, (in thousands)
		Total				2026				2027-2028				2029-2030				2031 and thereafter
Software agreements		$	5			$	5			$	-			$	-			$	-
Operating leases*			1,241				190				483				522				46
Contractual services			272				212				60				-				-
Purchase commitments**			706				706				-				-				-
Total contractual cash obligations		$	2,224			$	1,113			$	543			$	522			$	46

*Reflects the gross amount of the payments to be made under the operating lease liabilities. Does not include rent amounts to be received under the sublease.

**Reflects open purchase orders for components/parts to be delivered over the next twelve months as sales forecast requires.