August 5, 2026 - 10-Q: Quarterly report [Sections 13 or 15(d)]

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

[X] 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: 0-12305

KORU MEDICAL SYSTEMS, INC.

(Exact name of registrant as specified in its charter)

Delaware	13-3044880
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

100 Corporate Drive, Mahwah, New Jersey	07430
(Address of principal executive offices)	(Zip Code)

(845) 469-2042

(Registrant’s telephone number, including area code)

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, $0.01 par value	KRMD	The Nasdaq Stock 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. [X] 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 (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). [X] 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 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 [X]	Smaller reporting company [X]
		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 [X] No

As of August 5, 2026, 46,171,902 shares of common stock, $0.01 par value per share, were outstanding, which excludes 4,018,526 shares of treasury stock.

KORU MEDICAL SYSTEMS, INC.

FORM 10-Q

FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2026

TABLE OF CONTENTS

		PAGE

PART I. FINANCIAL INFORMATION

ITEM 1.	Condensed Financial Statements (Unaudited)	3

	Balance Sheets as of June 30, 2026 (Unaudited) and December 31, 2025	3

	Statements of Operations (Unaudited) for the three and six months ended June 30, 2026 and 2025	4

	Statements of Cash Flows (Unaudited) for the six months ended June 30, 2026 and 2025	5

	Statements of Stockholders’ Equity (Unaudited) for the three and six months ended June 30, 2026 and 2025	6-7

	Notes to Financial Statements	8

ITEM 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	15

ITEM 3.	Quantitative and Qualitative Disclosures About Market Risk	20

ITEM 4.	Controls and Procedures	20

PART II. OTHER INFORMATION

ITEM 1A.	Risk Factors	20

ITEM 2.	Unregistered Sales of Equity Securities	20

ITEM 6.	Exhibits	21

	Signatures	22

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PART I — FINANCIAL INFORMATION

Item 1. Financial Statements (Unaudited)

KORU MEDICAL SYSTEMS, INC.

BALANCE SHEETS


	June 30,			December 31,
	2026			2025
	(UNAUDITED)

ASSETS

CURRENT ASSETS
Cash and cash equivalents	$	8,287,704		$	8,872,212
Accounts receivable, net		5,027,723			5,972,252
Inventory, net		4,511,126			3,678,131
Other receivables		1,064,909			557,653
Prepaid expenses and other current assets		622,655			908,542
TOTAL CURRENT ASSETS		19,514,117			19,988,790
Property and equipment, net		3,929,718			4,471,386
Intangible assets, net of accumulated amortization of $562,655 and $527,949 as of June 30, 2026 and December 31, 2025, respectively		1,663,318			684,841
Operating lease right-of-use assets		2,755,890			2,956,192
Other assets		98,970			98,970
TOTAL ASSETS	$	27,962,013		$	28,200,179

LIABILITIES AND STOCKHOLDERS’ EQUITY

CURRENT LIABILITIES
Accounts payable	$	2,912,589		$	2,267,473
Accrued expenses		2,869,568			4,828,830
Other liabilities		11,068			27,722
Accrued payroll and related taxes		807,832			531,972
Financing lease liability		148,592			124,913
Operating lease liability		430,173			413,448
TOTAL CURRENT LIABILITIES		7,179,822			8,194,358
Financing lease liability, net of current portion		71,409			78,675
Operating lease liability, net of current portion		2,659,265			2,879,224
TOTAL LIABILITIES		9,910,496			11,152,257

STOCKHOLDERS’ EQUITY
Common stock, $0.01 par value, 75,000,000 shares authorized, 50,172,404 and 49,790,934 shares issued 46,148,690 and 46,370,432 shares outstanding as of June 30, 2026, and December 31, 2025, respectively		501,724			497,909
Additional paid-in capital		56,527,047			52,449,339
Treasury stock, 4,018,526 and 3,438,526 shares as of June 30, 2026 and December 31, 2025, respectively, at cost		(6,405,793	)		(3,882,494	)
Accumulated deficit		(32,571,461	)		(32,016,832	)
TOTAL STOCKHOLDERS’ EQUITY		18,051,517			17,047,922
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	27,962,013		$	28,200,179

The accompanying notes are an integral part of these financial statements.

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KORU MEDICAL SYSTEMS, INC.

STATEMENTS OF OPERATIONS

(UNAUDITED)


	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2026			2025			2026			2025

NET REVENUES	$	12,045,420		$	10,194,800		$	23,810,044		$	19,829,875
Cost of goods sold		4,199,212			3,719,031			8,732,447			7,307,771
Gross Profit		7,846,208			6,475,769			15,077,597			12,522,104

OPERATING EXPENSES
Selling, general and administrative		5,939,986			5,384,148			12,522,165			11,343,522
Research and development		1,069,200			1,194,789			2,385,804			2,309,398
Depreciation and amortization		210,031			209,487			407,561			426,844
Total Operating Expenses		7,219,217			6,788,424			15,315,530			14,079,764

Net Operating Income /(Loss)		626,991			(312,655	)		(237,933	)		(1,557,660	)

Non-Operating Income/(Expense)
Gain/(Loss) on currency exchange		(22,343	)		44,193			(45,493	)		49,782
Loss on disposal of fixed assets, net		(406,269	)		—			(406,269	)		—
Interest income, net		59,870			78,951			140,866			152,130
TOTAL OTHER (EXPENSE)/INCOME		(368,742	)		123,144			(310,896	)		201,912

INCOME / (LOSS) BEFORE INCOME TAXES		258,249			(189,511	)		(548,829	)		(1,355,748	)

Income Tax Expense		(5,800	)		(17,356	)		(5,800	)		(17,356	)

NET INCOME/(LOSS)	$	252,449		$	(206,867	)	$	(554,629	)	$	(1,373,104	)

NET INCOME / (LOSS) PER SHARE
Basic	$	0.01		$	(0.00	)	$	(0.01	)	$	(0.03	)
Diluted	$	0.01		$	(0.00	)	$	(0.01	)	$	(0.03	)

WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING
Basic		46,083,893			46,193,709			46,223,623			46,088,353
Diluted		49,509,437			46,193,709			46,223,623			46,088,353

The accompanying notes are an integral part of these financial statements.

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KORU MEDICAL SYSTEMS, INC.

STATEMENTS OF CASH FLOWS

(UNAUDITED)


	Six Months Ended
	June 30,			June 30,
	2026			2025

CASH FLOWS FROM OPERATING ACTIVITIES
Net Loss	$	(554,629	)	$	(1,373,104	)
Adjustments to reconcile net loss to net cash used in operating activities:
Stock-based compensation expense and warrant expense		1,139,284			1,113,334
Depreciation and amortization		407,561			426,844
Loss on disposal of fixed assets		406,269			—
Non-cash leasing charges		(2,931	)		—
*Changes in operating assets and liabilities:*
Decrease/(Increase) in accounts receivable		944,529			805,133
Decrease/(Increase) in other receivables		(507,257	)		47,979
Decrease/(Increase) in inventory		(832,996	)		(1,144,175	)
Decrease/(Increase) in prepaid expenses and other assets		285,887			317,897
Increase/(Decrease) in accounts payable		645,116			(555,430	)
Increase/(Decrease) in accrued payroll and related taxes		275,860			(122,459	)
Increase/(Decrease) in other liabilities		(16,654	)		74,833
Increase/(Decrease) in accrued expenses		(1,959,263	)		(288,659	)
NET CASH FLOWS FROM OPERATING ACTIVITIES		230,776			(697,807	)

CASH FLOWS FROM INVESTING ACTIVITIES
Purchases of property and equipment		(154,070	)		(472,252	)
Purchases of intangible assets		(461,035	)		(3,400	)
Capitalized software development costs		(52,147	)		—
NET CASH FLOWS FROM INVESTING ACTIVITIES		(667,252	)		(475,652	)

CASH FLOWS FROM FINANCING ACTIVITIES
Payments on insurance finance indebtedness		—			(271,152	)
Payments for taxes related to net share settlement of equity awards		(81,059	)		(27,536	)
Payments on finance lease liability, net of asset		(66,973	)		(54,084	)
NET CASH FLOWS FROM FINANCING ACTIVITIES		(148,032	)		(352,772	)

NET DECREASE IN CASH AND CASH EQUIVALENTS		(584,508	)		(1,526,231	)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD		8,872,212			9,580,947
CASH AND CASH EQUIVALENTS, END OF PERIOD	$	8,287,704		$	8,054,716

Supplemental Information
Cash paid during the years for:
Interest	$	4,732		$	7,563
Income Taxes	$	5,800		$	17,356
Non-cash Financing Activity
During the six months ended June 30, 2026, the Company acquired an intangible asset for $961,035, of which $500,000 was settled through the issuance of 125,628 shares of common stock		-

The accompanying notes are an integral part of these financial statements.

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KORU MEDICAL SYSTEMS, INC.

STATEMENTS OF STOCKHOLDERS’ EQUITY

(UNAUDITED)

Three and Six Months Ended June 30, 2026


				Additional									Total
	Common Stock			Paid-in			Accumulated			Treasury			Stockholders’
	Shares	Amount		Capital			Deficit			Stock			Equity

BALANCE, DECEMBER 31, 2025	49,790,934	$	497,909	$	52,449,339		$	(32,016,832	)	$	(3,882,494	)	$	17,047,922
Issuance of stock-based compensation	142,568		1,426		96,074			—			—			97,500
Compensation expense related to stock options	—		—		254,053			—			—			254,053
Compensation related to restricted stock	—		—		329,957			—			—			329,957
Forfeiture of unvested restricted stock	—		—		1,666,299			—			(1,666,299	)		—
Net loss	—		—		—			(807,078	)		—			(807,078	)
BALANCE, MARCH 31, 2026	49,933,502	$	499,335	$	54,795,722		$	(32,823,910	)	$	(5,548,793	)	$	16,922,354

Issuance of stock-based compensation	113,274		1,133		96,367			—			—			97,500
Compensation expense related to stock options	—		—		308,252			—			—			308,252
Compensation related to restricted stock, net of payment for taxes	—		—		(29,038	)		—			—			(29,038	)
Forfeiture of unvested restricted stock	—		—		857,000			—			(857,000	)		—
Restricted shares issued as acquisition consideration	125,628		1,256		498,744			—			—			500,000
Net Income	—		—		—			252,449			—			252,449
BALANCE, JUNE 30, 2026	50,172,404	$	501,724	$	56,527,047		$	(32,571,461	)	$	(6,405,793	)	$	18,051,517

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Three and Six Months Ended June 30, 2025


				Additional								Total
	Common Stock			Paid-in		Accumulated			Treasury			Stockholders’
	Shares	Amount		Capital		Deficit			Stock			Equity

BALANCE, DECEMBER 31, 2024	49,377,617	$	493,776	$	49,581,303	$	(29,378,906	)	$	(3,882,494	)	$	16,813,679
Issuance of stock-based compensation	183,881		1,839		95,661		—			—			97,500
Compensation expense related to stock options	—		—		359,197		—			—			359,197
Compensation related to restricted stock	—		—		227,860		—			—			227,860
Issuance of warrants	—		—		13,032		—			—			13,032
Net loss	—		—		—		(1,166,237	)		—			(1,166,237	)
BALANCE, MARCH 31, 2025	49,561,498	$	495,615	$	50,277,053	$	(30,545,143	)	$	(3,882,494	)	$	16,345,031

Issuance of stock-based compensation	93,961		940		96,560		—			—			97,500
Compensation expense related to stock options	—		—		147,944		—			—			147,944
Compensation related to restricted stock, net of payment for taxes	—		—		142,766		—			—			142,766
Net loss	—		—		—		(206,867	)		—			(206,867	)
BALANCE, JUNE 30, 2025	49,655,459	$	496,555	$	50,664,323	$	(30,752,010	)	$	(3,882,494	)	$	16,526,374

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KORU MEDICAL SYSTEMS, INC.

NOTES TO THE UNAUDITED FINANCIAL STATEMENTS

NOTE 1 — NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

NATURE OF OPERATIONS

KORU MEDICAL SYSTEMS, INC. (the “Company,” “KORU Medical,” “KORU,” “we,” “us” or “our”) develops, manufactures and commercializes innovative and patient-centric large volume subcutaneous infusion solutions primarily for the subcutaneous drug delivery market as governed by the United States Food and Drug Administration (the “FDA”) quality and regulatory system and international standards for quality system management. The Company operates as one segment.

BASIS OF PRESENTATION

The accompanying financial statements should be read in conjunction with the Company’s annual report on Form 10-K for the year ended December 31, 2025 (“Annual Report”). In accordance with the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”), the Company has omitted footnote disclosures that would substantially duplicate the disclosures contained in the audited financial statements of the Company. The accompanying interim financial statements are unaudited and reflect all adjustments which are in the opinion of management necessary for a fair statement of the Company’s financial position, results of operations, and cash flows for the periods presented. All such adjustments are of a normal, recurring nature. The Company’s results of operations and cash flows for the interim periods are not necessarily indicative of the results of operations and cash flows that it may achieve in future periods.

CASH AND CASH EQUIVALENTS

For purposes of the statements of cash flows, the Company considers all short-term investments with an original maturity of three months or less to be cash equivalents. As of June 30, 2026 the Company held cash and cash-equivalents of $8.3 million.

INTANGIBLE ASSETS

Costs incurred in obtaining patents have been capitalized and are being amortized over the legal life of the patents.

During the three months ended June 30, 2026, the Company acquired certain intangible assets for $961,035. This purchase was accounted for as a technology asset acquisition, as it did not meet the definition of a business combination under ASC 805.

SOFTWARE DEVELOPMENT COSTS

The Company capitalizes certain costs related to the development of internal-use software in accordance with ASC 350-40, Internal-Use Software. Capitalization begins when management has authorized the project, and it is probable that the software will be completed and used as intended. Capitalized costs primarily include internal labor directly associated with application development activities, such as coding, configuration, and testing.

STOCK-BASED COMPENSATION

The Company maintains an omnibus equity incentive plan under which it grants options and other equity incentive awards to certain executives, employees and consultants, as well as shares of common stock to non-employee directors.

The fair value of each stock option grant is estimated on the date of the grant using the Black-Scholes option-pricing model. All options are charged against income at their fair value. The entire compensation expense of the award is recognized over the vesting period.

Shares of stock granted for director fees are recorded at the fair value of the shares at the grant date.

Restricted stock awards are equity classified and measured at the fair market value of the underlying stock at the grant date. The fair value of restricted stock awards vesting at certain market capitalization thresholds were estimated on the date of grant using the Brownian Motion Monte Carlo lattice model. The fair value of restricted stock awards with time-based vesting were estimated on the date of grant at the current stock price. The fair value of restricted stock awards vesting at certain annual sales growth thresholds were estimated as of the date of Board acknowledgement of the achievement, at the current stock price. We recognize restricted stock expense using the straight-line attribution method over the requisite service period and account for forfeitures as they occur.

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Restricted stock units (“RSUs”) and performance stock units (“PSUs”) are equity classified and measured at the fair market value of the underlying stock at the grant date.

NET INCOME PER SHARE

The following table sets forth the computation of basic and diluted income per share:


	Three Months Ended June 30,					Six Months Ended June 30,
	2026		2025			2026			2025
Numerator:
Net income(loss) for basic and diluted earnings per share	$	252,449	$	(206,867	)	$	(554,629	)	$	(1,373,104	)
Denominator for basic income per share weighted average shares		46,083,893		46,193,709			46,223,623			46,088,353
Effect of dilutive securities:
Options, restricted stock units, and warrants		3,425,544		—			—			—
Denominator for diluted income per share weighted average shares		49,509,437		46,193,709			46,223,623			46,088,353
Basic income per share	$	0.01	$	(0.00	)	$	(0.01	)	$	(0.03	)
Diluted income per share	$	0.01	$	(0.00	)	$	(0.01	)	$	(0.03	)

Approximately 2,273,140 stock options and 1,152,404 restricted stock units for the three months ended June 30, 2026 were included in the diluted EPS calculation because they were dilutive. Additional stock options and restricted stock units were excluded from the diluted EPS calculation for the three-month period ended June 30, 2026 because they were anti-dilutive, primarily consisting of unvested and out-of-the-money options of 1,677,997 and unvested performance-based awards of 525,875. Because the Company reported a net loss for the six months ended June 30, 2026, all potential common shares were anti-dilutive and therefore excluded from the calculation of diluted net loss per share for the period.

USE OF ESTIMATES IN THE FINANCIAL STATEMENTS

The preparation of financial statements in conformity with United States generally accepted accounting principles (“GAAP”) requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates. Important estimates include but are not limited to asset lives, deferred tax valuation allowances, inventory valuation, expected credit losses, and customer rebate and incentive accruals. The results of operations for the six months ended June 30, 2026 are not necessarily indicative of the results that may be expected for the entire 2026 fiscal year.

REVENUE RECOGNITION

Our revenues are derived from three business sources: (i) domestic core (which consists of US and Canada), (ii) international core, and (iii) pharma services and clinical trials. Our domestic and international core revenues consist of sales of our syringe drivers, tubing and needles (“Product Revenue”) for the delivery of subcutaneous drugs that are FDA cleared for use with the KORU Medical infusion system, with the primary delivery for immunoglobulin to treat Primary Immunodeficiency Diseases (“PIDD”) and Chronic Inflammatory Demyelinating Polyneuropathy (“CIDP”). Pharma services and clinical trials consist of Product Revenue for feasibility/clinical trials (pre-clinical studies, Phase I, Phase II, Phase III) of biopharmaceutical companies in the drug development process as well as non-recurring engineering services (“NRE”) revenues (including testing and registration services) received from biopharmaceutical companies to ready or customize the FREEDOM^TM System for clinical and commercial use across multiple drug categories.

For Product Revenue, we recognize revenues when shipment occurs, at which point the customer obtains control and ownership of the goods. Shipping costs generally are billed to customers and are included in Product Revenue.

The Company generally does not accept return of goods shipped unless it is a Company error. The only credits provided to customers are for defective merchandise. The Company warrants the syringe driver from defects in materials and workmanship under normal use and the warranty does not include a performance obligation. The costs under the warranty are expensed as incurred.

Rebates are provided to distributors for the difference in selling price to distributors and pricing specified to select customers. In addition, rebates are provided to customers for meeting growth targets. Provisions for both distributor pricing and customer growth rebates are variable consideration and are recorded as a reduction of revenue in the same period the related sales are recorded or when it is probable the growth target will be achieved.

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We recognize NRE revenue under an input method, which recognizes revenue on the basis of our efforts or inputs (for example, resources consumed, labor hours expended, costs incurred, or time elapsed) to the satisfaction of a performance obligation relative to the total expected inputs to the satisfaction of that performance obligation (i.e. completion milestone). The input method that we use is based on costs incurred.

Contracts are often modified to account for changes in contract specifications and requirements. Contract modifications exist when the modification either creates new, or changes existing, enforceable rights and obligations. Generally, when contract modifications create new performance obligations, the modification is considered to be a separate contract and revenue is recognized prospectively. When contract modifications change existing performance obligations, the impact on the existing transaction price and measure of progress for the performance obligation to which it relates is generally recognized as an adjustment to revenue (either as an increase in or a reduction of revenue) on a cumulative catch-up basis. Contract assets primarily represent revenue earnings over time that are not yet billable based on the terms of the contracts. Contract liabilities (i.e., deferred revenue) consist of fees invoiced or paid by the Company’s customers for which the associated performance obligations have not been satisfied and revenue has not been recognized based on the Company’s revenue recognition criteria described above. The Company has recognized a contract asset, which is included in other receivables in the accompanying balance sheet, of $335,206 and $319,955 as of June 30, 2026 and December 31, 2025, respectively.

The following table summarizes net revenues from our distributors and direct customers by geography for the three and six months ended June 30, 2026, and 2025.

	Three Months Ended June 30,				Six Months Ended June 30,
	2026		2025		2026		2025
Revenues
Domestic	$	8,396,591	$	8,012,272	$	16,835,334	$	15,217,904
International		3,648,829		2,182,528		6,974,710		4,611,971
Total	$	12,045,420	$	10,194,800	$	23,810,044	$	19,829,875

ACCOUNTING PRONOUNCEMENTS RECENTLY ADOPTED

The Company considers the applicability and impact of all recently issued accounting pronouncements. Recent accounting pronouncements not specifically identified in our disclosures are either not applicable to the Company or are not expected to have a material effect on our financial condition or results of operations.

IMPAIRMENT OF LONG-LIVED ASSETS

The Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be fully recoverable. An impairment loss would be recognized when estimated undiscounted future cash flows expected to result from the use of the asset and its eventual disposition are less than the carrying amount. The impairment loss, if recognized, would be based on the excess of the carrying value of the impaired asset over its respective fair value. The Company did not record any impairment losses for the quarter ended June 30, 2026, nor June 30, 2025.

NOTE 2 — PROPERTY AND EQUIPMENT

Property and equipment consist of the following at:

	June 30, 2026			December 31, 2025

Furniture and office equipment	$	1,527,809		$	1,407,636
Leasehold improvements		2,161,557			1,959,045
Manufacturing equipment and tooling		4,663,208			5,171,898
Total property and equipment		8,352,574			8,538,579
Less: accumulated depreciation and amortization		(4,422,856	)		(4,067,193	)
Property and equipment, net	$	3,929,718		$	4,471,386

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NOTE 3 — STOCK-BASED COMPENSATION

The Company maintains three equity incentive plans: the 2015 Stock Option Plan, as amended (the “2015 Plan”), the 2021 Omnibus Equity Incentive Plan (the “2021 Plan”), and the 2024 Omnibus Equity Incentive Plan (the “2024 Plan”). All equity awards issued to employees, consultants, and non-employee directors on or after May 9, 2024, are issued from the 2024 Plan. The Company has also issued restricted stock and stock options as employment inducement awards outside of these plans to certain executive officers.

The 2015 Plan provides for the grant of incentive stock options and nonqualified stock options. As of June 30, 2026, there were 1,903,000 shares reserved for outstanding awards under the 2015 Plan.

The 2021 Plan provides for the grant of incentive stock options, nonqualified stock options, stock awards, restricted stock awards, restricted stock units, performance share units, stock appreciation rights, and/or other equity-based awards to employees, consultants and directors. As of June 30, 2026, there were 100,000 shares reserved for outstanding awards under the 2021 Plan.

The 2024 Plan provides for the grant of incentive stock options, nonqualified stock options, stock awards, restricted stock awards, restricted stock units, performance share units, stock appreciation rights and/or other equity-based awards to employees, consultants and directors. Awards previously made under the 2015 Plan and the 2021 Plan that are forfeited or cancelled after May 9, 2024 will be available for issuance under the 2024 Plan. As of June 30, 2026, there were 2,134,545 shares reserved for outstanding awards and 3,028,956 shares available for issuance under the 2024 Plan.

Each non-employee director of the Company (other than the Chairman of the Board) is eligible to receive $110,000 annually, to be paid quarterly in arrears of $12,500 in cash and $15,000 in common stock. The Chairman of the Board is eligible to receive $140,000 annually, to be paid quarterly in arrears of $12,500 in cash and $22,500 in common stock. All payments were and are pro-rated for partial service.

Restricted stock units (“RSUs”) and performance share units (“PSUs”) are equity classified and measured at the fair value of the underlying stock at the grant date.

Shares of stock granted for non-employee director fees are recorded at the fair value of the shares at the grant date.

On March 12, 2026 the Company announced the retirement of our CEO, Linda Tharby, with both parties entering into a separation and transition agreement, and general release. Ms. Tharby continued to serve as CEO through June 30, 2026, at which time she transitioned to a non-executive advisory employee, and will continue to serve as a member of the Board of Directors through December 31, 2026. As part of the separation and transition agreement, 580,000 unvested restricted stock awards from Ms. Tharby’s new hire inducement plan were forfeited during the six months ended June 30, 2026. All forfeited restricted stock awards were transferred to Treasury, and forfeited RSUs, PSUs, and stock options were remitted back to the 2024 Plan.

Time-Vesting Stock Options

The following table summarizes the status of the time-vested stock options outstanding at June 30, 2026:

	Shares		Weighted Average Exercise Price

Outstanding at January 1	3,614,245		$	3.48
Granted	156,857		$	3.95
Exercised	—			—
Forfeited	(81,272	)	$	2.73
Outstanding at June 30	3,689,830		$	3.50
Options exercisable at June 30	2,097,335		$	3.28

Total stock-based compensation expense for time-vested stock options included in operating expense in the accompanying statement of operations was $308,252 and $562,305 for the three and six months ended June 30, 2026, respectively. As of June 30, 2026, the intrinsic value of all time-based stock options was $3,014,639.

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The following table presents information pertaining to time-vested stock options outstanding at June 30, 2026:

Range of Exercise Price	Number Outstanding	Weighted Average Remaining Contractual Life	Weighted Average Exercise Price		Number Exercisable	Weighted Average Exercise Price

$2.08 - $4.06	3,216,318	6.5 years	$	3.28	2,097,335	$	3.28
$4.35 - $5.70	473,512	9.6 years	$	5.01	—	$	—
Total	3,689,830	6.9 years	$	3.50	2,097,335	$	3.28

As of June 30, 2026, there was $3,368,702 of total unrecognized compensation cost related to unvested share-based stock compensation awards granted under the Plans. That cost is expected to be recognized over a weighted-average period of 25 months.

Restricted Stock Awards, RSUs, and PSUs

The following table summarizes the activities for our unvested restricted stock awards, RSUs, and PSUs for the six months ended June 30, 2026.

	Shares		Weighted Average Grant-Date Fair Value

Unvested at January 1	1,722,147		$	2.99
Granted	687,204		$	4.81
Vested	(242,348	)	$	2.32
Forfeited/canceled	(560,565	)	$	3.31
Unvested at June 30	1,606,438		$	3.61

During the six months ended June 30, 2026, 580,000 shares of restricted stock originally issued to our former CEO as part of her new hire inducement award were forfeited and returned to treasury.

Total stock-based compensation expense for restricted stock awards, RSUs, and PSUs, included in operating expense in the accompanying statement of operations was $52,021 and $381,978 for the three and six months ended June 30, 2026, respectively.

As of June 30, 2026, there was $4,919,605 of unrecognized compensation cost related to unvested employee restricted stock awards, RSUs, and PSUs. This amount is expected to be recognized over a weighted-average period of 25 months.

NOTE 4 — DEBT OBLIGATIONS

On March 8, 2024, the Company entered into a loan and security agreement with a large domestic banking institution, as lender, providing for a $5,000,000 revolving credit facility and a $5,000,000 term loan facility. Borrowings are secured by a first-priority lien on substantially all of the assets of the Company, subject to customary exceptions. On March 30, 2026 the loan and security agreement was amended to extend the maturity of the $5,000,000 revolver from December 31, 2026 to March 30, 2028, and extends the interest-only period of the $5,000,000 term loan from September 30, 2026 to June 30, 2027 with a possible further extension to December 31, 2027 upon the achievement of certain EBITDA milestones as set forth therein. The term loan maturity has been extended from December 1, 2028 to December 1, 2029. The amendment lowers the interest rate floor to 5.50% from 6.50% for the revolver and the term loan. The amendment removes the adjusted quick ratio covenant for both the term loan and the revolver. The adjusted quick ratio covenant for the revolver has been replaced with a remaining months liquidity covenant of at least twelve months, to be tested monthly beginning the first month the revolver is drawn on; provided, however, the Company will be in compliance if trailing three (3) month average Adjusted EBITDA (as defined in the revolver) is positive.

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NOTE 5 — LEASES

We have finance and operating leases for our corporate office, vehicles, and certain office and computer equipment.

The components of lease expense were as follows:


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2026		2025		2026		2025

Operating lease cost	$	133,495	$	132,502	$	266,990	$	257,587
Short-term lease cost		—		2,700		—		6,086
Total lease cost	$	133,495	$	135,202	$	266,990	$	263,673

Finance lease cost:
Amortization of right-of-use assets	$	36,547	$	28,896	$	66,022	$	57,793
Interest on lease liabilities		2,578		4,085		4,713		8,575
Total finance lease cost	$	39,125	$	32,981	$	70,735	$	66,368

Supplemental cash flow information related to leases was as follows:


	Six Months Ended
	June 30,
	2026		2025
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	268,433	$	261,117
Financing cash flows from finance leases		70,702		65,718
ROU assets obtained in exchange for new finance lease liabilities		82,383		—

	June 30, 2026	December 31, 2025
Weighted Average Remaining Lease Term
Operating leases	6.08 Years	6.57 Years
Finance leases	1.75 Years	1.67 Years

Weighted Average Discount Rate
Operating leases	4.11%	4.13%
Finance leases	4.47%	4.74%

Maturities of lease liabilities are as follows:

Year Ended December 31,	Operating Leases			Finance Leases
Remainder of 2026	$	270,896		$	80,669
2027		554,475			104,096
2028		557,286			36,079
2029		553,759			7,475
2030		568,217			—
Thereafter		986,164			—
Total undiscounted lease payments		3,490,797			228,319
Less: imputed interest		(401,359	)		(8,318	)
Total lease liabilities	$	3,089,438		$	220,001

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NOTE 6 — INCOME TAXES

For interim income tax reporting, the Company estimates its annual effective tax rate and applies it to fiscal year-to-date pretax loss, excluding unusual or infrequently occurring discrete items. Tax jurisdictions with losses for which tax benefits cannot be realized are excluded. The Company’s reported income tax expense as of June 30, 2026 and 2025 is lower than the statutory tax rate at 21% primarily due to the valuation allowance established against the net deferred tax assets.

We evaluate our deferred tax assets to determine if they are more likely than not to be realized by assessing both positive and negative evidence in accordance with ASC Topic 740, Income Taxes. After considering our cumulative pretax loss (the three-year period ended with the current year), as well as analyzing all available evidence, we maintained the full valuation allowance against our net deferred tax assets. As we continue to assess the realizability of our deferred tax assets, reported pretax income and new evidence may result in a partial or full reduction of the valuation allowance in future periods.

The Company files income tax returns in the U.S. federal jurisdiction and in various state jurisdictions. Income tax returns for years prior to fiscal 2022 are no longer subject to examination by tax authorities.

NOTE 7 — COMMITMENTS AND CONTINGENCIES

LEGAL PROCEEDINGS

The Company has been and may again become involved in legal proceedings, claims and litigation arising in the ordinary course of business. The Company is not presently a party to any litigation or other legal proceedings that is believed to be material to its financial condition.

NOTE 8 — SUBSEQUENT EVENTS

On August 5, 2026, the Company’s Board of Directors approved an increase in its non-employee director compensation, effective October 1, 2026.

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PART I — ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

This Quarterly Report on Form 10-Q contains, and our officers and representatives may from time to time make, certain “forward-looking” statements (as such term is defined in the Private Securities Litigation Reform Act of 1995) and information relating to us that are based on the beliefs of the management, as well as assumptions made and information currently available. Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on our current beliefs, expectations and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control.

Our actual results may vary materially from the forward-looking statements made in this report due to important factors such as uncertainties associated with inflation, tariffs, war and other geopolitical conflicts, customer ordering patterns, availability and costs of raw materials and labor and our ability to recover such costs, future operating results, growth of new patient starts and the Ig market, our compliance with Food and Drug Administration and foreign authority regulations and the outcome of regulatory audits, introduction and adoption of competitive products, acceptance of and demand for new and existing products, ability to penetrate new markets, success in enforcing and obtaining patents, reimbursement related risks, government regulation of the home health care industry, success of our research and development effort, expanding the market of FREEDOM^TM System, demand in the SCIg market, availability of sufficient capital if or when needed, dependence on key personnel, and the impact of recent accounting pronouncements, as well as those risks and uncertainties described in our Annual Report on Form 10-K for the year ended December 31, 2025. When used in this report, the words “estimate,” “project,” “believe,” “may,” “will,” “anticipate,” “intend,” “expect” and similar expressions are intended to identify forward-looking statements, which include, without limitation, statements regarding need for additional financing. Such statements reflect current views with respect to future events based on currently available information and are subject to risks and uncertainties that could cause actual results to differ materially from those contemplated in such forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. The Company does not undertake any obligation to release publicly any revision to these forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.

Throughout this report, the “Company,” “KORU Medical,” “we,” “us” or “our” refers to KORU Medical Systems, Inc.

OVERVIEW

The Company develops, manufactures and markets proprietary portable and innovative medical devices primarily for the subcutaneous drug delivery market as governed by the United States Food and Drug Administration (the “FDA”) quality and regulatory system and international regulations and standards for quality system management.

Our revenues derive from three business sources: (i) domestic core (which consists of US and Canada), (ii) international core, and (iii) pharma services and clinical trials. Our domestic core and international core revenues consist of sales of our products for the delivery of subcutaneous drugs that are FDA cleared for use with the FREEDOM^TM System, with the primary delivery for immunoglobulin to treat Primary Immunodeficiency Diseases (“PIDD”) and Chronic Inflammatory Demyelinating Polyneuropathy (“CIDP”). Pharma services and clinical trials revenues consist of product revenues from our infusion system (syringe drivers, tubing and needles) for feasibility/clinical trials (pre-clinical studies, Phase I, Phase II, Phase III) of biopharmaceutical companies in the drug development process as well as non-recurring engineering services revenues (“NRE”) received from biopharmaceutical companies to ready or customize the FREEDOM^TM System for clinical and commercial use.

The Company ended the second quarter of 2026 with $12.0 million in net revenues, an 18.2% increase compared to $10.2 million in the same period last year. Revenues were driven by growth in our core domestic and international business of 12.4% and 59.1%, respectively, along with a decrease of 35% in our pharma services and clinical trials business.

Gross profit for the second quarter of 2026 was $7.8 million, a 21.2% increase compared to $6.5 million in the same period last year. Gross margin was 65.1% for the three months ended June 30, 2026, an increase from 63.5% in the prior year period. We define gross margin as gross profit stated as a percentage of net revenues.

Operating expenses for the second quarter of 2026 were $7.2 million, an increase of 6.3%, compared to $6.8 million for the same period last year, driven by an increase of $0.6 million in selling, general, and administrative expenses, and a decrease of $0.1 million in research and development expenses.

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The Company imports certain materials and products that are subject to U.S. government tariffs and import duties. On February 20, 2026, a US federal court ordered the U.S. government to begin refunding certain tariffs. The Company believes that some of the tariffs it has paid may be eligible for refund; however, the amount and timing of any potential refunds are uncertain and not expected to have a material impact on the Company’s financial position. Accordingly, the Company has not recorded, nor plans to record, any benefit related to possible tariff refunds at this time.

RESULTS OF OPERATIONS

Three months ended June 30, 2026, compared to June 30, 2025

Net Revenues

The following table summarizes our net revenues for the three months ended June 30, 2026, and 2025:

	Three Months Ended June 30,				Change from Prior Year					% of Net Revenues
	2026		2025		$			%		2026	2025
Net Revenues
Domestic Core	$	7,979,558	$	7,097,285	$	882,273		12.4%		66.2%	69.6%
International Core		3,469,558		2,180,111		1,289,447		59.1%		28.8%	21.4%
Total Core		11,449,116		9,277,396		2,171,720		23.4%		95.0%	91.0%
Pharma Services and Clinical Trials		596,304		917,404		(321,100	)	(35.0%	)	5.0%	9.0%
Total	$	12,045,420	$	10,194,800	$	1,850,620		18.2%		100.0%	100.0%

Total net revenues increased $1.9 million, or 18.2%, to $12.0 million for the three months ended June 30, 2026, as compared to $10.2 million in the prior year period. Domestic core revenues were $8.0 million, an increase of 12.4% over the prior year period, primarily due to higher pump and consumable volumes, driven by new patient starts and market share gains within new and existing accounts, supported by a strong underlying SCIg market. International core revenues were $3.5 million, an increase of 59.1% over the prior year period, due to higher pump and consumable volumes, driven by distributor purchases supporting pre-filled syringe (PFS) conversions, and new patient starts in established EU markets. Pharma services and clinical trials net revenues were $0.6 million, a decrease of 35% over the prior year period, primarily due to lower clinical trial product revenues related to customer order timing.

Gross Profit

Our gross profit for the three months ended June 30, 2026 and 2025 is as follows:

	Three Months Ended June 30,				Change from Prior Year
	2026		2025		$		%
Gross Profit	$	7,846,208	$	6,475,769	$	1,370,439	21.2%
Gross Margin		65.1%		63.5%

Gross profit increased $1.4 million, or 21.2%, to $7.8 million in the three months ended June 30, 2026, as compared to $6.5 million in the prior year period, primarily driven by volume growth. Gross margin increased to 65.1% in the three months ended June 30, 2026, as compared to 63.5% in the prior year period. The increase in gross margin was primarily driven by lower manufacturing costs and higher average selling prices.

Operating Expenses

Our selling, general and administrative, research and development and depreciation and amortization expenses for the three months ended June 30, 2026 and 2025 are as follows:

	Three Months Ended June 30,				Change from Prior Year
	2026		2025		$			%
Selling, general and administrative	$	5,939,986	$	5,384,148	$	555,838		10.3%
Research and development		1,069,200		1,194,789		(125,589	)	(10.5%	)
Depreciation and amortization		210,031		209,487		544		0.3%
Total Operating Expenses	$	7,219,217	$	6,788,424	$	430,793		6.3%

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Selling, general and administrative expenses increased $0.6 million, or 10.3%, to $5.9 million during the three months ended June 30, 2026, as compared to $5.4 million in the prior year period. The increase in selling, general and administrative expenses was primarily driven by increases in compensation and benefits from new hires, and legal fees, partially offset by lower stock compensation, recruiting, and consulting expenses.

Research and development expenses decreased $0.1 million, or 10.5% to $1.1 million during the three months ended June 30, 2026, as compared to $1.2 million in the prior year period, primarily due to lower project spend and timing partially offset by higher compensation expenses for salary and stock compensation related to headcount additions

Depreciation and amortization expense remained flat at $0.2 million during the three months ended June 30, 2026, as compared to $0.2 million in the prior year period.

Net Income

	Three Months Ended June 30,					Change from Prior Year
	2026		2025			$		%
Net Income	$	252,449	$	(206,867	)	$	459,316	(222.0%	)

Our net income increased $0.5 million in the three months ended June 30, 2026, as compared to the prior year period, primarily driven by an increase in gross profit of $1.4 million from increased revenues, partially offset by operating expense increases of $0.4 million, and other income and losses change of $0.5 million due to an asset disposal.

Six months ended June 30, 2026, compared to June 30, 2025

Net Revenues

The following table summarizes our net revenues for the six months ended June 30, 2026, and 2025:

	Six Months Ended June 30,				Change from Prior Year			% of Net Revenues
	2026		2025		$		%	2026	2025
Net Revenues
Domestic Core	$	15,719,429	$	14,025,250	$	1,694,179	12.1%	66.0%	70.7%
International Core		6,753,599		4,608,773		2,144,826	46.5%	28.4%	23.2%
Total Core		22,473,028		18,634,023		3,839,005	20.6%	94.4%	94.0%
Pharma Services and Clinical Trials		1,337,016		1,195,852		141,164	11.8%	5.6%	6.0%
Total	$	23,810,044	$	19,829,875	$	3,980,169	20.1%	100.0%	100.0%

Total net revenues increased $4.0 million, or 20.1% to $23.8 million, for the six months ended June 30, 2026, as compared with the same prior year period. Domestic core revenues increased by 12.1% to $15.7 million, primarily due to volume growth in pumps and consumables, driven by new patient starts and market share gains. International core revenues increased by 46.5% to $6.8 million, primarily due to higher pump volumes, driven by prefill patient conversions, new patient starts in existing markets and entry into new geographic markets. Pharma services and clinical trials net revenues increased by $0.1 million, or 11.8% to $1.3 million in the six months ended June 30, 2026, as compared to the prior year period, driven by clinical trial orders and NRE revenue.

Gross Profit

Our gross profit for the six months ended June 30, 2026 and 2025 is as follows:

	Six Months Ended June 30,				Change from Prior Year
	2026		2025		$		%
Gross Profit	$	15,077,597	$	12,522,104	$	2,555,493	20.4%
Gross Margin		63.3%		63.1%

Gross profit increased by $2.6 million or 20.4% in the six months ended June 30, 2026, as compared with the same prior year period. The increase in the first half of 2026 was driven by an increase in net revenues of $4.0 million as described above. Gross margin increased to 63.3% in the six months ended June 30, 2026, as compared with 63.1% in the prior year period. The increase in gross margin was primarily driven by lower manufacturing costs, increases in average selling prices, partially offset by tariff related price increases.

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Operating Expenses

Our selling, general and administrative, research and development and depreciation and amortization expenses for the six months ended June 30, 2026 and 2025 are as follows:

	Six Months Ended June 30,				Change from Prior Year
	2026		2025		$			%
Selling, general and administrative	$	12,522,165	$	11,343,522	$	1,178,643		10.4%
Research and development		2,385,804		2,309,398		76,406		3.3%
Depreciation and amortization		407,561		426,844		(19,283	)	(4.5%	)
Total Operating Expenses	$	15,315,530	$	14,079,764	$	1,235,766		8.8%

Selling, general and administrative expenses increased $1.2 million, or 10.4%, during the six months ended June 30, 2026, as compared with the prior year period, primarily due to increases in legal fees and compensation and benefits partially offset by lower consulting expenses.

Research and development expenses increased by $0.08 million, or 3.3% during the six months ended June 30, 2026, as compared with the same prior year period, primarily due to higher compensation and benefit expenses partially offset by lower project expenses.

Depreciation and amortization expense remained flat at $0.4 million in the six months ended June 30, 2026, as compared with $0.4 million in the same prior year period.

Net Loss

	Six Months Ended June 30,						Change from Prior Year
	2026			2025			$		%
Net Loss	$	(554,629	)	$	(1,373,104	)	$	818,475	(59.6%	)
Stated as a Percentage of Net Revenues		(2.3%	)		(6.9%	)

Our net loss decreased $0.8 million in the six months ended June 30, 2026, as compared with the same prior year period, mostly driven by an increase in gross profit of $2.6 million or 20.4%, partially offset by an increase in operating expenses of $1.2 million or 8.8%, and changes in other income and losses of $0.5 million.

LIQUIDITY AND CAPITAL RESOURCES

Our principal source of liquidity is our cash on hand of $8.3 million as of June 30, 2026. Our principal source of operating cash inflows is from sales of our products and NRE. Our principal cash outflows relate to the purchase and production of inventory, funding of research and development, and selling, general and administrative expenses. To develop new products, support future growth, achieve operating efficiencies, and maintain product quality, we are continuing to invest in research and development and manufacturing equipment.

Our inventory position was $4.5 million at June 30, 2026, which reflects an increase of $0.8 million from December 31, 2025, due to expected future demand from our customers.

We expect that our cash on hand, cash flows from operations, and as needed, cash available under our credit facility, will be sufficient to meet our requirements at least through the next twelve months. Continued execution on our longer-term strategic plan may require the Company to take on additional debt, raise capital through issuance of equity, or utilize a combination of the above. Our future capital requirements may vary from those currently planned and will depend on many factors, including our rate of sales growth, the timing and extent of spending on various strategic initiatives including research and development, our international expansion, the timing of new product introductions, market acceptance of our solutions, and overall economic conditions including inflation and the potential impact of global supply imbalances on the global financial markets. To the extent that current and anticipated future sources of liquidity are or are expected to be insufficient to fund our future business activities and requirements, we may be required to obtain additional equity or debt financing sooner. There can be no assurance that the Company will be able to obtain the financing or raise the capital required to fund operations or planned expansion.

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Credit Facility

On March 8, 2024, the Company entered into a loan and security agreement with a large domestic banking institution, as lender, providing for a credit facility consisting of a $5,000,000 revolving credit facility and a $5,000,000 term loan facility. On March 30, 2026, the Company entered into an amendment to the agreement extending the revolver maturity to March 30, 2028 and the term loan maturity to December 1, 2029, extending the interest-only period on the term loan through at least June 30, 2027, and lowering the interest rate floor on both facilities from 6.50% to 5.50%. The Company has not drawn on the credit facility, and there is no obligation to do so at any time. Borrowings are secured by a first-priority lien on substantially all of the assets of the Company, subject to customary exceptions. The credit facility contains customary affirmative and negative covenants and events of default. For a complete description of the terms of the credit facility, see Note 4 to the condensed financial statements included herein.

Cash Flows

The following table summarizes our cash flows:

	Six Months Ended June 30, 2026			Six Months Ended June 30, 2025
Net cash from/(used in) operating activities	$	230,776		$	(697,807	)
Net cash used in investing activities	$	(667,252	)	$	(475,652	)
Net cash used in financing activities	$	(148,032	)	$	(352,772	)

Operating Activities

Net cash from operating activities was $0.2 million for the six months ended June 30, 2026, as compared to $(0.7) million in the prior year period. This net cash inflow of $0.2 million was due to a net loss of $0.6 million, working capital uses which netted $1.2 million and included a decrease of accrued expense by $2.0 million reflecting the pay-out of prior-year accrued bonuses, an increase in inventory of $0.8 million, and an increase in other receivables of $0.4 million partially offset by decreases in trade accounts receivable of $0.9 million, increases in accounts payable of $0.6 million, decreases of prepaid expense of $0.3 million, and other increases in payroll accruals and taxes of $0.3 million. Additional offsets to the net loss were non-cash items of $2.0 million including stock based compensation of $1.1 million, depreciation of $0.4 million, and losses on asset disposals of $0.4 million.

Net cash used in operating activities was $0.7 million for the six months ended June 30, 2025, as compared to $0.3 million in the prior year period. This net cash usage of $0.7 million was primarily due to the net loss of $1.3 million, a decrease in accounts receivable and contract assets of $0.9 million and an increase in prepaid expenses of $0.4 million, offset by increases in inventory of $1.1 million and decreases in accounts payable of $0.6 million. Additional offsets to the net loss were non-cash items including stock-based compensation expense of $1.1 million, and depreciation and amortization expense of $0.4 million.

Investing Activities

Net cash used in investing activities of $0.7 million for the six months ended June 30, 2026, was related to an acquisition of technology assets, capitalized software development costs, and capital expenditure for manufacturing equipment for our next generation pump production line.

Net cash used in investing activities of $0.5 million for the six months ending June 30, 2025, was due to capital expenditures related to purchases of manufacturing equipment for next generation consumable and pump production lines.

Financing Activities

Net cash used in financing activities of $0.1 million for the six months ended June 30, 2026 was for payment for taxes related to net share settlement of equity awards, and for payments on our finance leases.

Net cash used in financing activities of $0.4 million for the six months ended June 30, 2025 was primarily due to payments on our note payable for insurance premium financing.

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ACCOUNTING PRONOUNCEMENTS NOT YET ADOPTED

Refer to “NOTE 1 — NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES” in the accompanying financial statements, which is incorporated herein by reference.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Not applicable.

ITEM 4. CONTROLS AND PROCEDURES

The Company’s management, including the Company’s Principal Executive Officer and Principal Financial Officer, has evaluated the effectiveness of the Company’s disclosure controls and procedures as such is defined in Rule 13a-15(e) promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Based upon their evaluations, the Principal Executive Officer and Principal Financial Officer concluded that, as of the end of the period covered by this report, the Company’s disclosure controls and procedures were effective for the purpose of ensuring that the information required to be disclosed in the reports that the Company files or submits under the Exchange Act with the Securities and Exchange Commission (the “SEC”) (1) is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and (2) is accumulated and communicated to the Company’s management, including its Principal Executive Officer and Principal Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

There have been no changes in the Company’s internal control over financial reporting during the three months ended June 30, 2026, that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

PART II – OTHER INFORMATION

ITEM 1A. RISK FACTORS

Our operations and financial results are subject to various risks and uncertainties, including those described in “PART 1, ITEM 1A. RISK FACTORS” in our Annual Report on Form 10-K for the year ended December 31, 2025, which could adversely affect our business, financial condition, results of operations, cash flows, and the trading price of our common stock.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES

On May 18, 2026, the Company purchased certain contracts and intellectual property assets from a third-party in exchange for a combination of cash and 125,628 shares of the Company’s common stock, par value $0.01 per share, which shares represented $500,000 of the aggregate purchase price for the assets. The shares were issued to the collateral agent on behalf of the seller’s noteholders, and are subject to an 18-month restriction on transfer. The Company relied on Rule 506 of Regulation D under the Securities Act of 1933, as amended, in connection with the issuance.

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PART II – ITEM 6. EXHIBITS.

Exhibit No.	Description

31.1	Certification of Principal Executive Officer Pursuant to Section 302 of Sarbanes-Oxley Act 2002

31.2	Certification of Principal Financial Officer Pursuant to Section 302 of Sarbanes-Oxley Act 2002

32.1	Certification of Principal Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act 2002

32.2	Certification of Principal Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act 2002

101.INS	Inline XBRL Instance Document - the XBRL Instance Document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.

101.SCH	Inline XBRL Taxonomy Extension Schema Document

101.CAL	Inline XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF	Inline XBRL Taxonomy Definition Linkbase Document

101.LAB	Inline XBRL Taxonomy Extension Label Linkbase Document

101.PRE	Inline XBRL Taxonomy Extension Presentation Linkbase Document

104	Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	KORU MEDICAL SYSTEMS, INC.

August 5, 2026	/s/ Adam Kalbermatten
	Adam Kalbermatten, Chief Executive Officer (Principal Executive Officer)

August 5, 2026	/s/ Thomas Adams
	Thomas Adams, Chief Financial Officer and Treasurer (Principal Financial Officer)

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Form: 10-Q

Documents