scnd_10q.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2025

☐ 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 0-6658

SCIENTIFIC INDUSTRIES, INC.

(Exact Name of Registrant as specified in Its Charter)

Delaware		04-2217279
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

80 Orville Drive, Suite 102, Bohemia, New York		11716
(Address of principal executive offices)		(Zip Code)

(631) 567-4700

(Registrant’s telephone number, including area code)

Not Applicable

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock $.05 par value		SCND		OTC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company”, and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated Filer	☒	Smaller reporting company	☒
		Emerging Growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act) Yes ☐ No ☒

The number of shares outstanding of the registrant’s common stock, par value $.05 per share (“Common Stock”) as of May 13, 2025 is 11,553,599 shares.

SCIENTIFIC INDUSTRIES, INC.

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PART I - Financial Information

Item 1.	CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)	3

	Condensed Consolidated Balance Sheets	3

	Condensed Consolidated Statements of Operations and Comprehensive Loss	4

	Condensed Consolidated Statements of Changes in Shareholders’ Equity	5

	Condensed Consolidated Statements of Cash Flows	6

	Notes to Unaudited Condensed Consolidated Financial Statements	7

Item 2.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	16

Item 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	18

Item 4.	CONTROLS AND PROCEDURES	18

PART II - Other Information

Item 1.	Legal Proceedings	19

Item 1A.	Risk Factors	19

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	19

Item 3.	Defaults Upon Senior Securities	19

Item 4.	Mine Safety Disclosures	19

Item 5.	Other Information	19

Item 6.	Exhibits	20

SIGNATURE		21

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PART I – FINANCIAL INFORMATION

Item 1. Financial Statements

SCIENTIFIC INDUSTRIES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

	As of March 31, 2025			As of December 31, 2024
	(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	470,100		$	587,900
Investment securities		785,100			1,985,000
Trade accounts receivable, less allowance for doubtful accounts of $15,600 at March 31, 2025 and December 31, 2024		1,207,000			1,202,600
Inventories		4,354,000			4,085,900
Income tax receivable		73,600			73,600
Prepaid expenses and other current assets		502,300			352,700
Total current assets		7,392,100			8,287,700

Property and equipment, net		899,400			885,000
Goodwill		115,300			115,300
Other intangible assets, net		626,300			752,300
Inventories		542,900			509,500
Operating lease right-of-use assets		935,300			947,900
Other assets		58,800			63,100
Total assets	$	10,570,100		$	11,560,800

LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	973,400		$	586,100
Accrued expenses		778,200			790,100
Contract liabilities		63,900			63,500
Lease liabilities, current portion		317,300			307,300
Total current liabilities		2,132,800			1,747,000

Lease liabilities, less current portion		669,400			694,400
Total liabilities		2,802,200			2,441,400

Shareholders’ equity:
Common stock, $0.05 par value; 30,000,000 shares authorized; 10,503,599, shares issued and outstanding at March 31, 2025 and December 31, 2024		525,200			525,200
Additional paid-in capital		42,940,400			42,637,800
Accumulated other comprehensive gain (loss)		11,300			(113,100	)
Accumulated deficit		(35,709,000	)		(33,930,500	)

Total shareholders’ equity		7,767,900			9,119,400

Total liabilities and shareholders’ equity	$	10,570,100		$	11,560,800

See notes to unaudited condensed consolidated financial statements.

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SCIENTIFIC INDUSTRIES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (UNAUDITED)

	For the Three Months Ended March 31,
	2025			2024
Revenues	$	2,406,500		$	2,483,500

Cost of revenues		1,389,900			1,442,700

Gross profit		1,016,600			1,040,800

Operating expenses:
General and administrative		1,251,300			1,521,800
Selling		924,200			897,800
Research and development		652,000			710,700

Total operating expenses		2,827,500			3,130,300

Loss from operations		(1,810,900	)		(2,089,500	)

Other income:
Other income (expense), net		12,200			(4,300	)
Interest income		20,200			42,200
Total other income, net		32,400			37,900

Loss from operations before income tax expense		(1,778,500	)		(2,051,600	)

Income tax expense		-			-
Total income tax expense		-			-

Net loss	$	(1,778,500	)	$	(2,051,600	)

Comprehensive gain (loss):
Foreign currency translation gain (loss)		124,400			(60,300	)
Comprehensive gain (loss)		124,400			(60,300	)

Total comprehensive loss	$	(1,654,100	)	$	(2,111,900	)

Basic and Diluted loss per common share	$	(0.16	)	$	(0.20	)

See notes to unaudited condensed consolidated financial statements.

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SCIENTIFIC INDUSTRIES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY (UNAUDITED)

					Additional		Accumulated Other										Total
	Common Stock				Paid-in		Comprehensive			Accumulated			Treasury Stock				Stockholders’
	Shares		Amount		Capital		Income (Loss)			Deficit			Shares		Amount		Equity
Balance December 31, 2024		10,503,599	$	525,200	$	42,637,800	$	(113,100	)	$	(33,930,500	)		-	$	-	$	9,119,400

Net loss		-		-		-		-			(1,778,500	)		-		-		(1,778,500	)

Foreign currency translation adjustment		-		-		-		124,400			-			-		-		124,400

Stock-based compensation		-		-		302,600		-			-			-		-		302,600

Balance March 31, 2025		10,503,599	$	525,200	$	42,940,400	$	11,300		$	(35,709,000	)		-		-	$	7,767,900

	Common Stock				Additional Paid-in		Accumulated Other Comprehensive			Accumulated			Treasury Stock				Total Stockholders’
	Shares		Amount		Capital		Income (Loss)			Deficit			Shares		Amount		Equity
Balance December 31, 2023		10,145,211	$	507,300	$	40,844,600	$	18,600		$	(27,485,100	)		-	$	-	$	13,885,400

Net loss		-		-		-		-			(2,051,600	)		-		-		(2,051,600	)

Issuance of Common Stock and Warrants, net of issuance costs (Note 7)		358,388		17,900		204,000					-			-		-		221,900

Fair value modification of warrants recorded as stock issuance costs		-		-		423,800					-			-		-		423,800

Foreign currency translation adjustment		-		-		-		(60,300	)		-			-		-		(60,300	)

Stock-based compensation		-		-		199,900		-			-			-		-		199,900

Balance March 31, 2024		10,503,599	$	525,200	$	41,672,300	$	(41,700	)	$	(29,536,700	)		-		-	$	12,619,100

See notes to unaudited condensed consolidated financial statements

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SCIENTIFIC INDUSTRIES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

	For the Three Months Ended March 31,
	2025			2024
Operating activities:
Net loss	$	(1,778,500	)	$	(2,051,600	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		166,700			188,100
Stock-based compensation		302,600			199,900
Provision for bad debt		-			2,000
Loss on sale of investment securities		(19,100	)		1,400
Unrealized holding (gain) on investment securities		(11,300	)		(5,600	)
Noncash lease expense		16,000			82,500
Changes in operating assets and liabilities:
Trade accounts receivable		300			9,600
Inventories		(243,600	)		(19,500	)
Prepaid and other current assets		(130,200	)		(55,800	)
Other assets		4,300			-
Accounts payable		403,400			56,700
Accrued expenses		(23,200	)		110,200
Lease liabilities		(18,500	)		(83,000	)

Net cash used in operating activities		(1,331,100	)		(1,565,100	)

Investing activities:
Purchase of investment securities		-			(247,300	)
Redemption of investment securities		1,230,300			775,400
Capital expenditures		(26,300	)		(47,500	)

Net cash provided by investing activities		1,204,000			480,600

Financing activities:
Proceeds from issuance of common stock		-			716,800
Issuance costs of common stock and warrants		-			(71,100	)

Net cash provided by financing activities		-			645,700

Effect of changes in foreign currency exchange rates on cash and cash equivalents		9,300			(5,600	)

Net decrease in cash and cash equivalents		(117,800	)		(444,400	)
Cash and cash equivalents, beginning of period		587,900			796,100
Cash and cash equivalents, end of period	$	470,100		$	351,700

See notes to unaudited condensed consolidated financial statements

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SCIENTIFIC INDUSTRIES, INC. AND SUBSIDIARIES

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1. Nature of the Business and Basis of Presentation

Scientific Industries, Inc. and its subsidiaries (the “Company”) design, manufacture, and market a variety of benchtop laboratory equipment and bioprocessing products. The Company is headquartered in Bohemia, New York where it produces benchtop laboratory and pharmacy equipment. Additionally, the Company has a location in Baesweiller, Germany, where it designs and produces a variety of bioprocessing products, and administrative facilities in Pearl River, New York and Pittsburgh, Pennsylvania related to sales and marketing. The products, which are sold to customers worldwide, include mixers, shakers, stirrers, refrigerated incubators, pharmacy balances and scales, force gauges, bioprocessing sensors and analytical tools.

The accompanying (a) unaudited condensed balance sheet as of December 31, 2024, which has been derived from audited financial statements, and (b) unaudited interim condensed consolidated financial statements are prepared pursuant to the Securities and Exchange Commission’s rules and regulations for reporting on Form 10-Q. Accordingly, certain information and notes required by accounting principles generally accepted in the United States for complete financial statements are not included herein. The Company believes all adjustments necessary for a fair presentation of these interim statements have been included and that they are of a normal and recurring nature. These interim statements should be read in conjunction with the Company’s consolidated financial statements and notes thereto, included in its Annual Report on Form 10-K for the fiscal year ended December 31, 2024. The results for the three months ended March 31, 2025, are not necessarily an indication of the results for the full fiscal year ending December 31, 2025.

2. Significant Accounting Policies

Principles of Consolidation

The accompanying unaudited interim condensed consolidated financial statements include the accounts of Scientific Industries, Inc., Scientific Bioprocessing Holdings, Inc. (“SBHI”), a Delaware corporation and wholly-owned subsidiary, which holds 100% of the outstanding stock of Scientific Bioprocessing, Inc. (“SBI”), a Delaware corporation, and aquila biolabs GmbH (“Aquila”), a German corporation and Scientific Packaging Industries, Inc., an inactive wholly-owned subsidiary (all collectively referred to as the “Company”). All material intercompany balances and transactions have been eliminated in consolidation.

Liquidity and Going Concern Considerations

The Company has evaluated whether there are certain conditions and events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date of the Consolidated Financial Statements are issued. Based upon the recuring losses from operations and continued cash outflow from operating activities (as described below), the Company has concluded that there is substantial doubt about the ability to continue as a going concern for a period of one year from the date that these Consolidated Financial Statements are issued.

For the three months ended March 31, 2025, the Company generated negative cash flows from operations of $1,331,100 and has an accumulated deficit of $35,709,000 as of March 31, 2025. In order to continue as a going concern, the Company will need, among other things, additional capital resources in addition to those secured on April 18, 2025 as detailed in the Subsequent Events Footnote [Note 11]. Management has developed a strategic plan to secure such resources for the Company which may include capital from management and significant shareholders sufficient to meet its operating expenses and third-party equity and/or debt financing and exploring the sale of assets. However, management cannot provide any assurances that the Company will be successful in accomplishing any of its plans.

The Consolidated Financial Statements do not include any adjustments that might result from the outcome of this uncertainty. Accordingly, Consolidated Financial Statements have been prepared on the basis that assumes the Company will continue as a going concern and which contemplates the realization of assets and satisfaction of liabilities and the commitments in the ordinary course of business.

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New Accounting Pronouncements

In December 2023, the FASB issued ASU 2023-09, Income Taxes - Improvements to Income Tax Disclosures. This standard includes enhanced income tax disclosures primarily related to the effective tax rate reconciliation and income taxes paid for annual periods. For public companies, the amendments in this update are effective for annual periods beginning after December 12, 2024, with early adoption permitted. The adoption of this standard is not expected to have a material impact on the Company’s consolidated financial statements.

In November 2024, the FASB issued ASU No. 2024-03, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosure (Subtopic 220-40): Disaggregation of Income Statement Expenses and in January 2025, the FASB issued ASU No. 2025-01 Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40): Clarifying the Effective Date, which clarified the effective date of ASU 2024-04. The ASU requires, among other things, more detailed disclosures about the type of expenses in commonly presented expense captions such as cost of sales and selling, general and administrative expenses and is intended to improve the disclosures about an entity’s expenses including purchases of inventory, employee compensation, depreciation and intangible asset amortization. ASU 2024-03 will also require the Company to disclose both the amount and the Company’s definition of selling expenses. The guidance, clarified by ASU 2025-01, is effective for fiscal years beginning after December 15, 2026, and interim periods for fiscal years beginning after December 15, 2027, on a prospective or retrospective basis. Early adoption is permitted. We are currently evaluating the impact of adopting this ASU on our disclosures.

3. Fair Value of Financial Instruments

The Company follows ASC - Accounting Standards Codification (“ASC 820”), Fair Value Measurement, which has defined the fair value of financial instruments as the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair value measurements do not include transaction costs.

The accounting guidance also expands the disclosure requirements around fair value and establishes a fair value hierarchy for valuation inputs. The hierarchy prioritizes the inputs into three levels based on the extent to which inputs used in measuring fair value are observable in the market. Each fair value measurement is reported in one of the three levels, which is determined by the lowest level input that is significant to the fair value measurement in its entirety. These levels are described below:

Level 1 Inputs that are based upon unadjusted quoted prices for identical instruments traded in active markets.

Level 2 Quoted prices in markets that are not considered to be active or financial instruments for which all significant inputs are observable, either directly or indirectly.

Level 3 Prices or valuation that require inputs that are both significant to the fair value measurement and unobservable.

In valuing assets and liabilities, the Company is required to maximize the use of quoted market prices and minimize the use of unobservable inputs. The Company calculated the fair value of its Level 1 and 2 instruments based on the exchange traded price of similar or identical instruments where available or based on other observable instruments. These calculations take into consideration the credit risk of both the Company and its counterparties. The Company has not changed its valuation techniques in measuring the fair value of any financial assets and liabilities during the period.

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The following tables set forth by level within the fair value hierarchy, the Company’s financial assets that were accounted for at fair value on a recurring basis as of March 31, 2025, and December 31, 2024, according to the valuation techniques the Company used to determine their fair values:

	Fair Value Measurement as of March 31, 2025
	Level 1		Level 2		Level 3		Total
Investment securities - mutual funds	$	785,100	$	-	$	-	$	785,100
Total	$	785,100	$	-	$	-	$	785,100

	Fair Value Measurement as of December 31, 2024
	Level 1		Level 2		Level 3		Total
Investment securities - mutual funds	$	1,985,000	$	-	$	-	$	1,985,000
Total	$	1,985,000	$	-	$	-	$	1,985,000

Investments in marketable securities by security type as of March 31, 2025, and December 31, 2024, consisted of the following:

As of March 31, 2025:

Cost

Fair Value

Unrealized

Holding Gain

Mutual funds

773,800

785,100

11,300

Total

773,800

785,100

11,300

As of December 31, 2024:

Cost

Fair Value

Unrealized

Holding Gain

Mutual funds

1,729,000

1,985,000

256,000

Total

1,729,000

1,985,000

256,000

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4. Inventories

	As of March 31, 2025		As of December 31, 2024
Raw materials	$	3,112,400	$	3,015,700
Work-in-process		99,600		28,500
Finished goods		1,684,900		1,551,200
Total Inventories	$	4,896,900	$	4,595,400

Inventories - Current Asset	$	4,354,000	$	4,085,900
Inventories - Noncurrent Asset	$	542,900	$	509,500

5. Goodwill and Finite Lived Intangible Assets

Goodwill represents the excess of the purchase price over the fair value of the net assets acquired in connection with the Company’s acquisitions. Goodwill amounted to $115,300 as of March 31, 2025, and December 31, 2024, all of which is expected to be deductible for tax purposes.

Finite lived intangible assets are as follows:

As of March 31, 2025	Useful Lives	Cost		Accumulated Amortization		Net
Technology, trademarks	3--10 yrs.	$	1,216,800	$	1,057,400	$	159,400
Trade names	3--6 yrs.		592,300		436,100		156,200
Websites	3--7 yrs.		210,000		210,000		-
Customer relationships	4--10 yrs.		372,200		228,100		144,100
Sublicense agreements	10 yrs.		294,000		294,000		-
Non-compete agreements	4--5 yrs.		1,060,500		1,042,100		18,400
Patents	5--7 yrs.		605,600		457,400		148,200
		$	4,351,400	$	3,725,100	$	626,300

As of December 31, 2024	Useful Lives	Cost		Accumulated Amortization		Net
Technology, trademarks	3--10 yrs.	$	1,216,800	$	1,020,100	$	196,700
Trade names	3--6 yrs.		592,300		417,300		175,000
Websites	3--7 yrs.		210,000		210,000		-
Customer relationships	4--10 yrs.		372,200		221,200		151,000
Sublicense agreements	10 yrs.		294,000		294,000		-
Non-compete agreements	4--5 yrs.		1,060,500		993,200		67,300
Patents	5--7 yrs.		605,600		443,300		162,300
		$	4,351,400	$	3,599,100	$	752,300

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Total amortization expense was $126,000 and $127,000 for the three months ended March 31, 2025, and March 31, 2024, respectively.

Estimated future fiscal year amortization expense of intangible assets as of March 31, 2025, is as follows:

As of March 31, 2025	Amount
Remainder of year ending 2025	$	259,200
2026		195,900
2027		97,900
2028		43,700
2029		28,300
Thereafter		1,300
Total	$	626,300

6. Commitment and Contingencies

Legal Matters

During the normal course of business, the Company may be named from time to time as a party to claims and litigations arising in the ordinary course of business. When the Company becomes aware of potential litigation, it evaluates the merits of the case in accordance with ASC 450, Contingencies. Litigation and contingency accruals are based on our assessment, including advice of legal counsel, regarding the expected outcome of litigation or other dispute resolution proceedings. If the Company determines that an unfavorable outcome is probable and can be reasonably assessed, it establishes the necessary accruals. As of March 31, 2025 and December 31, 2024, the Company is not aware of any contingent legal liabilities that should be reflected in the consolidated financial statements.

Leases

The Company’s approximate future minimum rental payments under all operating leases as of March 31, 2025, were as follows:

As of March 31, 2025:	Amount
Remainder of fiscal year ending 2025	$	282,100
2026		289,900
2027		296,700
2028		201,000
Total future minimum payments	$	1,069,700
Less: Imputed interest		(83,000	)
Total Present Value of Operating Lease Liabilities	$	986,700

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7. Stockholders’ Equity

Issuance of Common Stock and Warrants

On January 17, 2024, the Company completed the last closing of its sale of securities pursuant to the Securities Purchase Agreement (the “2024 Purchase Agreement”) entered on December 13, 2023, as filed in the Company’s Form 8-K on December 15, 2023. At this closing, the Company sold an aggregate of 358,388 Units (“2024 Units”), comprising 358,388 shares of the Company’s common stock, par value $.05 per share (“Common Stock”) and warrants (“2024 Warrants”) to purchase 358,388 shares of Common Stock for a total consideration of $716,776. (the “2024 Offering”). The Company recognized $98,700 of issuance cost, which includes $71,100 attributable to legal and placement agent fees and $27,600 attributable to the fair value of warrants, issued to the placement agent, to purchase up to 17,919 shares of Common Stock at an exercise price of $2.00 per share on substantially the same terms as the 2024 Warrants issued to the purchasers of Units (“2024 Investors”).

As an incentive to certain 2024 Investors of the Company who participated in previous private placements (“Existing Investors”) and received as part of those financings, warrants (“Outstanding Warrants”) to purchase shares of Common Stock, the Company agreed that if any Existing Investor were to purchase 2024 Units at a certain level in the 2024 Offering, the Company would reduce the exercise price of the Outstanding Warrants held by such Existing Investor to $2.50 per share and extend the period in which such Outstanding Warrants could be exercised to the fifth anniversary of the date on which the Existing Investor purchased Units under the 2024 Purchase Agreement. Each Existing Investor purchasing Units at the requisite level received a new warrant (the “Replacement Warrants”) to replace such Existing Investor’s Outstanding Warrants. On January 17, 2024, as a result of their purchase of 2024 Units, Existing Investors became entitled to receive Replacement Warrants to replace 333,884 Outstanding Warrants, with each Replacement Warranting having a reduced exercise price of such Outstanding Warrants of $2.50 per share and exercisable until the fifth anniversary of the relevant closing under the 2024 Purchase Agreement.

Salary for Equity Incentive Options

On April 1, 2024 and May 17, 2024, as part of the Company’s strategic initiatives to reduce operating costs and conserve cash for operations, the Company offered a voluntary Salary/Compensation Waiver Program pursuant to which each director, officer and employee of the Company and its subsidiaries could elect to waive a portion of his or her salary/compensation for twelve months and receive instead options to purchase shares of Common Stock of the Company (the “stock options”). Under this program, the Company issued 10-year options to purchase 628,960 shares of Common Stock, each having an exercise price of $2.50 per share, vesting monthly over twelve months, valued at $948,200 on the grant date using the Black-Scholes-Merton option pricing model.

Equity Cancel and Replacement Options

On April 1, 2024, as part of the Company’s strategic initiatives to incentivize current employees, the Company entered into a cancellation and replacement agreement regarding certain out-of-the money outstanding employee stock options (the “replacement stock options”), whereby employees surrendered out-of-the-money outstanding stock options (“cancelled option awards") and the Company granted replacement stock options in the same number, having an exercise price of $2.50 per share, which replacement options vest monthly over three years from their date of issuance. The Company accounted for the issuance of these replacements options as a modification of the terms of the cancelled option awards and in accordance with ASC 718-20-35-2A the Company will recognize $613,400 stock compensation expense over the three-year vesting period, which was determined by the grant-date fair value of the original award for which the service is expected to be rendered at the cancellation date, plus incremental costs measured as the excess of the fair value of the replacement options on the grant date using the Black-Scholes-Merton option pricing model over the fair value of the cancelled option award at the cancellation date in accordance with ASC 718-20-35-3.

Board of Director Stock Options

On April 12, 2024, the Board of Directors of the Company (the “Board”) appointed Michael Blechman (“Mr. Blechman”) as (i) a Class B Director of the Company, (ii) a member of the Board’s audit committee, (iii) a member of the Board’s compensation committee, and (iv) the Chair and a member of the Company’s Nominating Committee. On May 17, 2024, in connection with such appointment, the Company granted and issued to Mr. Blechman stock options to purchase 25,000 shares of the Common Stock of the Company with an exercise price of $1.75 which vest monthly over three years, valued at $34,500 on the grant date using the Black-Scholes-Merton option pricing model.

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On July 1, 2024, the Company granted and issued stock options to purchase 10,000 shares of the Common Stock of the Company, to each of Christopher Cox, John Nicols, and Jurgen Schumacher, as part of their annual compensation for serving as independent directors of the Board. The stock options have a 10-year life, an exercise price of $1.29, will be 100% vested one year after the grant date, and were valued at $10,400 on the grant date using the Black-Scholes-Merton option pricing model.

On July 1, 2024, the Company granted and issued stock options to purchase 5,000 shares of the Common Stock of the Company, to each of Michael Blechman, Christopher Cox, and John Nicols, as part of their annual compensation serving as independent Committee Chairmen of the Company’s Board Committees. The stock options have a 10-year life, an exercise price of $1.29, will be 100% vested one year after the grant date, and were valued at $5,200 on the grant date using the Black-Scholes-Merton option pricing model.

8. Loss Per Common Share

The Company presents the computation of earnings per share (“EPS”) on a basic basis. Basic EPS is computed by dividing net income or loss by the weighted average number of shares outstanding during the reported period. Diluted EPS is computed similarly to basic EPS, except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential additional common shares that were dilutive had been issued. Common shares are excluded from the calculation if they are determined to be anti-dilutive. The following table sets forth the weighted average number of common shares outstanding for each period presented.

	For the three months ended March 31,
	2025			2024
Weighted average number of common shares outstanding		10,503,599			10,436,647
Effect of dilutive securities:		-			-
Weighted average number of common shares outstanding		10,503,599			10,436,647

Basic and Diluted loss per common share:	$	(0.16	)	$	(0.20	)

Approximately 1,831,447 and 8,232,510 shares of the Company’s common stock issuable upon the exercise of stock options and warrants, respectively, were excluded from the calculation because the effect would be anti-dilutive due to the loss for the three months ended March 31, 2025.

Approximately 1,113,837 and 7,856,203 shares of the Company’s common stock issuable upon the exercise of stock options and warrants, respectively, were excluded from the calculation because the effect would be anti-dilutive due to the loss for the three months ended March 31, 2024.

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9. Related Parties

Consulting Agreements

During the three months ended March 31, 2025, and March 31, 2024, respectively, the Company paid $24,000 and $16,000, respectively, to Mr. John Nicols, a Director of the Company, who provided consulting services to the Bioprocessing Systems segment.

10. Segment Information and Concentration

The Company views its operations as two operating segments: the manufacture and marketing of standard benchtop laboratory equipment for research in university, hospital and industrial laboratories sold primarily through laboratory equipment distributors and laboratory and pharmacy balances and scales (“Benchtop Laboratory Equipment Operations”), and the manufacture, design, and marketing of bioprocessing systems and products (“Bioprocessing Systems”). The Company also has included a non-operating Corporate segment. All inter-segment revenues are eliminated.

Three Months Ended March 31, 2025	Benchtop Laboratory Equipment		Bioprocessing Systems			Corporate and Other			Consolidated
Revenues	$	2,273,000	$	133,500		$	-		$	2,406,500
Foreign Sales		496,300		80,900			-			577,200
Income (Loss) From Operations		194,100		(1,492,500	)		(512,500	)		(1,810,900	)
Assets		3,390,100		3,692,400			3,487,600			10,570,100
Long-Lived Asset Expenditures		26,300		-			-			26,300
Depreciation and Amortization		19,300		147,400			-			166,700

Three Months Ended March 31, 2024	Benchtop Laboratory Equipment		Bioprocessing Systems			Corporate and Other			Consolidated
Revenues	$	2,167,400	$	316,100		$	-		$	2,483,500
Foreign Sales		655,100		200,500			-			855,600
Income (Loss) From Operations		72,800		(1,601,800	)		(560,500	)		(2,089,500	)
Assets		6,283,100		4,858,600			4,404,800			15,546,500
Long-Lived Asset Expenditures		45,800		1,700			-			47,500
Depreciation and Amortization		21,400		166,700			-			188,100

Segment information is reported as follows.

For the three months ending March 31, 2025, two customers accounted for approximately 10% or more of the Company’s total revenue. For the three months ending March 31, 2024, no customers accounted for approximately 10% or more of the Company’s total revenue.

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A reconciliation of the Company’s consolidated segment income (loss) from operations to consolidated loss from operations before income taxes and net loss for the three months ended March 31, 2025 and 2024, respectively are as follows:

Three Months Ended March 31, 2025	Benchtop Laboratory Equipment			Bioprocessing Systems			Corporate and Other			Consolidated
Income (Loss from Operations)	$	194,100		$	(1,492,500	)	$	(512,500	)	$	(1,810,900	)

Other (expense) income, net		(2,700	)		14,900			-			12,200
Interest income		20,200			-			-			20,200
Total other income, net		17,500			14,900			-			32,400

Income (Loss) from operations before operations and income taxes	$	226,900		$	(1,492,900	)	$	(512,500	)	$	(1,778,500	)

Three Months Ended March 31, 2024	Benchtop Laboratory Equipment			Bioprocessing Systems			Corporate and Other			Consolidated
Income (Loss from Operations)	$	72,800		$	(1,601,800	)	$	(560,500	)	$	(2,089,500	)

Other income (expense), net		(9,800	)		5,500			-			(4,300	)
Interest income		42,200			-			-			42,200
Total other income, net		32,400			5,500			-			37,900

Income (Loss) from operations before operations and income taxes	$	105,200		$	(1,596,300	)	$	(560,500	)	$	(2,051,600	)

11. Subsequent Events

On April 18, 2025, the Company entered into a Securities Purchase Agreement (the “2025 Purchase Agreement”) with certain investors (the “2025 Investors”) pursuant to which the Company sold in a private placement (the “Private Placement”), and the Investors purchased, an aggregate of 1,550,000 Units (the “2025 Units”), comprising (i) 1,050,000 shares of the Company’s Common Stock, pre-funded warrants (the “Pre-Funded Warrants”) to purchase 500,000 shares of Common Stock and (iii) warrants (“2025 Warrants”) to purchase 1,550,000 shares of Common Stock, for a total consideration of $1,550,000. The Company intends to use the net proceeds from the sale of the securities for operations, working capital and other general corporate purposes.

Each 2025 Warrant is exercisable for the purchase of one share of Common Stock at an exercise price of $1.00 per share. The 2025 Warrants are immediately exercisable and expire 6 months from their date of issuance. Certain of the 2025 Warrants are exercisable for Pre-funded Warrants to purchase shares of Common Stock in lieu of shares of Common Stock.

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

Forward-Looking statements. The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our audited financial statements and related notes included in our Annual Report on Form 10-K for the year ended December 31, 2024. Certain statements contained in this report are not based on historical facts, but are forward-looking statements that are based upon various assumptions about future conditions. Actual events in the future could differ materially from those described in the forward-looking statements. Numerous unknown factors and future events could cause such differences, including but not limited to, product demand, market acceptance, success of marketing strategy, success of expansion efforts, impact of competition, adverse economic conditions, and other factors affecting the Company’s business that are beyond the Company’s control, which are discussed elsewhere in this report. Consequently, no forward-looking statement can be guaranteed. The Company undertakes no obligation to publicly update forward-looking statements, whether as a result of new information, future events or otherwise. Throughout this Quarterly Report on Form 10-Q, the terms the “Company,” “Scientific,” “we,” “our” or “us,” refer to Scientific Industries, Inc. and its subsidiaries on a consolidated basis, unless stated or the context implies otherwise.

Overview.

Scientific Industries, Inc., a Delaware corporation (“SI” and along with its subsidiaries, the “Company”, “we”, “our”), is engaged in the design, manufacture, and marketing of standard benchtop laboratory equipment (“Benchtop Laboratory Equipment”), and through its wholly-owned subsidiary, Scientific Bioprocessing Holdings, Inc., a Delaware corporation (“SBHI”), the design, manufacture, and marketing of bioprocessing systems and products (“Bioprocessing Systems”). SBHI has two wholly-owned subsidiaries – Scientific Bioprocessing, Inc., a Delaware corporation (“SBI”), and aquila biolabs GmbH, a German corporation (“Aquila”). The Company’s products are used primarily for research purposes by universities, pharmaceutical companies, pharmacies, national laboratories, medical device manufacturers, and other industries performing laboratory-scale research. The Company’s results reflect those of the Benchtop Laboratory Equipment Operations and the Bioprocessing Systems Operations and its corporate operation.

Results of Operations.

The Company realized a loss from continuing operations before income tax expense of $1,778,500 for the three months ended March 31, 2025 compared to a $2,051,600 loss from continuing operations before income tax expense for the three months ended March 31, 2024, primarily due to cost cutting initiatives in the Bioprocessing Systems Operations segment which were initiated at the beginning of the second quarter of the fiscal year ended December 31, 2024 (“fiscal 2024”).

Revenue

Net revenues for the three months ended March 31, 2025 decreased $77,000 (3.1%) to $2,406,500 from $2,483,500 for the three months ended March 31, 2024, primarily due to a $182,600 decrease in the Bioprocessing Systems Operations revenues, which was offset by an increase of $105,600 in the Benchtop Laboratory Equipment Operations in both sales of Genie and Torbal divisions’ products.

Gross profit

The gross profit percentage for the three months ended March 31, 2025, and 2024, was 42.2% and 41.9%, respectively. The increase is due primarily to higher gross margin percentage in the Bioprocessing Systems Operations.

General and administrative

General and administrative expenses for the three months ended March 31, 2025, and 2024, were $1,251,300 and $1,521,800, respectively. The decrease of $270,500 (17.8%) is due primarily to decreased employee-related costs associated with a reduction in force in the Bioprocessing Systems Operations during the second quarter of fiscal 2024.

Selling

Selling expenses for the three months ended March 31, 2025 and 2024, were $924,200 and $897,800, respectively. The increase of $26,400 (2.9%) is due primarily to commissions incurred by the Laboratory Equipment Operations.

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Research and development

Research and development expenses for the three months ended March 31, 2025, and 2024, were $652,000 and $710,700, respectively. The decrease of $58,700 (8.3%) is due primarily to the reduction of research and development expenditures in the Bioprocessing Systems Operations.

Other income, net

Other income, net, for the three months ended March 31, 2025 and 2024, were $32,400 and $37,900, respectively. The decrease is due primarily to the decrease in interest income.

Income tax

Income tax for the three months ended March 31, 2025, and 2024, was $0 and $0, respectively. The Company maintains a full valuation allowance of $10,512,500 against its consolidated net deferred tax asset as the Company determined the net deferred tax assets, which includes net operating loss carry-forwards and other tax credits, are not more likely than not to be realized in the future.

Liquidity and Capital Resources.

Our primary sources of liquidity are existing cash and cash equivalents, and cash generated from operating activities of the Benchtop Laboratory Equipment Operations. We assess our liquidity in terms of our ability to generate cash to fund our short and long-term cash requirements. For the three months ending March 31, 2025, the Company generated negative cash flows from operations of $1,331,300 and has an accumulated deficit of $35,709,900 as of March 31, 2025. We believe that our operating cash flow derived primarily from the Benchtop Laboratory Operations, our cash and investment securities on hand, the availability of our line of credit and latest financing efforts are not sufficient to fund our cash requirements over the next twelve months. The accompanying unaudited condensed financial statements do not include any adjustments related to the recoverability and classification of asset amounts or the classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

The following table discloses our cash flows for the periods presented:

	For the three months ended March 31,
	2025			2024
Net cash used in operating activities	$	(1,331,100	)	$	(1,565,100	)
Net cash provided in investing activities		1,204,000			480,600
Net cash provided in financing activities		-			645,700
Effect of changes in foreign currency exchange rates		9,300			(5,600	)
Decrease in cash and cash equivalents		(117,800	)		(444,400	)

Net cash used in operating activities was $1,331,100 for the three months ended March 31, 2025 compared to $1,565,100 for the three months ended March 31, 2024. The net change of $234,000 is primarily due to a lower net loss in March 31, 2025.

Net cash provided by investing activities was $1,204,000 for the three months ended March 31, 2025 compared to $480,600 provided in the three months ended March 31, 2024. The net increase of $723,400 is primarily due to the net redemption of investment securities in the three months ended March 31, 2025.

Net cash provided by financing activities was zero for the three months ended March 31, 2025 compared to $645,700 for the three months ended March 31, 2024. The net change of $645,700, is primarily due to the issuance of common stock in the three months ended March 31, 2024.

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Critical Accounting Estimates

The preparation of financial statements and related disclosures in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”) requires us to make judgments, assumptions, and estimates that affect the amounts reported in the consolidated financial statements and accompanying notes. “Note 2-Summary of significant accounting policies” to the Consolidated Financial Statements in our Annual Report on Form 10-K for the year ended December 31, 2024 (“2024 Form 10-K”) describes the significant accounting policies and methods used in the preparation of the consolidated financial statements. Our critical accounting estimates are identified in Management’s Discussion and Analysis of Financial Condition and Results of Operations in Part II, Item 7 of our fiscal 2024 Form 10-K. Such accounting policies and estimates require significant judgments and assumptions to be used in the preparation of the consolidated financial statements, and actual results could differ from our assumptions and estimates, and such differences could be material.

ITEM 3. Quantitative and Qualitative Disclosures about Market Risk

We are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and are not required to provide the information otherwise required under this item.

ITEM 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

As of the end of the period covered by this report, our management, with the participation and supervision of our Chief Executive Officer and Chief Financial Officer, have evaluated the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934). In designing and evaluating our disclosure controls and procedures, we recognize that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives and that we are required to apply our judgment in evaluating the cost-benefit relationship of possible controls and procedures. Further, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, within the Company have been detected. Based on the evaluation of our disclosure controls and procedures and internal controls over financial reporting as of March 31, 2025, our Chief Executive Officer and our Chief Financial Officer concluded that our disclosure controls and procedures were effective. Our management has concluded that the condensed consolidated financial statements included in this Quarterly Report on Form 10-Q present fairly, in all material respects, the Company’s financial position, results of operations and cash flows for the periods disclosed in accordance with U.S. GAAP.

Changes in Internal Controls Over Financial Reporting

There were no changes in our internal control over financial reporting identified in connection with the evaluation required by Rule 13a-15(d) and 15d-15(d) of the Exchange Act that occurred during the three months ended March 31, 2025 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II – OTHER INFORMATION

ITEM 1. Legal Proceedings

None

ITEM 1A. Risk Factors

Not required for smaller reporting companies.

ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds

Refer to Current Report on Form 8-K filed with the SEC on April 22, 2025 as incorporated by reference for recent sales of unregistered securities.

ITEM 3. Defaults Upon Senior Securities

None

ITEM 4. Mine Safety Disclosures

Not applicable

ITEM 5. Other Information

None

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ITEM 6. Exhibits

Exhibit Number		Description of document
31.1		Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2		Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1		Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2		Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

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SIGNATURES

Pursuant to the requirements of Section13 or 15(d) of the Securities Exchange Act of 1934, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	SCIENTIFIC INDUSTRIES, INC. (Registrant)

Date: May 13, 2025	By:	/s/ Helena R. Santos
		Helena R. Santos
		President, Chief Executive Officer, and Treasurer

	SCIENTIFIC INDUSTRIES, INC. (Registrant)

Date: May 13, 2025	By:	/s/ Nicholas Lavacca
		Nicholas Lavacca
		Chief Financial Officer