U. S. SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM
For
the quarterly period ended
For the transition period from _________ to _________
Commission
File No.
(Exact name of registrant as specified in its charter)
(State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer I.D. No.) |
(Address of principal executive offices)
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 | ||
Indicate
by check mark whether the registrant (1) has filed all reports required to be filed by Sections 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.
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).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, 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 | ☐ |
| ☒ | 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 Exchange Act) Yes ☐ No
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date: as of November 14, 2025, shares of common stock, par value $ per share were issued and outstanding.
MY SIZE, INC.
INDEX TO QUARTERLY REPORT ON FORM 10-Q
FOR THE QUARTER ENDED SEPTEMBER 30, 2025
TABLE OF CONTENTS
| i |
PART I
FINANCIAL INFORMATION
Item 1. Financial Statements.
My Size, Inc. and Subsidiaries
Condensed Consolidated
Interim
Financial Statements
As of September 30, 2025
(unaudited)
U.S. Dollars in Thousands
| 1 |
MY SIZE, INC. AND ITS SUBSIDIARIES
Condensed Consolidated Interim Financial Statements as of September 30, 2025 (Unaudited)
Contents
| 2 |
MY SIZE, INC. AND ITS SUBSIDIARIES
Condensed Consolidated Interim Balance Sheets (Unaudited)
U.S. dollars in thousands (except share data and per share data)
| September 30, | December 31, | |||||||
| 2025 | 2024 | |||||||
| Assets | ||||||||
| Current Assets: | ||||||||
| Cash and cash equivalents | ||||||||
| Inventory | ||||||||
| Account receivables | ||||||||
| Other receivables and prepaid expenses | ||||||||
| Total current assets | ||||||||
| Long term deposits | ||||||||
| Property and equipment, net | ||||||||
| Operating right-of-use asset | ||||||||
| Intangible assets | ||||||||
| Goodwill | ||||||||
| Investment in marketable securities | ||||||||
| Other non-current asset | ||||||||
| Total non-current assets | ||||||||
| Total assets | ||||||||
| Liabilities and stockholders’ equity | ||||||||
| Current liabilities: | ||||||||
| Operating lease liability | ||||||||
| Short-term loans | ||||||||
| Trade payables | ||||||||
| Liabilities to related parties | ||||||||
| Seller payable | ||||||||
| Other payables | ||||||||
| Total current liabilities | ||||||||
| Long-term loans | ||||||||
| Operating lease liability | ||||||||
| Other Non-Current Liabilities | ||||||||
| Total non-current liabilities | ||||||||
| Commitments and contingencies | ||||||||
| Total liabilities | ||||||||
| Stockholders’ equity: | ||||||||
| Stock Capital - | ||||||||
| Common stock of $ par value - Authorized: shares; Issued and outstanding: and as of September 30, 2025 and December 31, 2024, respectively | ||||||||
| Additional paid-in capital | ||||||||
| Accumulated other comprehensive loss | ( | ) | ( | ) | ||||
| Accumulated deficit | ( | ) | ( | ) | ||||
| Total stockholders’ equity | ||||||||
| Total liabilities and stockholders’ equity | ||||||||
The accompanying notes are an integral part of the condensed consolidated interim financial statements.
| 3 |
MY SIZE, INC. AND ITS SUBSIDIARIES
Condensed Consolidated Interim Statements of Comprehensive Loss (Unaudited)
U.S. dollars in thousands (except share data and per share data)
| Nine-Months
Ended September 30, | Three-Months
Ended September 30, | |||||||||||||||
| 2025 | 2024 | 2025 | 2024 | |||||||||||||
| Revenues | ||||||||||||||||
| Cost of revenues | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Gross profit | ||||||||||||||||
| Operating expenses | ||||||||||||||||
| Research and development | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Sales and marketing | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| General and administrative | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Impairment of goodwill | ( | ) | ( | ) | ( | ) | ||||||||||
| Total operating expenses | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Operating loss | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Financial income (expenses), net | ( | ) | ||||||||||||||
| Loss before taxes | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Taxes on income | ||||||||||||||||
| Net loss | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Other comprehensive income (loss): | ||||||||||||||||
| Foreign currency translation differences | ( | ) | ( | ) | ( | ) | ||||||||||
| Total comprehensive loss | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Basic and diluted loss per share | ) | ) | ) | ) | ||||||||||||
| Basic and diluted weighted average number of shares outstanding | ||||||||||||||||
The accompanying notes are an integral part of the interim condensed consolidated financial statements.
| 4 |
MY SIZE, INC. AND ITS SUBSIDIARIES
Condensed Consolidated Interim Statements of Changes in Stockholders’ Equity (Unaudited)
U.S. dollars in thousands (except share data and per share data)
| Common stock | Additional paid-in | Accumulated other comprehensive | Accumulated | Total stockholders’ | ||||||||||||||||||||
| Number | Amount | capital | loss | deficit | equity | |||||||||||||||||||
| Balance as of January 1, 2025 | ( | ) | ( | ) | ||||||||||||||||||||
| Stock-based compensation related to options granted to employees and consultants | * | |||||||||||||||||||||||
| Issuance of shares pursuant to At The Market
Offering Agreement for - net of $ | ||||||||||||||||||||||||
| Investment in Shoe Size Me *** | * | |||||||||||||||||||||||
| Total comprehensive loss | - | ( | ) | ( | ) | ( | ) | |||||||||||||||||
| Balance as of September 30, 2025 | ( | ) | ( | ) | ||||||||||||||||||||
| (*) | |
| (**) | |
| (***) |
| Common stock | Additional paid-in | Accumulated other comprehensive | Accumulated | Total stockholders’ | ||||||||||||||||||||
| Number | Amount | capital | loss | deficit | equity | |||||||||||||||||||
| Balance as of January 1, 2024 | ( | ) | ( | ) | ||||||||||||||||||||
| Stock-based compensation related to options granted to employees and consultants | * | |||||||||||||||||||||||
| Issuance of shares post Business Combination | * | |||||||||||||||||||||||
| Effect of reverse stock split | * | |||||||||||||||||||||||
| Issuance of shares, net of issuance cost of $ | * | |||||||||||||||||||||||
| Exercise of shares in abeyance | * | |||||||||||||||||||||||
| Total comprehensive loss | - | ( | ) | ( | ) | ( | ) | |||||||||||||||||
| Balance as of September 30, 2024 | ( | ) | ( | ) | ||||||||||||||||||||
| (*) |
| Common stock | Additional paid-in | Accumulated other comprehensive | Accumulated | Total stockholders’ | ||||||||||||||||||||
| Number | Amount | capital | loss | deficit | equity | |||||||||||||||||||
| Balance as of July 1, 2025 | ( | ) | ( | ) | ||||||||||||||||||||
| Stock-based compensation related to options granted to employees and consultants | - | |||||||||||||||||||||||
| Issuance of shares pursuant to At The Market
Offering Agreement for - net of $ | ||||||||||||||||||||||||
| Investment Shoe Size Me | * | |||||||||||||||||||||||
| Total comprehensive loss | - | ( | ) | ( | ) | |||||||||||||||||||
| Balance as of September 30, 2025 | ( | ) | ( | ) | ||||||||||||||||||||
| (*) | |
| (**) | |
| (***) | See note 6 |
| Common stock | Additional paid-in | Accumulated other comprehensive | Accumulated | Total stockholders’ | ||||||||||||||||||||
| Number | Amount | capital | loss | deficit | equity | |||||||||||||||||||
| Balance as of July 1, 2024 | ( | ) | ( | ) | ||||||||||||||||||||
| Stock-based compensation related to options granted to employees and consultants | - | |||||||||||||||||||||||
| Exercise of shares in abeyance | * | |||||||||||||||||||||||
| Total comprehensive loss | - | ( | ) | ( | ) | ( | ) | |||||||||||||||||
| Balance as of September 30, 2024 | ( | ) | ( | ) | ||||||||||||||||||||
| (*) |
| 5 |
MY SIZE, INC. AND ITS SUBSIDIARIES
Condensed Consolidated Interim Statements of Cash Flows (Unaudited)
U.S. dollars in thousands
| Nine-Months Ended September 30, | ||||||||
| 2025 | 2024 | |||||||
| Cash flows from operating activities: | ||||||||
| Net loss | ( | ) | ( | ) | ||||
| Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
| Depreciation | ||||||||
| Loss on disposition of property and equipment | ||||||||
| Change in operating lease right-of-use asset | ||||||||
| Amortization of intangible assets | ||||||||
| Impairment of goodwill | ||||||||
| Change in liabilities to related parties | ( | ) | ( | ) | ||||
| Interest on long-term liabilities | ||||||||
| Interest paid | ( | ) | ( | ) | ||||
| Revaluation of investment in marketable securities | ( | ) | ( | ) | ||||
| Stock based compensation | ||||||||
| Change in inventory | ( | ) | ||||||
| Change in account receivable | ( | ) | ||||||
| Changes in operating lease liabilities | ( | ) | ( | ) | ||||
| Change in other receivables and prepaid expenses | ( | ) | ||||||
| Change in other non-current asset | ( | ) | ||||||
| Change in trade payables | ( | ) | ( | ) | ||||
| Change in other payables | ||||||||
| Change in Seller payable | ( | ) | ||||||
| Net cash used in operating activities | ( | ) | ( | ) | ||||
| Cash flows from investing activities: | ||||||||
| Purchase of Percentil | ( | ) | ||||||
| Purchase of ShoeSizeMe | ( | ) | ||||||
| Proceeds from investment in JV | ||||||||
| Purchase of Property, Equipment & Intangibles | ( | ) | ||||||
| Proceeds from short-term deposits | ||||||||
| Net cash (used) provided by investing activities | ( | ) | ||||||
| Cash flows from financing activities: | ||||||||
| Proceeds from issuance of shares, net of issuance costs | ||||||||
| Loans received | ||||||||
| Repayment of loans | ( | ) | ( | ) | ||||
| Net cash provided by financing activities | ||||||||
| Effect of exchange rate fluctuations on cash and cash equivalents | ( | ) | ( | ) | ||||
| Increase (decrease) in cash, cash equivalents and restricted cash | ( | ) | ||||||
| Cash, cash equivalents and restricted cash at the beginning of the period | ||||||||
| Cash, cash equivalents and restricted cash at the end of the period | ||||||||
| Noncash activities: | ||||||||
| Purchase of ShoeSizeMe - see note 6 | ||||||||
| Change in operating lease right-of-use asset and liability | ||||||||
The accompanying notes are an integral part of the interim condensed consolidated financial statements.
| 6 |
MY SIZE, INC. AND ITS SUBSIDIARIES
Notes to Condensed Consolidated Interim Financial Statements (Unaudited)
U.S. dollars in thousands (except share data and per share data)
Note 1 - General
| a. | My Size, Inc. (the “Company”) is developing unique measurement technologies based on algorithms with applications focused on the apparel e-commerce market. The technology is driven by proprietary algorithms, which are able to calculate and record measurements in a variety of novel ways.
Following the acquisitions of Naiz Fit Bespoke Technologies, S.L (“Naiz”) in October 2022 and ShoeSize.Me AG (“ShoeSizeMe”) in September 2025 (refer to note 6), the Company expanded its offering outreach and customer base. Following the acquisition of Orgad International Marketing Ltd. (“Orgad”) in February 2022, the Company also operates an omnichannel e-commerce platform.
Following the formation of a new subsidiary, New Percentil S.L. (“New Percentil”), and acquisition of a new business unit in May 2025 (see note 6), the Company also operates a resale platform that enables consumers to buy and sell primarily secondhand apparel.
The Company has nine subsidiaries. My Size Israel 2014 Ltd. (“My Size Israel”), Topspin Medical (Israel) Ltd., Orgad and Rotrade Ltd., are all incorporated in Israel, My Size LLC, is incorporated in the Russian Federation, there are two limited liability companies incorporated under the laws of Spain namely Naiz Fit and New Percentil, and ShoeSizeMe, which is incorporated in Switzerland. On July 21, 2025, the Company established Ten Peacks Ltd. (“Ten Peacks”), which is incorporated in Israel and is a wholly-owned subsidiary of My Size Israel, that focuses on marketing and distribution of global apparel and shoes brands in Israel. References to the Company include the subsidiaries unless the context indicates otherwise.
My Size, Inc., was incorporated and commenced operations in September 1999, as Topspin Medical Inc. (“Topspin”), a private company registered in the State of Delaware. In December 2013, the Company changed its name to Knowledgetree Ventures Inc. Subsequently, in February 2014, the Company changed its name to My Size, Inc. Topspin was engaged, through its Israeli subsidiary, in research and development in the field of cardiology and urology.
On July 25, 2016, the Company’s common stock began publicly trading on the Nasdaq Capital Market under the symbol “MYSZ”.
On May 9, 2025, a newly-formed, wholly-owned subsidiary of the Company, New Percentil entered into a production unit transfer agreement with Casi Nuevo Kids, S.L., a limited liability company incorporated under the laws of Spain (“Casi Nuevo”), pursuant to which New Percentil acquired (the “Acquisition”) a production unit of Casi Nuevo with a trade name of Percentil that was judicially awarded to the Company in April 2025 within the framework of insolvency proceedings of Casi Nuevo filed with Commercial Court No. 13 of Madrid (Spain). The Acquisition was completed on May 9, 2025.
The
Company paid a total transaction value of €
On September 8, 2025, the Company entered into a Share Sale and Purchase Agreement (the “Purchase Agreement”) with certain shareholders of ShoeSizeMe (the “Sellers”), who were the holders of % of the share capital of ShoeSizeMe, pursuant to which the Sellers sold to the Company all of the issued and outstanding shares of ShoeSizeMe. The acquisition of ShoeSizeMe closed on the same day. In consideration for the purchase of the shares of ShoeSizeMe and in accordance with the Purchase Agreement, the Company (i) paid a cash payment of $ and (ii) issued shares of the Company’s common stock. The fair value of the shares for the purchase price allocation was determined using the closing price on September 8, 2025 at $. In addition, pursuant to the Purchase Agreement, the Company issued to a key employee of ShoeSizeMe a warrant to purchase up to shares of the Company’s common stock. See note 4. In connection with the acquisition of ShoeSizeMe, certain major shareholders of ShoeSizeMe entered into (i) a voting agreement with the Company and (ii) customary six-month lock up agreements with the Company. |
| 7 |
MY SIZE, INC. AND ITS SUBSIDIARIES
Notes to Condensed Consolidated Interim Financial Statements (Unaudited)
U.S. dollars in thousands (except share data and per share data)
Note 1 - General (Cont.)
| b. | Since
inception, the Company has incurred significant losses and negative cash flows from operations
and has an accumulated deficit of $
The Company has financed its operations mainly through fundraising from various investors.
The Company’s management expects that the Company will continue to generate losses and negative cash flows from operations for the foreseeable future. Based on the projected cash flows and cash balances as of the date of these financial statements, management is of the opinion that there is an uncertainty that its existing cash will be sufficient to fund operations for a period of more than 12 months. As a result, there is substantial doubt about the Company’s ability to continue as a going concern.
Management’s
plans include the continued commercialization of the Company’s products and acquisition of technology, intellectual property
or businesses and securing sufficient financing through the sale of additional equity securities, debt or capital inflows from strategic
partnerships. Management is actively looking for additional technology and commercial opportunities that will increase the company’s
cashflow. The Company has sold additional securities for $
The financial statements include no adjustments for measurement or presentation of assets and liabilities, which may be required should the Company fail to operate as a going concern. | |
| c. | In October 2023, Israel was attacked by the Hamas terrorist organization and entered a state of war on several fronts. In June 2025, following escalating threats and intelligence reports of imminent attacks, Israel conducted preemptive strikes on military and nuclear infrastructure in Iran. Iran responded with drones and missiles attacks, some of which caused civilian casualties and infrastructure damage. After 12 days of hostilities, a ceasefire between Israel and Iran was reached in June 2025. As of October 9, 2025, Israel and Hamas entered into a ceasefire agreement calling for a permanent end of the war. However, there are no assurances that such agreements will hold. As a result, while the ceasefire marks a potential shift towards stability in the region, the situation remains volatile, and the risk of broader regional escalation involving additional actors persists. As of the date of these consolidated financial statements, conflict continues in parts of the region.
The security situation in Israel has had an immaterial effect on its operations and financial results so far. This is attributable to its offices in Spain which has become a hub for the Company’s sizing solutions business. The majority of Orgad’s inventory utilizes fulfillment by Amazon rather than fulfilling directly. Inventory is now maintained and orders are shipped from regional Amazon warehouses, thereby reducing exposure to inventory risk and contributing to operating efficiencies. | |
On February 24, 2022, Russia invaded Ukraine. The outbreak of hostilities between the two countries could result in more widespread conflict and could have a severe adverse effect on the region. Following Russia’s actions, various countries, issued broad-ranging economic sanctions against Russia. Such sanctions included, among other things, a prohibition on doing business with certain Russian companies, officials and oligarchs; a commitment by certain countries and the European Union to remove selected Russian banks from the Society for Worldwide Interbank Financial Telecommunications (SWIFT) electronic banking network that connects banks globally; and restrictive measures to prevent the Russian Central Bank from undermining the impact of the sanctions.
The Company shut down its operation in Russia and is expected to close down its subsidiary, My Size LLC, but due to technical reasons it is expected to occur in the near future. Therefore, the impact from the current situation is very limited. |
| 8 |
MY SIZE, INC. AND ITS SUBSIDIARIES
Notes to Condensed Consolidated Interim Financial Statements (Unaudited)
U.S. dollars in thousands (except share data and per share data)
Note 2 - Significant Accounting Policies
| a. | Unaudited condensed consolidated financial statements: | |
| The accompanying unaudited condensed consolidated interim financial statements included herein have been prepared by the Company in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and in accordance with the rules and regulations of the United States Securities and Exchange Commission (“SEC”). The unaudited condensed consolidated financial statements are comprised of the financial statements of the Company. In management’s opinion, the interim financial data presented includes all adjustments necessary for a fair presentation. All intercompany accounts and transactions have been eliminated. Operating results for the nine months ended September 30, 2025 not necessarily indicative of the results that may be expected for any future period or for the year ending December 31, 2025. | ||
| These unaudited condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and the notes thereto for the year ended December 31, 2024. |
| b. | Recently accounting standard that have not yet been adopted. | |
| In July 2025, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Updates (“ASU”) 2025-05 “Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets”. The ASU introduces a practical expedient for all entities when estimating expected credit losses for current accounts receivable and current contract assets arising from transactions accounted for under ASC 606. Under the practical expedient, when developing reasonable and supportable forecast as part of estimating expected credit losses, an entity may assume that current conditions as of the balance sheet date do not change for the remining life of the asset. The ASU is effective for annual reporting period beginning after December 15, 2025 and interim reporting within those annual reporting periods. Early adoption is permitted in both interim and annual reporting periods. The Company is evaluating the impact of ASU 2025-05 on its consolidated financial statements if it elects to apply the practical expedient. | ||
In September 2025, the FASB issued ASU 2025-07 “Derivatives Scope Refinements and Scope Clarification for Share-Based Noncash Consideration from a Customer in a Revenue Contract”. The ASU excludes from the derivative accounting certain non-exchange-traded contracts with contracts with underlyings that are based on operations or activities specific to one of the parties to the contract. Further, the ASU clarifies that an entity should apply the guidance in ASC 606 to a contract with share-based noncash consideration. The guidance in other Topics (such as ASC 815 or ASC 312) does not apply to such consideration unless and until the entity’s right to receive or retain the consideration is unconditional. The ASU is effective for annual periods beginning after December 15, 2026 and interim periods within those annual periods. Early adoption is permitted. The amendment can be applied either prospectively to new contracts entered into on or after the date of adoption or on a modified retrospective basis through cum. | ||
In September 2025, the FASB issued ASU 2025-06 “Targeted Improvements to the Accounting for Internal-Use Software”. The ASU removes all references to software development stages throughout ASU 350-40. Therefore, under the ASU, an entity will be required to start capitalizing software costs when management has authorized and committed to funding the software project, and it is probable that the project will be completed and the software will be used to perform the function intended (‘probable-to-complete’ recognition threshold). In applying the probable-to-complete recognition threshold, an entity is required to consider whether there is significant uncertainty associated with the development activities of the software. The ASU is effective for annual reporting periods beginning after December 15, 2027, and interim reporting periods within those annual periods. The ASU allows adoption either on a prospective basis, a modified prospective approach or a retrospective approach. | ||
| c. | Critical accounting estimates: | |
| ASC 350 requires goodwill to be tested for impairment at the reporting unit level at least annually, or between annual tests under certain circumstances, and written down when impaired. Goodwill is tested for impairment by comparing the fair value of the reporting unit with it carrying value. | ||
| An
impairment charge of $ |
| d. | Significant Accounting Policies: | |
| The significant accounting policies followed in the preparation of these unaudited interim condensed consolidated financial statements are identical to those applied in the preparation of the latest annual financial statements, except the following new policies which were adopted following the business combination (see note 6): | ||
| Revenue Recognition from resale platform | ||
| Revenue is recognized in accordance with FASB Accounting Standards Codification (“ASC”) Topic 606, Revenue from Contracts with Customers (“ASC 606”). Under ASC 606, revenue is recognized upon transfer of control of promised goods and services to customers in an amount that reflects the consideration the Company expects to receive for those goods and services. The Company generates the majority of its revenue from its marketplaces, which allows its buyers to browse and purchase resale items for apparel, shoes and accessories on behalf of sellers. The Company recognizes revenue through the following steps: (1) identification of the contract, or contracts, with the customer; (2) identification of the performance obligations in the contract; (3) determination of the transaction price; (4) allocation of the transaction price to the performance obligations in the contract; and (5) recognition of revenue when, or as, it satisfies a performance obligation. | ||
| Both buyers and sellers may be customers in the Company’s revenue arrangements. Sellers are the primary customer in a consignment arrangement while the buyer is the primary customer in a sale of Company-owned inventory, referred to as product sales. A contract with a customer exists in both cases when the end-customer purchases the goods obligating the Company to deliver the identified performance obligation(s). The Company requires authorization from a credit card or other payment method or verification of receipt of payment, before the products are shipped to buyers. |
| 9 |
MY SIZE, INC. AND ITS SUBSIDIARIES
Notes to Condensed Consolidated Interim Financial Statements (Unaudited)
U.S. dollars in thousands (except share data and per share data)
Note 2 - Significant Accounting Policies (Cont.)
| The Company generally receives payments from buyers before payments to the sellers are due. | ||
| Consignment Revenue | ||
| The Company generates consignment revenue primarily from the sale of secondhand apparel on behalf of sellers. The Company retains a percentage of the proceeds received as payment for its consignment service. The Company reports consignment revenue on net. Title to the consigned goods remain with the seller until transferred to the buyer, which occurs 90 days subsequent to purchase of the consigned goods and upon expiration of the allotted return period. The Company does not take title of consigned goods at any time except in certain cases where the consignment window of 90 days expires or returned goods become Company owned inventory and becomes product revenue. Consignment revenue is generally recognized upon purchase of the consigned good by the buyer as its performance obligation of providing consignment services to the consignor is satisfied at that point. Consignment revenue is also recognized upon purchase of the consigned good for which the consignment window has already expired and the Company has taken title to the consigned good. Consignment revenue is recognized gross of seller payouts but net of discounts, incentives and returns. Value added tax assessed by governmental authorities is excluded from revenue. |
Product Revenue
The Company recognizes product revenue on a gross basis as the Company acts as the principal in the transaction. Revenue is recognized at the time control of the asset is transferred to the customer, which is typically upon delivery and acceptance by the customer. The Company is the seller and not an agent due to inventory risk.
Shipping Fees
The Company charges shipping fees to buyers, which are included in revenue. All outbound shipping costs are accounted for in cost of revenue at the time revenue is recognized.
Returns
The Company generally has a 14-day return period, and possibly longer accordingly to regulations which may change from time to time, and recognizes a returns reserve based on historical experience, which is recorded in accrued and other current liabilities within the Company’s consolidated balance sheets and reduction of revenue within the Company’s consolidated statements of operations.
Inventory of resale platform.
Inventories, consisting of merchandise that the Company has purchased and to which the Company holds title, are accounted for using the specific identification method, and are valued at the lower of cost or net realizable value. The cost of inventory is equal to the cost of the merchandise paid to the seller and related inbound shipping costs. Inventory valuation requires the Company to make judgments based on currently available information about the likely method of disposition, such as through sales to individual customers or liquidations, and expected recoverable values of each disposition category. The Company records an inventory write-down based on the age of the inventory and historical experience of expected sell-through.
Seller Payable
Seller payable includes amounts owed to sellers upon the purchase of sellers’ goods by the Company. Amounts are initially provided as a credit to sellers. These credits may be applied towards purchases from the Company or redeemed for cash. Seller payables show up as seller payables in the consolidated balance sheet.
Cost of Revenue
Cost of consignment revenue consists of outbound shipping, outbound labor and packaging costs. Cost of product revenue mainly consists of the inventory cost, inbound shipping related to the sold merchandise, outbound shipping, outbound labor, packaging costs and inventory writedowns.
| 10 |
MY SIZE, INC. AND ITS SUBSIDIARIES
Notes to Condensed Consolidated Interim Financial Statements (Unaudited)
U.S. dollars in thousands (except share data and per share data)
Note 3 – Financial Instruments
The carrying amounts of cash and cash equivalents, restricted cash, accounts receivable, other receivables, trade payables, accounts payable and short and long term loans approximate their fair value due to the short-term maturities of such instruments.
The Company holds share certificates in My City Builders, Inc. (“MYCB”), formerly known as Diamante Minerals, Inc., a publicly traded company on the OTCQB.
Due to sales restrictions on the sale of the MYCB shares, the fair value of the shares was measured on the basis of the quoted market price for an otherwise identical unrestricted equity instrument of the same issuer that trades in a public market, adjusted to reflect the effect of the sales restrictions and is therefore, ranked as Level 2 assets.
| September 30, 2025 | ||||||||||||
| Fair value hierarchy | ||||||||||||
| Level 1 | Level 2 | Level 3 | ||||||||||
| Financial assets | ||||||||||||
| Investment in marketable securities (*) | ||||||||||||
| December 31, 2024 | ||||||||||||
| Fair value hierarchy | ||||||||||||
| Level 1 | Level 2 | Level 3 | ||||||||||
| Financial assets | ||||||||||||
| Investment in marketable securities (*) | ||||||||||||
| (*) |
| Nine months ended September 30, | ||||||||
| 2025 | 2024 | |||||||
| Stock-based compensation expense – Cost of revenues | ||||||||
| Stock-based compensation expense - Research and development | ||||||||
| Stock-based compensation expense - Sales and marketing | ||||||||
| Stock-based compensation expense - General and administrative | ||||||||
| Three months ended September 30, | ||||||||
| 2025 | 2024 | |||||||
| Stock-based compensation expense - Research and development | ||||||||
| Stock-based compensation expense - Sales and marketing | ||||||||
| Stock-based compensation expense - General and administrative | ||||||||
| 11 |
MY SIZE, INC. AND ITS SUBSIDIARIES
Notes to Condensed Consolidated Interim Financial Statements (Unaudited)
U.S. dollars in thousands (except share data and per share data)
Note 4 - Stock Based Compensation (Cont.)
Stock Option Plan for Employees:
The
total number of shares of common stock which may be granted to directors, officers and employees under the 2017 Equity Incentive Plan
(the “Plan”), is limited to shares. In addition, in September 2025, the Company’s stockholders approved an
amendment to the Plan to adopt an evergreen provision such that, beginning on January 1, 2026 and ending on and including January 1,
2029, the share reserve under the Plan will be automatically increased by a number of shares of the Company’s common stock equal
to the lesser of (A)
On February 14, 2024, the Compensation Committee of the Company granted restricted common stock awards under the Company’s 2017 Equity Incentive Plan to Ronen Luzon, Oren Elmaliah and Billy Pardo, pursuant to which they were issued restricted shares, restricted shares and restricted shares, respectively. The restricted shares shall vest in three equal installments on January 1, 2025, January 1, 2026 and January 1, 2027, conditioned upon continuous employment with the Company and subject to accelerated vesting upon a change in control of the Company. On the same day, the Company granted a total of restricted stock units (“RSUs”) to its directors that will vest on January 1, 2025 and five-years options to purchase up to shares of common stock to other employees of the Company at an exercise price of $ per share. The option vesting period is over three years in three equal portions from the vesting commencement date.
The compensation cost resulting from the grant is approximately $ and is expected to be recognized over a period of years.
The fair value of each option award is estimated on the date of grant using the Binomial option-pricing model that used the weighted average assumptions in the following table. The risk free rate for the expected term of the option is based on the U.S. Treasury yield curve in effect at the time of grant.
| 2024 Grants | ||||
| Dividend yield | % | |||
| Expected volatility | % | |||
| Risk-free interest | % | |||
| Contractual term | - | |||
| 2025 Repricing | ||||
| Dividend yield | % | |||
| Expected volatility | - | % | ||
| Risk-free interest | - | % | ||
| Contractual term | - | |||
There were no options, shares of restricted common stock or RSUs granted during the nine-month period September 30, 2025, compared to an aggregate of options, shares of restricted common stock and RSUs granted during the nine-month period ended September 30, 2024, under the Plan. options were exercised.
On
June 4, 2025, the compensation committee of the Company’s board of directors reduced the exercise price of outstanding options
granted under the Plan of certain employees, officers and directors of the Company for the purchase of an aggregate of shares
of common stock (with exercise prices ranging from $ to $ per share) to $ per share, which was the closing price for the
Company’s common stock on June 4, 2025 (the “Option Repricing”). options were exercised. In connection with the
Option Repricing, the Company accelerated the vesting options held by the Company’s former chief financial officer and the Company
recorded one-time expenses of $
The total stock option compensation expense for employees during the nine and three-month period ended September 30, 2025 and 2024 was $, $ and $, and $, respectively.
The total stock option compensation expense relating to the Orgad acquisition during the nine and three-month period ended September 30, 2025 and 2024 was $, $, $, and $ respectively.
Options issued to consultants:
In July 2023, the Company entered into a six month agreement (the “Consultant Agreement”) with a consultant (the “Consultant”) to provide services to the Company, including assisting the Company to promote, market and sell the Company’s technology to potential customers and make strategic introductions and inquiries with interested parties in the financial community. Pursuant to the Consultant Agreement and in partial consideration for such consulting services, the Company issued to the Consultant .
The issuance was approved by the Company’s board of directors in February 2024.
During the nine and three-month periods ended September 30, 2025 and 2024, the Company recorded $, $ and $, and $ respectively, as stock-based equity awards with respect to the Consultant.
| 12 |
MY SIZE, INC. AND ITS SUBSIDIARIES
Notes to Condensed Consolidated Interim Financial Statements (Unaudited)
U.S. dollars in thousands (except share data and per share data)
Note 4 - Stock Based Compensation (Cont.)
Warrant issued in connection with the acquisition of ShoeSizeMe
Pursuant
to the Purchase Agreement, the Company issued a key employee of ShoeSizeMe a warrant (the “Warrant”) to purchase up to
shares of the Company’s common stock (such shares of common stock underlying the Warrant, the “Warrant Shares”). The
Warrant provides for a tiered exercise structure, with (i)
The Warrant is subject to vesting upon satisfaction of certain service-based, financial performance and integration milestones, as follows:
●
Continuing Service Milestone:
●
Financial Result Milestone:
● Integration Milestone: The vesting of of the Warrant is contingent on the completion of the full integration (as determined by the Company at its reasonable discretion) of ShoeSizeMe into the Company’s wholly-owned subsidiary, Naiz Bespoke Technologies, S.L., by March 31, 2026.
The award was determined to be a share-based payment accounted for under ASC 718, as vesting is contingent upon the employee’s continued service and performance conditions. The grant-date fair value of the warrant was measured using an option-pricing model and a compensation expense is recognized over the vesting periods, based on management’s assessment of the likelihood of achieving the performance and integration conditions. The award is classified as equity, as it will be settled in a fixed number of shares with fixed exercise prices.
Note 5 - Contingencies and Commitments
| In
July 2024, the Company was served with a legal complaint filed by Shimon Shukron in the Magistrate’s Court in Herzliya (the
“Court”) for a monetary award in an amount of NIS |
Note 6 – Business Combination
Acquisition of Percentil
On May 9, 2025, a newly-formed, wholly-owned subsidiary of the Company, New Percentil, entered into a production unit transfer agreement with Casi Nuevo, pursuant to which New Percentil acquired a production unit of Casi Nuevo with a trade name of Percentil that was judicially awarded to the Company in April 2025 within the framework of insolvency proceedings of Casi Nuevo filed with Commercial Court No. 13 of Madrid (Spain). The Acquisition was completed on May 9, 2025.
The
results of operations of New Percentil have been included in the consolidated financial statements since the acquisition date of May
9 2025. New Percentil revenues included in the Company’s consolidated statement of operations from May 9, 2025 through September
30, 2025 were $
| (a) | Consideration transferred |
The
Company paid €
| (b) | Identifiable assets acquired and liabilities assumed |
Under the preliminary purchase price allocation, the Company allocated the purchase price to tangible and identified intangible assets acquired and liabilities assumed based on the preliminary estimates of their fair values, which were determined using generally accepted valuation techniques based on estimates and assumptions made by management at the time of the acquisition. Such estimates are subject to change during the measurement period which is not expected to exceed one year. The purchase price allocation was not finalized due to examination of the net working capital of New Percentil at the acquisition date. Any adjustments to the preliminary purchase price allocation identified during the measurement period will be recognized in the period in which the adjustments are determined.
| 13 |
MY SIZE, INC. AND ITS SUBSIDIARIES
Notes to Condensed Consolidated Interim Financial Statements (Unaudited)
U.S. dollars in thousands (except share data and per share data)
Note 6 – Business Combination (Cont.)
The following table summarizes the preliminary fair value of assets acquired and liabilities assumed as of the acquisition date:
| Thousands USD | ||||
| Inventory | ||||
| Fixed assets | ||||
| Technology** | ||||
| Goodwill | ||||
| Other payables | ( | ) | ||
| Sellers payables | ( | ) | ||
| Long-term payables | ( | ) | ||
| Total consideration paid | ||||
| * | The
estimated useful life of technology is |
| ** |
| (c) | Acquisition-related costs |
The Company did not incur any direct transaction costs during the nine month period ended September 30, 2025.
Acquisition of ShoeSizeMe
On
September 8, 2025, the company purchased
The
results of operations of ShoeSizeMe have been included in these consolidated financial statements since the acquisition date of September
8, 2025. ShoeSizeMe revenues included in the Company’s consolidated statement of operations from September 8 2025 through September
30, 2025 were $
| (a) | Consideration transferred |
In consideration for the purchase of the shares of ShoeSizeMe and in accordance with the Purchase Agreement, the Company (i) paid a cash payment of $ and (ii) issued shares of the Company’s common stock. The fair value of the shares for the purchase price allocation was determined using the closing price on September 8, 2025 at $.
| (b) | Identifiable assets acquired and liabilities assumed |
Under the preliminary purchase price allocation, the Company allocated the purchase price to tangible and identified intangible assets acquired and liabilities assumed based on the preliminary estimates of their fair values, which were determined using generally accepted valuation techniques based on estimates and assumptions made by management at the time of the acquisition. Such estimates are subject to change during the measurement period which is not expected to exceed one year. The purchase price allocation was not finalized duo to examination of the net working capital of Shoe Size Me at the acquisition date. Any adjustments to the preliminary purchase price allocation identified during the measurement period will be recognized in the period in which the adjustments are determined.
| 14 |
MY SIZE, INC. AND ITS SUBSIDIARIES
Notes to Condensed Consolidated Interim Financial Statements (Unaudited)
U.S. dollars in thousands (except share data and per share data)
Note 6 – Business Combination (Cont.)
The following table summarizes the preliminary fair value of assets acquired and liabilities assumed as of the acquisition date:
| Thousands USD | ||||
| Cash | ||||
| Account receivable | ||||
| Other receivable | ||||
| Technology* | ||||
| Client relationship** | ||||
| Goodwill*** | ||||
| Trade payables | ( | ) | ||
| Other payables | ( | ) | ||
| Deferred tax liability | ( | ) | ||
Deferred tax Asset | 146 | |||
| Loans | ( | ) | ||
| Total consideration paid | ||||
| * | |
| The technology was calculated using MEEM replacement cost and is ranked as Level 3 assets as there is no active market. | |
| ** | |
The Client relationship was calculated using MEEM replacement cost and is ranked as Level 3 assets as there is no active market. | |
| *** |
| (c) | Acquisition-related costs |
The
Company occurred $
Note 7 – Goodwill
As of June 30, 2025, the Company experienced a triggering event in the reporting period due to sustained decreases in the Company’s share price and a decline in actual and forecasted operating results, prompting impairment assessments of goodwill and long-lived assets including definite-lived intangibles.
The table below indicates changes in the most significant inputs to the Company’s impairment analysis on each testing date since its last annual test for the Fashion and equipment e-commerce platform segment.
| Discount rate | Terminal growth rate | Revenue growth rate | ||||||||||
| Testing dates | ||||||||||||
| December 31, 2024 | % | % | ||||||||||
| June 30, 2025 | % | % | ||||||||||
In
June 2025, the Company updated the forecasted future cash flows used in the impairment assessment, including revenues and margin to reflect
current conditions. Other changes in valuation assumptions included selection of lower revenue growth rates based upon an assessment
of current market conditions. As a result of this review, the Company did not identify an impairment to its definite-lived intangible
assets or other long-lived assets, but the Company recorded a $
This impairment charge was recorded within Impairment of goodwill, within the Consolidated Statement of Operations, and within the Fashion and equipment e-commerce platform segment for the Nine months ended September 30, 2025.
The aggregate carrying amounts of goodwill allocated to each reporting unit are as follows:
| September 30 | December 31 | |||||||
| 2025 | 2024 | |||||||
| Resale platform | ||||||||
| Fashion and equipment e-commerce platform | ||||||||
| SaaS Solutions | ||||||||
| 15 |
MY SIZE, INC. AND ITS SUBSIDIARIES
Notes to Condensed Consolidated Interim Financial Statements (Unaudited)
U.S. dollars in thousands (except share data and per share data)
Note 8 – Operating Segments
The
Company has the following
The Company operating segments are the same as its reportable segments.
The CODM reviews total operating expenses and consolidated net loss to assess performance, forecast future financial results, and allocate resources. In assessing the Company’s financial performance and making strategic decisions, the CODM regularly reviews segment operational loss and operating expenses by function. This includes a review of budget versus actual expenses and cost of goods, sales and marketing salaries, and other segment expenses. For the fashion and equipment e-commerce platform operating segment, the CODM also reviews gross profit and Amazon fees. For the SaaS Solutions operating segment, the CODM also reviews research and development expenses.
Revenue, costs of goods and other costs and expenses are generally directly attributed to the segments. These expenses include research and development-related expenses, costs of Amazon fees, cost of goods, and legal-related costs. Indirect costs are allocated to segments based on a reasonable allocation methodology, when such costs are significant to the performance measures of the operating segments. Indirect operating expenses, such as insurance, legal, and audit services, are mostly allocated based on revenues, most of which is allocated to the fashion and equipment e-commerce platform segment.
Information related to the operations of the Company’s reportable operating segments is set forth below:
Fashion and equipment e-commerce platform | SaaS Solutions | Resale Platform | Other | Total | ||||||||||||||||
| As of the nine months ended September 30, 2025 | ||||||||||||||||||||
| Revenues from external customers | ||||||||||||||||||||
| Cost of revenues | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||
| Research and development expenses | ( | ) | ( | ) | ||||||||||||||||
| Amazon fees | ( | ) | ( | ) | ||||||||||||||||
| Sales and marketing Salaries | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||
Impairment of goodwill | ( | ) | ( | ) | ||||||||||||||||
| Other Segment Items (*) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||
| Segment loss | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||
| Reconciliation of Profit or Loss | ||||||||||||||||||||
| Financial income, (expense) net | ||||||||||||||||||||
| Loss before income taxes | ( | ) | ||||||||||||||||||
| Significant non-cash items: | ||||||||||||||||||||
| Amortization | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||
| Share based payments | ( | ) | ( | ) | ( | ) | ||||||||||||||
| (*) |
Fashion and equipment e-commerce platform | SaaS Solutions | Resale Platform | Total | |||||||||||||
| As of the nine months ended September 30, 2025 | ||||||||||||||||
| Assets | ||||||||||||||||
| 16 |
MY SIZE, INC. AND ITS SUBSIDIARIES
Notes to Condensed Consolidated Interim Financial Statements (Unaudited)
U.S. dollars in thousands (except share data and per share data)
Note 8 – Operating Segments (Cont.)
Fashion and Equipment e-commerce platform | SaaS Solutions | Total | ||||||||||
| As of the nine months ended September 30, 2024 | ||||||||||||
| Revenues from external customers | ||||||||||||
| Cost of revenues | ( | ) | ( | ) | ( | ) | ||||||
| Research and development expenses | ( | ) | ( | ) | ||||||||
| Amazon fees | ( | ) | ( | ) | ||||||||
| Sales and marketing Salaries | ( | ) | ( | ) | ( | ) | ||||||
| Impairment of goodwill | ( | ) | ( | ) | ||||||||
| Other Segment Items (*) | ( | ) | ( | ) | ( | ) | ||||||
| Segment loss | ( | ) | ( | ) | ( | ) | ||||||
| Reconciliation of Profit or Loss | ||||||||||||
| Financial income, (expense) net | ||||||||||||
| Loss before income taxes | ( | ) | ||||||||||
| Significant non-cash items: | ||||||||||||
| Amortization | ( | ) | ( | ) | ( | ) | ||||||
| Share based payments | ( | ) | ( | ) | ( | ) | ||||||
| (*) |
Fashion and equipment e-commerce platform | SaaS Solutions | Resale Platform | Other | Total | ||||||||||||||||
| As of the three months ended September 30, 2025 | ||||||||||||||||||||
| Revenues from external customers | ||||||||||||||||||||
| Cost of revenues | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||
| Research and development expenses | ( | ) | ( | ) | ||||||||||||||||
| Amazon fees | ( | ) | ( | ) | ||||||||||||||||
| Sales and marketing Salaries | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||
| Other Segment Items (*) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||
| Segment loss | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||
| Reconciliation of Profit or Loss | ||||||||||||||||||||
| Financial income, (expense) net | ||||||||||||||||||||
| Loss before income taxes | ( | ) | ||||||||||||||||||
| Significant non-cash items: | ||||||||||||||||||||
| Amortization | ( | ) | ( | ) | ( | ) | ||||||||||||||
| Share based payments | ( | ) | ( | ) | ( | ) | ||||||||||||||
| (*) |
| 17 |
MY SIZE, INC. AND ITS SUBSIDIARIES
Notes to Condensed Consolidated Interim Financial Statements (Unaudited)
U.S. dollars in thousands (except share data and per share data)
Note 8 – Operating Segments (Cont.)
Fashion and Equipment e-commerce platform | SaaS Solutions | Total | ||||||||||
| As of the three months ended September 30, 2024 | ||||||||||||
| Revenues from external customers | ||||||||||||
| Cost of revenues | ( | ) | ( | ) | ( | ) | ||||||
| Research and development expenses | ( | ) | ( | ) | ||||||||
| Amazon fees | ( | ) | ( | ) | ||||||||
| Sales and marketing Salaries | ( | ) | ( | ) | ( | ) | ||||||
| Impairment of goodwill | ( | ) | ( | ) | ||||||||
| Other Segment Items (*) | ( | ) | ( | ) | ( | ) | ||||||
| Segment loss | ( | ) | ( | ) | ( | ) | ||||||
| Reconciliation of Profit or Loss | ||||||||||||
| Financial income, (expense) net | ||||||||||||
| Loss before income taxes | ( | ) | ||||||||||
| Significant non-cash items: | ||||||||||||
| Amortization | ( | ) | ( | ) | ( | ) | ||||||
| Share based payments | ( | ) | ( | ) | ( | ) | ||||||
Fashion and equipment e-commerce platform | Saas Solution | |||||||
| As of December 31, 2024 | ||||||||
| Assets | ||||||||
Note 9 – Significant events during the reporting period.
On
January 21, 2025, the Company entered into an At The Market Offering Agreement (the “Offering Agreement”), with H.C.
Wainwright & Co., LLC (“Wainwright”), pursuant to which the Company may offer and sell, from time to time through
Wainwright shares of the Company’s common stock having an aggregate offering price of up to $
| 18 |
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations .
The following discussion and analysis provides information that we believe to be relevant to an assessment and understanding of our results of operations and financial condition for the periods described. This discussion should be read together with our condensed consolidated interim financial statements and the notes to the financial statements, which are included in this Quarterly Report on Form 10-Q. This information should also be read in conjunction with the information contained in our Annual Report on Form 10-K for the year ended December 31, 2024, filed with the Securities and Exchange Commission, or the SEC on March 27, 2025, or the Annual Report, including the consolidated annual financial statements as of December 31, 2024 and their accompanying notes included therein.
This Quarterly Report on Form 10-Q contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, or the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended or the Exchange Act. Any statements in this Quarterly Report on Form 10-Q about our expectations, beliefs, plans, objectives, assumptions or future events or performance are not historical facts and are forward-looking statements. These statements are often, but not always, made through the use of words or phrases such as “believe,” “will,” “expect,” “anticipate,” “estimate,” “intend,” “plan” and “would.” For example, statements concerning financial condition, possible or assumed future results of operations, growth opportunities, industry ranking, plans and objectives of management, markets for our common stock and future management and organizational structure are all forward-looking statements. Forward-looking statements are not guarantees of performance. They involve known and unknown risks, uncertainties and assumptions that may cause actual results, levels of activity, performance or achievements to differ materially from any results, levels of activity, performance or achievements expressed or implied by any forward-looking statement.
Any forward-looking statements are qualified in their entirety by reference to the risk factors discussed throughout this Quarterly Report on Form 10-Q. Some of the risks, uncertainties and assumptions that could cause actual results to differ materially from estimates or projections contained in the forward-looking statements include but are not limited to:
| ● | our history of losses and needs for additional capital to fund our operations and our inability to obtain additional capital on acceptable terms, or at all; | |
| ● | risks related to our ability to continue as a going concern; | |
| ● | the new and unproven nature of the measurement technology markets; | |
| ● | our ability to achieve customer adoption of our products; | |
| ● | our ability to realize the benefits of our acquisitions of Orgad, Naiz and New Percentil; | |
| ● | our dependence on assets we purchased from a related party; | |
| ● | our ability to enhance our brand and increase market awareness; | |
| ● | our ability to introduce new products and continually enhance our product offerings; | |
| ● | the success of our strategic relationships with third parties; | |
| ● | information technology system failures or breaches of our network security; | |
| ● | competition from competitors; | |
| ● | our reliance on key members of our management team; | |
| ● | current or future litigation; | |
| ● | current or future unfavorable economic and market conditions and adverse developments with respect to financial institutions and associated liquidity risk | |
| ● | changes in tariffs, trade barriers, price and exchange controls and other regulatory requirements and the impact of such policies on us, our customers and suppliers, and the global economic environment; and | |
| ● | the impact of the political and security situation in Israel on our business. |
| 19 |
The foregoing list sets forth some, but not all, of the factors that could affect our ability to achieve results described in any forward-looking statements. You should read this Quarterly Report on Form 10-Q and the documents that we reference herein and have filed as exhibits to the Quarterly Report on Form 10-Q completely and with the understanding that our actual future results may be materially different from what we expect. You should assume that the information appearing in this Quarterly Report on Form 10-Q is accurate as of the date hereof. Because the risk factors referred to on page 18 of our Annual Report, could cause actual results or outcomes to differ materially from those expressed in any forward-looking statements made by us or on our behalf, you should not place undue reliance on any forward-looking statements. Further, any forward-looking statement speaks only as of the date on which it is made, and we undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events. New factors emerge from time to time, and it is not possible for us to predict which factors will arise. In addition, we cannot assess the impact of each factor on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. We qualify all of the information presented in this Quarterly Report on Form 10-Q, and particularly our forward-looking statements, by these cautionary statements.
Unless the context otherwise requires, all references to “we,” “us,” “our” or “the Company” in this Quarterly Report on Form 10-Q are to MySize, Inc., a Delaware corporation, and its subsidiaries, including MySize Israel 2014 Ltd. My Size LLC, Orgad International Marketing Ltd., or Orgad, and Naiz Bespoke Technologies, S.L, or Naiz Fit, New Percentil, S.L., or New Percentil, Rotrade Ltd., ShoeSize.Me AG (“ShoeSizeMe”) and Ten Peacks Ltd. taken as a whole.
References to “U.S. dollars” and “$” are to currency of the United States of America, and references to “NIS” are to New Israeli Shekels. Unless otherwise indicated, U.S. dollar translations of NIS amounts presented in this Quarterly Report on Form 10-Q for nine months ended on September 30, 2025 are translated using the rate of NIS 3.306 to $1.00.
All information in this Quarterly Report on Form 10-Q relating to shares or price per share reflects the 1-for-8 reverse stock split effected by us on April 19, 2024 with the shares beginning trading on a post-split basis on the Nasdaq Capital Market on April 23, 2024.
Overview
We are an omnichannel e-commerce platform and provider of AI-driven SaaS measurement solutions and our recently acquired subsidiaries, Naiz Fit, which provides SaaS technology solutions that solve size and fit issues and AI solutions for smarter design through data driven decisions for fashion ecommerce companies, and Orgad, an online retailer operating in the global markets. To date, we have generated almost all our revenue as a third-party seller on Amazon. Our advanced software and solutions assists us in supply chain, identifying products that can drive growth and provides a user-friendly experience and best customer service.
| 20 |
We are currently focused on driving the commercialization of the Naiz Fit technology which, enables shoppers to generate highly accurate measurements of their body to find the accurate fitting apparel by using our Naiz Fit Widget, a simple questionnaire which uses a database collected over the years and allows buyers to know what size to pick when buying online, reducing returns and increasing conversion rates of sellers.
Naiz Fit syncs the user’s measurement data to a sizing model generated with our proprietary Garment Modelling technology for each item sold on the ecommerce, and only presents items for purchase that match their measurements to ensure a correct fit.
We are positioning ourselves as a consolidator of sizing solutions and new digital experience due to new developments for the fashion industry needs. Our other product offerings include First Look Smart Mirror for physical stores and Smart Catalog to empower brand design teams, which are designed to increase end consumer satisfaction, contributing to a sustainable world and reduce operation costs. We also recently launched True Feedback, a Go-To-market solution that extracts data from our Naiz Community mystery shoppers to fine-tune the customer experience offered to fashion buyers, both online and offline.
ShoeSizeMe
On September 8, 2025, we entered into a Share Sale and Purchase Agreement, or the Purchase Agreement, with certain sellers, or the Sellers, who were the holders of 100% of the share capital of ShoeSize.Me, a Swiss SaaS company specializing in AI-powered footwear sizing and fit solutions, or ShoeSizeMe, pursuant to which the Sellers agreed to sell to us all of the issued and outstanding shares of ShoeSizseMe. The transaction closed on the same day, or the Closing Date.
In consideration for the purchase of the shares of ShoeSizeMe and in accordance with the Purchase Agreement, the Sellers received (i) a cash payment of $150,000 and (ii) 241,093 shares of our common stock (having an aggregate value of $290,000, determined by dividing $290,000 by the average closing price of our common stock during the seven trading days immediately preceding the Closing Date.
New Percentil
On May 9, 2025, our newly-formed, wholly-owned subsidiary, New Percentil, a limited liability company incorporated under the laws of Spain, or New Percentil, entered into a production unit transfer agreement, or the Production Transfer Agreement, with Casi Nuevo Kids, S.L., a limited liability company incorporated under the laws of Spain, or Casi Nuevo, pursuant to which New Percentil acquired, or the Acquisition, a production unit of Casi Nuevo with a trade name of Percentil, or the Production Unit or Percentil, that was judicially awarded to us in April 2025 within the framework of insolvency proceedings of Casi Nuevo filed with Commercial Court No. 13 of Madrid (Spain). The Acquisition was completed on May 9, 2025.
Pursuant to the Production Transfer Agreement, New Percentil acquired the Production Unit, which consists of warehouse infrastructure and equipment, including Percentil’s central warehouse, process and logistics equipment, including Percentil’s proprietary quality control and picking systems, AI-powered pricing engine and proprietary garment assessment tools and processes, computer and electronic equipment, including photographic equipment and content production, equipment for garments and product presentation, supplies and support equipment, inventory and other equipment and tools. In addition, pursuant to the Production Transfer Agreement, New Percentil was subrogated exclusively in the position of Casi Nuevo in the labor contracts of 17 former employees of Casi Nuevo, including its chief executive officer and chief marketing officer, who have transferred to New Percentil in connection with the Acquisition, or the Percentil Employees.
The total purchase price of the Acquisition was €610,806.81 (approximately $679,000), which consists of (i) €40,000 (approximately $45,000) paid by Naiz Fit, (ii) €358,196 (approximately $398,000) for the assumption of certain liabilities owed by Casi Nuevo to its customers, (iii) €48,000 (approximately $53,500) for the assumption of certain debt and social security payments related to the Percentil Employees, and (iv) €164,610 (approximately $183,000) for the assumption of accrued labor liabilities related to the Percentil Employees.
| 21 |
The Production Unit’s assets that were acquired by New Percentil in connection with the Acquisition were acquired free of liens, encumbrances, attachments or third party rights.
Macroeconomic and Geopolitical Environment
Because we operate globally, our business is subject to the effects of economic downturns or recessions in the regions in which we do business, volatility in foreign currency exchange rates relative to the U.S. dollar, inflation, changing interest rates, expanded trade control laws and regulations, imposition of new or higher tariffs and geopolitical conflicts.
In addition, U.S. President Trump has continued to make announcements regarding the imposition of new and higher U.S. tariffs on imports from many countries. In response, certain countries, as well as the European Union, have announced retaliatory tariffs on imports of U.S. goods and other countermeasures. We are continuing to monitor these actions, including any pauses, escalations, exemptions or removal of exemptions, with respect to the threatened or imposed tariffs, and will continue to assess their potential impact on our business either directly, such as on our hardware business, or due to downstream effects.
We also continuously monitor geopolitical conflicts around the world, including the ongoing conflict between Russia and Ukraine and conflicts in the Middle East, and assess their impact on our business. To date, these conflicts have not materially limited our ability to develop or support our products and have not had a material impact on our results of operations, financial condition, liquidity or cash flows.
While our business model provides some resilience against these factors, we will continue to monitor the direct and indirect impacts of these or similar circumstances on our business and financial results. For additional information on the potential impact of macroeconomic and geopolitical conditions on our business, see the “Risk Factors” section in our Annual Report.
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Results of Operations
The table below provides our results of operations for the periods indicated.
| Nine-Months Ended September 30, | Three-Months Ended September 30, | |||||||||||||||
| 2025 | 2024 | 2025 | 2024 | |||||||||||||
| Revenues | 6,057 | 6,802 | 2,572 | 1,839 | ||||||||||||
| Cost of revenues | (3,504 | ) | (3,831 | ) | (1,563 | ) | (1,048 | ) | ||||||||
| Gross profit | 2,553 | 2,971 | 1,009 | 791 | ||||||||||||
| Operating expenses | ||||||||||||||||
| Research and development | (355 | ) | (352 | ) | (131 | ) | (89 | ) | ||||||||
| Sales and marketing | (2,321 | ) | (2,670 | ) | (1,234 | ) | (737 | ) | ||||||||
| General and administrative | (2,735 | ) | (2,572 | ) | (1,000 | ) | (640 | ) | ||||||||
| Impairment of goodwill | (144 | ) | (631 | ) | - | (631 | ) | |||||||||
| Total operating expenses | (5,555 | ) | (6,225 | ) | (2,365 | ) | (2,097 | ) | ||||||||
| Operating loss | (3,002 | ) | (3,254 | ) | (1,356 | ) | (1,306 | ) | ||||||||
| Financial income (expenses), net | 157 | (26 | ) | 21 | 6 | |||||||||||
| Loss before taxes | (2,845 | ) | (3,280 | ) | (1,335 | ) | (1,300 | ) | ||||||||
| Taxes on income | - | - | - | - | ||||||||||||
| Net loss | (2,845 | ) | (3,280 | ) | (1,335 | ) | (1,300 | ) | ||||||||
| Other comprehensive income (loss): | ||||||||||||||||
| Foreign currency translation differences | (36 | ) | (125 | ) | 4 | (26 | ) | |||||||||
| Total comprehensive loss | (2,881 | ) | (3,405 | ) | (1,331 | ) | (1,326 | ) | ||||||||
| Basic and diluted loss per share | (1.00 | ) | (4.21 | ) | (0.40 | ) | (1.25 | ) | ||||||||
| Basic and diluted weighted average number of shares outstanding | 2,837,552 | 779,319 | 3,313,569 | 1,040,446 | ||||||||||||
Nine and Three Months Ended September 30, 2025 Compared to Nine and Three Months Ended September 30, 2024
Revenues
Our revenues for the nine months ended September 30, 2025 amounted to $6,057,000 compared to $6,802,000 for the nine months ended September 30, 2024. The decrease in the nine months ended September 30, 2025 from the corresponding period is primarily attributable to a decrease in Orgad sales.
Our revenues for the three months ended September 30, 2025 amounted to $2,572,000 compared to $1,839,000 for the three months ended September 30, 2024. The increase in the three months ended September 30, 2024 from the corresponding period is primarily attributable to the inclusion of New Percentil in the consolidated reporting as of September 30, 2025.
Cost of Revenues
Our cost of revenues for the nine months ended September 30, 2025 amounted to $3,504,000 compared to $3,831,000 for the nine months ended September 30, 2024. The decrease in comparison with the corresponding period was mainly due to transition to fulfillment by Amazon shipping and warehousing method.
Our cost of revenues expenses for the three months ended September 30, 2025 amounted to $1,563,000 compared to $1,048,000 for the three months ended September 30, 2024. The increase in comparison with the corresponding period was attributable to the inclusion of New Percentil and ShoeSizeMe in the consolidated reporting as of September 30, 2025.
Research and Development Expenses
Our research and development expenses for the nine months ended September 30, 2025 amounted to $355,000 compared to $352,000 for the nine months ended September 30, 2024. The increase from the corresponding period was mainly due to the annual salary increase of the retained employees in Naiz Fit and inclusion of New Percentil in the consolidated reporting as of September 30, 2025.
Our research and development expenses for the three months ended September 30, 2025 amounted to $131,000 compared to $89,000 for the three months ended September 30, 2024. The increase was mainly due to the annual salary increase of the retained employees in Naiz Fit and inclusion of New Percentil in the consolidated reporting as of September 30, 2025.
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Sales and Marketing Expenses
Our sales and marketing expenses for the nine months ended September 30, 2025 amounted to $2,321,000 compared to $2,670,000 for the nine months ended September 30, 2024. The decrease primarily resulted from a decrease in salary expenses due to reduced headcount, consultant expenses, travel and marketing expenses.
Our sales and marketing expenses for the three months ended September 30, 2025 amounted to $1,234,000 compared to $737,000 for the three months ended September 30, 2024. The increase primarily is attributable to the increased marketing effort of Naiz Fit for the three months period ended September 30, 2025 as well as the inclusion of New Percentil in the consolidated reporting as of September 30, 2025.
General and Administrative Expenses
Our general and administrative expenses for the nine months ended September 30, 2025 amounted to $2,735,000 compared to $2,572,000 for the nine months ended September 30, 2024. The increase primarily is attributable to the inclusion of New Percentil and ShoeSizeMe in the consolidated reporting as of September 30, 2025.
Our general and administrative expenses for the three months ended September 30, 2025 amounted to $1,000,000 compared to $640,000 for the three months ended September 30, 2024. The increase primarily is attributable to the inclusion of New Percentil and ShoesSizeMe in the consolidated reporting as of September 30, 2025.
Operating Loss
As a result of the foregoing, for the nine months ended September 30, 2025, our operating loss was $3,002,000, a decrease of $252,000, or 8% lower, compared to our operating loss for the nine months ended September 30, 2024 of $3,254,000.
As a result of the foregoing, for the three months ended September 30, 2025, our operating loss was $1,356,000, an increase of $50,000, or 4% higher, compared to our operating loss for the three months ended September 30, 2024 of $1,306,000.
Financial Income (Expenses), Net
Our financial income for the nine months ended September 30, 2025 was $157,000 compared to financial expenses of $26,000 for the nine months ended September 30, 2024.
Our financial income for the three months ended September 30, 2025 was $21,000 compared to financial income of $6,000 for the three months ended September 30, 2024.
Net Loss
As a result of the foregoing, our net loss for the nine months ended September 30, 2025 was $2,845,000, compared to net loss of $3,280,000 for the nine months ended September 30, 2024. The decrease in net loss was mainly due to the reasons mentioned above.
As a result of the foregoing, our net loss for the three months ended September 30, 2025 was $1,335,000 compared to net loss of $1,300,000 for the three months ended September 30, 2024. The increase in net loss was mainly due to the reasons mentioned above.
Liquidity and Capital Resources
Since our inception, we have funded our operations primarily through public and private offerings of debt and equity securities in the State of Israel and in the United States
As of September 30, 2025, we had cash, cash equivalents and restricted cash of $4,493,000 compared to $4,880,000 of cash, cash equivalents and restricted cash as of December 31, 2024. This decrease primarily resulted from offset by payments that were made to suppliers, resources that were deployed to grow our businesses and payments related to the New Percentil and ShoeSizeMe acquisition.
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In January 2025, we entered into an At The Market Offering Agreement, or the Offering Agreement with H.C. Wainwright & Co., LLC, as agent, or Wainwright, pursuant to which we may offer and sell, from time to time through Wainwright shares of our common stock having an aggregate offering price of up to $4.1 million. We agreed to pay Wainwright a commission at a fixed rate of 3.0% of the aggregate gross proceeds from each sale of the shares under the Offering Agreement. As of September 30, 2025, we sold 1,557,727 shares of common stock pursuant to the Offering Agreement for aggregate gross proceeds of approximately $3,096,000.
Cash used in operating activities amounted to $2,806,000 for the nine months ended September 30, 2025, compared to $2,523,000 for the nine months ended September 30, 2024. The increase in cash used in operating activity is derived mainly from the increase in inventory and customers, offsetting the decrease in net loss.
Net cash used by investing activities was $196,000 for the nine months ended September 30, 2025, compared to the $60,000 cash provided for the nine months ended September 30, 2024.
Net cash provided by financing activities was $2,710,000 for the nine months ended September 30, 2025, compared to $2,626,000 for the nine months ended September 30, 2024. The cash flow from financing activities for the nine months ended September 30, 2025 resulted from the issuance of shares during the period.
We expect that we will continue to generate losses and negative cash flows from operations for the foreseeable future. Based on the projected cash flows and cash balances as of September 30, 2025, we believe our existing cash will not be sufficient to fund operations for a period of more than 12 months. As a result, there is substantial doubt about our ability to continue as a going concern. We will need to raise additional capital, which may not be available on reasonable terms or at all. Additional capital would be used to accomplish the following:
| ● | finance our current operating expenses; | |
| ● | pursue growth opportunities; | |
| ● | hire and retain qualified management and key employees; | |
| ● | respond to competitive pressures; | |
| ● | comply with regulatory requirements; and | |
| ● | maintain compliance with applicable laws. |
Current conditions in the capital markets are such that traditional sources of capital may not be available to us when needed or may be available only on unfavorable terms. Our ability to raise additional capital, if needed, will depend on conditions in the capital markets, economic conditions, the security situation in Israel, and a number of other factors, many of which are outside our control, and on our financial performance. Accordingly, we cannot assure you that we will be able to successfully raise additional capital at all or on terms that are acceptable to us. If we cannot raise additional capital when needed, it may have a material adverse effect on our business, results of operations and financial condition.
To the extent that we raise additional capital through the sale of equity or convertible debt securities, the issuance of such securities could result in substantial dilution for our current stockholders. The terms of any securities issued by us in future capital-raising transactions may be more favorable to new investors, and may include preferences, superior voting rights and the issuance of warrants or other derivative securities, which may have a further dilutive effect on the holders of any of our securities then-outstanding. We may issue additional shares of our common stock or securities convertible into or exchangeable or exercisable for our common stock in connection with hiring or retaining personnel, option or warrant exercises, future acquisitions or future placements of our securities for capital-raising or other business purposes. The issuance of additional securities, whether equity or debt, by us, or the possibility of such issuance, may cause the market price of our common stock to decline and existing stockholders may not agree with our financing plans or the terms of such financings. In addition, we may incur substantial costs in pursuing future capital financing, including investment banking fees, legal fees, accounting fees, securities law compliance fees, printing and distribution expenses and other costs. We may also be required to recognize non-cash expenses in connection with certain securities we issue, such as convertible notes and warrants, which may adversely impact our financial condition. Furthermore, any additional debt or equity financing that we may need may not be available on terms favorable to us, or at all. If we are unable to obtain such additional financing on a timely basis, we may have to curtail our development activities and growth plans and/or be forced to sell assets, perhaps on unfavorable terms, or we may have to cease our operations, which would have a material adverse effect on our business, results of operations and financial condition.
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We have not entered into any transactions with unconsolidated entities in which we have financial guarantees, subordinated retained interests, derivative instruments or other contingent arrangements that expose us to material continuing risks, contingent liabilities or any other obligations under a variable interest in an unconsolidated entity that provides us with financing, liquidity, market risk or credit risk support.
Critical Accounting Estimates
Our management’s discussion and analysis of our financial condition and results of operations is based on our financial statements, which we have prepared in accordance with U.S. generally accepted accounting principles issued by the Financial Accounting Standards Board. The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported expenses during the reporting periods. Actual results may differ from these estimates under different assumptions or conditions.
Our significant accounting policies were revenue from contracts with customers which are more fully described in the notes to our financial statements included herein. We believe these accounting policies discussed below are critical to our financial results and to the understanding of our past and future performance, as these policies relate to the more significant areas involving management’s estimates and assumptions. We consider an accounting estimate to be critical if: (1) it requires us to make assumptions because information was not available at the time or it included matters that were highly uncertain at the time we were making our estimate; and (2) changes in the estimate could have a material impact on our financial condition or results of operations.
Item 3. Quantitative and Qualitative Disclosure About Market Risk.
Not required for a smaller reporting company.
Item 4. Controls and Procedures.
Disclosure Controls and Procedures
We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports under the Exchange Act, and the rules and regulations thereunder, is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and that such information is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate, to allow for timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management is required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.
As required by Rule 13a-15(b) under the Exchange Act, our management, under the supervision and with the participation of our principal executive officer and principal financial officer, has evaluated the effectiveness of the design and operation of our disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of September 30, 2025. Based upon such evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures as of September 30, 2025 were effective.
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Our Chief Executive Officer and Chief Financial Officer do not expect that our disclosure controls and procedures or our internal controls will prevent all error or fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints and the benefits of controls must be considered relative to their costs. Due to the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected.
Changes in Internal Controls
During the most recent fiscal quarter, no change has occurred in our internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
Part II – Other Information
Item 1. Legal Proceedings.
From time to time, we may become involved in various lawsuits and legal proceedings which arise in the ordinary course of business. However, litigation is subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harm our business.
Shimon Shukron
In July 2024, we were served with a legal complaint filed by Shimon Shukron in the Magistrate’s Court in Herzliya for a monetary award in an amount of NIS 1,895,345 (approximately $510,000). The plaintiff alleges that due to the fire that broke out at Orgad’s warehouse in January 2023, the fire spread to the plaintiff’s business and caused heavy damage to the structure and contents, inventory of the business and loss of profits. We filed our statement of defense in September 2024. At this preliminary stage, the plaintiff did not provide sufficient documents to support his claims regarding the extent of the alleged damage. Based on the Company’s legal advisors, we evaluate the chances of the claim to succeed for only a nominal sum of NIS 175,000 (approximately $53,000), at this stage.
Item 1A. Risk Factors.
Except as set forth below in this Item 1A and the Risk Factors included in our previous filings made with the SEC, there have been no material changes to our risk factors from those disclosed in “Part I. Item 1A. Risk Factors” in the Company’s Annual Report on Form 10-K filed with the SEC on March 27, 2025.
Our headquarters and some of our operations are located in Israel, and therefore, political, economic and military conditions in Israel may affect our operations and results.
Our headquarters and some of our operations are located in central Israel and our key employees, officers and directors are residents of Israel. Accordingly, political, economic and military conditions in Israel and the surrounding region may directly affect our business and operations. Since the establishment of the State of Israel in 1948, a number of armed conflicts have taken place between Israel and its neighboring Arab countries, Hamas (an Islamist terrorist militia and political group that controls the Gaza strip), Hezbollah (an Islamist terrorist militia and political group based in Lebanon) and other terrorist organizations active in the region. These conflicts have involved missile strikes, hostile infiltrations and terrorism against civilian targets in various parts of Israel, which have negatively affected business conditions in Israel.. Any hostilities involving Israel or the interruption or curtailment of trade within Israel or between Israel and its trading partners could adversely affect our operations and results of operations and could make it more difficult for us to raise capital.
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In October 2023, Hamas terrorists infiltrated Israel’s southern border from the Gaza Strip and conducted a series of attacks on civilian and military targets. Hamas also launched extensive rocket attacks on Israeli population and industrial centers located along Israel’s border with the Gaza Strip and in other areas within the State of Israel. These attacks resulted in extensive deaths, injuries and kidnapping of civilians and soldiers. Following the attack, Israel’s security cabinet declared war against Hamas and a military campaign against these terrorist organizations commenced in parallel to their continued rocket and terror attacks. In January 2025, Israel and Hamas entered into a ceasefire agreement, which remained in effect until March 18, 2025, when hostilities resumed. As of October 9, 2025, Israel and Hamas entered into a renewed ceasefire agreement calling for a permanent end of the war. However, there are no assurances that such as agreement will hold. While the conflict has created heightened security concerns, disruptions to business operations, and economic instability, the ceasefire may contribute to improved regional stability. However, the security situation remains fluid, and any renewed military actions, restrictions, or government-imposed measures could adversely affect our operations, supply chains, and financial condition.
Since the commencement of these events, there have been continued hostilities along Israel’s northern border with Lebanon (with the Hezbollah terror organization) and on other fronts from various extremist groups in region, such as the Houthis in Yemen and various rebel militia groups in Syria and Iraq. In October 2024, Israel began limited ground operations against Hezbollah in Lebanon, and in November 2024, a ceasefire was brokered between Israel and Hezbollah, but there are no guarantees as to whether the agreement will hold or whether further hostilities will resume.
In addition, in April 2024 and October 2024, Iran launched direct attacks on Israel involving hundreds of drones and missiles and has threatened to continue to attack Israel and is widely believed to be developing nuclear weapons. In June 2025, in light of continued nuclear threats and intelligence assessments indicating imminent attacks, Israel launched a preemptive strike directly targeting military and nuclear infrastructure inside Iran, aimed at disrupting Iran’s capacity to coordinate or launch further hostilities against Israel, as well as to degrade its nuclear program. In response, Iran launched multiple waves of drones and ballistic missiles at Israeli cities. While most of these attacks were intercepted, several caused civilian casualties and damage to infrastructure. While a ceasefire was reached between Israel and Iran in June 2025 after 12 days of hostilities, the situation remains volatile. A broader regional conflict involving additional state and non-state actors remains a significant risk. Iran is also believed to have a strong influence among extremist groups in the region, such as Hamas in Gaza, Hezbollah in Lebanon, the Houthi movement in Yemen and various rebel militia groups in Syria and Iraq. These situations may potentially escalate in the future to more violent events which may affect Israel and us..
As a result of the events of October 7, 2023, the Israeli government declared that the country was at war and the Israeli military began to call-up reservists for active duty. None of our full-time or part-time employees in Israel were called up for reserve service. Military service call ups that result in absences of personnel from us for an extended period of time may materially and adversely affect our business, prospects, financial condition and results of operations.
In addition, the political and security situation in Israel may result in parties with whom we have agreements involving performance in Israel claiming that they are not obligated to perform their commitments under those agreements pursuant to force majeure provisions in such agreements. Further, in the past, the State of Israel and Israeli companies have been subjected to economic boycotts. Several countries still restrict business with the State of Israel and with Israeli companies. These restrictive laws and policies may have an adverse impact on our operating results, financial condition or the expansion of our business. In addition, there have been increased efforts by countries, activists and organizations to cause companies and consumers to boycott Israeli goods and services and some of such efforts have been successful. Any hostilities involving Israel or the interruption or curtailment of trade between Israel and its trading partners could adversely affect our operations and results of operations. In recent years, the hostilities involved missile strikes against civilian targets in various parts of Israel, including areas in which our employees and some of our consultants are located, and negatively affected business conditions in Israel.
Since the war broke out on October 7, 2023, our operations have not been adversely affected by this situation, and we have not experienced disruptions to our business operations. In particular, most of our operations are in Spain. While the intensity and duration of the security situation in Israel has been difficult to predict, as were the economic implications on our business and operations and on Israel’s economy in general, the ceasefire marks a potential shift towards stability in the region. If sustained, this could reduce the risk of disruptions to our business and the Israeli economy in general. However, if the war is renewed or expands to other fronts, such as Lebanon, Syria and the West Bank, our operations may be harmed.
Our commercial insurance does not cover losses that may occur as a result of events associated with the security situation in the Middle East. Although the Israeli government currently covers the reinstatement value of direct damages that are caused by terrorist attacks or acts of war, we cannot assure you that this government coverage will be maintained. Any losses or damages incurred by us could have a material adverse effect on our business. Any armed conflicts or political instability in the region would likely negatively affect business conditions and could harm our results of operations.
The continued political instability and hostilities between Israel and its neighbors and any future armed conflict, terrorist activity or political instability in the region could adversely affect our operations in Israel and adversely affect the market price of our shares of common stock. In addition, several organizations and countries may restrict doing business with Israel and Israeli companies have been and are today subjected to economic boycotts. The interruption or curtailment of trade between Israel and its present trading partners could adversely affect our business, financial condition and results of operations.
Finally, political conditions within Israel may affect our operations. Israel has held five general elections between 2019 and 2022, and prior to October 2023, the Israeli government pursued extensive changes to Israel’s judicial system, which sparked extensive political debate and unrest. Actual or perceived political instability in Israel or any negative changes in the political environment, may individually or in the aggregate adversely affect the Israeli economy and, in turn, our business, financial condition, results of operations and growth prospects.
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Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
None.
Item 3. Defaults Upon Senior Securities.
None.
Item 4. Mine Safety Disclosures.
Not applicable.
Item 5. Other Information.
During
the quarter ended September 30, 2025, no director or officer of the Company
Item 6. Exhibits.
| * | Filed herewith |
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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.
| My Size, Inc. | ||
| Date: November 14, 2025 | By: | /s/ Ronen Luzon |
| Ronen Luzon | ||
Chief Executive Officer (Principal Executive Officer) | ||
| Date: November 14, 2025 | By: | /s/ Oren Elmaliah |
| Oren Elmaliah | ||
Chief Financial Officer (Principal Financial and Accounting Officer) | ||
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