UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark one)

x	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2026

¨	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number 001-39332

VERIFYME, INC.

(Exact Name of Registrant as Specified in Its Charter)

Nevada		23-3023677
(State or Other Jurisdiction of Incorporation or Organization)		(I.R.S. Employer Identification No.)

801 International Parkway, Fifth Floor Lake Mary, FL		32746
(Address of Principal Executive Offices)		(Zip Code)

(585) 736-9400
(Registrant’s Telephone Number, Including Area Code)

(Former Name, Former Address and Former Fiscal year, if Changed Since Last Report)

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

Title of each class

Trading Symbol(s)

Name of each exchange on which

Registered

Common Stock, par value $0.001 per share

VRME

The Nasdaq Capital Market

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

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

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

Large accelerated filer	¨	Accelerated filer	¨

Non-accelerated filer	x	Smaller reporting company	x

Emerging growth company	¨

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

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

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date: 13,119,065 shares of common stock outstanding at May 12, 2026.

PART I - FINANCIAL INFORMATION

ITEM 1.	Financial Statements	4
Consolidated Balance Sheets (Unaudited)		4
Consolidated Statements of Operations (Unaudited)		6
Consolidated Statements of Comprehensive Loss (Unaudited)		7
Consolidated Statements of Cash Flows (Unaudited)		8
Consolidated Statements of Stockholders' Equity (Unaudited)		10
Notes to Consolidated Financial Statements (Unaudited)		11
ITEM 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	24
ITEM 3.	Quantitative and Qualitative Disclosures about Market Risk	32
ITEM 4.	Controls and Procedures	32

PART II - OTHER INFORMATION
ITEM 1.	Legal Proceedings	33
ITEM 1A.	Risk Factors	33
ITEM 2.	Unregistered Sales of Equity Securities and Use of Proceeds	34
ITEM 3.	Defaults Upon Senior Securities	34
ITEM 4.	Mine Safety Disclosures	34
ITEM 5.	Other Information	34
ITEM 6.	Exhibits	35
SIGNATURES		36


	March 31, 2026		December 31, 2025
	(Unaudited)

ASSETS

CURRENT ASSETS
Cash and cash equivalents	$	3,519	$	4,353
Accounts receivable, net of allowance for credit loss reserve, $21 and $10 as of March 31, 2026 and December 31, 2025, respectively		818		857
Note receivable, net of allowance for credit loss reserve, $12 and $12 as of March 31, 2026 and December 31, 2025, respectively		1,988		1,988
Unbilled revenue		285		338
Prepaid expenses and other current assets		208		154
Inventory		31		37
TOTAL CURRENT ASSETS		6,849		7,727

PROPERTY AND EQUIPMENT, NET	$	16	$	20

INTANGIBLE ASSETS, NET		2,325		2,345

GOODWILL		2,926		2,926
TOTAL ASSETS	$	12,116	$	13,018

LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES
Accounts payable	$	532	$	745
Other accrued expense		457		530
Convertible note – related party, current		400		400
Convertible note, current		350		350
TOTAL CURRENT LIABILITIES		1,739		2,025

TOTAL LIABILITIES	$	1,739	$	2,025

STOCKHOLDERS' EQUITY
Series A Convertible Preferred Stock, $0.001 par value, 37,564,767 shares authorized; 0 shares issued and outstanding as of March 31, 2026 and December 31, 2025, respectively		-		-

Series B Convertible Preferred Stock, $0.001 par value; 85 shares authorized; 0.85 shares issued and outstanding as of March 31, 2026 and December 31, 2025, respectively		-		-

Common stock, $0.001 par value; 675,000,000 shares authorized; 13,581,242 and 13,553,049 shares issued, 13,119,065 and 13,071,601 shares outstanding as of March 31, 2026 and December 31, 2025, respectively		14			14

Additional paid in capital		102,096			102,059

Treasury stock at cost; 462,117 and 481,448 shares at March 31, 2026 and December 31, 2025, respectively		(476	)		(502	)

Accumulated deficit		(91,257	)		(90,578	)

STOCKHOLDERS' EQUITY		10,377			10,993

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	12,116		$	13,018


	Three Months Ended
	March 31, 2026			March 31, 2025

NET REVENUE	$	1,772		$	4,455

COST OF REVENUE		812			2,965

GROSS PROFIT		960			1,490

OPERATING EXPENSES
Management and Technology^(a)		570			926
General and administrative ^(a)		1,016			856
Research and development		-			5
Sales and marketing ^(a)		141			296
Total Operating expenses		1,727			2,083

LOSS BEFORE OTHER INCOME (EXPENSE)		(767	)		(593	)

OTHER INCOME (EXPENSE)
Interest income, net		88			22
TOTAL OTHER INCOME, NET		88			22

NET LOSS	$	(679	)	$	(571	)

LOSS PER SHARE
BASIC		(0.05	)		(0.05	)
DILUTED		(0.05	)		(0.05	)

WEIGHTED AVERAGE COMMON SHARE OUTSTANDING

BASIC		13,352,749			12,292,150
DILUTED		13,352,749			12,292,150

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Cash paid during the period for:
Interest	$	30	$	40
Income taxes	$	-	$	-

SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES
Lease modification	$	-	$	7
Conversion of convertible note and accrued interest	$	-	$	360
Change in fair value of interest rate, swap	$	-	$	12


	Series A				Series B
	Convertible				Convertible
	Preferred				Preferred				Common						Treasury
	Stock				Stock				Stock						Stock
													Additional								Accumulated Other
	Number of				Number of				Number of				Paid-In		Number of						Comprehensive			Accumulated
	Shares		Amount		Shares		Amount		Shares		Amount		Capital		Shares			Amount			Loss			Deficit			Total
Balance at December 31, 2024		-		-		0.85		-		10,539,441		11		96,344		290,467			(480	)		12			(85,673	)		10,214
Warrants exercise		-		-		-		-		1,461,896		2		4,346		-			-			-			-			4,348
Convertible note		-		-		-		-		313,520		-		285		(22,359	)		75			-			-			360
Restricted stock awards		-		-		-		-		-		-		55		-			-			-			-			55
Restricted stock units, net of shares withheld for employee tax		-		-		-		-		39,915		-		154		(16,988	)		54			-			-			208
Common stock issued for services		-		-		-		-		60,000		-		41		-			-			-			-			41
Accumulated other comprehensive loss		-		-		-		-		-		-		-		-			-			(12	)		-			(12	)
Net loss		-		-		-		-		-		-		-		-			-			-			(571	)		(571	)
Balance at March 31, 2025		-		-		0.85		-		12,414,772		13		101,225		251,120			(351	)		-			(86,244	)		14,643

Schedule of disaggregation of revenue
	Consolidated
Revenue	Three Months Ended March 31,
	2026		2025

Proactive services	$	1,040	$	3,694
Premium services		708		735
Other		24		26
	$	1,772	$	4,455

Schedule of contract assets from contracts with customers
	Contract Asset
	March 31,
	2026			2025
Beginning balance, January 1	$	338		$	733
Contract asset additions		285			641
Reclassification to accounts receivable, billed to customers		(338	)		(733	)
Ending balance, March 31 ⁽¹⁾	$	285		$	641

Schedule of intangible assets subject to amortization
March 31, 2026	Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount		Weighted Average Remaining Useful Life (Years)
Patents and Trademarks	$	699	$	(37	)	$	662		9
Developed Technology		795		(156	)		639		2
Internally Used Software		1,088		(64	)		1,024		5
Total Intangible Assets	$	2,582	$	(257	)	$	2,325
December 31, 2025
Patents and Trademarks	$	699	$	(18	)	$	681		9
Developed Technology		795		(78	)		717		2
Internally Used Software		979		(32	)		947		5
Total Intangible Assets	$	2,473	$	(128	)	$	2,345

Schedule of future amortization expense
Fiscal Year ending December 31,
2026 (nine months remaining)	$	385
2027		513
2028		297
2029		202
2030		202
Thereafter		726
Total	$	2,325

Schedule of unvested restricted stock awards
			Weighted -
			Average
	Number of		Grant
	Award Shares		Date Fair Value

Unvested at December 31, 2025		70,000	$	1.04

Granted		-		-

Vested		-		-

Forfeited		-		-

Balance at March 31, 2026		70,000	$	1.04

Schedule of unvested restricted stock units
				Weighted -
				Average
	Number of			Grant
	Unit Shares			Date Fair Value
Unvested at December 31, 2025		232,801		$	1.32

Granted		-			-

Vested		(70,773	)		1.70

Forfeited		-			-

Balance at March 31, 2026		162,028		$	1.13

Schedule of unvested performance restricted stock units
				Weighted -
				Average
	Number of			Number of
	Unit Shares			Unit Shares
Unvested at December 31, 2025		1,321,591		$	1.15

Granted		-			-

Forfeited/Cancelled		(168,183	)		1.55

Balance at March 31, 2026		1,153,408		$	1.10

Schedule of warrants outstanding
	Number of Warrant Shares			Weighted- Average Exercise Price		Weighted - Average Remaining Contractual Term (in years)		Aggregate Intrinsic Value (in thousands)⁽¹⁾
Balance as of December 31, 2025		1,555,207			3.95		4.4

Issued		-			-

Exercised			-		-

Expired		-			-

Balance as of March 31, 2026		1,555,207		$	3.95		4.1

Exercisable as of March 31, 2026		1,555,207		$	3.95		4.1	$	-

Schedule of components of lease expense
	Three months ended March 31,
	2026		2025
Operating lease cost	$	-	$	26
Short-term lease cost		-		4
Total lease costs	$	-	$	30

Schedule of supplemental information related to leases
	March 31, 2026		December 31, 2025
Operating Lease right-of-use asset	$	-	$	-

Current portion of operating lease liabilities		-		-
Non-current portion of operating lease liabilities		-		-
Total operating lease liabilities	$	-	$	-


Cash paid for amounts included in the measurement of operating lease liabilities	$	-	$	65

Right-of-use assets obtained in exchange for operating lease liabilities	$	-	$	-

Weighted-average remaining lease term for operating leases (years)		-		-
Weighted average discount rate for operating leases		-		-

Exhibit No.		Description
2.1+		Agreement and Plan of Merger dated February 11, 2026, by and among VerifyMe, Inc., VRME Subsidiary Corp., and Open World, Ltd. (incorporated herein by reference from Exhibit 2.1 to the Company’s Current Report on Form 8-K filed on February 12, 2026)
2.2		First Amendment to the Agreement and Plan of Merger dated April 13, 2026, by and among VerifyMe, Inc., VRME Subsidiary Corp., and Open World, Ltd., (incorporated herein by reference from Exhibit 2.2 to the Company’s Registration Statement on Form S-4, filed on April 15, 2026).
10.1*†+		Digital Channel Program Agreement (incorporated herein by reference from Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2025).
10.2*†+		Partner API Access Agreement (incorporated herein by reference from Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2025).
10.3*		Master Loan Agreement and Promissory Note with ZenCredit Ventures, LLC (incorporated herein by reference from Exhibit 10.3 to the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2025).
10.4*		Promissory Note to ZenCredit Ventures, LLC (incorporated herein by reference from Exhibit 10.4 to the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2025).
10.5		Letter of Intent, dated January 2, 2026, between VerifyMe, Inc. and Open World Ltd.(incorporated by reference from Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on January 5, 2026).
10.6+		Form of Company Stockholder Support Agreement dated February 11, 2026 (incorporated herein by reference from Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on February 12, 2026).
10.7#+		Amended and Restated Employment Agreement with Adam Stedham dated February 11, 2026 and subject to effectiveness (incorporated herein by reference from Exhibit 10.2 to the Company’s Current Report on Form 8-K filed on February 12, 2026).
10.8#+		Employment Agreement with Jennifer Cola dated February 11, 2026 and subject to effectiveness (incorporated herein by reference from Exhibit 10.3 to the Company’s Current Report on Form 8-K filed on February 12, 2026).
10.9*		Waiver and Amendment to Loan Documents between PeriShip Global LLC and PNC Bank, National Association, effective December 31, 2025 (incorporated herein by reference from Exhibit 10.29 to the Company’s Annual Report on Form 10-K filed on March 31, 2026).
31.1*		Certification of Principal Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2*		Certification of Principal Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1**		Certification of Principal Executive Officer and Principal Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS*		XBRL Instance Document. The instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
101.SCH*		Inline XBRL Taxonomy Extension Schema Document.
101.CAL*		Inline XBRL Taxonomy Extension Calculation Linkbase Document.
101.LAB*		Inline XBRL Taxonomy Extension Label Linkbase Document.
101.PRE*		Inline XBRL Taxonomy Extension Presentation Linkbase Document.
101.DEF*		Inline XBRL Taxonomy Extension Definition Linkbase Document.
104*		Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).

	VERIFYME, INC.

Date: May 15, 2026	By: /s/ Adam Stedham
	Adam Stedham
	Chief Executive Officer and President (Principal Executive Officer)

Date: May 15, 2026	By: /s/ Jennifer Cola
	Jennifer Cola
	Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer)

SEC Form 10-Q filed by VerifyMe Inc.