INVO Invo Bioscience, Inc. - 10-K

Item 1A. Risk Factors

You should carefully consider the following risk factors, in addition to the other information in this report on Form 10-K, including the section of this report titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our consolidated financial statements and related notes. If any of the events described in the following risk factors and the risks described elsewhere in this report on Form 10-K occurs, our business, operating results and financial condition could be seriously harmed. This report on Form 10-K also contains forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those anticipated in the forward-looking statements as a result of factors that are described below and elsewhere in this report.

Summary of Risk Factors

Our business is subject to a number of risks, including risks that may prevent us from achieving our business objectives or may adversely affect our business, financial condition, results of operations, cash flows, and prospects. These risks are discussed more fully below and include, but are not limited to, risks related to the following:

Risks Related to Our Financial Condition and Need for Additional Capital

We have incurred an accumulated net loss of $91.4 million since inception, which raises substantial doubt about our ability to continue as a going concern.

We have substantial secured indebtedness outstanding, and if we are unable to service our debt, our secured creditors could seize and liquidate our assets.

We do not expect our current cash position to be sufficient to fund operations and service our debt for the next 12 months, and additional capital may not be available on acceptable terms, if at all.

Any future fundraising may be dilutive to existing stockholders and may impose restrictive covenants that limit our operational flexibility.

Risks Related to Our Business and Operations

We have a limited operating history and a history of net operating losses, and we depend on continued access to capital and clinic revenue growth to fund our operations.

The fertility and ART services industry is highly competitive, and new providers, technologies, or techniques could erode our market share, patient volume, and pricing power.

Our growth strategy depends on identifying and successfully completing and integrating fertility clinic acquisitions, and we may fail to realize expected synergies or encounter unanticipated liabilities.

We are heavily dependent on key executives, physicians, embryologists, and clinical personnel whose loss could materially harm our operations.

Certain of our fertility clinics operate as joint ventures with medical partners who may fail to perform their obligations or seek to terminate their agreements.

We face significant litigation exposure from medical malpractice, errors in handling reproductive materials, and product liability claims, which may exceed our insurance coverage.

We rely on a single third-party manufacturer for INVOcell production, and any disruption in supply or product quality failure could limit our growth and harm our reputation.

Our intellectual property rights may be challenged or circumvented, and we may be subject to costly third-party infringement claims.

Risks Related to Our Industry and Regulation

Evolving state and federal laws on abortion and embryo personhood could restrict the availability of IVF services in states where we operate.

We are subject to extensive federal and state regulation as both a fertility clinic operator and a medical device manufacturer, and noncompliance could result in penalties, product recalls, or cessation of operations.

The FDA clearance process for the INVOcell and any future device modifications is expensive and uncertain, and we may be unable to obtain or maintain required clearances.

Payor consolidation and managed care trends could result in pricing pressure and reimbursement changes that reduce demand for our services and products.

Cybersecurity threats or data breaches involving sensitive patient health information could expose us to HIPAA liability and disrupt our operations.

Risks Related to Our Common Stock and Capital Structure

Our secured debt instruments contain restrictive covenants that limit our operational and financial flexibility, and a covenant default could trigger acceleration of our indebtedness.

Our common stock is thinly traded and highly volatile, and there can be no assurance of an active or liquid trading market.

Our former shell company status restricts stockholder reliance on Rule 144 for resales of restricted securities, which may impair our ability to raise capital.

Our directors have broad authority to issue preferred stock or additional common stock without stockholder approval, which could dilute the interests of existing holders.

We have never paid dividends on our common stock and do not expect to do so in the foreseeable future.

If we fail to maintain compliance with Nasdaq listing standards, our common stock could be delisted, reducing liquidity and investor confidence.

Risks Related to Market and Macroeconomic Conditions

Global economic volatility, inflation, rising interest rates, and geopolitical instability could adversely affect our access to capital and reduce patient demand for fertility services.

Changes in U.S. tariff and trade policy could increase the cost of medical devices and clinical supplies used in our operations.

Economic downturns may reduce consumer spending on fertility treatments, which could adversely affect our revenues and profitability.

General Risk Factors

As a Smaller Reporting Company, we are subject to reduced disclosure requirements that may make our common stock less attractive to certain investors.

We may need to issue additional equity or convertible securities to fund our operations, which could result in significant dilution to existing stockholders.

Compliance with SEC reporting requirements is time-consuming and costly, and failure to maintain adequate internal controls could result in regulatory sanctions and loss of investor confidence.

We have identified material weaknesses in our internal control over financial reporting and our internal control was not effective as of December 31, 2025; failure to remediate these weaknesses could adversely affect our ability to report financial results accurately and on a timely basis.

If analysts reduce or cease coverage of our company, our stock price and trading volume could decline.

Risks Related to Our Financial Condition and Our Need for Additional Capital

Our financial situation creates doubt whether we will continue as a going concern.

From the inception of our consolidated subsidiaries on January 5, 2007, through December 31, 2025, we had an accumulated net loss of $91.4 million. There can be no assurances that we will be able to achieve a level of revenues adequate to generate sufficient cash flow from operations or additional financing through private placements, public offerings and/or bank financing necessary to support our working capital requirements. To the extent that funds generated from any private placements, public offerings and/or bank financing are insufficient, we will have to raise additional working capital. No assurance can be given that additional financing will be available, or if available, will be on acceptable terms. These conditions raise substantial doubt about our ability to continue as a going concern. If adequate working capital is not available, we may be forced to discontinue operations, which would cause investors to lose their entire investment.

We have substantial indebtedness outstanding, and our operations are significantly leveraged. If we were unable to service our indebtedness, our business would be adversely affected.

In order to finance our operations we have incurred substantial indebtedness, including our secured obligation to Decathlon. We may not be able to continue to service our debt in the future. If we are unable to service our debt and fail to pay our debt obligations in a timely fashion, we will be in default under one or more of our loan agreements. Upon such a default, our secured creditors could exercise their rights and remedies under the applicable loan agreements, which could include seizing all of our assets and selling them off under the Uniform Commercial Code and the loan agreements. Any such action would have a material adverse effect on our business and prospects.

We will need to raise additional funding, which may not be available on acceptable terms, or at all. Failure to obtain this necessary capital when needed may force us to delay, limit or terminate operations.

We do not expect that our current cash position will be sufficient to fund our current operations and service our current debt obligations for the next 12 months. Our operating plan may change as a result of many factors currently unknown to us, and we may need to seek additional funds sooner than planned, through public or private equity or debt financings, government or other third-party funding or a combination of these approaches. Raising funds in the current economic environment may present additional challenges. Even if we believe we have raised or generated sufficient funds for our current or future operating plans, we may seek additional capital if market conditions are favorable or if we have specific strategic considerations.

Any additional fundraising efforts may divert our management from their day-to-day activities, which may adversely affect our ability to effectively manage our clinics. In addition, we cannot guarantee that future financing will be available in sufficient amounts or on terms acceptable to us, if at all. Moreover, the terms of any financing may adversely affect the holdings or the rights of our stockholders and the issuance of additional securities, whether equity or debt, by us, or the possibility of such issuance, may cause the market price of our shares to decline. The sale of additional equity or convertible securities may dilute our existing stockholders. The incurrence of additional indebtedness would result in increased fixed payment obligations, and we may be required to agree to certain restrictive covenants, such as limitations on our ability to incur additional debt, limitations on our ability to acquire, sell or license intellectual property rights or clinics and other operating restrictions that could adversely impact our ability to conduct our business. We could also be required to seek funds through arrangements with collaborative partners or otherwise at an earlier stage than otherwise would be desirable and we may be required to relinquish rights to some of our technologies or product candidates or otherwise agree to terms unfavorable to us, any of which may have a material adverse effect on our business, operating results and prospects.

If we are unable to obtain funding on a timely basis, we may be required to significantly curtail, delay or be unable to expand our operations or otherwise capitalize on our business opportunities, as desired, which could materially affect our business, financial condition and results of operations.

Even if we can raise additional funding, we may be required to do so on terms that are dilutive to you.

The capital markets have been unpredictable in the past for unprofitable companies such as ours. In addition, it is generally difficult for development stage companies to raise capital under current market conditions. The amount of capital that a company such as ours is able to raise often depends on variables that are beyond our control. As a result, we may not be able to secure financing on terms attractive to us, or at all. If we are able to consummate a financing arrangement, the amount raised may not be sufficient to meet our future needs. If adequate funds are not available on acceptable terms, or at all, our business, including our results of operations, financial condition and our continued viability will be materially adversely affected.

Risks Relating to Our Business

Our business has posted net operating losses, has a limited operating history, and needs additional capital to grow and finance its operations.

From the inception of our consolidated subsidiary BioXcell Inc. on January 5, 2007, through December 31, 2025, we had an accumulated net loss of $91.4 million. We have a limited operating history and are essentially an early-stage operation. We will continue to be dependent on having access to additional new capital and/or generating positive operating cash flow primarily through the growth of our clinics, the development of new INVO Centers and the acquisition of additional IVF clinics, in order to finance the growth of our operations. Continued net operating losses together with limited working capital make investing in our common stock a high-risk proposal. Our limited operating history may make it difficult for management to provide effective insight into future activities, marketing costs, and customer acquisition and retention. This could lead to us missing targets for the achievement of profitability, which could negatively affect the value of your investment.

Our business is subject to significant competition.

The fertility industry is highly competitive and characterized by well entrenched and long-standing practices as well as technological improvements and advancements. New ART services, devices and techniques may be developed that may render the INVOcell obsolete. Competition in the areas of fertility and ART services is largely based on pregnancy rates and other patient outcomes. Accordingly, the ability of our business to compete is largely dependent on our ability to achieve adequate pregnancy rates and patient satisfaction levels. Our business operates in highly competitive areas that are subject to change. New health care providers and medical technology companies entering the market may reduce our and our fertility clinics market share, patient volume and growth rates, and could force us to alter our planned pricing and fertility clinic service offerings. Additionally, increased competitive pressures may require us to commit more resources to our and our fertility clinic marketing efforts, thereby increasing our cost structure and affecting our ability to achieve, or the timing of achieving, profitability. There can be no assurance that we will not be able to compete effectively, nor can there be any assurance that additional competitors will not enter the market. Such competition may make it more difficult for us to enter into additional contracts with third party fertility clinics or maintain the profitability of our own fertility clinics.

We need to manage growth in our fertility operations, and we may not be successful in implementing our growth strategy.

In order to maximize potential growth in our current and potential markets, we may need to expand the scope of our services in the healthcare industry. As a result, we plan to continue to improve our clinic operations, marketing, and management information systems. We will also need to effectively train, motivate and manage our employees. Our failure to manage our growth could disrupt our operations and ultimately prevent us from generating revenues at the levels we expect.

Many factors including, but not limited to, increased competition from similar businesses, unexpected costs, costs associated with marketing efforts and maintaining a strong patient and client base may interfere with our ability to expand successfully. Our inability to implement our internal strategy successfully may have a negative impact on our growth, future financial condition, results of operations and/or cash flows.

We may not be successful at pursuing our acquisition strategy.

Our current strategy includes acquiring profitable fertility clinics in the United States to accelerate our growth. We have acquired Wisconsin Fertility Institute and Family Beginnings, and while we believe that there are in excess of 80 other clinics in the United States that may be suitable acquisition targets, we may not have any further success in identifying or pursuing additional acquisition candidates. If suitable acquisition targets are identified, we may not be able to negotiate terms of acquisition or obtain financing to fund such acquisitions.

We may not be able to develop or continue our business if we fail to recruit and/or retain key personnel.

The success of our business is heavily dependent on our executive management at the corporate level and our clinic personnel including our physicians, lab directors, embryologists, and other clinic and lab staff. We face strong competition to recruit and retain clinic and lab staff. The loss of any of our key personnel could potentially have a material adverse effect on our business, operations, revenues and/or prospects. If one or more of these persons were to become unable or unwilling to continue in their present positions, we may not be able to replace them readily or timely, if at all. Furthermore, our ability to recruit and employ physicians is closely regulated. For example, the types, amount and duration of compensation and assistance we can provide to recruited physicians are limited by the Anti-Kickback Statute and the Stark Law, as well as other applicable antifraud and abuse laws and regulations.

We may not be successful at managing clinics.

Our management team has limited experience in managing fertility clinics. We seek to retain experienced personnel to provide clinical practice expertise, perform recruitment functions, provide necessary training, and provide day-to-day management of our clinics. We may not be successful in retaining such personnel, integrating such personnel into our operations, or otherwise successfully manage clinics that we have acquired or may acquire in the future.

We may not be able to successfully manage current and future acquisitions and to achieve the benefits expected to result from the acquisitions.

Current and future acquisitions may present challenges to management, including the integration of our operations and personnel and that of the acquisition, continued management of the clinic and special risks, including possible unanticipated liabilities, unanticipated integration costs and diversion of management attention.

We cannot assure you that we will successfully integrate or profitably manage an acquisition’s business. Even if we are able to integrate and profitably manage an acquisition’s business, we cannot assure you that our business will achieve sales levels, profitability, efficiencies or synergies that justify the acquisition or that the acquisition will result in increased earnings for us in any future period.

Some of our existing fertility clinics were established as joint ventures with medical partners. These joint ventures are important to our business. If we are unable to maintain any of these joint ventures, or if they are not successful, our business could be adversely affected.

We have established, and may enter into additional, joint ventures for the operation of our INVO Centers. Our existing and any future joint ventures may have a number of risks, including that our joint venture partners:

have significant discretion in determining the efforts and resources that they will apply;

may not perform their obligations as expected;

may dispute the amounts of payments owed;

may fail to comply with applicable legal and regulatory requirements regarding the distribution or marketing of our INVOcell product;

may not properly maintain or defend their or our relevant intellectual property rights or may use our proprietary information in such a way as to invite litigation that could jeopardize or invalidate our intellectual property or proprietary information or expose us to potential litigation and liability;

may infringe the intellectual property rights of third parties, which may expose us to litigation and potential liability;

could become involved in a business combination or cessation that could cause them to deemphasize or terminate the development or commercialization of our INVOcell product; and

may seek to terminate our joint venture, which could require us to raise additional capital and to develop new joint venture relationships.

Additionally, if one of our joint venture partners seeks to terminate its agreement with us, we may find it difficult to attract new joint venture partners, and the perception of our INVO Centers in the business and financial communities could be adversely affected.

We may be subject to significant liabilities arising from claims brought against our fertility clinics, affiliated physicians, and related service providers.

We face the risk of litigation associated with our clinical and laboratory services, including claims by patients or others alleging medical malpractice, errors in handling reproductive materials, product liability, or other causes of action commonly encountered in the healthcare sector. Providers in our industry have also faced class-action lawsuits related to billing practices, record management, informed-consent procedures, and the classification of services for reimbursement purposes. These types of claims can involve substantial monetary demands and high defense costs.

Although certain jurisdictions limit recoverable damages, plaintiffs may pursue alternative legal theories or claims that fall outside those caps. We maintain professional liability and general liability insurance in amounts we believe to be appropriate; however, some claims may exceed our coverage limits, and certain categories of damages—such as punitive damages—may not be covered or may later be denied by insurers. In addition, the rising cost and fluctuating availability of malpractice insurance for physicians who provide services at our clinics increases the risk that we could be held vicariously liable when uninsured or underinsured practitioners are named alongside us in legal actions.

We cannot guarantee that we will be able to obtain continued insurance coverage on acceptable terms, or at all. To the extent we are self-insured or required to fund claims that exceed or fall outside our insurance coverage, we may be required to use operating cash flow to satisfy such liabilities. Any of these events could materially adversely affect our financial condition, results of operations, and liquidity.

We face potential liability as a provider of a medical device. These risks may be heightened in the area of artificial reproduction.

The provision of medical devices entails the substantial risk of potential tort injury claims. We currently utilize product liability insurance to provide coverage against potential tort injury claims, as well as customary insurance protection, such as professional liability insurance, for our fertility clinics. However, there can be no assurance such coverage will provide adequate protection against any potential claims. Furthermore, any claim asserted against us could generate costly legal fees, consume management’s time and resources, and adversely affect our reputation and business, regardless of the merit or eventual outcome of such claim.

There are inherent risks specific to the provision of fertility and ART services. For example, the long-term effects on women of the administration of fertility medication, integral to most fertility and ART services, are of concern to certain physicians and others who fear the medication may prove to be carcinogenic or cause other medical problems. Additionally, any ban or other limitation imposed by the FDA or other foreign regulatory department on fertility medication and services could have a material adverse effect on our business. Any such action would likely adversely affect the value of your investment.

If we fail to maintain adequate quality standards for our services and products, our reputation and business may be adversely affected and harmed.

Our customers are expecting that our products and services will perform as marketed and in accordance with industry standards. For our INVOcell device, we rely on third-party manufacturing companies and their packaging processes in connection with the production of our products. Our key suppliers, which are located in the U.S. and include NextPhase Medical Devices and Casco Bay Molding, and have been steadfast partners since our company first began and can provide us with virtually an unlimited capability to support our growth objectives, with all manufacturing performed in the New England region of the U.S. However, a failure to maintain product quality standards in accordance with our customers’ expectations could result in the loss of demand for our products. Additionally, delays or quality lapses in our production lines could result in substantial economic losses to us. Although we believe that our current quality control procedures adequately address these risks, there can be no assurance that we will not experience occasional or systemic quality lapses in our manufacturing and service operations. Currently, we have limited manufacturing capabilities as we rely on a single manufacturing provider regarding our production process. In the event our manufacturer is unable to produce an adequate supply of products at appropriate quality levels, our growth could be limited, and our business may be harmed. If we experience significant or prolonged disturbance in our quality standards, our business and reputation may be harmed, which may result in the loss of customers, our inability to participate in future customer product opportunities and reduced revenue and earnings.

We heavily rely on third party package delivery services, and a significant disruption in these services or significant increases in prices may disrupt our ability to import or export materials, increase our costs and negatively affect our ability to achieve and maintain profitability.

We ship our products to our customers through known independent package delivery companies, such as FedEx and UPS. If any third party package delivery providers experience a significant disruption such that any of our products, components or raw materials cannot be delivered in a timely fashion or such that we incur additional shipping costs that we are unable to recoup, our costs may increase and our relationships with certain customers may be adversely affected. In particular, if our third-party package delivery providers increase prices and we are not able to find comparable alternatives or adjust our delivery network, our profitability could be adversely affected.

Our products incorporate intellectual property rights developed by us that may be difficult to protect or may be found to infringe on the rights of others .

While we currently own a U.S. patent, this patent may be challenged, invalidated or circumvented, and will ultimately expire. In addition, the rights granted under this patent may not provide the competitive advantages we currently anticipate. Certain countries, including the United States and in Europe, could place restrictions on the patentability of various medical devices which may materially affect our business and competitive position. Additionally, the laws of some foreign countries, in particular China and India, do not protect our proprietary rights to the same extent or in the same manner as U.S. laws, and we may encounter significant problems in protecting and defending our proprietary rights in these countries. In addition to relying on patent, copyright and trademark laws, we also utilize a combination of trade secrets, confidentiality policies, non-disclosure and other contractual arrangements to protect our intellectual property rights. However, these measures may not be adequate to prevent or deter infringement or other misappropriation. Further, our intellectual property rights may be found to infringe on intellectual property rights of third parties. Moreover, we may not be able to detect unauthorized use or take appropriate and timely steps to establish and enforce our proprietary rights. Existing laws of some countries in which we conduct business offer only limited protection of our intellectual property rights, if at all. As the number of market entrants as well as the complexity of technology in the fertility marketplace increases, the possibility of functional overlap and inadvertent infringement of intellectual property rights also increases.

We may be forced to defend our intellectual property rights from infringement through expensive legal action.

Third parties may in the future assert claims against us alleging infringement on their intellectual property rights. Defending such claims may be expensive, time consuming and divert the efforts of our management and/or technical personnel. Because of litigation, we could be required to pay damages and other compensation, develop non-infringing products or enter into royalty and/or licensing agreements. However, we cannot be certain that any such licenses will be made available to us on commercially reasonable terms.

We regard our trade secrets, patents and similar intellectual property as critical to our successful operations. To protect our proprietary rights, we rely on intellectual property and trade secret laws, as well as confidentiality and license agreements with certain employees, customers and third parties. No assurance can be given that our intellectual property will not be challenged, invalidated, infringed or circumvented. If necessary, we intend to defend our intellectual property rights from infringement through legal action, which could be very costly and could adversely affect our ability to achieve and maintain profitability. Our limited capital resources could put us at a disadvantage if we are required to take legal action to enforce our intellectual property rights.

We are subject to risks in connection with changes in international, national, and local economic and market conditions.

Our business is subject to risks in connection with changes in international, national and local economic and market conditions, including the effects of global financial crises, effects of terrorist acts, war and global pandemics. Such economic changes could negatively impact infertile people’s ability to pay for fertility treatment around the world.

We could experience additional risks associated with international sales, including:

political and economic instability;

export controls;

changes in international legal and regulatory requirements;

United States and foreign government policy changes affecting the product marketability; and

changes in tax laws, duties and tariffs.

Any of these factors could have a material adverse effect on our business, results of operations and financial condition. From 2011 through 2023, we sold products in certain international markets mainly through independent distributors. Although we are not actively pursuing international sales, they could become more meaningful in the future. In the event a distributor fails to meet annual sales goals, we may be required to obtain a replacement distributor, which may be costly and difficult to identify. Additionally, a change in our distributors may increase costs, and create a disruption in our operations resulting in a loss of revenue.

If we are unable to effectively adapt to changes in the healthcare industry, our business may be harmed.

Federal, state, and local legislative bodies frequently pass legislation and promulgate regulations relating to healthcare reform or that affect the healthcare industry. As has been the trend in recent years, it is reasonable to assume that there will continue to be increased government oversight and regulation of the healthcare industry in the future. We cannot predict the ultimate content, timing, or effect of any new healthcare legislation or regulations, nor is it possible at this time to estimate the impact of potential new legislation or regulations on our business. It is possible that future legislation enacted by Congress or state legislatures, or regulations promulgated by regulatory authorities at the federal or state level, could adversely affect our business. It is also possible that the changes to federal healthcare program reimbursements to providers who purchase our products or use our services may serve as precedent to possible changes in other payors’ reimbursement policies in a manner adverse to us. Similarly, changes in private payor reimbursements could lead to adverse changes in federal healthcare programs, which could have a material adverse effect on our business, financial condition, cash flows, and results of operations.

There can be no assurance that we will be able to successfully address changes in the current regulatory environment. Some of the healthcare laws and regulations applicable to us are subject to limited or evolving interpretations, and a review of our business or operations by a court, law enforcement, or a regulatory authority might result in a determination that could have a material adverse effect on us. Furthermore, the healthcare laws and regulations applicable to us may be amended or interpreted in a manner that could have a material adverse effect on our business, financial condition, cash flows and results of operations.

Social media platforms present risks and challenges.

The unauthorized use of certain social media vehicles could result in the improper collection and/or dissemination of personally identifiable information causing brand damage and various legal implications. In addition, negative or inaccurate social media posts or comments about us on any social networking site could damage our brand, reputation, and goodwill.

We are susceptible to cybersecurity breaches and cyber-related fraud.

We depend on information technology (“IT”) systems, networks, and services, encompassing internet sites, data hosting and processing facilities, as well as hardware (including laptops and mobile devices), along with software and technical applications and platforms. Some of these are overseen, hosted, supplied, and/or utilized by third parties or their vendors, supporting us in the administration of our business.

The escalation of IT security threats and the increasing sophistication of cyber-crime pose a potential hazard to the security of our IT systems, networks, and services, as well as to the confidentiality, availability, and integrity of our data. Should the IT systems, networks, or service providers we rely on encounter malfunctions or if we experience a loss or disclosure of sensitive information due to various causes such as catastrophic events, power outages, or security breaches, and our business continuity plans fail to address these issues promptly, we could face disruptions in managing operations. This may result in reputational, competitive, and/or business harm, potentially adversely impacting our business operations and financial condition. Furthermore, such incidents could lead to the unauthorized disclosure of critical confidential information, causing financial and reputational damage due to the loss or misappropriation of confidential information belonging to us, our partners, employees, customers, suppliers, or consumers. In such scenarios, significant financial and other resources might be required to rectify the damage caused by a security breach or to repair and replace networks and IT systems.

In addition, in the ordinary course of our business, we may use, collect, and store sensitive data, including personal health information. We face risks relative to protecting this critical information, including loss of access risk, inappropriate disclosure risk, inappropriate modification risk, and the risk of being unable to adequately monitor our controls. Our information technology and infrastructure may be vulnerable to attacks by hackers or viruses or breached due to employee error, malfeasance, or other disruptions. Any such breach or interruption could compromise our networks and the information stored there could be accessed by unauthorized parties, publicly disclosed, lost or stolen. Any such access, disclosure, or other loss of information could result in legal claims or proceedings, liability under laws that protect the privacy of personal information, such as HIPAA, and regulatory penalties. There is no guarantee that we can continue to protect our systems from breach. Unauthorized access, loss, or dissemination could also disrupt our operations.

We are subject to risks associated with doing business globally.

Our operations, both inside and outside the United States, are subject to risks inherent in conducting business globally and under the laws, regulations and customs of various jurisdictions and geographies. Our operations outside the United States are subject to special risks and restrictions, including, without limitation: fluctuations in currency values and foreign-currency exchange rates; exchange control regulations; changes in local political or economic conditions; governmental pricing directives; import and trade restrictions; import or export licensing requirements and trade policy; restrictions on the ability to repatriate funds; and other potentially detrimental domestic and foreign governmental practices or policies affecting U.S. companies doing business abroad, including the U.S. Foreign Corrupt Practices Act and the trade sanctions laws and regulations administered by the U.S. Department of the Treasury’s Office of Foreign Assets Control. Acts of terror or war may impair our ability to operate in particular countries or regions and may impede the flow of goods and services between countries. Customers in weakened economies may be unable to purchase our products, or it could become more expensive for them to purchase imported products in their local currency, or sell at competitive prices, and we may be unable to collect receivables from such customers. Further, changes in exchange rates may affect our net earnings, the book value of our assets outside the United States and our stockholders’ equity. Failure to comply with the laws and regulations that affect our global operations could have an adverse effect on our business, financial condition or results of operations.

Currency exchange rate fluctuations may affect the results of our operations.

We may distribute our INVOcell product internationally with all sales, domestic and international, in U.S. dollars. As a result, our operations could be impacted by fluctuations in currency exchange rates, although we expect to mitigate such risk by invoicing only in U.S. dollars. In spite of this, our operations may still be negatively impacted by foreign currency exchange rates in the event the U.S. dollar strengthens and the local currency where the product may be sold weakens. In the event such international patients are unable to afford the associated increase costs, international doctors and clinics may not be able to offer the INVOcell and IVC procedure. Additionally, as an international business we may be susceptible to adverse foreign currency fluctuations unconnected to the U.S. dollar.

Failure to comply with the United States Foreign Corrupt Practices Act or similar laws could subject us to penalties and other adverse consequences.

We are subject to the United States Foreign Corrupt Practices Act, which generally prohibits United States companies, including their suppliers, distributors and other commercial partners, from engaging in bribery or other prohibited payments to foreign officials for the purpose of obtaining or retaining business. Corruption, extortion, bribery, pay-offs, theft and other fraudulent practices occur from time to time in the countries in which we distribute products. We have adopted formal policies and procedures designed to facilitate compliance with these laws. If our employees or other agents, including our distributors or suppliers, are found to have engaged in such practices, we could suffer severe penalties and other consequences that may have a material adverse effect on our business, financial condition and results of operations.

We will need additional, qualified personnel in order to expand our fertility business. Without additional personnel, we will not be able to expand our fertility business.

Expanding our fertility business requires increasing the number of persons engaged in activities for the sale, marketing, administration and delivery of our products as well as clinical training personnel for proper IVC procedure training. Our ability to attract and hire personnel to fulfil these efforts is dependent on our ability to attract and retain potential employees with the proper background and training matching the skills required for the positions. In addition, we may not be able to attract personnel who will be able to successfully implement our business operations and growth strategy in the manner that we currently anticipate.

Risks Related to Our Industry

We may be subject to risks related to changes in laws regarding abortion, which can affect how a fertility clinic must treat and handle embryos.

In June 2022, the U.S. Supreme Court in Dobbs v. Jackson Women’s Health Organization overturned Roe v. Wade by holding that there is no constitutional right to abortion. This ended federal legalization on abortion, bringing the matter back to individual states to determine. Soon after the decision was handed down, several U.S. states adopted laws that drastically limited the availability of abortion, with a number of other states working on or proposing similar restrictions. While we believe these actions are more targeted toward abortions during pregnancy, certain laws may also impact embryos and how excess embryos are handled or implicate fertility procedures and travel reimbursement programs, which may decrease the demand for, or availability of, certain fertility services.

In February 2024, the Alabama Supreme Court issued a landmark ruling holding that stored embryos are afforded the same legal protections as children under the state’s Wrongful Death of a Minor Act, causing IVF clinics in Alabama to temporarily pause services. Although the Alabama legislature subsequently passed a law providing limited civil and criminal liability protection for IVF providers, the underlying ruling has not been overturned, and similar challenges may arise in other states. As of 2025, personhood bills with potential implications for IVF and embryo handling have been introduced or are being tracked in multiple states. While Indiana law currently exempts IVF from its abortion restrictions, and the Indiana Court of Appeals has held that frozen embryos do not have the rights of persons under Indiana law, the legal landscape remains unsettled and future legislative or judicial developments in Indiana or other states where we operate could adversely affect our business.

The enactment of certain state laws restricting abortion care and other changes in laws, or in interpretation of laws through court decisions, affecting fertility benefits may conflict with, and ultimately limit, the covered benefits offered by a company to its employees and the types of fertility treatment services available at provider clinics. While the Trump administration has expressed general support for IVF access, no federal legislation has been enacted to protect IVF services, and executive positions and priorities are subject to change. We cannot predict the timing or impact of any future rulemaking, executive orders, court decisions or other changes in the law, or in how such laws, once enacted, would be interpreted and enforced. This may negatively impact fertility clinics and their patients operating in those states with more restrictive laws.

We are subject to significant domestic and international governmental regulation and if we fail to comply we could suffer penalties or be required to make significant changes to our operations.

Our business is heavily regulated, both as a fertility clinic operator and as a medical device manufacturer. We are subject to complex laws and regulations from the FDA and other federal, state and local authorities that subject us to civil and criminal penalties, including cessation of operations and recall of products distributed, in the event we fail to comply. Any such actions could severely curtail our revenue and business reputation.

These laws relate to among other things: billing practices and prices for services; relationships with physicians and other referral sources; necessity and quality of medical care; condition and adequacy of facilities; qualifications of medical and support personnel; confidentiality, privacy and security issues associated with health-related information and PHI; handling of controlled substances; and certification, licensure and accreditation of our facilities.

In addition, restrictive laws, regulations or interpretations could be adopted, making compliance with such regulations more difficult or expensive. While we devote substantial resources to ensure our compliance with laws and regulations, we cannot completely eliminate the risk that we may be found non-compliant with applicable legal and regulatory requirements.

We believe that the healthcare industry will continue to be subject to increased regulation as well as political and legal action, as future proposals to reform the health care system are considered by the U.S. Congress and state legislatures. We do not know of, nor do we have any control over, future changes to healthcare laws and regulations which may have a significant impact on our business.

The FDA regulatory review process for medical devices is expensive, time-consuming and uncertain, and the failure to obtain and maintain required regulatory clearances and approvals could prevent us from commercializing our products.

Unless an exemption applies, each medical device commercially distributed in the United States requires either FDA clearance of a 510(k) premarket notification, approval of a premarket approval, or issuance of a de novo classification order. The FDA clearance, de novo classification, and approval processes for medical devices are expensive, uncertain and time-consuming.

Future modifications to the INVOcell that was classified through de novo may require a 510(k) clearance. We may make minor changes to the INVOcell without seeking clearance for the modifications if we determine such clearances are not necessary and document the basis for that conclusion. However, the FDA may disagree with our determination or may require additional information, including clinical data, to be submitted before a determination is made, in which case we may be required to delay the introduction and marketing of our modified products, redesign our products, conduct clinical trials to support any modifications, or we may be subject to enforcement actions. In addition, the FDA may not clear such modified INVOcell for the indications that are necessary or desirable for successful commercialization.

There is no assurance that we will be able to obtain the necessary clearances on a timely basis or at all. Further, the FDA may change its policies, adopt additional regulations or revise existing regulations, or take other actions which may impact our ability to modify the INVOcell on a timely basis, and may prevent or delay clearance of future products. Delays in receipt of, or failure to obtain clearances for any product modifications or future products we may develop would result in delayed or no realization of revenue from such products and the viability of our INVO Centers, and in substantial additional costs, which could decrease our profitability.

In addition, we are required to continue to comply with applicable FDA and other regulatory requirements following de novo classification or clearance. The failure to comply with existing or future regulatory requirements could have a material adverse effect on our business.

Improper marketing and promotion or off-label use of our product could lead to investigations and enforcement by governmental bodies including product recalls or market withdrawal, may harm our reputation and business, and could result in product liability suits.

If the FDA or any foreign regulatory entity determines that our promotional materials or training constitute promotion of off-label use, it could request that we modify our training or promotional materials or subject us to regulatory or enforcement actions. These enforcement actions could include, for example, a warning letter or untitled letter, injunction, seizure, civil fine or criminal penalties. We cannot, however, prevent a physician from using the INVOcell off-label, when in the physician’s independent professional medical judgement, he or she deems it appropriate. There may be increased risk of injury to patients if physicians attempt to use the INVOcell off-label, or the INVOcell may not be as effective, which could harm our reputation.

If we fail to comply with the FDA ’ s Quality System Regulation (“QSR”), the FDA could take various enforcement actions, including suspending our FDA clearance to market, or halting our manufacturing operations, and our business would suffer.

In the United States, as a manufacturer of a medical device, we are required to demonstrate and maintain compliance with the FDA’s QSR. The QSR covers the methods and documentation of the design, testing, control, manufacturing, labeling, quality assurance, packaging, storage and distribution of medical devices. The FDA enforces the QSR through periodic inspections and unannounced “for cause” inspections. Outside the United States, our products and operations are also required to comply with national requirements where the product is sold and also standards set by industrial standards bodies, such as the International Organization for Standardization. Foreign regulatory bodies may evaluate our products or the testing that our products undergo against these standards. The specific standards, types of evaluation and scope of review differ among foreign regulatory bodies. Our failure to comply with FDA or foreign regulatory agency requirements, or failure to take satisfactory and prompt corrective action in response to an adverse inspection, could result in enforcement actions, including a warning letter, adverse publicity, a shutdown of or restrictions on our manufacturing operations, a recall or seizure of our products, fines, injunctions, civil or criminal penalties, or other sanctions, any of which could cause our business and operating results to suffer.

We are subject to continuing regulation by the FDA, and failure to comply may materially harm our business.

We are subject to Medical Device Reporting (“MDR”)  regulations, which require us to report to the FDA if we become aware of information that reasonably suggests our product may have caused or contributed to a death or serious injury or has malfunctioned and the device or a similar device we market would likely cause or contribute to a death or serious injury if the malfunction were to recur. We may fail to report adverse events of which we become aware within the prescribed timeframe. We may also fail to recognize that we have become aware of a reportable adverse event. If we fail to comply with our medical device reporting obligations, the FDA could issue warning letters or untitled letters, take administrative actions, commence criminal prosecution, impose civil monetary penalties, request or require a product recall, seize our products, or delay the clearance of our future products. We must report corrections and removals to the FDA where the correction or removal was initiated to reduce a risk to health posed by the device or to remedy a violation of the Federal Food, Drug, and Cosmetic Act, or FDCA, caused by the device that may present a risk to health.

Our failure to comply with these or other applicable regulatory requirements could result in enforcement actions by the FDA which may include untitled letters, warning letters, fines, injunctions, consent decrees and civil penalties; customer notifications or repair, replacement or refunds; and criminal prosecution.

Changes in the healthcare industry may require us to decrease the selling price for our services or products or could result in a reduction in the available market size.

Governmental and private sector initiatives in the U.S. and abroad involving trends toward managed healthcare and cost containment could place an emphasis on our ability to deliver more cost-effective medical therapies. The development of other cost-effective devices could eventually adversely affect the prices and/or sales of our services or products. Companies in the healthcare industry are subject to various existing and proposed laws and regulations, in both domestic and international markets, regulating healthcare pricing and profitability. Additionally, there have been third-party payer initiatives to challenge the prices associated with medical products, which if successful, could affect our ability to sell services or products on a competitive basis in the future.

In the United States, there has been a trend of consolidation among healthcare facilities and purchasers of medical devices, allowing such purchasers to limit the number of suppliers from whom they purchase medical products. As result, it is unknown whether such purchasers will decide to stop purchasing our products or demand discounts on our prices. Any pressure to reduce our product prices in response to these industry trends and the decrease in market size could adversely affect our anticipated revenue and profitability of our sales, creating a material adverse effect on our business.

If we are unable to effectively adapt to changes in the healthcare industry, our business may be harmed.

Federal, state, and local legislative bodies frequently pass legislation and promulgate regulations relating to healthcare reform or that affect the healthcare industry. As has been the trend in recent years, it is reasonable to assume that there will continue to be increased government oversight and regulation of the healthcare industry in the future. We cannot predict the ultimate content, timing, or effect of any new healthcare legislation or regulations, nor is it possible at this time to estimate the impact of potential new legislation or regulations on our business. It is possible that future legislation enacted by Congress or state legislatures, or regulations promulgated by regulatory authorities at the federal or state level, could adversely affect our business. It is also possible that the changes to federal healthcare program reimbursements to providers who purchase our products or use our services may serve as precedent to possible changes in other payors’ reimbursement policies in a manner adverse to us. Similarly, changes in private payor reimbursements could lead to adverse changes in federal healthcare programs, which could have a material adverse effect on our business, financial condition, cash flows, and results of operations.

There can be no assurance that we will be able to successfully address changes in the current regulatory environment. Some of the healthcare laws and regulations applicable to us are subject to limited or evolving interpretations, and a review of our business or operations by a court, law enforcement, or a regulatory authority might result in a determination that could have a material adverse effect on us. Furthermore, the healthcare laws and regulations applicable to us may be amended or interpreted in a manner that could have a material adverse effect on our business, financial condition, cash flows and results of operations.

Recent economic trends could adversely affect our financial performance.

Economic downturns and declines in consumption in the healthcare market may affect the levels of both our sales and profitability. If a downturn in economic conditions occurs, or if there is deterioration in financial markets and major economies, our financial performance could be adversely affected. The tightening of credit in financial markets may adversely affect the ability of our customers and suppliers to obtain financing, which could result in a decrease in, or deferrals or cancellations of, the sale of our products and services. In addition, weakening economic conditions may result in a decline in spending for ART and fertility assistance that could adversely affect our business operations and liquidity. We are unable to predict the likely duration and severity of any disruption in the domestic and global financial markets.

Risks Related to Our Common Stock

Our secured debt instruments contain numerous restrictive covenants that limit management’s discretion to operate our business.

In our secured debt instruments, we agreed to certain covenants that place significant restrictions on, among other things, our ability to incur additional indebtedness, to create liens or other encumbrances, to make certain payments and investments, and to sell or otherwise dispose of assets and merge or consolidate with other entities. Any failure to comply with the covenants included in the secured debt instruments could result in an event of default, which could trigger an acceleration of the related debt. If we were unable to repay the debt upon any such acceleration, our senior lenders could seek to foreclose on our assets in an effort to seek repayment under the loans. If our lenders were successful, we would be unable to conduct our business as it is presently conducted and our ability to generate revenues and fund our ongoing operations would be materially adversely affected.

If we are unable to maintain compliance with all applicable continued listing requirements and standards of Nasdaq, our common stock will be delisted from Nasdaq.

Our common stock is currently listed on Nasdaq. In order to maintain that listing, we must satisfy minimum financial and other continued listing requirements and standards, including those regarding director independence and independent committee requirements, minimum stockholders’ equity, minimum share price, and certain corporate governance requirements.

If we were to be delisted, we would expect our common stock to be traded in the over-the-counter market which could adversely affect the liquidity of our common stock. Additionally, we could face significant material adverse consequences, including:

a limited availability of market quotations for our common stock;

a decreased ability to issue additional securities or obtain additional financing in the future;

reduced liquidity for our stockholders;

potential loss of confidence by customers, collaboration partners and employees; and

loss of institutional investor interest.

In the event of a delisting, we can provide no assurance that any action taken by us to restore compliance with listing requirements would allow our common stock to become listed again, stabilize the market price or improve the liquidity of our common stock, prevent our common stock from dropping below the Nasdaq minimum bid price requirement, or prevent future non-compliance with Nasdaq’s listing requirements.

Our common stock is subject to risks arising from restrictions on reliance on Rule 144 by shell companies or former shell companies.

Under a SEC rule known as “Rule 144”, a person who has beneficially owned restricted securities of an issuer and who is not an affiliate of that issuer may sell them without registration under the Securities Act provided that certain conditions have been met. However, Rule 144 is unavailable for the resale of securities issued by an issuer that is a shell company or that has been at any time previously a shell company. The SEC defines a shell company as a company that has no or nominal operations and either (i) no or nominal assets, (ii) assets consisting solely of cash and cash equivalents, or (iii) assets consisting of any amount of cash and cash equivalents and nominal other assets. We are a former shell company.

The SEC has provided an exception to this unavailability if and for as long as the following conditions are met: (a) the issuer of the securities that was formerly a shell company has ceased to be a shell company; (b) the issuer of the securities is subject to the reporting requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended; (c) the issuer of the securities has filed all Exchange Act reports and materials required to be filed, as applicable during the preceding 12 months, other than certain Current Reports on Form 8-K; and (d) at least one (1) year has elapsed form the time the issuer filed current comprehensive disclosure with the SEC reflecting its status as an entity that it is not a shell company.

Because of our prior history as a shell company, stockholders who receive our restricted securities will only be able to sell them pursuant to Rule 144 without registration for only as long as we continue to meet the requirements set forth above. No assurance can be given that we will meet these requirements going forward. Furthermore, any non-registered securities we sell in the future or issue will have limited or no liquidity until and unless such securities are registered with the SEC and/or until we comply with the foregoing requirements.

As a result, it may be harder for us to raise funding through the sale of debt or equity securities unless we agree to register such securities with the SEC, which could require us to deploy additional resources. In addition, if we are unable to attract additional capital, it could have an adverse impact on our ability to implement our business plan and/or sustain our operations. Our status as a former “shell company” could prevent us from raising additional funds to develop additional technological advancements, which could cause the value of our securities to decline in value.

Our directors have the right to authorize the issuance of shares of our preferred stock and additional shares of our common stock.

Our directors, within the limitations and restrictions contained in our articles of incorporation and without further action by our shareholders, have the authority to issue shares of preferred stock from time to time in one or more series and to fix the number of shares and the relative conversion and voting rights, and terms of redemption, liquidation preferences and any other preferences, special rights and qualifications of any such series. While we have no intention of issuing shares of preferred stock at the present time, we may seek to raise capital through the sale of our securities and may issue shares of preferred stock in connection with a particular investment. Any issuance of shares of preferred stock could adversely affect the rights of holders of our common stock.

Should we issue additional shares of our common stock, each investor’s ownership interest in our stock would be proportionally reduced.

The indemnification rights provided to our directors, officers and employees may result in substantial expenditures by us and may discourage lawsuits against its directors, officers and employees.

Our articles of incorporation and applicable Nevada law provide for the indemnification of our directors, officers, employees. The foregoing indemnification obligations could result in us incurring substantial expenditures to cover the costs of settlement or damage awards against directors, officers, and employees, which we may be unable to recoup. These provisions and resultant costs may also discourage us from bringing a lawsuit against our directors and officers for breaches of their fiduciary duties and may similarly discourage the filing of derivative litigation by our stockholders against our directors or officers even though such actions, if successful, might otherwise benefit us and our stockholders.

Our shares of common stock are thinly traded, and the price may not reflect our value; there can be no assurance that there will be an active market for our shares now or in the future.

We have a trading symbol for our common stock (“IVF”) and our common stock is currently listed on the Nasdaq Capital Market.

Our shares of common stock are thinly traded, and as such the price, if traded, may not reflect our value. There can be no assurance that there will be an active market for our shares of common stock either now or in the future. The market liquidity will be dependent on, among other things, the perception of our operating business and any steps that our management might take to bring us to the awareness of investors. There can be no assurance given that there will be any awareness generated or, if given, that it will be positive.

Consequently, investors may not be able to liquidate their investment or may be able to liquidate it only at a price that does not reflect the value of the business. If a more active market should develop, the price may be highly volatile. Due to the possibility of our common stock being priced lower than its actual value, many brokerage firms may not be willing to effect transactions in the securities. Even if an investor finds a broker willing to effect a transaction in the shares of our common stock, the combination of brokerage commissions, transfer fees, taxes, if any, and any other selling costs may exceed the selling price.

We do not expect to pay any dividends to shareholders.

To date, we have never declared or paid any dividends to our stockholders. Our Board does not intend to distribute dividends in the near future. The declaration, payment and amount of any future dividends will be made at the discretion of the Board, and will depend upon, among other things, the results of our operations, cash flows and financial conditions, operating and capital requirements, and other factors as the Board considers relevant. There is no assurance that future dividends will be paid to stockholders. In the event dividends are paid to stockholders, there is no assurance with respect to the amount of any such dividend.

Our revenue and operating results could fluctuate from quarter to quarter, which may cause our stock price to decline.

Our results from year-to-year and from quarter-to-quarter may vary significantly based on individual clinic performance, the addition of new acquisitions, and ordering cycles for our INVOcell device from distributors and our partners. As a result, we expect period-to-period comparisons of our operating results may not be meaningful as an indication of our future performance for any future period.

We may have difficulty raising the necessary capital to fund operations because of the thin market and market price volatility for our shares of common stock.

Throughout 2025, there has been a thin market for our shares, and the market price for our shares has been volatile. In recent years, the securities markets in the U.S. and around the world have experienced a high level of price and volume volatility, and the market price of securities of many companies have experienced wide fluctuations that have not necessarily been related to the operations, performances, underlying asset values or prospects of such companies. For these reasons, we expect our shares of common stock may also be subject to volatility resulting from market forces over which we will have no control. The success of our growth strategy may be dependent upon our ability to obtain additional financing through debt and equity or other means. The thin market for our shares, and the volatility in the market price for our shares, may adversely affect our ability to raise needed additional capital.

An active trading market for our common stock may not be sustained. If an active trading market is not sustained, our ability to raise capital in the future may be impaired.

There is limited history of trading for our common stock. Given the lack of trading history of our common stock, there is a risk that an active trading market for our shares may not be sustained, which could put downward pressure on the market price of our common stock and thereby affect your ability to sell shares you purchased. An inactive trading market for our common stock may also impair our ability to raise capital to continue to fund the operations of the combined companies by selling shares and impair our ability to acquire other companies or technologies by using our shares as consideration.

The trading price of our common stock is highly volatile, which could result in substantial losses for purchasers of our common stock. Securities class action or other litigation involving our company or members of our management team could also substantially harm our business, financial condition and results of operations.

Our stock price is highly volatile. The stock market in general and the market for smaller healthcare and fertility services companies in particular have experienced extreme volatility that has often been unrelated to the operating performance of particular companies. In addition, if the market for healthcare and fertility services stocks or the broader stock market continues to experience a loss of investor confidence, the trading price of our common stock could decline for reasons unrelated to our business, financial condition or results of operations. As a result of this volatility, you may not be able to sell your common stock at or above the purchase price and you may lose some or all of your investment. The market price for our common stock may be influenced by many factors, including the following:

● the success of existing or new competitive products or technologies;

● announcements by us or our competitors of significant acquisitions, strategic partnerships, joint ventures, collaborations or capital commitments;

● regulatory or legal developments in the United States, including those affecting reproductive healthcare, fertility services, and embryo handling;

● the recruitment or departure of key personnel;

● actual or anticipated changes in estimates as to financial results, clinical performance, or development timelines;

● announcement or expectation of additional financing efforts;

● sales of our common stock by us, our insiders or other stockholders;

● variations in our financial results or those of companies that are perceived to be similar to us;

● changes in estimates or recommendations by securities analysts, if any, that cover us;

● changes in the structure of healthcare payment systems;

● market conditions in the healthcare and fertility services sectors;

● our ability to successfully identify, acquire, and integrate fertility clinic acquisitions;

● patient volume trends and seasonal fluctuations in demand for fertility services;

● general economic, industry and market conditions; and

● the other factors described in this “Risk Factors” section.

In the past, securities class action litigation has often been brought against a company following a decline in the market price of its securities. This risk is especially relevant for healthcare and fertility services companies, which have experienced significant stock price volatility in recent years.

Related to Market Uncertainties

Unstable market and economic conditions may have serious adverse consequences on our business, financial condition and stock price.

The global credit and financial markets have experienced extreme volatility and disruptions in the past several years, including severe volatility resulting from U.S. trade policy and the threatened or actual implementation of tariffs, severely diminished liquidity and credit availability, volatile interest rates, rising and fluctuating inflation rates, reduced corporate profitability, declines in consumer confidence, declines in economic growth, increases in unemployment rates and uncertainty about economic stability. U.S. debt ceiling and budget deficit concerns have increased the possibility of additional credit-rating downgrades and economic slowdowns, or a recession in the United States. Although U.S. lawmakers passed legislation to raise the federal debt ceiling on multiple occasions, ratings agencies have lowered or threatened to lower the long-term sovereign credit rating on the United States. The impact of this or any further downgrades to the U.S. government’s sovereign credit rating or its perceived creditworthiness could adversely affect the U.S. and global financial markets and economic conditions. In addition, inflation rates in the U.S. have recently increased to levels not seen in decades.

We believe that the state of global economic conditions are particularly volatile and uncertain due to ongoing global tensions and unexpected shifts in political, legislative and regulatory conditions concerning, among other matters, international trade and taxation, and that an uneven recovery or a renewed global downturn may negatively impact our business and operations. There can be no assurance that further deterioration in credit and financial markets and confidence in economic conditions will not occur. Our general business strategy may be adversely affected by any such economic downturn, volatile business or political environment or continued unpredictable and unstable market conditions. If the current equity and credit markets deteriorate, it may make obtaining any necessary debt or equity financing more difficult, more costly and more dilutive. For example, as a result of political, social, and economic instability abroad, including as a result of armed conflict, war or threat of war, in particular, the ongoing conflicts in Ukraine and the Middle East, including resulting sanctions and supply chain disruptions, terrorist activity and other security concerns in general, there could be a significant disruption of global financial markets, impairing our ability to raise capital when needed on acceptable terms, if at all. Failure to secure any necessary financing in a timely manner and on favorable terms could have a material adverse effect on our growth strategy, financial performance and stock price and could require us to delay or abandon our acquisition and expansion strategy. In addition, there is a risk that one or more of our current service providers and other partners may not survive an economic downturn, which could directly affect our ability to attain our operating goals on schedule and on budget. To the extent that our profitability and strategies are negatively affected by downturns or volatility in general economic conditions, our business and results of operations may be materially adversely affected.

Changes in U.S. trade policy and the imposition of tariffs could increase our operating costs and adversely affect our business.

The U.S. government has imposed broad tariffs on a wide range of imported goods, and further escalation of trade restrictions remains possible. To the extent that medical devices, consumables, or other supplies used in our clinic operations are sourced from foreign manufacturers, these tariffs could increase our operating costs. If we are unable to offset such cost increases, our margins and results of operations could be adversely affected. We cannot predict the scope or duration of current tariff measures or the extent to which retaliatory trade actions by other countries could further disrupt our supply chain or increase our costs.

Our business is affected by macroeconomic conditions, including rising inflation, interest rates and supply chain constraints.

Various macroeconomic factors could adversely affect our business and the results of our operations and financial condition, including changes in inflation, interest rates and overall economic conditions and uncertainties such as those resulting from the current and future conditions in the global financial markets. For instance, rising interest rates have impacted our net income. Recent supply chain constraints have led to higher inflation, which, if sustained, could have a negative impact on our product development and operations. If inflation or other factors were to significantly increase our business costs, our ability to develop our current pipeline and new therapeutic products may be negatively affected. Current capital market conditions, including the impact of inflation, have increased borrowing rates and can be expected to significantly increase our cost of capital as compared to prior periods and could also affect our ability to raise capital on favorable terms, or at all, in order to fund our operations. Similarly, these macroeconomic factors could affect the ability of our third-party suppliers and manufacturers to manufacture clinical trial materials for our product candidates.

General Risk Factors

We are a Smaller Reporting Company, or SRC, and the reduced disclosure requirements applicable to SRCs may make our common stock less attractive to investors.

We are considered a SRC under Rule 12b-2 of the Exchange Act. We are therefore entitled to rely on certain reduced disclosure requirements, such as an exemption from providing selected financial data and executive compensation information. These exemptions and reduced disclosures in our SEC filings due to our status as a smaller reporting company also mean our auditors are not required to review our internal control over financial reporting and may make it harder for investors to analyze our results of operations and financial prospects. We cannot predict if investors will find our common stock less attractive because we may rely on these exemptions. If some investors find our common stock less attractive as a result, there may be a less active trading market for our common stock and our common stock prices may be more volatile. We will remain a smaller reporting company until our public float exceeds $250 million or our annual revenues exceed $100 million with a public float greater than $700 million.

We have broad discretion over the use of our cash and cash equivalents and may not use them effectively.

Our management has broad discretion to use our cash and cash equivalents to fund our operations and could spend these funds in ways that do not improve our results of operations or enhance the value of our common stock. The failure by our management to apply these funds effectively could result in financial losses that could have a material adverse effect on our business, cause the price of our common stock to decline and delay the development of our product candidates. Pending our use to fund operations, we may invest our cash and cash equivalents in a manner that does not produce income or that loses value.

We have identified material weaknesses in our internal control over financial reporting, and our internal control over financial reporting was not effective. If we are unable to remediate these material weaknesses, or if we identify additional material weaknesses in the future, we may be unable to accurately or timely report our financial results, which could have a material adverse effect on our business and the trading price of our common stock.

A material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis. As disclosed in Item 9A of this Annual Report on Form 10-K, our management concluded that, as of December 31, 2025, our internal control over financial reporting was not effective due to the existence of material weaknesses.

The material weaknesses identified relate to (1) a limited segregation of duties due to our lack of formal control documentation, limited resources, and the small number of employees, and (2) a lack of adequate accounting resources to properly account for complex accounting transactions. We are in the process of implementing remediation measures designed to address these material weaknesses, which include seeking to improve our formal control documentation, increase our resources, and additional accounting personnel to further segregate duties, improve supervision and increase training of our accounting staff with respect to generally accepted accounting principles, provide additional training to our management regarding use of estimates in accordance with generally accepted accounting principles, increase the use of contract accounting assistance, and increase the frequency of internal financial statement review. We cannot assure you, however, that our remediation efforts will be successful, that additional material weaknesses will not be identified in the future, or that our independent registered public accounting firm will not identify material weaknesses in connection with future audits.

If we fail to remediate the identified material weaknesses, or if additional material weaknesses or significant deficiencies in our internal control over financial reporting are identified, we could be required to restate our historical financial statements, we may be unable to accurately or timely report our financial condition or results of operations, and investor confidence in the accuracy and completeness of our financial reports may be undermined. Any of these outcomes could result in regulatory scrutiny or enforcement action by the SEC, civil litigation, delisting of our common stock from Nasdaq, and a decline in the trading price of our common stock. In addition, our ability to raise capital could be materially impaired if investors and lenders lose confidence in our financial reporting.

If securities or industry analysts do not publish research or publish inaccurate or unfavorable research about our business, our share price and trading volume could decline.

The trading market for our common stock will be influenced by the research and reports that industry or securities analysts publish about us or our business. If one or more of the analysts who cover us issues an adverse opinion about our company, our stock price would likely decline. If one or more of these analysts ceases research coverage of us or fails to regularly publish reports on us, we could lose visibility in the financial markets, which in turn could cause our stock price or trading volume to decline.

Stockholders may be diluted significantly through our efforts to obtain financing and from issuance of additional shares of our common stock, including such issuances of shares for services.

To satisfy certain financial obligations, we have issued and may continue to issue shares of our common stock and we have incurred and may continue to incur debt, which may be convertible into shares of our common stock. We may attempt to raise capital by selling shares of our common stock, possibly with warrants, which may be issued or exercised at a discount to the market price for our common stock. These actions would result in dilution of the ownership interests of existing shareholders, and may further dilute the common stock book value, and that dilution may be material. Such issuances may also serve to enhance existing management’s ability to control us as the shares may be issued to our officers, directors, new employees, or other related parties.

We are subject to the reporting requirements of U.S. federal securities laws, which can be time consuming and expensive.

We are a public reporting company and accordingly subject to the information and reporting requirements of the Exchange Act, and other federal securities laws, including compliance with the Sarbanes-Oxley Act of 2002. We are required to prepare and file annual and quarterly reports, proxy statements and other information with the SEC and furnish audited reports. Compliance with such reporting requirements is both time-consuming and costly for us. We may need to hire additional financial reporting, internal control, and other finance personnel in order to develop and implement appropriate internal controls and reporting procedures.

In addition, the Sarbanes-Oxley Act of 2002 and the Dodd-Frank Wall Street Reform and Consumer Protection Act, as well as rules implemented by the SEC and the securities exchanges, require certain corporate governance practices for public companies. Our management and other personnel have devoted and expect to continue to devote a substantial amount of time to public reporting requirements and corporate governance. These rules and regulations have significantly increased our legal and financial compliance costs and made some activities more time-consuming and costly. If these costs are not offset by increased revenues and improved financial performance, our financial condition and results of operations may be materially adversely affected. These rules and regulations also make it more difficult and more expensive for us to obtain director and officer liability insurance in the future. Additionally, we may be required to accept reduced policy limits and coverage or incur substantially higher costs to obtain the same or similar coverage. As a result, it may be more difficult for us to attract and retain qualified personnel to serve on our Board or as executive officers.

Failure to comply with internal control attestation requirements could lead to loss of public confidence in our financial statements and negatively impact our stock price.

Pursuant to Section 404 of the Sarbanes-Oxley Act of 2002, we are required to conduct an annual management assessment of the effectiveness of our internal controls over financial reporting. If we fail to timely develop our internal controls, and management is unable to make this assessment, or, once required, if the independent registered public accounting firm cannot timely attest to this assessment, we could be subject to regulatory sanctions. As a result, a loss of public confidence in our financial controls and the reliability of our consolidated financial statements may develop ultimately negatively impacting our stock price and our ability to raise additional capital when and as needed.

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Forward-Looking Statements

This discussion includes certain forward-looking statements about our business and our expectations, including statements relating to revenues, international revenues, revenue growth rates, gross margin, operating expenses, amortization expenses, earnings per share, available cash and operating cash flow. Any such statements are subject to risk that could cause the actual results to vary materially from expectations. For a further discussion of the various risks that may affect our business and expectations, see the section titled “Risk Factors” contained in Item 1A of Part I of this Annual Report on Form 10-K. The risks and uncertainties discussed therein do not reflect the potential future impact of any mergers, acquisitions or dispositions. In addition, any forward-looking statements represent our estimates only as of the day this Annual Report was filed with the SEC and should not be relied upon as representing our estimates as of any subsequent date. While we may elect to update forward-looking statements at some point in the future, we specifically disclaim any obligation to do so, even if our estimates change.

Overview

We are a healthcare services and technology company focused on the fertility marketplace and dedicated to expanding access to ART care to patients in need. Our principal commercial strategy is focused on acquiring, establishing, and operating fertility clinics and related businesses and technologies. Our acquisition strategy focuses on US-based, profitable fertility clinics. Our clinics offer a variety of fertility services including IVF and the IVC procedure enabled by INVOcell.  As of the date of this filing, we have four fertility clinics in the United States. We also continue to engage in the sale and distribution of our INVOcell technology solution into third-party owned and operated fertility clinics. We also intend to seek out additional, innovative fertility-focused technologies, to license or acquire in order to utilize within our clinics.

Fertility Clinics

On February 18, 2026, we completed our acquisition of Family Beginnings, an Indiana based fertility clinic that offers both IVF and IVC. (See Item 1 for additional information on the acquisition of Family Beginnings).

On August 10, 2023, we consummated the first acquisition of an existing fertility clinic, WFI. As an established and profitable clinic, the closing of the WFI acquisition more than tripled our annual revenue and became a major part of our clinic-based operations. The acquisition accelerated our transformation from a medical device company to a healthcare services company and immediately added scale and a significant source of positive cash flow to our operations. The acquisition of profitable IVF clinics complements our efforts to build new INVO Centers, and we expect to continue this strategy to accelerate overall growth.

On March 10 and June 28, 2021, we established joint ventures to open INVO Centers in Birmingham, Alabama, and Atlanta, Georgia, respectively. We established these clinics to increase use of the INVOcell, to accelerate the growth and awareness of the IVC procedure, and to expand the availability of statistical and clinical data supporting its use. These clinics also represent our initial entry into clinic-based fertility operations and enabled us to expand our revenue per fertility cycle from hundreds of dollars (from the sale of each INVOcell device) to thousands of dollars, and to significantly advance our path to building greater scale in our overall operations and to reaching profitability.

INVOcell Device

Our proprietary INVOcell® device enables fertilization and early embryo development to occur in vivo within the woman’s body - the world’s first IVC technique of its kind. Unlike IVF, which relies on expensive laboratory incubators, the INVOcell allows fertilization and early embryo development to take place in the woman’s body and has demonstrated equivalent pregnancy success and live birth rates as IVF.

While INVOcell remains part of our efforts, our strategy has expanded to focus more broadly on providing ART services through clinic operations.

Operations

Our critical management and leadership functions are carried out by our management team. In the Fertility Clinic segment, each clinic is separately staffed with the people necessary to manage daily activities, while most administrative tasks are centralized and handled by the INVO corporate staff. With respect to the INVOcell Device segment, we have contracted out the manufacturing, assembly, packaging, and labeling to a medical manufacturing company, sterilization of the device to a sterilization specialist, and storage and shipping to a third part logistics company.

Wisconsin Fertility Institute

As an established and profitable clinic, WFI has a full staff, including a REI, an OBGYN trained to provide fertility treatment and full complement of medical, laboratory and administration staff. The day to day clinical operations are handled by on site staff. Our corporate staff manages finance, accounting, human resources and other overhead responsibilities.

Alabama JV

We established the Alabama JV with HRCFG. The responsibilities of HRCFG’s principals include providing clinical practice expertise, performing recruitment functions, providing all necessary training, and providing day-to-day management of the Alabama JV. Our responsibilities include providing funding to the Alabama JV and being the exclusive provider of the INVOcell.

Georgia JV

We formed a joint venture with Bloom to establish the Georgia JV. The responsibilities of Bloom include providing all medical services required for the operation of the Georgia JV. Our responsibilities include providing funding to the Georgia JV, lab services, quality management, and being the exclusive provider of the INVOcell.

INVOcell

To date, we have completed a series of important steps in the successful development and manufacturing of the INVOcell:

Manufacturing : We are ISO 13485:2016 certified and manage all aspects of production and manufacturing with qualified suppliers. Our key suppliers, which include NextPhase Medical Devices, R.E.C. Manufacturing Corporation, and Casco Bay Molding, have been steadfast partners since our company first began and can provide us with virtually an unlimited capability to support our growth objectives, with all manufacturing performed in the New England region of the U.S.

Raw Materials : All raw materials utilized for the INVOcell are medical grade and commonly used in medical devices (e.g., medical grade silicone, medical grade plastic). Our principal molded component suppliers, Casco Bay Molding and R.E.C. Manufacturing Corporation, are well-established companies in the molding industry and are either ISO 13485 or ISO 9001 certified. The molded components are supplied to our contract manufacturer for assembly and packaging of the INVOcell system. The contract manufacturer is ISO 13485 certified, and FDA registered.

US Marketing Clearance : The safety and efficacy of the INVOcell has been demonstrated and cleared for marketing and use by the FDA in November 2015.

Clinical : In June 2023, we received FDA 510(k) clearance to expand the labeling on the INVOcell device and its indication for use to provide for a 5-day incubation period. The data supporting the expanded 5-day incubation clearance demonstrated improved patient outcomes.

Market Opportunity

Fertility Clinics and INVOcell Device

The global ART marketplace is a large and growing, multi-billion-dollar industry across the world as increased infertility rates, greater patient awareness and improving financial incentives, such as insurance and governmental assistance, continue to drive growth and demand. According to the European Society for Human Reproduction 2024 ART Fact Sheet, one in six couples worldwide experience fertility challenges. Additionally, the worldwide market remains vastly underserved as a high percentage of patients in need of care continue to go untreated each year for many reasons, but key among them are capacity constraints and cost barriers. There have been large increases in the use of IVF, with current estimates of approximately 4 million ART cycles performed globally each year, producing around 1 million babies. Regrettably, this only amounts to less than 5% of the infertile couples worldwide being treated and less than 2% of such couples having a child though IVF. The industry remains capacity constrained which creates challenges in providing access to care at an affordable price for the volume of patients in need. A survey by “Resolve: The National Infertility Association,” indicates the two main reasons couples do not use IVF is cost and geographical availability (and/or capacity).

In the United States, infertility affects an estimated 10%-15% of the couples of childbearing-age, according to the American Society of Reproductive Medicine (2017). According to the CDC, there are approximately 6.7 million women with impaired fertility. Based on 2022 data from the CDC’s National ART Surveillance System, approximately 435,000 IVF cycles were performed across ~500 IVF centers, leaving the U.S. with a large, underserved patient population, similar to most markets around the world.

Our corporate development strategy, which includes acquiring established existing practices, building new clinics, and expanding our INVOcell device, is designed to take advantage of the attractive fertility market dynamics of supply and demand.

Competitive Advantages

INVOcell Device and Fertility Clinics

Over the past several years, the principal focus of our commercial efforts has shifted from the distribution of our INVOcell device to the provision of fertility clinic services through our network of clinics. For the most part, our clinical activities have been focused on secondary markets where there is a greater imbalance between the need for ART treatment and the number of cycles available. Combined with our ability to offer a wider range of advanced fertility care, including IVC, IVF and IUI, at multiple price points, our clinics have the opportunity for differentiation from our competitors. As with our INVOcell technology, we continuously look for new solutions that can create greater efficiency and effectiveness in the provision of fertility cycles and support our efforts to democratize fertility care.

While a much smaller part of our current business, we continue to believe that our INVOcell device, and the IVC procedure it enables, can play a key role in making advanced fertility care more affordable and accessible. We continue to engage with sympathetic third-party clinics that share our same vision and that use our one-of-a-kind INVOcell device.

Unlike IVF, where the oocytes and sperm develop into embryos in a laboratory incubator, the INVOcell allows fertilization and early embryo development to take place in the woman’s body. We believe that the IVC procedure can provide the following benefits:

May reduce lab procedures, helping clinics and doctors to increase patient capacity, lower costs and offer a more affordable advanced fertility treatment option;

A natural and stable incubation environment; and

A more personal, intimate experience in creating a baby.

In both current utilization of the INVOcell, and in clinical studies, the IVC procedure has demonstrated equivalent pregnancy success and live birth rates as IVF and generally may be offered at a significant discount to IVF cycles.

Sales and Marketing

Fertility Clinics

Our four fertility clinics employ various strategies to build awareness for their services and/or to maintain and grow patient flow and fertility cycle volume. The principal source of patient flow comes through social media marketing, OBGYN referrals, and patient word of mouth. Our clinical staff build and maintain relationships with the local OBGYN community, regularly following up with patient OBGYNs to build additional referral flow. We also conduct regular social and other media campaigns to attract new patients and to build awareness.

At the corporate level, we seek to build general awareness for our clinical activities and IVC procedure results with a view to drive patients to our centers and to grow demand for our INVOcell device. These efforts also support our ongoing work to acquire additional IVF clinics in the near term and open new fertility clinics longer term.

The acquisition of existing fertility clinics requires less sales and marketing effort compared to opening new fertility clinics, as they have established patient flows that can be built upon. When entering a new market with a fertility clinic, we leverage the experience developed in establishing our Alabama and Georgia joint ventures. We employ strategies to secure patient flow levels that can enable new fertility clinics to become profitable and contribute economically to our overall business as soon as possible. Primarily, our fertility clinics seek to employ local, reputable physicians with strong ties to the OBGYN community.

INVOcell Device

Historically, our approach to marketing INVOcell was focused on identifying partners within targeted geographic regions that we believe could best support our efforts to expand access to advanced fertility treatment using the INVOcell and IVC procedure for the large number of underserved infertile people around the world. Those efforts resulted in the execution of a series of distribution agreements with partners across the globe. More recently, as we shifted our focus to opening INVO Centers and acquiring IVF clinics, which activities have been centered in the US, and as a result of the limited traction experienced in international markets, proactive marketing efforts for the INVOcell have been limited to the United States. In our domestic market, we distribute the INVOcell directly to a number of third-party IVF clinics and we remain open to pursuing foreign markets that present a realistic opportunity for incremental revenue on a profitable basis.

Recent Developments

JAG Amendment

On May 27, 2026, we entered into a letter agreement (the “JAG May 2026 Letter”) with JAG Multi Investments LLC (“JAG”) pursuant to which (i) the maturity date of certain previously issued convertible notes with a principal balance of $660,000 (the “JAG Notes”) was extended until December 31, 2026, (ii) we agreed to repay the JAG Notes in monthly installments of $50,000 starting in April 2026 with a balloon payment at the end of December 2026, (iii) confirmation that if we raise more than $3,000,000 after the date of the JAG May 2026 Letter, we shall pay ten percent (10%) of any proceeds in excess of $3,000,000 to accelerate repayment of the JAG Notes, (iv) the conversion price of the JAG Notes was reset to $1.60, (v) we agreed to issue to JAG a new warrant (the “JAG May 2026 Warrant”) to purchase up to 150,000 shares of our common stock at an exercise price of $1.60 per share, exercisable for five years from the date of issuance, and (vi) we agreed to the reset of the conversion and exercise prices of the JAG Notes and JAG May 2026 Warrant, respectively, to equal the price of any future financing based on a share price that is lower than the conversion and exercise prices then in effect.

Nasdaq

On April 23, 2026, we received a letter (the “10-K Letter”) from the Listing Qualifications staff (the “Staff”) of The Nasdaq Stock Market LLC (“Nasdaq”) indicating that we failed to file our Annual Report on Form 10-K for the year ended December 31, 2025 (the “10- K Filing”), on a timely basis and, as such, no longer satisfies Nasdaq Listing Rule 5250(c)(1) (the “Timely Filing Rule”)

On May 27, 2026 we receive an additional letter (the “10-Q Letter”) from the Staff indicating that we failed to file our Quarterly Report on Form 10-Q for the period ended March 31, 2026 (the “10-Q Filing”), on a timely basis.

Neither letter had an immediate effect on the listing of our common stock.

Both letters also stated that, in accordance with Nasdaq rules, we have 60 calendar days from the date of the 10-K Letter to submit a plan to regain compliance with the Timely Filing Rule. Should the Staff accept such plan, it could grant an exception of up to 180 calendar days from the 10-K Filing’s due date, or until October 13, 2026, to regain compliance.

Reverse Stock Split (March 2026)

On March 25, 2026, we filed a certificate of change with the Secretary of State of Nevada to effectuate a reverse split of our common stock at a ratio of 1-for-5, and our authorized common stock was proportionately reduced to 50,000,000 shares from 250,000,000 shares. The reverse stock split took effect on March 27, 2026. All share information included in this Form 10-K has been reflected as if the reverse stock split occurred as of the earliest period presented.

Closing of Family Beginnings Acquisition

On February 18, 2026, we completed the acquisition of Family Beginnings P.C., a fertility clinic located in Indianapolis, Indiana. The transaction was executed through our wholly owned subsidiary Wood Violet. The total purchase price was approximately $760,000, consisting of $360,000 in cash (net of a holdback) and $400,000 in Series D Preferred Stock.

As part of the acquisition structure, we acquired the clinic’s non-medical business assets through Wood Violet, while the clinic’s medical assets were acquired by Fertility, P.A., which entered into a long-term Management Services Agreement with Wood Violet. Under this agreement, Wood Violet will provide management, administrative, laboratory, and operational support services to the clinic for an initial 10-year term, renewable for additional five-year periods.

In connection with the acquisition, we also entered into a lease for approximately 4,387 square feet of clinic and office space in Indianapolis, effective March 1, 2026, with an initial term through July 31, 2033.

Founded more than a decade ago, Family Beginnings has built a strong reputation for delivering comprehensive fertility services with a highly personalized, patient-first approach. The clinic offers a full suite of reproductive services, including in vitro fertilization, intravaginal culture (as an early adopter of our INVOcell solution), ovulation induction, intrauterine insemination, fertility preservation, and diagnostic testing, supported by an experienced clinical and embryology team. The acquisition expands INVO’s clinical footprint and is expected to support continued growth of our fertility services platform.

Warrant Inducement (January 2026)

On January 28, 2026, we entered into the January 2026 Inducement Letter Agreement with an institutional investor and the Holder of the Common Warrants.

The issuance of the shares of common stock upon exercise of such the Common Warrants was registered pursuant to a registration statement on Form S-1 (File No. 333-292206), which was declared effective by the SEC on December 29, 2025.

Pursuant to the January 2026 Inducement Letter Agreement, the Holder agreed to exercise the Common Warrants for cash at the exercise price of $7.95 per share in consideration for our agreement to issue new unregistered warrants to purchase up to an aggregate of 1,893,492 shares of common stock at an exercise price of $7.95 per share. Such new warrants will become exercisable upon receipt of such approval as may be required by the applicable rules and regulations of the Nasdaq Capital Market (or any successor entity) from the stockholders of INVO with respect to issuance of all of such new warrants and the shares of common stock upon the exercise thereof and have a term of five and one-half years from the date stockholder approval is obtained.

We registered the resale of the shares underlying such new warrants pursuant to a registration statement on Form S-1 (File No. 333-293135), which was declared effective by the SEC on February 12, 2026, and we agreed to observe customary limitations on additional issuances of common stock and variable-rate financing arrangements for a limited period following the warrant inducement transaction.

The aggregate gross proceeds to us from the exercise of such existing warrants was approximately $7.5 million, before deducting offering expenses payable by us.

Maxim acted as our financial advisor in connection with the inducement transaction.

Increase in Authorized Common Stock (Jan 2026)

On January 22, 2026, our stockholders approved an amendment to our Amended and Restated Articles of Incorporation to increase our number of authorized shares of common stock from 6,250,000 to 250,000,000 and we filed a Certificate of Amendment to our Articles of Incorporation to increase our authorized shares of common stock for the same.

Private Placement (December 2025)

On December 2, 2025, we entered into a securities purchase agreement with an institutional investor for a private placement of approximately $4 million in securities, comprised of 47,000 shares of common stock, pre-funded warrants, and common warrants (the “Armistice Warrants”). The Common Warrants became exercisable on January 22, 2026 upon receipt of such approval as required by the applicable rules and regulations of the Nasdaq Capital Market (or any successor entity) from the stockholders of INVO with respect to issuance of all of such new warrants and the shares of common stock upon the exercise thereof, expired five years thereafter, and carried an exercise price of $8.45 per share. The Pre-Funded Warrants were immediately exercisable at $0.0005 per share until exercised in full.

In connection with the foregoing private placement, we entered into a placement agency agreement with Maxim on a reasonable best efforts basis, pursuant to which we agreed to pay the Placement Agent a fee equal to 8.0% of gross proceeds, warrants to purchase 23,669 shares of Common Stock at $10.5625 per share, and reimbursement of expenses up to $50,000.

Net proceeds from the private placement are being used to support our growth and liquidity needs, including funding a portion of the Family Beginnings P.C. acquisition, paying certain outstanding debt obligations, and providing additional working capital.

Reverse Stock Split (Nov 2025)

On November 26, 2025, we filed a certificate of change with the Secretary of State of Nevada to effectuate a reverse split of our common stock at a ratio of 1-for-8, and our authorized common stock was proportionately reduced to 6,250,000 shares from 50,000,000 shares. The reverse stock split took effect on November 28, 2025. All share information included in this Form 10-K has been reflected as if the reverse stock split occurred as of the earliest period presented.

Pritts Litigation and Binding Settlement Term Sheet

On May 7, 2025, Dr. Pritts and Pritts Trust filed a complaint in the Circuit Court of the State of Wisconsin, Dane County, against us and our subsidiaries INVO CTR, Wisconsin Fertility and Reproductive Surgery Associates, S.C., and Wood Violet. Dr. Pritts and the Pritts Trust have asserted causes of action arising out of the WFI Documents for breach of contract, breach of the implied covenant of good faith and fair dealing, tortious interference with contract (or, in the alternative, veil piercing), and unjust enrichment.

On May 14, 2025, INVO, Dr. Pritts, the Pritts Trust, and certain of their respective affiliates entered into the Term Sheet to settle all disputes between the parties pursuant to the Terms. The parties agreed to cooperate in good faith to prepare and enter into the Settlement Agreement based on the terms set forth in the Term Sheet; provided, however, that unless and until the Settlement Agreement is executed, the Terms are binding on the parties. Under the Terms, Wood Violet agreed to pay Dr. Pritts $6,000,000 in full and final settlement and satisfaction of all obligations to Dr. Pritts and her affiliates under the WFI Documents, of which $525,000 was paid concurrently with the execution of the Term Sheet, and the remainder of which is payable as follows: $475,000 due June 30, 2025, $750,000 due September 30, 2025, $750,000 due December 31, 2025, $1,000,000 due March 31, 2026, $2,000,000 due June 30, 2026, and $500,000 due December 31, 2026. INVO shall provide Wood Violet with use of 25% of all gross funding proceeds above $2,000,000 raised within any six-month period to accelerate the payment of scheduled settlement payments in chronological order. The parties will enter into a consent judgment to resolve the complaint that would come into effect upon any breach of the Settlement Agreement. The parties agreed to settle all disputes, including those related to employment, acquisition, tax, and related matters, the termination of all employment, consulting, and similar agreements with Dr Pritts, and other customary terms, including, without limitation, indemnification and release of claims. On September 30, 2025 we executed the Settlement Agreement.

FNL Financing Transactions

On October 11, 2024, we issued the Debenture to FNL. We became a party to the Securities Purchase Agreement, pursuant to the Joinder Agreement. FNL was entitled to convert any portion of the outstanding principal and accrued interest into shares of our common stock at a conversion price of $1,339.992 per share, subject to adjustment, following stockholder approval, provided that conversion could not result in FNL beneficially owning more than 4.99% of our outstanding common stock. Commencing March 14, 2025, we were required to redeem $437,127.24 of principal, plus accrued interest, on the 14th of each month until maturity.

Effective May 23, 2025, we entered into the May 2025 Amendment and Exchange Agreement, pursuant to which the parties agreed to (a) exchange outstanding shares of Series C-1 Preferred held by FNL for shares of Series C-2 Preferred, (b) amend the Series C-2 Certificate of Designation pursuant to the Certificate of Amendment to the Series C-2 Certificate of Designation, (c) exchange the Debenture for the Amended and Restated Debenture, and (d) amend the Securities Purchase Agreement to grant FNL the Additional Investment Right, exercisable at any time and from time to time beginning on or after May 23, 2025, to purchase up to $10,000,000 of aggregate stated value of AIR Preferred Shares, exercisable in minimum amounts of $500,000. The AIR Preferred Shares carry the same terms as the Series C-2 Preferred then outstanding, except that the conversion price upon issuance is deemed to be the lowest of (i) the conversion price then in effect, and (ii) the greater of (x) the Floor Price (as defined in the Certificate of Amendment to the Series C-2 Certificate of Designation) and (y) 85% of the arithmetic average of the three lowest VWAPs during the ten trading days prior to exercise. In consideration of the foregoing, we issued 1,029 additional shares of Series C-2 Preferred to FNL.

On June 30, 2025, we entered into an Amendment to the Securities Purchase Agreement (the “June 2025 Amendment”) with FNL to permit FNL to elect, when exercising its Additional Investment Right, to either purchase AIR Preferred Shares for cash (an “AIR Purchase”) or exchange them for all or a portion of the Amended and Restated Debenture, with the aggregate stated value of AIR Preferred Shares received in such exchange equal to the principal amount so exchanged plus accrued and unpaid interest thereon (an “AIR Exchange”). The Amendment also reduced the minimum exercise amount to $200,000. On the same date, we entered into the AIR Exercise and Reload Agreement, pursuant to which FNL exercised its Additional Investment Right to acquire 1,800 shares of Series C-2 Preferred with an aggregate stated value of $1,800,000 in exchange for $1,800,000 of principal, plus accrued and unpaid interest, under the Amended and Restated Debenture. In consideration thereof, we issued 630 additional shares of Series C-2 Preferred to FNL.

Effective August 21, 2025, we entered into the August 2025 Amendment and Exchange Agreement, pursuant to which the parties exchanged the Amended and Restated Debenture for the Second Amended and Restated Debenture, and removed the monthly redemption provisions. In connection therewith, the parties agreed to reduce the outstanding principal by $1,300,000 in exchange for AIR Preferred Shares with an aggregate stated value of $1,300,000, and we issued 325 additional shares of Series C-2 Preferred to FNL.

Effective September 29, 2025, we entered into the September 2025 Exchange Agreement, pursuant to which FNL exchanged the Second Amended and Restated Debenture for 467 shares of Series C-2 Preferred with an aggregate stated value of $1,334,000. As a result, the Second Amended and Restated Debenture was paid in full and fully extinguished.

In addition to the exchanges of outstanding debenture principal, during 2025, FNL exercised the AIR for $2,850,000 in aggregate cash consideration, for which we issued 2,850 shares of Series C-2 Preferred. As January 31, 2026, all outstanding shares of Series C-2 Preferred have been converted into shares of our common stock, and all dividends owed under the Series C-2 Preferred have been settled in full.

Decathlon Amendment

On September 29, 2023, we, our CEO, Steven Shum as a Key Person (as defined in the Loan Agreement defined below), and the our wholly-owned subsidiaries Bio X Cell, Inc, INVO Centers LLC, Wood Violet, Fertility Labs of Wisconsin LLC and Orange Blossom Fertility LLC as guarantors (the “Guarantors”), entered into the Loan Agreement with the Lender under which the Lender advanced a gross amount of $1,500,000.00 to us.

On September 24, 2024, we, the Lender, Steven Shum and the Guarantors entered into the First Amendment to the Loan Agreement, pursuant to which (i) the Lender approved that certain Standard Merchant Cash Advance Agreement, dated September 25, 2024 between us and Cedar Advance LLC, and (ii) we agreed to increase the Minimum Interest multiples set forth therein by 0.15 effective as of December 1, 2024, if we did not receive equity investment of at least $1,000,000 by November 30, 2024.

On October 11, 2024, we, the Lender, Steven Shum and the Guarantors entered into the Second Amendment to the Loan Agreement, pursuant to which we agreed, among other things, to pay down its loan by at least $500,000 and increase its monthly payments by up to $30,000 if we close a private offering of its securities. We also agreed to retain an investment banker to pursue a financing or a sale if it fails to meet certain liquidity covenants.

On August 13, 2025, we, the Lender, Steven Shum and the Guarantors entered into the Third Amendment to the Loan Agreement, pursuant to which (a) the Lender consented to the change of our name to INVO Fertility, Inc., (b) the Lender waived the event of default that would result from the entry of judgment pursuant to the Term Sheet with Dr. Pritts and the Pritts Trust, (c) the parties agreed to an adjusted repayment schedule whereby the monthly payment under the Loan Agreement increased by $20,000, and (d) we agreed to reimburse the Lender for approximately $17,500 in fees and expenses incurred in connection with the Third Amendment to the Loan Agreement.

On September 22, 2025, we, the Lender, Steven Shum, and the Guarantors entered into the Restated Third Amendment to the Loan Agreement, pursuant to which and in addition to amendments set forth in the Third Amendment, since we did not raise the above stated $1 million by November 30, 2024 as required under the Loan Agreement, the Loan Agreement was amended to reflect an increase of 0.15 to the Minimum Interest multiples set forth in the Loan Agreement.

Side Letter Agreement

Effective as of August 21, 2025, we entered into the Side Letter Agreement pursuant to which, among other things, the parties agreed to extend the deadline by which we must file a registration statement with the SEC for the resale of shares of our common stock (i) issuable upon conversion of the Second Amended and Restated Debenture, (ii) issuable upon conversion of shares of our Series C-2 Preferred Stock held by FNL, and (iii) issuable upon exercise of warrants held by FNL, to August 29, 2025. The parties further agreed to extend the deadline by which such registration statement must be declared effective by the SEC to the earlier of the (A) September 30, 2025 (or, in the event of a “full review” by the SEC, October 31, 2025) and (B) the 2nd business day after the date the Company is notified (orally or in writing, whichever is earlier) by the SEC that such registration statement will not be reviewed or will not be subject to further review.

Increase in Authorized Common Stock (July 2025)

On July 23, 2025, our stockholders approved an amendment to our Amended and Restated Articles of Incorporation to increase our number of authorized shares of common stock from 1,388,888 to 50,000,000 and we filed a Certificate of Amendment to our Articles of Incorporation to increase our authorized shares of common stock for the same.

Reverse Stock Split (July 2025)

On July 18, 2025, we filed a certificate of change with the Secretary of State of Nevada to effectuate a reverse split of our common stock at a ratio of 1-for-3, and our authorized common stock was proportionately reduced to 1,388,888 shares from 4,166,667 shares. The reverse stock split took effect on July 21, 2025. All share information included in this Form 10-K has been reflected as if the reverse stock split occurred as of the earliest period presented.

Series C-2 Preferred Amendments

On May 23, 2025, the Company filed a Certificate of Amendment that, among other changes, allows holders of Series C-2 Preferred to receive dividends payable in additional shares of Series C-2 Preferred, subject to specified equity-related conditions. The amendment also updated the mechanics for adjusting the conversion price of the Series C-2 Preferred in connection with any future issuances of AIR Preferred Shares.

On June 27, 2025, the Company filed a second amendment to the Series C-2 Certificate of Designation, which restated the rights and preferences of the Series C-2 Preferred and authorized 20,000 shares with a stated value of $1,000 per share. This amendment also removed certain redemption features, including the “Bankruptcy Triggering Event” and “Change of Control” redemption rights, as defined therein.

NTI Divesture

On October 11, 2024, we acquired NAYA Therapeutics, Inc. with the intent to expand beyond fertility into a broader healthcare portfolio combining our commercial-stage fertility business with a clinical-stage oncology and autoimmune technology business. Following insufficient stockholder support for key elements of the transaction at a March 2025 stockholder meeting, and upon advice of counsel, our proxy solicitation firm, and general stakeholder feedback, we elected to re-focus exclusively on our fertility business.

Effective June 2, 2025, we divested a majority stake in NAYA Therapeutics, Inc. by redeeming all outstanding shares of Series C-1 Preferred at a redemption price of 113.8558 shares of NAYA Therapeutics Class A Common Stock per share of Series C-1 Preferred redeemed. We retained 6,300 shares of Series A Preferred Stock of NAYA Therapeutics, representing 19.9% of outstanding common stock on an as-converted basis, and hold a secured convertible promissory note issued by NAYA Therapeutics on May 28, 2025 in the principal amount of $4,803,175.

Series C-1 Preferred Amendment

On May 28, 2025, we filed with the Nevada Secretary of State a certificate of amendment to the Series C-1 Certificate of Designation pursuant to which, we are entitled to redeem at our option at any time or from time to time upon not less than 2 calendar days written notice to the holders prior to the date fixed for redemption thereof, at a redemption price of 113.8558 shares of Class A Common Stock of NTI for each share of Series C-1 Preferred being redeemed.

Warrant Inducement (April 2025)

On April 30, 2025, we entered into the April 2025 Inducement Letter Agreement with an institutional investor and existing holder of certain existing warrants to purchase up to 3,882 shares of our common stock. Such existing warrants were originally issued on January 14, 2025, with an exercise price of $1,008.00 per share.

The issuance of the shares of common stock upon exercise of such existing warrants was registered pursuant to a registration statement on Form S-3 (File No. 333-283872), which was declared effective by the SEC on January 14, 2025.

Pursuant to the April 2025 Inducement Letter Agreement, FNL agreed to exercise such existing warrants for cash at the exercise price of $193.20 per share in consideration for our agreement to issue new unregistered warrants to purchase up to an aggregate of 5,823 shares of common stock at an exercise price of $193.20 per share (“FNL Inducement Warrants”). Such new warrants would become exercisable upon receipt of such approval as may be required by the applicable rules and regulations of the Nasdaq Capital Market (or any successor entity) from the stockholders of INVO with respect to issuance of all of such new warrants and the shares of common stock upon the exercise thereof and have a term of five years from the date stockholder approval would be obtained. We received stockholder approval for the issuance of shares of common stock upon exercise of such new warrants on July 23, 2025.

The aggregate gross proceeds to us from the exercise of such existing warrants was approximately $750,000, before deducting offering expenses payable by us.

Name Change

On April 14, 2025, we changed our corporate name to INVO Fertility, Inc., pursuant to an Amendment to Articles of Incorporation filed with the Nevada Secretary of State on April 14, 2025 (the “Name Change”). Pursuant to Nevada law, a stockholder vote was not necessary to effectuate the Name Change.

On April 28, 2025, our common stock ceased trading under the ticker symbol “NAYA” and began trading under our new ticker symbol, “IVF”, on the Nasdaq Capital Market.

Reverse Stock Split (March 2025)

On February 24, 2025, we filed a certificate of change with the Secretary of State of Nevada to effectuate a reverse split of our common stock at a ratio of 1-for-12, and our authorized common stock was proportionately reduced to 4,166,667 shares from 50,000,000 shares. The reverse stock split took effect on March 18, 2025. All share information included in this Form 10-K has been reflected as if the reverse stock split occurred as of the earliest period presented.

Public Offering

On January 14, 2025, we consummated the January 2025 Offering of 9,455 units (“Units”), each consisting of either one share of common stock, or one January 2025 PFWs in lieu thereof, and one January 2025 Warrant. The January 2025 Warrants are exercisable from and after the date of their issuance and expire on the five-year anniversary of such date, at an exercise price of $1,008.00 per share of common stock. Each January 2025 PFW is immediately exercisable at an exercise price of $0.144 per share and may be exercised at any time until all of the January 2025 PFWs are exercised in full. In connection with the January 2025 Offering, we entered into the January 2025 SPA with certain institutional investors who purchased Units in this January 2025 Offering.

The securities issued in the January 2025 Offering were offered pursuant to our registration statement on Form S-1, as amended (File No. 333-283872), initially filed by us with the SEC, on December 17, 2024 and declared effective on January 13, 2025.

We closed the January 2025 Offering on January 14, 2025, raising gross proceeds of approximately $9.5 million before deducting placement agent fees and other offering expenses payable.

Also in connection with the January 2025 Offering, on January 13, 2025, we entered into the January 2025 PAA with Maxim, pursuant to which (i) Maxim agreed to act as lead placement agent on a “best efforts” basis in connection with the January 2025 Offering, and (ii) we agreed to pay Maxim an aggregate fee equal to 6.5% of the gross proceeds raised in the January 2025 Offering (or 5.0% in the case of certain investors) and the Maxim January 2025 Warrants. The Maxim January 2025 Warrants are exercisable at any time after the six-month anniversary of the closing date, from time to time, in whole or in part, until five (5) years from the commencement of sales of the securities in the January 2025 Offering. Additionally, we reimbursed Maxim for certain expenses and legal fees up to $90,000.

In connection with the January 2025 Offering, on January 13, 2025, we entered into a Class C-2 Preferred Stock Redemption Agreement with FNL, pursuant to which we agreed to purchase and acquire from FNL 4,000 shares of our C-2 Preferred Stock for $4,000,000. Accrued dividends, plus any other accrued payments under the Certificate of Designations for the C-2 Preferred Stock, remained outstanding.

Results of Operations

During fiscal 2025, we worked to stabilize and build the business, strengthen the balance sheet and seek out additional acquisition opportunities. We successfully advanced these key goals, with substantial progress in the early part of 2026. We now have a robust pipeline of acquisitions opportunities and recently closed on the acquisition of Family Beginnings in Indiana (see Recent Developments for additional information on this acquisition).

Looking ahead, we expect our fertility operations to expand further, both through organic growth of our existing clinics and through the acquisition of additional, profitable fertility clinics. Our active pursuit of additional acquisitions is aimed at accelerating our growth, building scale in our operations, and driving our overall business to cash flow break even and beyond to profitability.

Although we anticipate our clinic operations will dominate our commercial efforts and revenue, we also will continue to work on growing INVOcell, both within our own clinics as well as to third party fertility clinics. We also intend to seek out additional, innovative technologies that we can utilize to benefit patients and enhance our clinic operations.

From a macro perspective, we believe we will benefit from the ongoing growth in the ART market, which continues to experience positive trends, including (1) an under-served patient population, (2) increasing infertility rates around the world, (3) growing awareness and education of fertility treatment options, (4) a growing acceptance of fertility treatment, (5) improvements in procedure techniques and hence improvements in pregnancy success rates, (6) generally improving insurance (private and public) reimbursement trends, and (7) an administration that supports increased access to fertility treatments.

As previously described, we completed the acquisition of NAYA Therapeutics in October of 2024. The original goal behind this transaction was to expand our business activities beyond fertility and to create a healthcare portfolio company initially focused on a commercial-stage fertility business combined with a unique clinical-stage oncology and autoimmune technology business .

In April 2025, not having received sufficient shareholder support for key elements of the NAYA Therapeutics acquisition, upon advice of counsel as well as general feedback from stakeholders, we elected to re-focus exclusively on our fertility business. As such, we changed our name and ticker symbol to “INVO Fertility, Inc.” and “IVF”, respectively, and, in May 2025, divested a majority interest in NAYA Therapeutics.

We remain enthusiastic about NAYA Therapeutics’ prospects and will retain a minority stake, which we hope to monetize in the future through value appreciation that could be generated from the clinical development of its bifunctional antibodies.

We believe that our renewed focus on our core fertility operations best serves our growth objectives.

Comparison of the years ended December 31, 2025 and 2024

Revenues

Revenue for the years ended December 31, 2025 and 2024 was $6.8 million and $6.5 million, respectively. Of the $6.8 million in revenue for 2025, $6.7 million was related to clinic revenue from the consolidated Georgia JV and WFI. The increase of approximately $0.3 million, or approximately 5%, was primarily related to increased clinical revenue.

Cost of Services

Cost of services for the years ended December 31, 2025 and 2024 was $4.3 million and $3.6 million, respectively. The increase in our cost of services was primarily related to an increase in clinical personnel expenses.

Cost of Goods Sold

Cost of goods sold for the years ended December 31, 2025 and 2024 was $31 thousand and $12 thousand, respectively. The increase in our cost of goods sold was primarily related to an increase in product revenue.

Selling, General, and Administrative Expenses

Selling, general and administrative expenses for the years ended December 31, 2025 and 2024 were $7.7 million and $8.1 million, respectively, of which $1.5 million and $1.6 million, respectively, was for non-cash, stock-based compensation expense. The decrease of $0.4 million or 5% was primarily the result of decreased corporate personnel expenses.

Impairment of Intangible Assets

Impairment of intangible assets for the years ended December 31, 2025 and 2024 were $1.4 million and $0, respectively. We recognized an impairment of $1,397,353 in our Clinic Services segment on the noncompetition agreement as we agreed to release Dr. Pritts from her noncompetition agreement as part of a settlement and binding term sheet entered into with Dr. Pritts on May 14, 2025. See Pritts Litigation and Binding Settlement Term Sheet in Recent Developments for additional information on the settlement and binding term sheet.

Gain on Changes in Fair Value

Gain on changes in fair value for the years ended December 31, 2025 and 2024 were $5.2 million and $0, respectively. We recognized gain of $0.2 million related to the change in fair value of the NAYA Note Receivable from the time of issuance to December 31, 2025, a gain of $3.8 million related to the change in the fair value of the FNL Inducement Warrants and the Armistice Warrants, and a gain of $1.1 million related to the change in fair value of the embedded derivative in the FNL Debenture.

Loss From Debt Extinguishment

Loss from debt extinguishment for the years ended December 31, 2025 and 2024, was $2.1 million and $0.04 million, respectively. The increase of approximately $1.8 million was primarily non-cash equity issued in conjunction with the convertible debentures issued to FNL and updated JAG Notes (as defined in the financial statements contained herein).

Gain on Settlement of Liability

Gain on settlement of liability for the years ended December 31, 2025 and 2024 was $ 0.9 million and $0, respectively. We recognized a gain of $0.9 million as part of a settlement and binding term sheet entered into with Dr. Pritts on May 14, 2025. See Pritts Litigation and Binding Settlement Term Sheet in Recent Developments for additional information on the settlement and binding term sheet.

Interest Expense and Financing Fees

Interest expense and financing fees for the years ended December 31, 2025 and 2024 were $1.3 million and $1.0 million, respectively. The increase of approximately $0.3 million, or approximately 26%, was primarily non-cash and due to the debt discount on the FNL Debenture.

Income Taxes

As of December 31, 2025, we had unused federal net operating loss carryforwards (“NOLs”) of $43.5 million. These losses expire in various amounts at varying times beginning in 2029 with a portion carrying on indefinitely. Unless expiration occurs, these NOLs may be used to offset future taxable income and thereby reduce our income taxes.

We recorded a valuation allowance against our deferred tax assets at December 31, 2025 and 2024 totaling $12.5 million and $8.9 million, respectively.

Discontinued O perations

Loss from discontinued operations, inclusive of the loss on disposition, for the years ended December 31, 2025 and 2024 was $18.0 million and $0, respectively. The loss from discontinued operations was from the divesture of NTI which was completed on May 2, 2025.

Liquidity and Capital Resources

For the years ending December 31, 2025, and 2024, we had net losses from continuing operations of approximately $5.3 million and $7.7 million, respectively. We had negative working capital of approximately $7.4 million as of December 31, 2025, compared to negative working capital of approximately $12.2 million as of December 31, 2024. As of December 31, 2025, we had stockholder’s equity of approximately $7.3 million compared to stockholder’s equity of approximately $12.6 million as of December 31, 2024. Cash used in operations for the year ending December 31, 2025 was approximately $7.0 million, compared to approximately $3.0 million for the year ending December 31, 2024.

We have been dependent on raising capital through debt and equity financing to secure the cash required to fund our operating expenses and investing activities. During 2025, we received net proceeds of approximately $2.9 million from the sale of preferred stock, net proceeds of approximately $1.1 million from the exercise of warrants, and net proceeds of approximately $12.4 million for the sale of our common stock, of which $4 million was used to redeem preferred stock. During 2024, we received proceeds of approximately $1.3 million from notes, net proceeds of approximately $1.6 million from the sale of preferred stock, net proceeds of approximately $0.9 million from the exercise of warrants, and net proceeds of approximately $0.2 million for the sale of our common stock. In January 2026 we raised an additional $7.5 million from the exercise of warrants in a warrant inducement.

Over the next 12 months, our plan includes growing our clinic revenue organically and pursuing additional profitable fertility clinic acquisitions. Until we can generate a sufficient amount of cash from operations, we will need to raise additional funding to meet our liquidity needs and to execute our business strategy. As in the past, we will seek debt and/or equity financing, which may not be available on reasonable terms, if at all.

These factors, among others, raise substantial doubt about our ability to continue as a going concern. If we are unable to raise additional funding to meet our working capital needs in the future, we will be forced to delay or reduce the scope of our growth and acquisition plans and/or limit or cease our operations. If we cannot continue as a going concern, our stockholders would likely lose most or all of their investment in INVO. Our financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Cash Flows

The following table shows a summary of our cash flows for the year ended December 31:

Cash (used in) provided by:

Operating activities

Investing activities

Financing activities

Cash Flows from Operating Activities

As of December 31, 2025, we had approximately $2.1 million in cash compared to approximately $0.6 million as of December 31, 2024. Net cash used in operating activities in 2025 was approximately $7.0 million, compared to approximately $3.0 million for the same period in 2024. The increase in net cash used in operations was primarily due to an increase in net loss and a decrease in accounts payable.

Cash Flows from Investing Activities

During the year ended December 31, 2025, cash used in investing activities of approximately $2.7 million was primarily related to payments due on the WFI acquisition. During the year ended December 31, 2024, cash provided by investing activities of approximately $0.4 million was primarily related to the cash acquired in the NAYA Therapeutics acquisition.

Cash Flows from Financing Activities

During the year ended December 31, 2025, cash provided by financing activities of approximately $11.1 million was related to proceeds from the sale of common stock, the sale of preferred stock, and warrant exercises. During the year ended December 31, 2024, cash provided by financing activities of approximately $3.1 million was related to proceeds from notes payable, the sale of preferred stock, and proceeds from warrant exercises.

Financing Activities

Public Offering (Jan 2025)

On January 14, 2025, we consummated the January 2025 Offering of 9,455 units, each consisting of either one share of common stock or one January 2025 Pre-Funded Warrant in lieu thereof, and one January 2025 Warrant, raising gross proceeds of approximately $9.5 million before deducting placement agent fees and other offering expenses. The January 2025 Warrants are exercisable immediately upon issuance, expire five years from issuance, and carry an exercise price of $1,008.00 per unit.

Warrant Inducement (April 2025)

On April 30, 2025, we entered into the April 2025 Inducement Letter Agreement with an institutional investor and existing holder of warrants to purchase up to 3,882 shares of common stock, originally issued January 14, 2025 at an exercise price of $1,008.00 per share. Pursuant to the agreement, the investor agreed to exercise such warrants for cash at a reduced exercise price of $193.20 per share in consideration for our issuance of new unregistered warrants to purchase up to 5,823 shares of common stock at an exercise price of $193.20 per share, with a five-year term commencing upon stockholder approval. We received stockholder approval on July 23, 2025. Aggregate gross proceeds from the warrant exercise were approximately $750,000, before deducting offering expenses.

FNL Amendment and Exchange Agreements & Additional Investment Right

On October 11, 2024, we issued the Debenture to FNL pursuant to the Joinder Agreement, entitling FNL to convert outstanding principal and accrued interest into common stock at $1,339.992 per share, subject to adjustment and stockholder approval, provided that conversion could not result in FNL beneficially owning more than 4.99% of our outstanding common stock. Commencing March 14, 2025, we were required to redeem $437,127.24 of principal plus accrued interest on the 14th of each month until maturity.

Through a series of amendments and exchange agreements entered into between May and September 2025, we restructured and ultimately extinguished the Debenture. These transactions included exchanging the Debenture for the Amended and Restated Debenture, subsequently for the Second Amended and Restated Debenture with principal reduced to $1,751,344 and monthly redemption provisions removed, and ultimately exchanging the remaining outstanding principal for shares of Series C-2 Preferred. In connection with these transactions, we also granted FNL the Additional Investment Right to purchase up to $10,000,000 of AIR Preferred Shares. During 2025, FNL exercised the AIR for $2,850,000 in aggregate cash consideration, for which we issued 2,850 shares of Series C-2 Preferred. As a result of these transactions, the Second Amended and Restated Debenture was paid in full and fully extinguished.

As of January 31, 2026, all outstanding shares of Series C-2 Preferred have been converted into shares of our common stock and all dividends owed thereunder have been settled in full.

Private Placement (Dec 2025)

On December 2, 2025, we completed a private placement with an institutional investor, raising approximately $4.0 million in gross proceeds. The financing included the issuance of 47,000 shares of common stock, pre-funded warrants to purchase 426,373 shares, and common stock warrants to purchase 946,746 shares at an exercise price of $8.45 per share, exercisable upon rec eipt of stockholder approval.

Warrant Inducement (Jan 2026)

On January 28, 2026, we entered into the January 2026 Inducement Letter Agreement with an institutional investor and the Holder of the Common Warrants.

Pursuant to the January 2026 Inducement Letter Agreement, the Holder agreed to exercise the Common Warrants for cash at the exercise price of $7.95 per share in consideration for our agreement to issue new unregistered warrants to purchase up to an aggregate of 1,893,492 shares of common stock at an exercise price of $7.95 per share. Such new warrants will become exercisable upon receipt of such approval as may be required by the applicable rules and regulations of the Nasdaq Capital Market (or any successor entity) from the stockholders of INVO with respect to issuance of all of such new warrants and the shares of common stock upon the exercise thereof and have a term of five and one-half years from the date stockholder approval is obtained.

The aggregate gross proceeds to us from the exercise of such existing warrants was approximately $7.5 million, before deducting offering expenses payable by us.

Critical Accounting Policies and Estimates

The discussion and analysis of our financial condition presented in this section is based upon our audited consolidated financial statements, which have been prepared in accordance with generally accepted accounting principles in the United States. During the preparation of the financial statements, we are required to make estimates and judgments that affect the reported amounts of assets, liabilities, revenue and expenses, and related disclosure of contingent assets and liabilities. On an ongoing basis, we evaluate, based on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, our results, which allows us to form a basis for making judgments on the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates based on variance with our assumptions and conditions. A summary of significant accounting policies is included below. Management believes that the application of these policies on a consistent basis enables us to provide useful and reliable financial information about our operating results and financial condition.

See Note 1 of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K for a summary of significant accounting policies and the effect on our consolidated financial statements.

Business Acquisitions

The Company accounts for all business acquisitions at fair value and expenses acquisition costs as they are incurred. Any identifiable assets acquired and liabilities assumed are recognized and measured at their respective fair values on the acquisition date. If information about facts and circumstances existing as of the acquisition date is incomplete at the end of the reporting period in which a business acquisition occurs, the Company will report provisional amounts for the items for which the accounting is incomplete. The measurement period ends once the Company receives sufficient information to finalize the fair values; however, the period will not exceed one year from the acquisition date. Any adjustments to provisional amounts that are identified during the measurement period are recognized in the reporting period in which the adjustment amounts are determined.

Discontinued Operations

The Company accounted for the divesture of its NAYA Therapeutics (“NTI”) subsidiary in accordance with Accounting Standards Codification (“ASC”) 205 Discontinued Operations (“ASC 205”). ASC 205 requires that a component of an entity that has been disposed of or is classified as held for sale, has operations and cash flows that can be clearly distinguished from the rest of the entity, and represents a strategic shift that has (or will have) a major effect on the reporting entity’s financial results must be reported as discontinued operations. The divesture of NTI met the held-for-sale criteria as defined in ASC 205.

In the period a component of an entity is classified as a discontinued operation, the results of operations for the periods presented are reclassified into separate line items in the unaudited condensed consolidated statements of operations and the assets and liabilities of the discontinued operation are also reclassified into separate line items on the related condensed consolidated balance sheets. Prior period amounts are also adjusted to reflect discontinued operations presentation. All amounts included in the notes to the unaudited condensed consolidated financial statements relate to continuing operations unless otherwise noted.

Variable Interest Entities

The Company’s consolidated financial statements include the accounts of the Company, its wholly owned subsidiaries, and variable interest entities (“VIE”), where the Company is the primary beneficiary under the provisions of ASC 810, Consolidation (“ASC 810”). A VIE must be consolidated by its primary beneficiary when, along with its affiliates and agents, the primary beneficiary has both: (i) the power to direct the activities that most significantly impact the VIE’s economic performance; and (ii) the obligation to absorb losses or the right to receive the benefits of the VIE that could potentially be significant to the VIE. The Company reconsiders whether an entity is still a VIE only upon certain triggering events and continually assesses its consolidated VIEs to determine if it continues to be the primary beneficiary. See “Note 4 – Variable Interest Entities” for additional information on the Company’s VIEs.

Equity Method Investments

Investments in unconsolidated affiliates, over which the Company exerts significant influence but does not control or otherwise consolidate, are accounted for using the equity method. Equity method investments are initially recorded at cost. These investments are included in investment in joint ventures in the accompanying consolidated balance sheets. The Company’s share of the profits and losses from these investments is reported in loss from equity method joint venture in the accompanying consolidated statements of operations. The Company monitors its investments for other-than-temporary impairment by considering factors such as current economic and market conditions and the operating performance of the investees and records reductions in carrying values when necessary.

Fair Value of Financial Instruments

The Company’s financial instruments consist primarily of cash, accounts receivable, accounts payable, notes payable, convertible preferred stock, and warrants. The carrying value of cash, accounts receivable, accounts payable and notes payable, as reflected in the balance sheets, approximate fair value because of the short-term maturity of these instruments. The Company measures the fair value of its liability-classified warrants at the end of each reporting period using a Black-Scholes option pricing model, and changes in fair value are recognized in the consolidated statements of operations.

Derivatives

The Company reviews the conversion features of all liability and equity instruments based on the requirements of ASC 815, “Derivatives and Hedging” to determine if the conversion feature represents an embedded derivative. The Company determined certain warrants issued during the fiscal year ending December 31, 2025 that were classified as derivative intstrument, see Note 15 – Unit Purchase Options and Warrants for additional information.

Recent Accounting Pronouncements

See Note 1 of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K for a summary of significant accounting policies and the effect on our consolidated financial statements.