SenesTech — Q3 2026 Earnings Summary

Financial Performance:

• Total revenue reached a record $1.097 million in Q3 2026, a 42% sequential increase from $770,000 in Q2 2026 and a 59% year-over-year increase from $690,000 in Q3 2025.
• Gross profit increased 40% sequentially to a record $796,000 and 84% year-over-year to $796,000 from $433,000 in Q3 2025.
• Gross margin was 72.6% in Q3 2026, compared to 73.6% in Q2 2026 and 62.8% in Q3 2025.
• Net loss for Q3 2026 was $2.0 million, compared to $1.8 million in Q2 2026 and $1.3 million in Q3 2025.
• Adjusted EBITDA loss was $1.4 million in Q3 2026, compared to $1.4 million in Q2 2026 and $1.1 million in Q3 2025.
• Cash and cash equivalents decreased $1.1 million during Q3 2026 to $4.0 million.
• Net cash used in operating activities was $1.3 million in Q3 2026, declining from $1.7 million in Q2 2026 and $1.9 million in Q1 2026.
• Deferred revenue was $45,000 as of September 30, 2026, up from $32,000 as of December 31, 2025.
• Total liabilities were $3.545 million as of September 30, 2026, compared to $3.275 million as of December 31, 2025.

Business Segments and Product Lines:

• E-commerce revenue increased 52% sequentially and 337% year-over-year, representing approximately 71% of total Q3 revenue.
• Subscription revenue increased 53% sequentially and 234% year-over-year; combined subscribers across Amazon and the Company's website increased 72% compared to Q2 2026.
• Direct B2B revenue increased 19% sequentially and 2% year-over-year, driven by process changes in pest management, government, and commercial verticals.
• Evolve® revenue increased 67% year-over-year to $979,000, representing 89% of product revenue.
• ContraPest® revenue increased 13% year-over-year to $118,000, driven by higher refill sales.
• Assessment and monitoring services were launched in July for B2B customers, utilizing an internally developed AI tool to analyze rodent activity.
• Grove Collaborative was added as a third-party e-commerce channel for Evolve®.

Market and Competitive Landscape:

• Chicago's Wicker Park Bucktown program reduced average rat activity intensity by 88% over 12 months using SenesTech's assessment services and Evolve®.
• Evolve® has expanded to six Chicago-area Special Service Areas and wards.
• In Swampscott, Massachusetts, Evolve Rat combined with sanitation improvements reduced measured rodent activity by 43% over six months.
• The Company engaged Sandstrom Partners, a brand development firm with clients including Nike, Target, and Coca-Cola, to support marketing and branding.

Risks and Challenges:

• The Company faces risks related to sustaining revenue growth across e-commerce and B2B channels.
• Reliance on Amazon and other third-party platforms remains a factor.
• Risks include the ability to retain and grow subscribers and the sales team's ability to generate direct B2B revenue.
• Continued adoption by municipalities and market acceptance of assessment services are potential challenges.
• The Company has a history of losses and a need for additional capital to fund operations.
• Regulatory developments affecting products, including EPA and state registration requirements, pose risks.
• Supply chain and manufacturing risks, as well as general economic conditions, are identified factors.

Management Commentary and Tone:

• Michael Edell, President and CEO, described the quarter as a "milestone" exceeding $1 million in revenue for the first time, citing momentum in e-commerce and B2B growth.
• Edell noted that e-commerce revenue increased 52% sequentially with a record quarter on Amazon and that subscription customers increased 72% sequentially.
• Edell identified direct B2B as the "next significant driver of growth," supported by an expanded sales team.
• Tom Chesterman, CFO, highlighted the record gross profit and 72.6% gross margin as evidence of business model strength as revenue scales.
• Chesterman stated the focus is on translating commercial momentum into sustained financial progress and using cash more efficiently, noting sales and marketing grew as a share of operating expenses while general and administrative spending declined as a share compared to Q3 2025.

Other Key Points:

• The B2B sales team was expanded to four members under Executive Vice President of Sales Jack Karabees, with two additional hires expected by year-end.
• Amazon revenue increased each month of Q3, bringing in new customers and expanding the recurring subscription base.
• The Company reported a net loss of $5.851 million for the nine months ended September 30, 2026, compared to $4.579 million in the same period in 2025.
• Stock-based compensation was $276,000 for the three months ended September 30, 2026, compared to $47,000 in Q3 2025.
• Proceeds from the exercise of warrants and issuances of common stock contributed $211,000 to financing activities in Q3 2026.
• The Company holds $3.951 million in cash and cash equivalents as of September 30, 2026, down from $7.575 million as of December 31, 2025.