UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For
the quarterly period ended
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| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
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Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
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As of August 12, 2026, the issuer had shares of common stock issued and outstanding.
Table of Contents
CEMTREX, INC. AND SUBSIDIARIES
INDEX
| 2 |
Part I. Financial Information
Item 1. Financial Statements
Cemtrex, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
| (Unaudited) | ||||||||
| June 30, | September 30, | |||||||
| Assets | 2026 | 2025 | ||||||
| Current assets | ||||||||
| Cash and cash equivalents | $ | $ | ||||||
| Restricted cash | ||||||||
| Marketable securities | ||||||||
| Trade receivables, net | ||||||||
| Trade receivables, net - related party | ||||||||
| Inventory, net | ||||||||
| Contract assets, net | ||||||||
| Prepaid expenses and other current assets | ||||||||
| Total current assets | ||||||||
| Property and equipment, net | ||||||||
| Right-of-use operating lease assets | ||||||||
| Right-of-use financing lease assets | ||||||||
| Royalties receivable, net - related party | ||||||||
| Digital assets | ||||||||
| Goodwill | ||||||||
| Intangible assets, net of amortization | ||||||||
| Other | ||||||||
| Total Assets | $ | $ | ||||||
| Liabilities & Stockholders’ Equity | ||||||||
| Current liabilities | ||||||||
| Accounts payable | $ | $ | ||||||
| Sales tax payable | ||||||||
| Revolving line of credit | ||||||||
| Current maturities of long-term liabilities | ||||||||
| Operating lease liabilities - short-term | ||||||||
| Financing lease liabilities - short-term | ||||||||
| Deposits from customers | ||||||||
| Accrued expenses | ||||||||
| Accrued payable on inventory in transit | ||||||||
| Contract liabilities | ||||||||
| Deferred revenue | ||||||||
| Accrued income taxes | ||||||||
| Total current liabilities | ||||||||
| Long-term liabilities | ||||||||
| Long-term debt | ||||||||
| Long-term operating lease liabilities | ||||||||
| Other long-term liabilities | ||||||||
| Deferred revenue - long-term | ||||||||
| Warrant liabilities | ||||||||
| Total long-term liabilities | ||||||||
| Total liabilities | ||||||||
| Commitments and contingencies | ||||||||
| Stockholders’ equity | ||||||||
| Preferred stock, $ par value,
shares authorized, Series 1, shares authorized, shares issued and shares outstanding as of June 30,
2026 and shares issued and shares outstanding as of September 30, 2025 (liquidation value of $ | ||||||||
| Series C, shares authorized, shares issued and outstanding at June 30, 2026 and September 30, 2025 | ||||||||
| Common stock, $ par value, shares authorized, shares issued and outstanding at June 30, 2026 and shares issued and outstanding at September 30, 2025 | ||||||||
| Additional paid-in capital | ||||||||
| Accumulated deficit | ( | ) | ( | ) | ||||
| Treasury stock, shares of Series 1 Preferred Stock at June 30, 2026, and September 30, 2025 | ( | ) | ( | ) | ||||
| Accumulated other comprehensive income | ||||||||
| Total stockholders’ equity | ||||||||
| Total liabilities and stockholders’ equity | $ | $ | ||||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
| 3 |
Cemtrex, Inc. and Subsidiaries
Condensed Consolidated Statements of Operations
(Unaudited)
| For the three months ended | For the nine months ended | |||||||||||||||
| June 30, 2026 | June 30, 2025 | June 30, 2026 | June 30, 2025 | |||||||||||||
| Revenues | $ | $ | $ | $ | ||||||||||||
| Cost of revenues | ||||||||||||||||
| Gross profit | ||||||||||||||||
| Operating expenses | ||||||||||||||||
| General and administrative | ||||||||||||||||
| Research and development | ||||||||||||||||
| Total operating expenses | ||||||||||||||||
| Operating (loss)/income | ( | ) | ( | ) | ( | ) | ||||||||||
| Other income/(expense) | ||||||||||||||||
| Other income/(expense), net | ( | ) | ||||||||||||||
| Bargain purchase gain | ||||||||||||||||
| Interest expense | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Changes in fair value of digital assets | ( | ) | ( | ) | ||||||||||||
| Unrealized loss on marketable Securities | ( | ) | ( | ) | ||||||||||||
| Gain on Sale of marketable securities | ||||||||||||||||
| Gain/(loss) on exercise of warrant liabilities | ( | ) | ( | ) | ||||||||||||
| Changes in fair value of warrant liability | ( | ) | ( | ) | ( | ) | ||||||||||
| Total other income/(expense), net | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Net loss before income taxes | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Income tax (benefit)/expense | ( | ) | ||||||||||||||
| Loss from continuing operations | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Loss from discontinued operations, net of tax | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Net loss | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Less net loss in noncontrolling interest | ( | ) | ||||||||||||||
| Less preferred stock dividends | ||||||||||||||||
| Net loss attributable to Cemtrex, Inc. stockholders | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| Loss per share attributable to Cemtrex, Inc. stockholders - Basic and diluted | ||||||||||||||||
| Continuing Operations | $ | ) | $ | ) | $ | ) | $ | ) | ||||||||
| Discontinued Operations | $ | ) | $ | ) | $ | ) | $ | ) | ||||||||
| Loss per share attributable to Cemtrex, Inc. stockholders - Basic and diluted | $ | ) | $ | ) | $ | ) | $ | ) | ||||||||
| Weighted Average Number of Shares-Basic and diluted | ||||||||||||||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
| 4 |
Condensed Consolidated Statements of Comprehensive Loss
(Unaudited)
| For the three months ended | For the nine months ended | |||||||||||||||
| June 30, 2026 | June 30, 2025 | June 30, 2026 | June 30, 2025 | |||||||||||||
| Other comprehensive loss | ||||||||||||||||
| Net loss | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| Foreign currency translation gain/(loss) | ( | ) | ( | ) | ||||||||||||
| Comprehensive loss | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Less net loss in noncontrolling interest | ( | ) | ||||||||||||||
| Comprehensive loss attributable to Cemtrex, Inc. stockholders | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
| 5 |
Cemtrex, Inc. and Subsidiaries
Condensed Consolidated Statement of Stockholders’ Equity
(Unaudited)
| Treasury Stock, | ||||||||||||||||||||||||||||||||||||||||||||
| Preferred Stock | Preferred Stock | 64,100 | ||||||||||||||||||||||||||||||||||||||||||
| Series 1 | Series C | Common Stock | shares of | Accumulated | ||||||||||||||||||||||||||||||||||||||||
| Par Value $0.001 | Par Value $0.001 | Par Value $0.001 | Additional | Series 1 | other | Cemtrex | ||||||||||||||||||||||||||||||||||||||
| Number of | Number of | Number of | Paid-in | Accumulated | Preferred | Comprehensive | Stockholders’ | |||||||||||||||||||||||||||||||||||||
| Shares | Amount | Shares | Amount | Shares | Amount | Capital | Deficit | Stock | Income | Equity | ||||||||||||||||||||||||||||||||||
| Balance at September 30, 2025 | | $ | | $ | | $ | $ | $ | ( | ) | $ | ( | ) | $ | $ | | ||||||||||||||||||||||||||||
| Foreign currency translation loss | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||||||
| Dividends paid in Series 1 preferred shares | ( | ) | ||||||||||||||||||||||||||||||||||||||||||
| Shares issued to pay debt | ||||||||||||||||||||||||||||||||||||||||||||
| Exercise of Series A warrants | ||||||||||||||||||||||||||||||||||||||||||||
| Exercise of Series B warrants | ||||||||||||||||||||||||||||||||||||||||||||
| Shares issued in offering | ||||||||||||||||||||||||||||||||||||||||||||
| Issuance of roundup shares | ( | ) | ||||||||||||||||||||||||||||||||||||||||||
| Net loss | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||||||
| Balance at December 31, 2025 | $ | $ | $ | $ | $ | ( | ) | $ | ( | ) | $ | $ | ||||||||||||||||||||||||||||||||
| Foreign currency translation gain | ||||||||||||||||||||||||||||||||||||||||||||
| Exercise of Series B warrants | ||||||||||||||||||||||||||||||||||||||||||||
| Shares issued in offering | ||||||||||||||||||||||||||||||||||||||||||||
| Net income | ||||||||||||||||||||||||||||||||||||||||||||
| Balance at March 31, 2026 | $ | $ | $ | $ | $ | ( | ) | $ | ( | ) | $ | $ | ||||||||||||||||||||||||||||||||
| Foreign currency translation gain | ||||||||||||||||||||||||||||||||||||||||||||
| Dividends paid in Series 1 preferred shares | ( | ) | ||||||||||||||||||||||||||||||||||||||||||
| Exercise of Series B warrants | ||||||||||||||||||||||||||||||||||||||||||||
| Shares issued to pay debt | ||||||||||||||||||||||||||||||||||||||||||||
| Issuance of roundup shares | ( | ) | ||||||||||||||||||||||||||||||||||||||||||
| Net loss | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||||||
| Balance at June 30, 2026 | $ | $ | $ | $ | $ | ( | ) | $ | ( | ) | $ | $ | ||||||||||||||||||||||||||||||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
| 6 |
Cemtrex, Inc. and Subsidiaries
Condensed Consolidated Statement of Stockholders’ Equity (Continued)
(Unaudited)
| Treasury Stock, | ||||||||||||||||||||||||||||||||||||||||||||||||
| Preferred Stock | Preferred Stock | 64,100 | ||||||||||||||||||||||||||||||||||||||||||||||
| Series 1 | Series C | Common Stock | shares of | Accumulated | ||||||||||||||||||||||||||||||||||||||||||||
| Par Value $0.001 | Par Value $0.001 | Par Value $0.001 | Additional | Series 1 | other | Cemtrex | Non- | |||||||||||||||||||||||||||||||||||||||||
| Number of | Number of | Number of | Paid-in | Accumulated | Preferred | Comprehensive | Stockholders’ | controlling | ||||||||||||||||||||||||||||||||||||||||
| Shares | Amount | Shares | Amount | Shares | Amount | Capital | Deficit | Stock | Income | Equity | interest | |||||||||||||||||||||||||||||||||||||
| Balance at September 30, 2024 | | $ | | $ | | $ | $ | $ | ( | ) | $ | ( | ) | $ | $ | | $ | |||||||||||||||||||||||||||||||
| Foreign currency translation loss | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||||||||||
| Share-based compensation | ||||||||||||||||||||||||||||||||||||||||||||||||
| Dividends paid in Series 1 preferred shares | ( | ) | ||||||||||||||||||||||||||||||||||||||||||||||
| Exercise of Series A warrants | ||||||||||||||||||||||||||||||||||||||||||||||||
| Exercise of Series B warrants | ||||||||||||||||||||||||||||||||||||||||||||||||
| Issuance of roundup shares | ( | ) | ||||||||||||||||||||||||||||||||||||||||||||||
| Loss attributable to noncontrolling interest | ( | ) | ||||||||||||||||||||||||||||||||||||||||||||||
| Net loss | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||||||||||
| Balance at December 31, 2024 | $ | $ | $ | $ | $ | ( | ) | $ | ( | ) | $ | $ | ( | ) | $ | |||||||||||||||||||||||||||||||||
| Foreign currency translation loss | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||||||||||
| Share-based compensation | ||||||||||||||||||||||||||||||||||||||||||||||||
| Rounding shares | ||||||||||||||||||||||||||||||||||||||||||||||||
| Elimination of non-controlling interest | ( | ) | ||||||||||||||||||||||||||||||||||||||||||||||
| Net income | ||||||||||||||||||||||||||||||||||||||||||||||||
| Balance at March 31, 2025 | $ | $ | $ | $ | $ | ( | ) | $ | ( | ) | $ | $ | $ | |||||||||||||||||||||||||||||||||||
| Foreign currency translation gain | ||||||||||||||||||||||||||||||||||||||||||||||||
| Share-based compensation | ||||||||||||||||||||||||||||||||||||||||||||||||
| Dividends paid in Series 1 preferred shares | ( | ) | ||||||||||||||||||||||||||||||||||||||||||||||
| Cancelation of shares of Series 1 Preferred Shares | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||||||||||
| Shares issued in offering | ||||||||||||||||||||||||||||||||||||||||||||||||
| Shares issued in over allotment exercise | ||||||||||||||||||||||||||||||||||||||||||||||||
| Series B Warrant exercises | ||||||||||||||||||||||||||||||||||||||||||||||||
| Net loss | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||||||||||
| Balance at June 30, 2025 | $ | $ | $ | $ | $ | ( | ) | $ | ( | ) | $ | $ | $ | |||||||||||||||||||||||||||||||||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
| 7 |
Cemtrex, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows
(Unaudited)
| For the nine months ended | ||||||||
| June 30, | ||||||||
| Cash Flows from Operating Activities | 2026 | 2025 | ||||||
| Net loss | $ | ( | ) | $ | ( | ) | ||
| Adjustments to reconcile net loss to net cash used by operating activities | ||||||||
| Depreciation and amortization | ||||||||
| Loss on disposal of property and equipment | ||||||||
| Noncash lease expense | ||||||||
| Interest on finance leases | ||||||||
| Loss on marketable securities | ||||||||
| Credit loss expense | ||||||||
| Loss on write-off of related party receivables | ||||||||
| Contract modification - related party | ||||||||
| Share-based compensation | ||||||||
| Bargain purchase gain | ( | ) | ||||||
| Write-off of demonstration equipment | ||||||||
| Interest expense paid in equity shares | ||||||||
| Accrued interest on notes payable | ||||||||
| Non-cash royalty income | ( | ) | ( | ) | ||||
| Amortization of original issue discounts on notes payable | ||||||||
| Loan origination costs | ||||||||
| Receipt of SOL from staking | ( | ) | ||||||
| Non-cash transaction fees | ||||||||
| Unrealized loss on digital assets | ||||||||
| Loss on exercise of warrant liabilities | ||||||||
| Changes in fair value of warrant liability | ( | ) | ||||||
| Changes in operating assets and liabilities net of effects from acquisition of subsidiaries: | ||||||||
| Trade receivables | ( | ) | ||||||
| Trade receivables - related party | ||||||||
| Inventory | ( | ) | ||||||
| Contract assets | ( | ) | ||||||
| Prepaid expenses and other current assets | ( | ) | ( | ) | ||||
| Other assets | ||||||||
| Accounts payable | ( | ) | ||||||
| Sales tax payable | ( | ) | ( | ) | ||||
| Operating lease liabilities | ( | ) | ( | ) | ||||
| Deposits from customers | ( | ) | ||||||
| Accrued expenses | ( | ) | ||||||
| Contract liabilities | ||||||||
| Deferred revenue | ( | ) | ( | ) | ||||
| Income taxes payable | ( | ) | ||||||
| Other liabilities | ||||||||
| Net cash (used in)/provided by operating activities | ( | ) | ||||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
| 8 |
Cemtrex, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows (Continued)
(Unaudited)
| Cash Flows from Investing Activities | ||||||||
| Purchase of property and equipment | ( | ) | ( | ) | ||||
| Proceeds from sale of property and equipment | ||||||||
| Royalties on related party revenues | ||||||||
| Purchase of marketable securities | ( | ) | ||||||
| Proceeds from sale of marketable securities | ||||||||
| Acquisitions, net of cash acquired | ( | ) | ||||||
| Investment in digital assets | ( | ) | ||||||
| Investment in MasterpieceVR | ( | ) | ||||||
| Net cash used by investing activities | ( | ) | ( | ) | ||||
| Cash Flows from Financing Activities | ||||||||
| Proceeds on revolving line of credit | ||||||||
| Payments on revolving line of credit | ( | ) | ( | ) | ||||
| Payments on debt | ( | ) | ( | ) | ||||
| Financing lease liabilities | ( | ) | ||||||
| Payments on Paycheck Protection Program Loans | ( | ) | ||||||
| Proceeds on Loan from CEO | ||||||||
| Proceeds on bank loans | ||||||||
| Proceeds from notes payable | ||||||||
| Proceeds from warrant exercises | ||||||||
| Proceeds from offerings | ||||||||
| Expenses on offerings | ( | ) | ( | ) | ||||
| Net cash provided by financing activities | ||||||||
| Effect of currency translation | ( | ) | ( | ) | ||||
| Net increase in cash, cash equivalents, and restricted cash | ||||||||
| Cash, cash equivalents, and restricted cash at beginning of period | ||||||||
| Cash, cash equivalents, and restricted cash at end of period | $ | $ | ||||||
| Balance Sheet Accounts Included in Cash, Cash Equivalents, and Restricted Cash | June 30, 2026 | June 30, 2025 | ||||||
| Cash and cash equivalents | $ | $ | ||||||
| Restricted cash | ||||||||
| Total cash, cash equivalents, and restricted cash | $ | $ | ||||||
| For the nine months ended | ||||||||
| June 30, | ||||||||
| Supplemental Disclosure of Cash Flow Information: | 2026 | 2025 | ||||||
| Cash paid during the period for interest | $ | $ | ||||||
| Cash paid during the period for income taxes, net of refunds | $ | $ | ||||||
| Supplemental Schedule of Non-Cash Investing and Financing Activities | ||||||||
| Shares issued to pay notes payable | $ | $ | ||||||
| Noncash dividends | $ | $ | ||||||
| Financing of Building Purchase | $ | $ | ||||||
| Financing of Acquisitions | $ | $ | ||||||
| Noncash recognition of new leases | $ | $ | ||||||
| Series A Warrant Exercises | $ | $ | ||||||
| Series B Warrant Exercises | $ | $ | ||||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
| 9 |
Cemtrex, Inc. and Subsidiaries
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
NOTE 1 – ORGANIZATION AND PLAN OF OPERATIONS
Cemtrex was incorporated in 1998 in the state of Delaware and has evolved through strategic acquisitions and internal growth into a leading multi-industry company. Unless the context requires otherwise, all references to “we”, “our”, “us”, “Company”, “registrant”, “Cemtrex” or “management” refer to Cemtrex, Inc. and its subsidiaries.
Security
Cemtrex’s Security segment operates under the brand of its subsidiary, Vicon Industries, Inc. (“Vicon”), which provides end-to-end security solutions to meet the toughest corporate, industrial, and governmental security challenges. Vicon’s products include browser-based video monitoring systems and analytics-based recognition systems, cameras, servers, and access control systems for every aspect of security and surveillance in industrial and commercial facilities, federal prisons, hospitals, universities, schools, and federal and state government offices. Vicon provides innovative, mission critical security and video surveillance solutions utilizing Artificial Intelligence (AI) based data algorithms.
Industrial Services
Cemtrex’s Industrial Services segment operates under the brand, Advanced Industrial Services (“AIS”), which offers single-source expertise and services for rigging, millwrighting, in plant maintenance, equipment erection, relocation, and disassembly to diversified customers. AIS installs high precision equipment in a wide variety of industrial markets like automotive, printing & graphics, industrial automation, packaging, and chemicals, among others. AIS is a leading provider of reliability-driven maintenance and contracting solutions for machinery, packaging, printing, chemical, and other manufacturing markets. We help customers seeking to achieve greater asset utilization and reliability to cut costs and increase production from existing assets, including small projects, sustaining capital, turnarounds, maintenance, specialty welding services, and high-quality scaffolding.
Aerospace and Defense
Cemtrex’s Aerospace and Defense segment operates under the brand Invocon, Inc., which offers designing, manufacturing, and supporting advanced instrumentation, wireless sensing, and telemetry systems deployed across satellites, launch vehicles, target missiles, and space-based platforms. Its technologies support numerous government and prime contractor programs, including multiple Space Shuttle and International Space Station systems, and the company maintains long-standing relationships across the Missile Defense Agency and leading aerospace and defense primes.
Common Stock Reverse Stock Split
On
September 29, 2025, and June 5, 2026, the Company completed
Acquisitions
The Company accounts for business combinations using the acquisition method. The consideration transferred is measured at fair value, which is calculated as the sum of the acquisition-date fair values of the assets transferred, liabilities incurred, and equity interests issued. Acquisition-related costs are expensed as incurred. Identifiable assets acquired and liabilities assumed are measured at their acquisition-date fair values.
| 10 |
On January 8, 2026, the Company completed the acquisition of Invocon, Inc. (“Invocon”). As a result of the transaction, Invocon became a wholly owned subsidiary of the Company. The purchase price of $ was paid in cash at closing. Invocon will be the launch of the Company’s Aerospace and Defense segment with reporting results beginning in the second quarter of fiscal year 2026.
The purchase price allocation presented below is still preliminary but has been developed based on an estimate of fair values of Invocon’s identifiable tangible and intangible assets acquired and liabilities assumed as of January 8, 2026. The final allocation of the purchase price will be determined within one year from the closing date of the Invocon acquisition.
The acquisition of Invocon was accounted for as a business combination under ASC 805 using the acquisition method of accounting. The assets acquired and liabilities assumed, affected for adjustments to reflect fair values assigned to assets purchased and liabilities assumed, and results of operations, are included in the Company’s condensed consolidated financial statements from the Invocon acquisition date.
The Company determined that developed technology was the primary intangible acquired. Under ASC 820-10-55-3A, fair value should reflect market participant assumptions and the asset’s ability to generate cash flows, supporting an income approach and also states the Multi-Period Excess Earnings Method (“MPEEM”) is typically applied when the subject intangible asset is the primary driver of earnings. Because the developed technology is the primary driver of earnings, the MPEEM appropriately isolates its economic contribution after deducting contributory asset charges. Significant assumptions utilized included projected cash flows, royalty rates, risk free rate commensurate with the period to determine the value of developed software and tradenames.
The consideration transferred, preliminary, and as adjusted as of June 30, 2026, allocation of Invocon’s tangible and intangible assets and liabilities, are as follows:
| Preliminary | Adjusted | |||||||
| Consideration Transferred: | ||||||||
| Cash | $ | $ | ||||||
| Less cash acquired | ( | ) | ( | ) | ||||
| Total consideration transferred | $ | $ | ||||||
| Purchase Price Allocation: | ||||||||
| Accounts receivable | ||||||||
| Prepaid expenses | ||||||||
| Contract assets | ||||||||
| Property and equipment | ||||||||
| Right-of-use assets | ||||||||
| Intangible assets | ||||||||
| Accounts payable | ( | ) | ( | ) | ||||
| Accrued expenses | ( | ) | ( | ) | ||||
| Contract liabilities | ( | ) | ( | ) | ||||
| Lease liabilities | ( | ) | ( | ) | ||||
| Goodwill | ||||||||
| Total consideration transferred | $ | $ | ||||||
The
pro forma summary below presents the results of operations as if the Invocon acquisition occurred on October 1, 2024. Proforma adjustments
for the three and nine months ended June 30, 2026, include $
| 11 |
| Unaudited | Unaudited | Unaudited | Unaudited | |||||||||||||
| For the three months ended | For the three months ended | For the nine months ended | For the nine months ended | |||||||||||||
| June 30, 2026 | June 30, 2025 | June 30, 2026 | June 30, 2025 | |||||||||||||
| Revenues | $ | $ | $ | $ | ||||||||||||
| Net loss | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
On
February 5, 2026, the Company, through its subsidiary AIS, acquired substantially all the assets of Richland Industries LLC (“Richland”),
an industrial services and fabrication company located in Tennessee. In connection with the transaction, AIS established a new subsidiary,
AIS Tennessee, Inc (“AIS – TN”), as part of the Company’s Industrial Services Segment. The purchase price of
$
The acquisition of Richland was accounted for as a business combination under ASC 805 using the acquisition method of accounting. The assets and liabilities acquired, affected for adjustments to reflect fair values assigned to assets purchased and liabilities assumed, and results of operations, are included in the Company’s condensed consolidated financial statements from the Richland acquisition date.
The purchase price allocation presented below is still preliminary but has been developed based on an estimate of fair values of AIS - TN identifiable tangible and intangible assets acquired, and liabilities assumed as of February 5, 2026. The final allocation of the purchase price will be determined within one year from the closing date of the Invocon acquisition.
The consideration transferred and preliminary allocation of AIS - TN tangible and intangible assets and liabilities, are as follows:
| Preliminary | ||||
| Consideration Transferred: | ||||
| Cash | $ | |||
| Note payable to finance acquisition | ||||
| Less cash acquired | ( | ) | ||
| Total consideration transferred | $ | |||
| Purchase Price Allocation: | ||||
| Accounts receivable | ||||
| Prepaid expenses | ||||
| Inventory | ||||
| Contract assets | ||||
| Property and equipment | ||||
| Right-of-use assets | ||||
| Other assets | ||||
| Accounts payable | ( | ) | ||
| Letter of credit | ( | ) | ||
| Accrued expenses | ( | ) | ||
| Contract liabilities | ( | ) | ||
| Lease liabilities | ( | ) | ||
| Long-term debt | ( | ) | ||
| Bargain purchase gain | ( | ) | ||
| Total consideration transferred | $ | |||
The
pro forma summary below presents the results of operations as if the Richland acquisition occurred on October 1, 2024. Proforma adjustments
for the three and nine months ended June 30, 2026, includes $(
| 12 |
| Unaudited | Unaudited | Unaudited | Unaudited | |||||||||||||
| For the three months ended | For the three months ended | For the nine months ended | For the nine months ended | |||||||||||||
| June 30, 2026 | June 30, 2025 | June 30, 2026 | June 30, 2025 | |||||||||||||
| Revenues | $ | $ | $ | $ | ||||||||||||
| Net loss | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
Going Concern Considerations
The accompanying unaudited condensed consolidated financial statements of the Company have been prepared assuming the Company will continue as a going concern and in accordance with generally accepted accounting principles in the United States of America. The going concern basis of presentation assumes that the Company will continue in operation one year after the date these financial statements are issued and will be able to realize its assets and discharge its liabilities and commitments in the normal course of business. Pursuant to the requirements of the ASC 205, management must evaluate whether there are conditions or events considered in the aggregate, which raise substantial doubt about the Company’s ability to continue as a going concern for one year from the date these financial statements are issued.
This evaluation does not take into consideration the potential mitigating effect of management’s plans that have not been fully implemented or are not within control of the Company as of the date the financial statements are issued. When substantial doubt exists under this methodology, management evaluates whether the mitigating effect of its plans sufficiently alleviates substantial doubt about the Company’s ability to continue as a going concern. The mitigating effect of management’s plans, however, is only considered if both (1) it is probable that the plans will be effectively implemented within one year after the date that the financial statements are issued, and (2) it is probable that the plans, when implemented, will mitigate the relevant conditions or events that raise substantial doubt about the entity’s ability to continue as a going concern within one year after the date that the financial statements are issued.
The
Company has incurred substantial net losses attributable to Cemtrex, Inc. stockholders of $
While
the Company’s losses and current debt indicate a substantial doubt regarding the Company’s ability to continue as a going
concern, the Company has historically, from time to time, satisfied and may continue to satisfy certain short-term liabilities through
the issuance of common stock, thus reducing our cash requirement to meet our operating needs. These transactions add additional significant
non-operational expenses which are non-cash in nature. The Company has $
| 13 |
Overall, there is no guarantee that cash flow from our existing or future operations and any external capital that we may be able to raise will be sufficient to meet our working capital needs. The Company currently does not have adequate cash or available liquidity/available capacity on our lines of credit to meet our long-term needs and our above plans in the short term may prove to be inadequate to continue as a going concern. Thus, despite our cash on hand, our ability to draw on our credit line, or changes to our pricing models, and other safeguards, we may be unable to meet our obligations as they become due over the next twelve months beyond the issuance date. The unaudited condensed consolidated financial statements do not include any adjustments relating to this uncertainty.
NOTE 2 – INTERIM STATEMENT PRESENTATION
Basis of Presentation and Use of Estimates
The accompanying unaudited condensed consolidated financial information should be read in conjunction with the audited consolidated financial statements and the notes thereto included in the Company’s Annual Report on Form 10-K for the year ended September 30, 2025.
The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X pursuant to the requirements of the U.S. Securities and Exchange Commission (‘SEC”). Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation have been included. The results of operations for the interim periods are not necessarily indicative of the results of operations for the entire year.
The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the condensed consolidated financial statements, the disclosure of contingent assets and liabilities in the condensed consolidated financial statements and the accompanying notes, and the reported amounts of revenues, expenses and cash flows during the periods presented. Actual amounts and results could differ from those estimates. The estimates and assumptions the Company makes are based on historical factors, current circumstances and the experience and judgment of the Company’s management. The Company evaluates its estimates and assumptions on an ongoing basis.
Significant Accounting Policies
Note 2 of the Notes to Consolidated Financial Statements, included in the annual report on Form 10-K for the year ended September 30, 2025, includes a summary of the significant accounting policies used in the preparation of the unaudited condensed consolidated financial statements.
Recently Adopted Accounting Pronouncements
In December 2023, the FASB issued ASU 2023-09, “Income Taxes (Topic 740): Improvements to Income Tax Disclosures,” which requires public entities to disclose consistent categories and greater disaggregation of information in the rate reconciliation and for income taxes paid. It also includes certain other amendments to improve the effectiveness of income tax disclosures. The guidance is effective for financial statements issued for annual periods beginning after December 15, 2024, with early adoption permitted. The Company adopted this standard on October 1, 2025. The Company does not believe that this will have a material effect on the unaudited condensed consolidated financial statements.
Recently Issued Accounting Pronouncements Not Yet Effective
In October 2023, the FASB issued ASU 2023-06, Disclosure Improvements: Codification Amendments in Response to the SEC’s Disclosure Update and Simplification Initiative, to amend certain disclosure and presentation requirements for a variety of topics within the Accounting Standards Codification (“ASC”). These amendments align the requirements in the ASC to the removal of certain disclosure requirements set out in Regulation S-X and Regulation S-K, announced by the SEC. The effective date for each amended topic in the ASC is the date on which the SEC’s removal of the related disclosure requirement from Regulation S-X or Regulation S-K becomes effective. Early adoption is prohibited. The Company does not anticipate that the ASU will have a material effect on the Company’s unaudited financial statements and related disclosures.
| 14 |
In November 2024, the FASB issued ASU 2024-03, “Income Statement (Topic 220): Reporting Comprehensive Income - Expense Disaggregation Disclosures, Disaggregation of Income Statement Expenses”, that requires public companies to disclose, in interim and reporting periods, additional information about certain expenses in the financial statements. ASU 2024-03 is effective for annual periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. Early adoption is permitted and is effective on either a prospective basis or retrospective basis. The Company is currently assessing the potential impacts of adoption on the unaudited condensed consolidated financial statements.
In November 2024, the FASB issued ASU 2024-04, “Debt with Conversion and Other Options (Subtopic 470-20), which clarifies the requirements for determining whether certain settlements of convertible debt instruments should be accounted for as an induced conversion. ASU 2024-04 is effective for annual periods beginning after December 15, 2025, and interim reporting periods within those annual reporting periods. Early adoption is permitted for all entities that have adopted the amendments in Update 2020-06. Adoption can be on a prospective or retrospective basis. The Company is currently in the process of evaluating the impact of adoption on the unaudited condensed consolidated financial statements.
In July 2025, the FASB issued ASU 2025-05, Financial Instruments—Credit Losses (Topic 326). This guidance contains amendments that provide decision-useful information to investors and other financial statement users while reducing the time and effort necessary to analyze and estimate credit losses for current accounts receivable and current contract assets. The amendments will be effective for annual reporting periods beginning after December 15, 2025, and interim reporting periods within those annual reporting periods. Early adoption is permitted in both interim and annual reporting periods in which financial statements have not yet been issued or made available for issuance. The Company is currently evaluating the impact of ASU 2025-05 on its unaudited condensed consolidated financial statements and related disclosures.
In December 2025, the FASB issued ASU 2025-11 - Interim Reporting (“ASU 2025-11”) which is intended to improve the navigability of the guidance in ASC 270, Interim Reporting, and clarify when it applies. Under the amendments, an entity is subject to ASC 270 if it provides interim financial statements and notes in accordance with GAAP. ASU 2025-11 also addresses the form and content of such financial statements, interim disclosures requirements, and establishes a principle under which an entity must disclose events since the end of the last annual reporting period that have a material impact on the entity. ASU 2025-11 is effective for interim reporting periods within annual reporting periods beginning after December 15, 2027, and early adoption is permitted. The Company is currently evaluating the impact the adoption of ASU 2025-11 may have on the Company’s unaudited consolidated financial statements.
In April 2026, the FASB issued Accounting Standards Update No. 2026-01, Equity (Topic 505): Initial Measurement of Paid-in-Kind Dividends on Equity-Classified Preferred Stock. The amendments in this Update clarify that PIK dividends on equity-classified preferred stock should be initially measured at the amount specified in the agreement, generally calculated by multiplying the PIK dividend rate by the liquidation value of the preferred stock outstanding. The standard is effective for the Company for fiscal years beginning after December 15, 2026. The Company is currently evaluating the impact the adoption of ASU 2026-01 may have on the Company’s unaudited consolidated financial statements.
The Company does not believe that any other recently issued but not yet effective accounting pronouncements, if adopted, would have a material effect on the accompanying unaudited condensed consolidated financial statements.
Correction of an Immaterial Error in Previously Issued Financial Statements
Subsequent
to the issuance of our financial statements for the quarter ended June 30, 2025, an immaterial error was identified and has been
corrected in our historical information related to the net income/(loss) in noncontrolling interest. On February 24, 2025, the
Company filed a Certificate of Amendment to the Certificate of Incorporation for Vicon Industries Inc. This amendment effected a
reverse stock split which exchanged
| 15 |
The effects of the correction to the individual effected line items in our Consolidated Statement of Operations are as follows:
| For the three months ended June 30, 2025 | ||||||||||||
| As previously reported | Corrections | As corrected | ||||||||||
| Less net income/(loss) in noncontrolling interest | ( | ) | ||||||||||
| Net income/(loss) attributable to Cemtrex, Inc. stockholders | $ | ( | ) | $ | ( | ) | $ | ( | ) | |||
| For the nine months ended June 30, 2025 | ||||||||||||
| As previously reported | Corrections | As corrected | ||||||||||
| Less net income/(loss) in noncontrolling interest | ( | ) | ( | ) | ( | ) | ||||||
| Less preferred stock dividends | ||||||||||||
| Net income/(loss) attributable to Cemtrex, Inc. stockholders | $ | ( | ) | $ | $ | ( | ) | |||||
NOTE 3 – REVENUE
The following table illustrates the approximate disaggregation of the Company’s revenue based off timing of revenue recognition for the three and nine months ended June 30, 2026, and 2025:
| For the three months ended | For the nine months ended | |||||||||||||||
| June 30, 2026 | June 30, 2025 | June 30, 2026 | June 30, 2025 | |||||||||||||
| Over time | % | % | % | % | ||||||||||||
| Point-in-time | % | % | % | % | ||||||||||||
Basic net loss per common share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the period. Diluted net loss per common share is computed by dividing net income by the weighted average number of shares of common stock and potentially dilutive outstanding shares of common stock during the period to reflect the potential dilution that could occur from common shares issuable through contingent share arrangements, stock options, and warrants. For the three and nine months ended June 30, 2026, and 2025, the following items were excluded from the computation of diluted net loss per common share as their effect is anti-dilutive:
| For the three months ended | For the nine months ended | |||||||||||||||
| June 30, 2026 | June 30, 2025 | June 30, 2026 | June 30, 2025 | |||||||||||||
| Options | ||||||||||||||||
| Warrants | ||||||||||||||||
| 16 |
| For the three months | For the nine months ended | |||||||||||||||
| June 30, | June 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Net loss | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| Less loss from discontinued operations, net of tax | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Less net loss in noncontrolling interest | ( | ) | ||||||||||||||
| Preferred stock dividends | ||||||||||||||||
| Loss from continuing operations attributable to Cemtrex, Inc. stockholders | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| Weighted Average Number of Shares-Basic and diluted | ||||||||||||||||
| Loss per share - Basic and diluted - Continuing Operations | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| Loss per share – Basic and diluted - Discontinued Operations | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
In accordance with ASC 260-45-13, the common shares underlying the Series A Warrants under the alternative cashless exercise have been included in the calculation of the weighted average shares.
NOTE 5 – SEGMENT INFORMATION
The Company reports and evaluates financial information for three reportable segments: the Security segment, Industrial Services segment, and the Aerospace and Defense segment. The Chief Operating Decision Maker (“CODM”) for all segments is Saagar Govil, the CEO of the Company.
Unallocated corporate expenses mainly relate to payroll and benefits for corporate officers, investor relation expenses, accounting expenses related to audit and taxes, legal expenses related to corporate matters, interest expense on notes payable, and Series A and B Warrants transaction losses.
The following tables summarize the Company’s reportable segment information and unallocated corporate expenses:
| Three months ended June 30, 2026 | ||||||||||||||||||||
| Reportable Segments | ||||||||||||||||||||
| Security | Industrial Services | Aerospace and Defense | Corporate | Consolidated | ||||||||||||||||
| External revenues | $ | $ | $ | $ | $ | |||||||||||||||
| Cost of revenues | ||||||||||||||||||||
| Gross profit | $ | $ | $ | $ | $ | |||||||||||||||
| Operating expenses | ||||||||||||||||||||
| General and administrative | ||||||||||||||||||||
| Depreciation and amortization | ||||||||||||||||||||
| Research and development | ||||||||||||||||||||
| Operating (loss)/income | $ | ( | ) | $ | ( | ) | $ | $ | ( | ) | $ | ( | ) | |||||||
| Other expense, net | $ | ( | ) | ( | ) | $ | $ | ( | ) | $ | ( | ) | ||||||||
| Three months ended June 30, 2025 | ||||||||||||||||||||
| Reportable Segments | ||||||||||||||||||||
| Security | Industrial Services | Aerospace and Defense | Corporate | Consolidated | ||||||||||||||||
| External revenues | $ | $ | $ | $ | $ | |||||||||||||||
| Cost of revenues | ||||||||||||||||||||
| Gross profit | $ | $ | $ | $ | $ | |||||||||||||||
| Operating expenses | ||||||||||||||||||||
| General and administrative | ||||||||||||||||||||
| Depreciation and amortization | ||||||||||||||||||||
| Research and development | ||||||||||||||||||||
| Operating (loss)/income | $ | ( | ) | $ | $ | $ | ( | ) | $ | ( | ) | |||||||||
| Other expense, net | $ | ( | ) | ( | ) | $ | $ | ( | ) | $ | ( | ) | ||||||||
| 17 |
| Nine months ended June 30, 2026 | ||||||||||||||||||||
| Reportable Segments | ||||||||||||||||||||
| Security | Industrial Services | Aerospace and Defense | Corporate | Consolidated | ||||||||||||||||
| External revenues | $ | $ | $ | $ | $ | |||||||||||||||
| Cost of revenues | ||||||||||||||||||||
| Gross profit | $ | $ | $ | $ | $ | |||||||||||||||
| Operating expenses | ||||||||||||||||||||
| General and administrative | ||||||||||||||||||||
| Depreciation and amortization | ||||||||||||||||||||
| Research and development | ||||||||||||||||||||
| Operating (loss)/income | $ | ( | ) | $ | $ | $ | ( | ) | $ | ( | ) | |||||||||
| Other (expense)/income, net | $ | ( | ) | $ | $ | $ | ( | ) | $ | ( | ) | |||||||||
| Nine months ended June 30, 2025 | ||||||||||||||||||||
| Reportable Segments | ||||||||||||||||||||
| Security | Industrial Services | Aerospace and Defense | Corporate | Consolidated | ||||||||||||||||
| External revenues | $ | $ | $ | $ | $ | |||||||||||||||
| Cost of revenues | ||||||||||||||||||||
| Gross profit | $ | $ | $ | $ | $ | |||||||||||||||
| Operating expenses | ||||||||||||||||||||
| General and administrative | ||||||||||||||||||||
| Depreciation and amortization | ||||||||||||||||||||
| Research and development | ||||||||||||||||||||
| Operating income/(loss) | $ | $ | $ | $ | ( | ) | $ | |||||||||||||
| Other expense, net | $ | ( | ) | $ | ( | ) | $ | $ | ( | ) | $ | ( | ) | |||||||
The following table summarizes the Company’s identifiable assets by segment as of June 30, 2026, and September 30, 2025.
| June 30, | September 30, | |||||||
| 2026 | 2025 | |||||||
| Identifiable Assets | ||||||||
| Security | $ | $ | ||||||
| Industrial Services | ||||||||
| Aerospace and Defense | ||||||||
| Corporate | ||||||||
| Total Assets | $ | $ | ||||||
NOTE 6 – RESTRICTED CASH
A subsidiary of the Company participates in a consortium in order to self-insure group care coverage for its employees. The plan is administrated by Benecon Group, and the Company makes monthly deposits in a trust account to cover medical claims and any administrative costs associated with the plan. Additionally, there was restricted cash in escrow per the purchase agreement with Heisey Mechanical Ltd. Additionally, there are funds in escrow related to bond requirements on certain public projects and deposit guarantees.
The Company’s restricted cash as of June 30, 2026, and September 30, 2025, are summarized below.
| June 30, | September 30, | |||||||
| 2026 | 2025 | |||||||
| Benecon group | $ | $ | ||||||
| Heisey escrow | ||||||||
| Bond escrow | ||||||||
| Deposit guarantees | ||||||||
| $ | $ | |||||||
| 18 |
NOTE 7 – FAIR VALUE MEASUREMENTS
Fair value is defined as the price that would be received upon sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. A three-level hierarchy is applied to prioritize the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements).
The three levels of the fair value hierarchy under the guidance for fair value measurements are described below:
Level 1 — Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date. Our Level 1 assets include cash equivalents, banker’s acceptances, trading securities, investments, and investment funds. The Company measures trading securities investments and investment funds at quoted market prices as they are traded in an active market with sufficient volume and frequency of transactions.
Level 2 — Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. If the asset or liability has a specified contractual term, a Level 2 input must be observable for substantially the full term of the asset or liability.
Level 3 — Level 3 inputs are unobservable inputs for the asset or liability in which there is little, if any, market activity for the asset or liability at the measurement date. Level 3 assets and liabilities include cost method investments. Quantitative information for Level 3 assets and liabilities reviewed at each reporting period includes indicators of significant deterioration in the earnings performance, credit rating, asset quality, business prospects of the investee, and financial indicators of the investee’s ability to continue as a going concern.
The Company’s fair value liabilities at June 30, 2026, and September 30, 2025, are as follows.
| As of June 30, 2026 | ||||||||||||||||
| Quoted Prices in | Significant Other | Significant | ||||||||||||||
| Active Markets for | Observable | Unobservable | ||||||||||||||
| Identical Assets | Inputs | Inputs | ||||||||||||||
| (Level 1) | (Level 2) | (Level 3) | Total | |||||||||||||
| Assets | ||||||||||||||||
| Digital assets - SOL | $ | $ | $ | $ | ||||||||||||
| Marketable Securities | $ | | $ | $ | $ | |||||||||||
| Liabilities | ||||||||||||||||
| Warrant liabilities | $ | $ | $ | $ | ||||||||||||
| As of September 30, 2025 | ||||||||||||||||
| Quoted Prices in | Significant Other | Significant | ||||||||||||||
| Active Markets for | Observable | Unobservable | ||||||||||||||
| Identical Assets | Inputs | Inputs | ||||||||||||||
| (Level 1) | (Level 2) | (Level 3) | Total | |||||||||||||
| Assets | ||||||||||||||||
| Digital assets - SOL | $ | | $ | $ | $ | |||||||||||
| Liabilities | ||||||||||||||||
| Warrant liabilities | $ | $ | $ | $ | ||||||||||||
Digital Assets – SOL
On
July 29, 2025, and January 7, 2026, the Company invested $
| 19 |
Digital Asset staking allows holders of specific cryptocurrencies to earn rewards for helping to validate blocks of transaction data as it is submitted to the blockchain network.
The staking process serves two key purposes:
● Ensures the accuracy of new information as it is added to the blockchain.
● Helps to secure the underlying blockchain network against the majority of the network taking over control, known as a 51% attack.
The staking process uses incentives and penalties governed by computer-based rules to encourage honest participation in the network. Stakers who act within the rules of the protocol receive rewards for their contributions, while those who act dishonestly can face penalties, such as losing their staked cryptocurrency through a process called slashing. Staking rewards are distributed as newly minted cryptocurrency units, oftentimes at a proportionate rate to the amount a person stakes. With some proof-of-stake blockchains, depositing more assets in a staking smart contract increases the chance of being selected to validate blocks. This mechanism is based on the assumption that those with more “skin in the game” are more likely to act within the best interests of the network because they have more to lose financially if their assets are slashed (confiscated by the network). However, to avoid favoring wealthier participants, some protocols incorporate randomness to ensure everyone, including those with smaller stakes, has a chance to earn rewards.
Staking incentives, in the form of additional SOL, are recognized on the date received at the fair market value on that date. There are no lockups or restrictions on the Company’s digital asset holdings due to staking.
The Company’s digital assets as of June 30, 2026, and September 30, 2025, are as follows.
June 30, 2026 | September 30, 2025 | |||||||
| Units - SOL | ||||||||
| Cost Per Unit | $ | $ | ||||||
| Cost Basis | $ | $ | ||||||
| Fair Value | $ | $ | ||||||
The following table is a summary of our digital assets as of June 30, 2026.
| Fair Value, September 30, 2025 | $ | |||
| Cash purchase | ||||
| Receipt of SOL from staking | ||||
| Non-cash transaction fees | ( | ) | ||
| Unrealized loss | ( | ) | ||
| Fair Value, June 30, 2026 | $ |
Marketable Securities
Marketable securities utilizing Level 1 inputs include active exchange-traded equity securities and equity index funds, as these securities all have quoted prices in active markets. These marketable securities are trading securities and are recorded at fair value. Unrealized gains and losses are reported under the caption other income/(expense), net on the Company’s Condensed Consolidated Statements of Operations.
Warrant Liabilities
The value of the Series A Warrants is based on the market value of our common stock on the balance sheet date.
| 20 |
The fair value of the Series B Warrants is estimated on the balance sheet date using the Black-Scholes model, which requires inputs based on certain subjective assumptions, including the fair value of the Company’s common shares, expected share price volatility, the expected term of the award, the risk-free interest rate for a period that approximates the expected term of the option, and the Company’s expected dividend yield.
At June 30, 2026, and September 30, 2025, the following inputs were used in the Black-Scholes model.
June 30, 2026 | September 30, 2025 | |||||||
| Expected term | ||||||||
| Risk-free interest rate | % | % | ||||||
| Expected volatility | % | % | ||||||
| Expected dividend yield | % | % | ||||||
| Exercise price | $ | $ | ||||||
The following table summarizes information on warrant liabilities as of June 30, 2026.
| Series A Warrants | Series B Warrants | Total | ||||||||||
| Warrant liabilities at September 30, 2025 | $ | $ | $ | |||||||||
| Warrants issued | ||||||||||||
| Warrants exercised | ( | ) | ( | ) | ( | ) | ||||||
| Fair market revaluation | ( | ) | ( | ) | ( | ) | ||||||
| Warrant liabilities at June 30, 2026 | $ | $ | $ | |||||||||
NOTE 8 – TRADE RECEIVABLES, NET
Trade receivables, net consisted of the following:
| June 30, | September 30, | |||||||
| 2026 | 2025 | |||||||
| Trade receivables | $ | $ | ||||||
| Allowance for credit losses | ( | ) | ( | ) | ||||
| $ | $ | |||||||
Trade receivables include amounts due for shipped products and services rendered.
Allowance for credit losses include estimated losses resulting from the inability of our customers to make the required payments.
NOTE 9 – PREPAID EXPENSES AND OTHER CURRENT ASSETS
Prepaid expenses and other current assets consisted of the following:
June 30, 2026 | September 30, 2025 | |||||||
| Prepaid expenses | $ | $ | ||||||
| Prepaid inventory | ||||||||
| Deferred costs | ||||||||
| Short-term investments | ||||||||
| Prepaid income taxes | ||||||||
| Prepaid expenses and other current assets total | $ | $ | ||||||
| 21 |
NOTE 10 – INVENTORY, NET
Inventory, net consisted of the following:
| June 30, | September 30, | |||||||
| 2026 | 2025 | |||||||
| Raw materials | $ | $ | ||||||
| Work in progress | ||||||||
| Finished goods | ||||||||
| Inventory, net | $ | $ | ||||||
The
Company maintained an allowance for obsolete inventories of $
NOTE 11 – PROPERTY AND EQUIPMENT
Property and equipment are summarized as follows:
| June 30, | September 30, | |||||||
| 2026 | 2025 | |||||||
| Land | $ | $ | ||||||
| Building and leasehold improvements | ||||||||
| Furniture and office equipment | ||||||||
| Computers and software | ||||||||
| Machinery and equipment | ||||||||
| Less: accumulated depreciation | ( | ) | ( | ) | ||||
| Property and equipment, net | $ | $ | ||||||
Depreciation
expense for the three-months ended June 30, 2026, and 2025, was $
NOTE 12 – GOODWILL AND INTANGIBLE ASSETS
Changes in the carrying amount of goodwill, by segment, were as follows:
| Security | Industrial Services | Aerospace and Defense | Consolidated | |||||||||||||
| Balance at September 30, 2025 | $ | $ | $ | $ | ||||||||||||
| Impairment /adjustments | ||||||||||||||||
| Acquisitions | ||||||||||||||||
| Balance at June 30, 2026 | $ | $ | $ | $ | ||||||||||||
As
of June 30, 2026, and September 30, 2025, accumulated impairment losses of $
On January 8, 2026, the Company acquired Invocon, as part of the fair market evaluation for the purchase price accounting, the company recognized intangible assets in the form of the company trade name and internal developed technologies. The company trade name will be amortized over a ten-year period and the internal developed technologies will be amortized over a five-year period.
| 22 |
Changes in the carrying amount of intangible assets, by segment, were as follows:
| Security | Industrial Services | Aerospace and Defense | Consolidated | |||||||||||||
| Balance at September 30, 2025 | $ | $ | $ | $ | ||||||||||||
| Acquisitions | ||||||||||||||||
| Amortization | ( | ) | ( | ) | ||||||||||||
| Balance at June 30, 2026 | $ | $ | $ | $ | ||||||||||||
NOTE 13 – OTHER ASSETS
On
various dates between November 2020, and November 2024, the Company invested $
Other assets consisted of the following:
June 30, 2026 | September 30, 2025 | |||||||
| Rental deposits | $ | $ | ||||||
| Investment in Masterpiece VR | ||||||||
| Other deposits | ||||||||
| Demonstration equipment supplied to resellers | ||||||||
| Other assets total | $ | $ | ||||||
NOTE 14 – ACCRUED EXPENSES
Accrued expenses consisted of the following:
June 30, 2026 | September 30, 2025 | |||||||
| Accrued expenses | $ | $ | ||||||
| Accrued payroll and payroll taxes | ||||||||
| Accrued warranty | ||||||||
| Accrued expenses total | $ | $ | ||||||
NOTE 15 – DEFERRED REVENUE
The Company’s deferred revenue for the three and nine months ended June 30, 2026, and 2025, were as follows:
| For the three months ended | For the nine months ended | |||||||||||||||
| June 30, 2026 | June 30, 2025 | June 30, 2026 | June 30, 2025 | |||||||||||||
| Deferred revenue at beginning of period | $ | $ | $ | $ | ||||||||||||
| Net additions: | ||||||||||||||||
| Deferred software revenues | ||||||||||||||||
| Recognized as revenue: | ||||||||||||||||
| Deferred software revenues | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Deferred revenue at end of period | ||||||||||||||||
| Less: current portion | ||||||||||||||||
| Long-term deferred revenue at end of period | $ | $ | $ | $ | ||||||||||||
| 23 |
For
the three months ended June 30, 2026, and 2025, the Company recognized revenue of $
NOTE 16 – CONTRACT ASSETS AND LIABILITIES
Project contracts typically provide for a schedule of billings on percentage of completion of specific tasks inherent in the fulfillment of the Company’s performance obligation(s). The schedules for such billings usually do not precisely match the schedule on which costs are incurred. As a result, contract revenue recognized in the statements of operations can and usually does differ from amounts that can be billed to the customer at any point during the contract. Amounts by which cumulative contract revenue recognized on a contract as of a given date exceeds cumulative billings and unbilled receivables to the customer under the contract are reflected as a current asset in the unaudited condensed consolidated balance sheets under the caption “Contract assets.” Amounts by which cumulative billings to the customer under a contract as of a given date exceed cumulative contract revenue recognized are reflected as a current liability in the unaudited condensed consolidated balance sheets under the caption “Contract liabilities.” Conditional retainage represents the portion of the contract price withheld until the work is substantially complete for assurance of the Company’s obligations to complete the job.
The following is a summary of the Company’s uncompleted contracts:
| June 30, 2026 | September 30, 2025 | |||||||
| Costs incurred on uncompleted contracts | $ | $ | ||||||
| Estimated gross profit | ||||||||
| Applicable billings to date | ( | ) | ( | ) | ||||
| Net billings in excess of costs | $ | ( | ) | $ | ( | ) | ||
For
the three and nine months ended June 30, 2026, the Company recognized revenue of $
The following table summarizes the net activity of the contract assets and contract liabilities for the three and nine months ended June 30, 2026, and 2025.
| For the three months ended | For the nine months ended | |||||||||||||||
| June 30, 2026 | June 30, 2025 | June 30, 2026 | June 30, 2025 | |||||||||||||
| Costs and Estimated Earnings in Excess of Billings on Uncompleted Contracts | ||||||||||||||||
| Contract asset, beginning balance | $ | $ | $ | $ | ||||||||||||
| Changes in revenue billed, contract price or cost estimates | ( | ) | ( | ) | ( | ) | ||||||||||
| Contract assets acquired in acquisition | ||||||||||||||||
| Contract asset, net, ending balance | $ | $ | $ | $ | ||||||||||||
| Billings in Excess of Costs and Estimated Earnings on Uncompleted Contracts | ||||||||||||||||
| Contract liability, beginning balance | ( | ) | $ | ( | ) | ( | ) | $ | ( | ) | ||||||
| Changes in revenue billed, contract price or cost estimates | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Contract liabilities acquired in acquisition | ( | ) | ||||||||||||||
| Contract liability, ending balance | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| Net Billings in Excess of Costs and Estimated Earnings on Uncompleted Contracts | ||||||||||||||||
| Net billings in excess of costs, beginning balance | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| Changes in revenue billed, contract price or cost estimates | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Net billings in excess of costs acquired in acquisition | ( | ) | ||||||||||||||
| Net (earnings in excess of billings)/costs in excess of billings, ending balance | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| 24 |
NOTE 17 – RELATED PARTY TRANSACTIONS
On November 22, 2022, the Company entered into two Asset Purchase Agreements and one Simple Agreement for Future Equity (“SAFE”) with the Company’s CEO, Saagar Govil, to secure the sale of the subsidiaries Cemtrex Advanced Technologies, Inc, which include the brand SmartDesk, and Cemtrex XR, Inc., which include the brands Cemtrex XR, Virtual Driver Interactive, Bravo Strong, and good tech (formerly Cemtrex Labs), to Mr. Govil.
On January 6, 2025, the Company and Saagar Govil signed an agreement to revise the purchase price structure and payment terms.
The
Agreement’s Purchase Price provisions were amended to reflect that the Purchase Price will solely consist of the royalties based
on the actual revenues generated in the three years following closing. The provision requiring the total sum of royalties to reach a
minimum of $
Additionally, it was agreed that the payment terms due under the royalties shall be as follows commencing on January 1, 2025:
| ● | First
Year (January 2025) Monthly Payment: $ | |
| ● | Second
Year (January 2026) Monthly Payment: $ | |
| ● | Balloon Payment at the end of the Second Year (December 31, 2026): Total outstanding royalties |
This transaction was approved by the Board of Directors with Saagar Govil abstaining from the vote.
Based
on the new payment terms, management determined that it was appropriate to remove the previously recognized royalty receivable of $
As
of June 30, 2026, there was $
As
of June 30, 2026, there were royalties receivable from the sale of Cemtrex, XR, Inc. of $
NOTE 18 – EXPECTED CREDIT LOSSES
The following table summarized the Company’s activity for expected credit losses for the nine months ended June 30, 2026.
Trade receivables, net | Contract assets, net | Royalties receivable, net - related party | ||||||||||
| As of September 30, 2025 | $ | $ | $ | |||||||||
| Provision | ||||||||||||
| Recovery | ||||||||||||
| Write-off | ||||||||||||
| As of June 30, 2026 | $ | $ | $ | |||||||||
NOTE 19 – LEASES
The
Company is party to contracts where we lease property from others under contracts classified as operating leases. The Company primarily
leases office and operating facilities, vehicles, and office equipment. The weighted average remaining term of our operating leases was
approximately
The
Company has a single lease that is classified as a finance lease for equipment acquired as part of the Richland acquisition. The remaining
term of this lease is
| 25 |
The Company has elected not to recognize lease assets and liabilities for leases with a term of 12 months or less.
The
Company’s security segment leases approximately
A reconciliation of undiscounted cash flows to finance and operating lease liabilities recognized in the unaudited condensed consolidated balance sheet at June 30, 2026, is set forth below:
| Years ending September 30, | Finance Leases | Operating Leases | ||||||
| Remainder of 2026 | $ | $ | ||||||
| 2027 | ||||||||
| 2028 | ||||||||
| 2029 | ||||||||
| 2030 and thereafter | ||||||||
| Undiscounted lease payments | ||||||||
| Amount representing interest | ( | ) | ( | ) | ||||
| Discounted lease payments | ||||||||
| Less short-term lease liabilities | ||||||||
| Long-term lease liabilities | $ | $ | ||||||
Lease costs for the three and nine months ended June 30, 2026, and 2025 are set forth below:
| For
the three months ended June 30, | For the nine months ended June 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Operating lease costs: | ||||||||||||||||
| Amortization of right-of-use assets | $ | $ | $ | $ | ||||||||||||
| Interest on lease obligations | ||||||||||||||||
| Operating lease costs total | ||||||||||||||||
| Finance lease costs | ||||||||||||||||
| Amortization of right-of-use assets | ||||||||||||||||
| Interest on lease obligations | ||||||||||||||||
| Finance lease costs total | ||||||||||||||||
| Short-term lease costs | ||||||||||||||||
| Total lease cost | $ | $ | $ | $ | ||||||||||||
| Other information: | ||||||||||||||||
| Cash paid for amounts included in the measurement of lease liabilities: | ||||||||||||||||
| Operating leases | $ | $ | $ | $ | ||||||||||||
| Financing lease | $ | $ | $ | $ | ||||||||||||
NOTE 20 – LINES OF CREDIT AND LONG-TERM LIABILITIES
Revolving line of credit
On
October 5, 2023, the Company obtained a revolving line of credit in the amount of $
Notes payable
On
November 7, 2025, the Company issued a note payable to Streeterville Capital, LLC in the amount of $
On
February 5, 2026, the company issued a promissory note to Fulton Bank in the amount of $
On
February 5, 2026, the Company acquired a mortgage in the amount of $
| 26 |
The following table outlines the Company’s secured liabilities:
| Interest Rate | Maturity | June
30, 2026 | September
30, 2025 | ||||||||||
| Fulton Bank - $ | SOFR plus | ||||||||||||
| Fulton Bank mortgage $ | SOFR plus | ||||||||||||
| Fulton Bank (HEISEY) - $ | SOFR plus | ||||||||||||
| Fulton Bank (HEISEY) - $ | SOFR plus | ||||||||||||
| Fulton Bank (AIS - TN) - $ | SOFR plus | ||||||||||||
| Fulton Bank (AIS - TN) - $ | % | ||||||||||||
| Note payable - $ | % | ||||||||||||
| Note payable - $ | % | ||||||||||||
| Note payable - $ | Between November 7, 2025
and December 31, 2025, SOFR ( | ||||||||||||
| Less: Unamortized original issue discount | ( | ) | ( | ) | |||||||||
| Total debt | $ | $ | |||||||||||
| Less: Current maturities | ( | ) | ( | ) | |||||||||
| Long-term debt | $ | $ | |||||||||||
| 27 |
NOTE 21 – STOCKHOLDERS’ EQUITY
Series 1 Preferred Stock
The Company’s Series 1 Preferred Stock is quoted on the OTC Markets OTCID tier under the symbol “CETXP.”
During the nine months ended June 30, 2026, shares of Series 1 Preferred Stock were issued to pay dividends to holders of Series 1 Preferred Stock.
As of June 30, 2026, and September 30, 2025, there were and shares of Series 1 Preferred Stock issued and and shares of Series 1 Preferred Stock outstanding, respectively.
Common Stock
On
September 29, 2025, and June 5, 2026, the Company completed a
During
the nine months ended June 30, 2026, shares of common stock were issued for the exercise
During the nine months ended June 30, 2026, shares of common stock issued for rounding on the September 29, 2025, and the June 5, 2026, reverse stock splits. During the three months ended June 30, 2026, shares of common stock issued for rounding on the June 5, 2026 reverse split.
During
the three and nine months ended June 30, 2026, , and shares of common stock were issued for the exercise of
During
the nine months ended June 30, 2026, shares of the Company’s common stock have been issued to satisfy $
Series A and Series B Warrants
The following table summarizes information about shares issuable under warrants outstanding as of June 30, 2026.
Warrant Shares Outstanding | Weighted Average Exercise Price | Weighted Average Remaining Contractual Term | ||||||||||
| Outstanding at September 30, 2025 | $ | |||||||||||
| Warrants granted | ||||||||||||
| Warrants exercised | ( | ) | $ | |||||||||
| Warrants forfeited | ||||||||||||
| Warrants cancelled | ||||||||||||
| Exercise price adjustments | ||||||||||||
| Outstanding at June 30, 2026 | $ | |||||||||||
| 28 |
On
October 13, 2025, the Company issued shares of common stock to relieve debt. At the time, the Company had
The following table illustrates the adjustment.
| Warrants outstanding | Aggregate Value | Adjusted number of warrants outstanding | ||||||||||
| Series A Warrants | $ | |||||||||||
| Series B Warrants | $ | |||||||||||
On
December 11, 2025, the Company closed on a Securities Purchase agreement of common stock. At the time, the Company had
The following table illustrates the adjustment.
| Warrants outstanding | Aggregate Value | Adjusted number of warrants outstanding | ||||||||||
| Series A Warrants | $ | |||||||||||
| Series B Warrants | $ | |||||||||||
On
December 30, 2025, the Company closed on a Securities Purchase agreement of common stock. At the time, the Company had
The following table illustrates the adjustment.
| Warrants outstanding | Aggregate Value | Adjusted number of warrants outstanding | ||||||||||
| Series A Warrants | $ | |||||||||||
| Series B Warrants | $ | |||||||||||
On
April 7, 2026, the Company issued shares of common stock to relieve debt. At the time, the Company had
The following table illustrates the adjustment.
| Warrants outstanding | Aggregate Value | Adjusted number of warrants outstanding | ||||||||||
| Series A Warrants | $ | |||||||||||
| Series B Warrants | $ | |||||||||||
On
June 5, 2026, the Company effected a
| 29 |
The following table illustrates the adjustment
| Warrants outstanding | Aggregate Value | Adjusted number of warrants outstanding | ||||||||||
| Series A Warrants | $ | |||||||||||
| Series B Warrants | $ | |||||||||||
On
June 25, 2026, the Company issued shares of common stock to relieve debt. At the time, the Company had
| Warrants outstanding | Aggregate Value | Adjusted number of warrants outstanding | ||||||||||
| Series A Warrants | $ | |||||||||||
| Series B Warrants | $ | |||||||||||
For the three months ended June 30, 2026, and 2025, the company recognized a gain on the fair value of common shares issued
for the exercised warrants of $
For
the three months ended June 30, 2026, and 2025 the company recognized a loss on changes in fair value of warrant liability of
$
Equity Offerings
On
December 11, 2025, the Company entered into a Securities Purchase Agreement with a single accredited institutional investor pursuant
to which the Company agreed to issue and sell to the Purchaser, in a registered direct offering securities consisting of shares of the
Company’s common stock, par value $ per share, and/or pre-funded warrants to purchase shares of Common Stock at $
On
December 23, 2025, the Company entered into a Securities Purchase Agreement with a single accredited institutional investor pursuant
to which the Company agreed to issue and sell to the Purchaser, in a registered direct offering securities consisting of shares of the
Company’s common stock, par value $ per share, and/or pre-funded warrants to purchase shares of Common Stock at $
On
December 30, 2025, the Company entered into a Securities Purchase Agreement with a single accredited institutional investor pursuant
to which the Company agreed to issue and sell to the Purchaser, in a registered direct offering securities consisting of shares of the
Company’s common stock, par value $ per share, and/or pre-funded warrants to purchase shares of Common Stock at $
On
January 9, 2026, Cemtrex, Inc. (the “Company”) entered into a Securities Purchase Agreement (the “Purchase Agreement”)
with a single accredited institutional investor (the “Purchaser”), pursuant to which the Company agreed to issue and sell
to the Purchaser, in a registered direct offering (the “Offering”), securities consisting of shares of the Company’s
common stock, par value $ per share (the “Common Stock”), and/or pre-funded warrants to purchase shares of Common Stock
(the “Pre-Funded Warrants”), for aggregate gross proceeds of $
| 30 |
For the nine months ended June 30, 2026, and 2025, the Company recognized $ and $ of share-based compensation expense on its outstanding options, respectively. As of June 30, 2026, there was unrecognized share-based compensation expense.
During the nine months ended June 30, 2026, options were granted, cancelled, or forfeited.
NOTE 23 – COMMITMENTS AND CONTINGENCIES
From time to time, the Company and its subsidiaries are involved in legal proceedings that are incidental to the operation of our business. The Company continues to defend vigorously against all claims. Although the ultimate outcome of any legal matter cannot be predicted with certainty, based on present information, including assessment of the merits of the particular claim, as well as current accruals and insurance coverage, the Corporation does not expect that such legal proceedings will have a material adverse impact on its unaudited condensed consolidated financial statements.
NOTE 24 – INCOME TAXES
For
the three and nine months ended June 30, 2026, the Company recorded an income tax benefit of approximately $
As
of year-end 2025, the Company had federal, state, and foreign net operating losses (“NOL”) of approximately $
The
Company’s effective tax rates for the three and nine months ended June 30, 2026, and 2025, were
NOTE 25 – SUBSEQUENT EVENTS
Completion of Acquisition
On July 1, 2026, the Company, through its wholly owned subsidiary AIS, completed the acquisition of substantially all of the assets of Plant Engineering Services, Inc, an Indiana corporation (“PES”) pursuant to an Asset Purchase Agreement dated July 1, 2026 (the “Asset Purchase Agreement”) by and among AIS Engineering, Inc., a newly formed wholly owned subsidiary of AIS (“Buyer”), PES, and Mark Bohler, an individual residing in state of Indiana (“the “Owner” and collectively with the PES, the “Seller Parties”).
As a result of the transaction, PES’s business operations have been integrated into the Company’s Industrial Services Segment, and Buyer has become the owner of the acquired assets
The
purchase price for the business assets was $
Issuance of common shares to satisfy notes payable
On
July 2, 2026, shares of the Company’s common stock have been issued to satisfy $
| 31 |
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
Except for historical information contained in this report, the matters discussed are forward-looking statements that involve risks and uncertainties. When used in this report, words such as “anticipates”, “believes”, “could”, “estimates”, “expects”, “may”, “plans”, “potential” and “intends” and similar expressions, as they relate to the Company or its management, identify forward-looking statements. Our operations involve risks and uncertainties, many of which are outside our control, and any one of which, or a combination of which, could materially affect our results of operations and whether the forward-looking statements ultimately prove to be correct. We have based these forward-looking statements largely on our current expectations and projections about future events and trends that we believe may affect our financial condition, results of operations, business strategy, short-term and long-term business operations and objectives, and financial needs. Such forward-looking statements are based on the beliefs of the Company’s management, as well as assumptions made by and information currently available to the Company’s management. Among the factors that could cause actual results to differ materially are the following: the effect of business and economic conditions; the impact of competitive products and their pricing; unexpected manufacturing or supplier problems; the Company’s ability to maintain sufficient credit arrangements; changes in governmental standards by which our environmental control products are evaluated and the risk factors reported from time to time in the Company’s SEC reports, including its recent report on Form 10-K. The Company undertakes no obligation to update forward-looking statements as a result of future events or developments.
General Overview
Cemtrex was incorporated in 1998 in the state of Delaware and has evolved through strategic acquisitions and internal growth into a leading multi-industry company. Unless the context requires otherwise, all references to “we”, “our”, “us”, “Company”, “registrant”, “Cemtrex” or “management” refer to Cemtrex, Inc. and its subsidiaries.
The Company’s reporting segments consist of Security, Industrial Services and Aerospace and Defense. Additionally, the Company’s operational structure also reports unallocated corporate expenses.
Security
Cemtrex’s Security segment operates under the brand, Vicon Industries, Inc. (“Vicon”), which provides end-to-end security solutions to meet the toughest corporate, industrial, and governmental security challenges. Vicon’s products include browser-based video monitoring systems and analytics-based recognition systems, cameras, servers, and access control systems for every aspect of security and surveillance in industrial and commercial facilities, federal prisons, hospitals, universities, schools, and federal and state government offices. Vicon provides innovative, mission critical security and video surveillance solutions utilizing Artificial Intelligence (AI) based data algorithms.
Industrial Services
Cemtrex’s Industrial Services segment operates under the brand, Advanced Industrial Services (“AIS”), which offers single-source expertise and services for rigging, millwrighting, in plant maintenance, equipment erection, relocation, and disassembly to diversified customers. AIS installs high precision equipment in a wide variety of industrial markets like automotive, printing & graphics, industrial automation, packaging, and chemicals, among others. AIS is a leading provider of reliability-driven maintenance and contracting solutions for machinery, packaging, printing, chemical, and other manufacturing markets. The focus is on customers seeking to achieve greater asset utilization and reliability to cut costs and increase production from existing assets, including small projects, sustaining capital, turnarounds, maintenance, specialty welding services, and high-quality scaffolding.
Aerospace and Defense
Cemtrex’s Aerospace and Defense segment operates under the brand Invocon, which offers designing, manufacturing, and supporting advanced instrumentation, wireless sensing, and telemetry systems deployed across satellites, launch vehicles, target missiles, and space-based platforms. Its technologies support numerous government and prime contractor programs, including multiple Space Shuttle and International Space Station systems, and the company maintains long-standing relationships across the Missile Defense Agency and leading aerospace and defense primes.
| 32 |
Significant Accounting Policies and Estimates
Our discussion and analysis of our financial condition and results of operations are based upon the accompanying unaudited condensed consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”). The preparation of financial statements in conformity with U.S. GAAP requires management to make judgments, estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, expenses, and the related disclosures at the date of the financial statements and during the reporting period. Although these estimates are based on our knowledge of current events, our actual amounts and results could differ from those estimates. The estimates made are based on historical factors, current circumstances, and the experience and judgment of our management, who continually evaluate the judgments, estimates and assumptions and may employ outside experts to assist in the evaluations.
Certain of our accounting policies are deemed “significant”, as they are both most important to the financial statement presentation and require management’s most difficult, subjective, or complex judgments as a result of the need to make estimates about the effect of matters that are inherently uncertain. For a discussion of our significant accounting policies, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended September 30, 2025.
Results of Operations – For the three months ended June 30, 2026, and 2025
The Company’s Security segment revenues for the three months ended June 30, 2026, decreased by $1,330,320 or 18% to $6,251,494 from $7,581,814 for the three months ended June 30, 2025. This decrease is mainly due to delays in shipping from increased production time on some of our component products. The Company is currently purchasing additional inventory to overcome this supply issue.
The Company’s Industrial Services segment revenues for the three months ended June 30, 2026, increased by $589,948 or 6%, to $9,973,792 from $9,383,844, for the three months ended June 30, 2025. This increase is mainly due to the revenues from the acquisition of Richland, LLC.
The Company’s newly established Aerospace and Defense segment generated revenues of $2,202,305 for the three months ended June 30, 2026.
There was unallocated revenue to Corporate of $12,619 for the three months ended June 30, 2026. This revenue is related to the Company’s investment in digital assets.
Gross Profit
Gross Profit for the three months ended June 30, 2026, was $7,696,790 or 42% of revenues as compared to gross profit of $7,370,506 or 43% of revenues for the three months ended June 30, 2025.
Gross profit in our Security segment was $3,066,481 or 49% of the segment’s revenues for the three months ended June 30, 2026, as compared to gross profit of $3,953,562 or 52% of the segment’s revenues for the three-month period ended June 30, 2025. Gross profit in our security segment decreased mainly due to increased costs on some of our component products, additionally gross profits have been impacted by tariffs and fuel surcharges on shipping. The Company has applied for tariff refunds and is waiting on the amount to be refunded.
Gross profit in our Industrial Services segment was $2,702,441 or 27% of the segment’s revenues for the three months ended June 30, 2026, as compared to gross profit of $3,416,944 or 36% of the segment’s revenues for the three-month period ended June 30, 2025. Gross profit decreased in the three months ended June 30, 2026, compared to the three months ended June 30, 2025, as the Company works to increase efficiency for its recent acquisition, Richland, LLC.
Gross profit in the Company’s newly established Aerospace and Defense segment was $1,915,249 or 87% of revenues for the three months ended June 30, 2026.
| 33 |
General and Administrative Expenses
General and administrative expenses, including depreciation and amortization expenses, for the three months ended June 30, 2026, increased $838,400 or 11% to $8,464,742 from $7,626,342 for the three months ended June 30, 2025. The increase in general and administrative expenses is mainly related to the additional expenses related to the acquisition of Invocon and Richland.
Research and Development Expenses
Research and Development expenses for the three months ended June 30, 2026, were $425,190 compared to $386,565 for the three months ended June 30, 2025, an increase of $38,625 or 10%. Research and Development expenses are related to the Security segment’s development of next generation solutions associated with security and surveillance systems software and the Aerospace and Defense segment’s development and improvement of their products.
Other Income/Expense
Other expense for the three months ended June 30, 2026, was $3,295,351 as compared to $3,934,931 for the three months ended June 30, 2025. Other expense for the three months ended June 30, 2026, was mainly driven by the change in the fair value of warrant liabilities, and interest expense. Other expense for the three months ended June 30, 2025, was mainly driven by the change in the fair value of warrant liabilities.
Provision for Income Taxes
During the three months ended June 30, 2026, and 2025, the Company had an income tax benefit from continuing operations of $119,001 and an income tax expense of $14,035, respectively. The provision for income tax is estimated based upon the current income projections of the Company, the effective rate of the prior year, and the Company’s current ability to utilize net loss carryforwards. The Company’s effective tax rate for the three months ended June 30, 2026, and 2025, was 2.65% and (0.31)% respectively.
Results of Operations – For the nine months ended June 30, 2026, and 2025
Revenues
The Company’s Security segment revenues for the nine months ended June 30, 2026, decreased by $12,477,086 or 42% to $17,539,579 from $30,016,665 for the nine months ended June 30, 2025. This decrease is mainly due to a large sale valued at $10,375,000 for security technology products under our Vicon brand during the prior nine-month period ended June 30, 2025.
The Company’s Industrial Services segment revenues for the nine months ended June 30, 2026, increased by $3,683,833 or 13%, to $31,622,994 from $27,939,161, for the nine months ended June 30, 2025. This increase is mainly due to the revenues from the acquisition of Richland LLC.
The Company’s newly established Aerospace and Defense segment generated revenues of $3,434,897 for the nine months ended June 30, 2026.
There was unallocated revenue to Corporate of $37,418 for the nine months ended June 30, 2026. This revenue is related to the Company’s investment in digital assets.
Gross Profit
Gross Profit for the nine months ended June 30, 2026, was $20,165,860 or 38% of revenues as compared to gross profit of $25,237,897 or 44% of revenues for the nine months ended June 30, 2025.
Gross profit in our Security segment was $7,757,943 or 44% of the segment’s revenues for the nine months ended June 30, 2026, as compared to gross profit of $15,597,177 or 52% of the segment’s revenues for the nine-month period ended June 30, 2025. Gross profit in our security segment decreased as a result of the large sale mentioned above, additionally gross profits have been impacted by increased costs, tariffs and fuel surcharges on shipping. The Company is currently evaluating the potential impact of tariff refunds on future gross profit percentages.
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Gross profit in our Industrial Services segment was $9,934,435 or 31% of the segment’s revenues for the nine months ended June 30, 2026, as compared to gross profit of $9,640,720 or 35% of the segment’s revenues for the nine-month period ended June 30, 2025. Gross profit increased in the nine months ended June 30, 2026, compared to the nine months ended June 30, 2025, mainly due to the acquisition of Richland, LLC.
Gross profit in the Company’s newly established Aerospace and Defense segment was $2,436,064 or 71% of revenues for the nine months ended June 30, 2026
General and Administrative Expenses
General and administrative expenses, including depreciation and amortization expenses, for the nine months ended June 30, 2026, increased $3,373,343 or 16% to $24,863,716 from $21,490,373 for the nine months ended June 30, 2025. The increase in general and administrative expenses is mainly related to the additional expenses related to the acquisition of Invocon and Richland.
Research and Development Expenses
Research and Development expenses for the nine months ended June 30, 2026, were $1,473,483 compared to $2,054,537 for the nine months ended June 30, 2025, a decrease of $581,054, or 28%. Research and Development expenses are related to the Security segment’s development of next generation solutions associated with security and surveillance systems software and the Aerospace and Defense segment’s development and improvement of their products.
Bargain Purchase Gain
As discussed in Note 1 of this Form 10-Q, the acquisition of Richland, LLC resulted in a bargain purchase gain of $2,068,047 based on the preliminary purchase price allocation. The purchase price allocation is still preliminary but has been developed based on an estimate of fair values of Richland’s identifiable tangible and intangible assets acquired and liabilities assumed as of February 5, 2026. The final allocation of the purchase price will be determined within one year from the closing date of the Richland acquisition.
Other Income/Expense
Other expense for the nine months ended June 30, 2026, was $17,343,292, as compared to $26,095,977 for the nine months ended June 30, 2025. Other expense for the nine months ended June 30, 2026, was mainly driven by interest expense related to the discount on common shares issued for the relief on notes payable, loss on the exercise of warrant liabilities, and the change in the fair value of the Company’s digital assets. Other expense for the nine months ended June 30, 2025, was mainly driven by the loss on excess fair value of warrant liabilities.
Provision for Income Taxes
During the nine months ended June 30, 2026, and 2025, the Company had income tax expense from continuing operations of $221,184 and $245,098, respectively. The provision for income tax is estimated based upon the current income projections of the Company, the effective rate of the prior year, and the Company’s current ability to utilize net loss carryforwards. The Company’s effective tax rate for the nine months ended June 30, 2026, and 2025, was (0.94%) and (1.00%) respectively.
Effects of Inflation
The Company’s business and operations have been affected by inflation during the periods for which financial information is presented. In response, the Company has instituted price increases and initiated cost-saving measures to mitigate the effects of inflation on operations.
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Liquidity and Capital Resources
Working capital was $13,155,389 at June 30, 2026, compared to working capital of $5,184,339 at September 30, 2025. This includes cash and cash equivalents and restricted cash of $9,301,740 at June 30, 2026, and $6,347,041 at September 30, 2025. The increase in working capital was primarily due to cash raised in the equity offerings and Series B Warrant exercises and the payment of the Company’s debt through equity.
Cash used by operating activities for the nine months ended June 30, 2026, was $4,900,015 compared to providing $3,410,782 for the nine months ended June 30, 2025. Our operating cash flow was mainly the result of our net loss, less the non-cash adjustments, combined with operating changes in inventory, contract assets, prepaid expenses and other current assets, accounts payable, operating lease liabilities, accrued expenses, and deferred revenues.
Trade receivables decreased by $613,244 or 5% to $12,520,180 at June 30, 2026, from $13,133,424 at September 30, 2025. The decrease in trade receivables is attributable to the decrease in sales in the Security segment.
Cash used by investing activities for the nine months ended June 30, 2026, was $13,278,551 compared to $1,482,232 for the nine months ended June 30, 2025. Investing activities for the nine months ended June 30, 2026, were driven by the Company’s purchase of property and equipment, investment in marketable securities, the acquisition of Richland and Invocon, and investment in digital assets. Investing activities for the nine months ended June 30, 2025, were driven by the Company’s purchase of property and equipment and investment in Masterpiece VR.
Cash provided by financing activities for the nine months ended June 30, 2026, was $21,151,864 compared to $1,117,811 for the nine months ended June 30, 2025. Financing activities for the nine months ended June 30, 2026, were primarily driven by the proceeds from equity offerings, proceeds of notes payable and bank loans, and proceeds from the exercise of the Company’s Series B Warrants. Financing activities for the nine months ended June 30, 2025, were primarily driven by the proceeds from the Company’s revolving line of credit, notes payable, and proceeds from the exercise of the Company’s Series B Warrants.
The Company’s working capital may not be sufficient to cover operating costs which indicates substantial doubt regarding the Company’s ability to continue as a going concern, the Company has historically, from time to time, satisfied and may continue to satisfy certain short-term liabilities through the issuance of common stock, thus reducing our cash requirement to meet our operating needs. The Company has $9,301,740 in cash and cash equivalents and restricted cash as of June 30, 2026. Additionally, the Company has (i) secured a line of credit for its Vicon brand to fund operations, which as of June 30, 2026, has available capacity of approximately $622,106, (ii) continually reevaluate our pricing model on our Vicon brand to improve margins on those products, (iii) raised $5,787,831 through the exercise of our Series B warrants during the nine months ended June 30, 2026 (iv) raised $10,000,000 in gross proceeds in equity offering during the nine months ended June 30, 2026.
In the event additional capital is raised through equity offerings and/or debt is satisfied with equity, it may have a dilutive effect on our existing stockholders. While the Company believes these plans, if successful, would be sufficient to meet the capital demands of our current operations for at least the next twelve months, there is no guarantee that we will succeed. Overall, there is no guarantee that cash flow from our existing or future operations and any external capital that we may be able to raise will be sufficient to meet our working capital needs. The Company currently does not have adequate cash or available liquidity/available capacity on our lines of credit to meet our short or long-term needs. Absent an ability to raise additional outside capital and restructure or refinance all or a portion of our debt, the Company will be unable to meet its obligations as they become due over the next twelve months beyond the issuance date.
Each segment of the Company’s operations has positioned itself for growth and the Company’s long-term objectives include increasing marketing and sales for the Company’s products and services in each segment, increasing the Company’s presence through collaboration partnerships in each segment and through strategic acquisitions of complementary businesses for each segment. These long-term objectives will require sufficient cash to complete, and the Company expects to fund these objectives with cash on hand, issuance of debt, and from proceeds from the sale of the Company’s securities, which may not be sufficient to fully implement our growth initiatives.
The unaudited condensed consolidated financial statements do not include any adjustments relating to this uncertainty.
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Item 4. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
Disclosure controls and procedures reporting as promulgated under the Exchange Act is defined as controls and procedures that are designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act are recorded, processed, summarized and reported within the time periods specified in the SEC rules and forms. Disclosure controls and procedures include without limitation, controls and procedures designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is accumulated and communicated to our management, including our Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.
Our CEO and our CFO have evaluated the effectiveness of the design and operation of our disclosure controls and procedures as of June 30, 2026. Based on their evaluation, our management has concluded that as of June 30, 2026, our disclosure controls and procedures were effective.
Changes in Internal Control Over Financial Reporting
There have been no changes in our internal control over financial reporting (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended) that occurred during the three months ended June 30, 2026, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
Limitations on the Effectiveness of Controls
Our management, including our CEO and CFO, does not expect that our disclosure controls and procedures or our internal controls will prevent all errors and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Due to the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within our company have been detected.
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Part II Other Information
Item 1. Legal Proceedings.
To the Company’s knowledge, there is no action, suit, proceeding, inquiry or investigation before or by any court, public board, government agency, self-regulatory organization or body pending or, to the knowledge of the executive officers of our Company or any of our subsidiaries, threatened against or affecting our Company, our common stock, any of our subsidiaries or of our Company’s or our Company’s subsidiaries’ officers or directors in their capacities as such, in which an adverse decision could have a material adverse effect.
Item 1A. Risk Factors
The risk factors set forth under the caption “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended September 30, 2025 (filed with the Securities and Exchange Commission on December 29, 2025, and amended on January 16, 2026) continue to apply to our business and operations, except as updated or supplemented below. You should carefully consider those risk factors, together with the other information contained in this Quarterly Report on Form 10-Q and in our other filings with the Securities and Exchange Commission, before making an investment decision regarding our securities. The risks described below and in our Annual Report are not the only risks we face. Additional risks and uncertainties not currently known to us, or that we currently deem to be immaterial, may also materially and adversely affect our business, financial condition, or results of operations.
Risk Related to Our Continued Listing on The Nasdaq Capital Market – New $5 Million Market Value of Listed Securities Requirement
Our common stock is listed on The Nasdaq Capital Market. On July 22, 2026, the Securities and Exchange Commission approved a new Nasdaq continued listing requirement (Nasdaq Listing Rules 5450(a)(3) and 5550(a)(6)) that requires all companies listed on the Nasdaq Global Select Market, Nasdaq Global Market, and Nasdaq Capital Market to maintain a Market Value of Listed Securities (“MVLS”) of at least $5 million. MVLS is calculated as the consolidated closing bid price of our common stock multiplied by the number of shares of our common stock outstanding.
As of August 12, 2026, our common stock was trading at approximately $3.05 per share. Based on approximately 1,721,141 shares of common stock outstanding as of August 12, 2026, our MVLS was approximately $5.249 million, which is above the $5 million threshold. If our MVLS falls below $5 million for 30 consecutive business days, Nasdaq will issue a Staff Delisting Determination, and our common stock will be immediately subject to suspension from trading on Nasdaq and delisting proceedings. Unlike most other Nasdaq continued listing deficiencies, the new MVLS requirement provides no cure or compliance period.
A request for a hearing before a Nasdaq Hearings Panel will not stay the suspension of trading. The Hearings Panel’s authority is limited; it may reverse a determination only if made in error or, in limited circumstances, grant an exception of up to 180 days for us to demonstrate compliance with Nasdaq’s more stringent initial listing standards. If our common stock is delisted from Nasdaq, it would likely trade only in the over-the-counter market, which could result in reduced liquidity, increased price volatility, decreased institutional interest, and material adverse effects on our ability to raise additional capital. There can be no assurance that we will be able to regain or maintain compliance with the $5 million MVLS requirement, or any other Nasdaq continued listing standard.
On July 29, 2026, we filed with the Securities and Exchange Commission a Notice of Intention to Petition for Review of the order approving the new MVLS requirement (File No. SR-NASDAQ-2026-004), pursuant to Rule 430 of the Commission’s Rules of Practice. As a result of this filing, we are a “person aggrieved” by the approval order. Under Rule 431(e) of the Commission’s Rules of Practice, the filing of the Notice automatically stays the effectiveness of the approval order unless and until the Commission orders otherwise. There can be no assurance that the stay will remain in effect for any particular period of time, that the Commission will grant any petition for review, or that we will be able to regain or maintain compliance with the $5 million MVLS requirement or any other Nasdaq continued listing standard.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
Preferred Stock
During the nine months ended June 30, 2026, 277,814 shares of Series 1 Preferred Stock were issued to pay dividends to holders of Series 1 Preferred Stock.
Common Stock
During the nine months ended June 30, 2026, 482,188 shares of the Company’s common stock have been issued to satisfy $8,430,895 of notes payable, $511,546 in accrued interest, and $12,269,120 of excess value of shares issued recorded as interest expense. Such shares were issued pursuant to the exemption contained under Section 4(a)(2) of the Securities Act of 1933, as amended.
Item 3. Defaults Upon Senior Securities
None.
Item 4. Mine Safety Disclosures
N/A
Item 5. Other Information
None.
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Item 6. Exhibits
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Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Cemtrex, Inc. | ||
| Dated: August 14, 2026 | By: | /s/ Saagar Govil |
| Saagar Govil | ||
| Chairman of the Board, CEO, | ||
President and Secretary (Principal Executive Officer) | ||
| Dated: August 14, 2026 | /s/ Paul J. Wyckoff | |
| Paul J. Wyckoff | ||
| Chief Financial Officer | ||
| and Principal Financial Officer | ||
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