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Please note today's event is being recorded. At this time, I'd like to turn the conference call over to Robert Blum with Lytham Partners. Please go ahead.

Thank you very much, Jamie, thank you all for joining us today to discuss SenesTech's Q1 2026 Financial Results. This for the period ended March 31, 2026. With us on the call today are Michael Edell, the company's newly appointed President and Chief Executive Officer, and Tom Chesterman, the company's Chief Financial Officer. At the conclusion of today's prepared remarks, we'll open the call for a question-and-answer session. As mentioned, if you are listening through the webcast portal and would like to ask a question, you can submit it, your question, through the Ask a Question feature in the webcast player. Before we begin with prepared remarks, we submit for the record the following statement.

Statements made by the management team of SenesTech during the course of this conference call may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 as amended, and Section 21E of the Securities Exchange Act of 1934 as amended, and such forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements describe future expectations, plans, results, or strategies and are generally preceded by words such as may, future, plan or planned, will or should, expected, anticipates, draft eventually, or projected.

Listeners are cautioned that such statements are subject to a multitude of risks and uncertainties that could cause future circumstances, events, or results to differ materially from those projected in the forward-looking statements, including the risks that actual results may differ materially from those projected in the forward-looking statements as a result of various factors and other risks identified in the company's filings with the Securities and Exchange Commission. All forward-looking statements contained during this conference call speak only as of the date which they were made and are based on management's assumptions and estimates as of such date. The company does not undertake any obligation to publicly update any forward-looking statements, whether as a result of the receipt of new information, the occurrence of future events, or otherwise. With that said, let me turn the call over to Michael Edell, President and Chief Executive Officer. Michael, please proceed.

Thank you, Robert. Good afternoon to everyone joining us today. As this is my first earnings call with SenesTech investors as President and Chief Executive Officer, I wanted to start by saying how excited I am to be formally joining the company. I accepted this role as CEO with SenesTech because my conviction in the products and markets is strong. My conviction in our ability to dramatically scale this business is even stronger. The work now is to translate product strengths into commercial execution at scale. That is the central priority of this management team. Although I have just been appointed CEO, I'm not coming into this business cold. I began working closely with SenesTech mid-2025, initially in a consulting capacity to evaluate the business and build a strategic plan focused on commercial growth.

In October, I became the interim chief operating officer to lead implementation of that strategic plan. Over the past several months, we have been taking a hard look at the business and making practical changes designed to create a more scalable, more accountable, and more data-driven operating model. Those changes are not theoretical. We have streamlined operations. We have prioritized direct-to-consumer revenue as a core growth engine. We have moved to direct management of our Amazon account for the Evolve brand. We have restructured B2B processes and the sales organization to improve discipline, pipeline visibility, forecasting accountability, and focus. We have advanced work on packaging, digital marketing efforts, subscription, customer education, and our own e-commerce platform. The goal across all of these initiatives is quite simple: make the product easier to understand, easier to buy, easier to deploy, and easier to reorder. The direct-to-consumer channel is central to that strategy.

During the Q1, direct-to-consumer revenue increased 42% to a record $194,000, despite the disruption associated with moving the Amazon operations in-house. That is an important result because the Amazon transition was a deliberate strategic move. It was not just a channel change. It changed what we can see, what we can control, and how quickly we can respond. By managing Amazon directly, we gained better access to customer behavior, advanced advertising performance, subscription data, pricing visibility, media buying efficiency, and just overall channel economics. We can learn faster, we could test faster, and we can improve conversion faster. We can test new products and new packaging more quickly, and that is the type of operating model that we need.

We consider Amazon as a key pillar to our sales strategy. There was a short-term disruption as we transitioned away from third-party e-commerce management and as existing third-party inventory continued to move through the channel. That was to be expected. The early data after the transition are highly encouraging. April was the first full month following the completion of the Amazon transition. E-commerce sales increased 163% to a record $146,000 compared with approximately $55,000 in April of 2025. Amazon retail sales of the Evolve brand were approximately $96,000 in April, while sales through our own SenesTech website were approximately $50,000. We began taking control of advertising execution in mid-February, completed the broader transition in March. The early trend is exactly the kind of signal that we want to see.

We are now moving to improve our website sales platform as well, that being the second pillar in our strategy. A product like Evolve is not a one-time novelty purchase. It is intended to be part of an ongoing rodent management program. That is why recurring revenue is so important to our strategy, with subscription revenue being a core part of the new direct-to-consumer strategy. We are now seeing meaningful evidence that this was the right focus. In just the Q1, subscription revenue increased 44% to a new record at $56,000, compared with just $39,000 in the prior year period, and subscriber counts increased more than 50%. In April, subsequent to the quarter end, subscription-based revenue increased 198% year-over-year to approximately $36,000, another record. Subscription-based customers increased 109%.

Those are still early numbers, but they are important proof points. They indicate the product stickiness, the customer engagement, and the potential to build a more predictable, recurring revenue-based model. Now we need to build on that. We are tracking weekly sales, new-to-brand sales, subscription metrics, conversion metrics, media ad buying performance, and customer behavior. We have reactivated our Google advertising in April to begin collecting search data to support online revenue. We are continuing to redesign our e-commerce website at senestech.com with a focus on reducing friction, simplifying navigation, improving conversion, and supporting subscription growth. We are also refreshing our packaging to improve shelf visibility and simplifying the consumer message. The updating packaging prominently features rat birth control messaging because we want the customers to immediately understand what makes this product different. We do not want ambiguity at the point of a decision. We want clarity.

The same principle applies to our B2B business, the third pillar to our commercial strategy. We believe there are large opportunities across pest management, agriculture, municipalities, distributor, commercial customers, national retailers, and other professional channels. By capturing those opportunities requires focus and discipline. It is not enough to have a long list of prospects. We need a qualified pipeline, clear ownership, better forecasting, and a standardized sales process. Over the past several months, we have restructured the entire B2B team and processes around those objectives. We are concentrating resources on the largest and highest impact opportunities within each vertical while providing accountability around pipeline and forecast accuracy. Here again, we saw early proof in the quarter. B2B revenue increased 57% to $298,000 compared with approximately $190,000 in the Q1 of last year.

We continue to see municipal deployment activity across major urban markets, including Chicago, Boston, Washington, D.C., New York, and New York City. The previously announced 12-month New York City rat contraception pilot program is expected to conclude this month. We look forward to those results. We are also continuing to support distributors, pest management professionals, commercial customers, and agricultural opportunities where the product can fit into a broader integrated pest management program. We will remain selective and disciplined, de-emphasizing the smaller or longer-term opportunities. We believe the B2B opportunity is significant. In addition, the work that we are doing with our focus on direct to consumer will bring more brand awareness, which will support our continuing efforts in the B2B. We are already seeing an increase in inbound opportunities and leads from these efforts. Product expansion is another part of building a broader commercial platform.

We plan to expand the Evolve brand with additional rodent control products that can broaden our offering and strengthen our position in the category. We are also advancing launch readiness around potential related products, such as an attractant and repellent products. Now, the idea is not to dilute the mission. It is to strengthen the ecosystem around the core fertility control solutions, yet give customers more tools to deploy with a complete program. I would note again, full control over Amazon and our own e-commerce website now gives us a very efficient launch platform for these potential new products which had not been in place historically. We are also improving how field activity, sales support, regulatory, and product development work together. The field and sales teams have been reintegrated, generating higher quality B2B opportunities to drive near-term revenues.

Internationally, we're putting more structure around opportunity vetting to focus on opportunities that can produce near-term revenues. We shipped initial stocking orders to New Zealand and Bermuda during the quarter. We will continue to pursue international opportunities where the regulatory process can move efficiently with limited incremental cost. Where a market requires significant regulatory investment or long periods of time, we will generally require local partners to assist us or fund that process. That is a disciplined approach to expansion. The Q1 also demonstrated the importance of operating discipline. Gross margin improved to a company record 68.6%, compared with 64.5% in the prior year period. That reflects improved product production efficiency and reduced reliance on discounted sales activity. We need to grow revenue, but we also need to protect the economics of the business as we grow.

That is how we build a durable company, not just a bigger one. When I think about SenesTech's future in very practical terms. We need to sell more product. We need to improve conversion. We need to focus on subscriptions for recurring revenue. We need to build repeat purchasing behavior, and we need to win larger B2B opportunities. We need to make Amazon our own website at senestech.com, our distributors, the municipalities, pest management professionals, and commercial customers working together as a coherent growth strategy. We need to measure progress with real operating metrics, not anecdotes. That is the vision I want investors to understand. We are building a more scalable, data-driven, recurring revenue business around a differentiated product in a market that needs better solutions for overall pest management.

We have a lot of work ahead of us, and I do not want to overstate early results, but I am very encouraged by what we are seeing. The record April e-commerce momentum, the record subscription growth, the B2B improvement, the record gross margins, and the stronger operating infrastructure all point in the same direction. SenesTech is entering a new phase defined by commercial focus, execution discipline, and accountability, and my job is to drive that every single day. With that, let me turn it over to Tom Chesterman to review the financials in more detail, and then I will come back with a few closing comments before turning over the call to your questions. Tom?

Thank you, Michael, and good afternoon, everyone. I will provide a brief review of our Q1 of 2026 financial results and add context around the operating trends that Michael discussed as I can. Note that we will be filing our 10-Q later today for a more detailed look at our results to date. Revenue for the Q1 was $493,000, an increase of 2% compared with $485,000 in the Q1 of 2025. This result should be viewed in the context of our transition from third-party management to direct management of Amazon sales for the Evolve brand. That transition was substantially completed in mid-March.

While it created short-term channel disruption, as Michael mentioned, it gives us greater control over customer data, advertising performance, pricing visibility, subscriptions, and overall channel economics, which we believe will drive growth and profitability into the future. Direct-to-consumer revenue increased 42% to a record $194,000 compared with $137,000 in the prior year period. Of that, subscription revenue increased 44% to a record $56,000 compared to approximately $39,000 last year. While subscriber counts have increased more than 57%. These metrics support our view that recurring revenue can be a larger component of the business over time. Note that the year-ago metrics exclude the third-party e-commerce revenue as we want to provide a clear understanding of the growth we are seeing. Third-party e-commerce revenue in the year-ago period was $158,000.

We expect that third-party e-commerce revenue has strong potential for growth, and we expect future announcements about expansion in this area. B2B revenue increased 57% to $298,000, compared with $190,000 in the Q1 of 2025. We saw continued traction across distributor, municipal, professional, and commercial channels. We're also improving process discipline in the B2B organization with a greater focus on standardized sales processes, pipeline validation, forecasting accuracy, and larger dollar opportunities within the targeted verticals. Subsequent to the quarter end, April provided an encouraging early proof point for the e-commerce transition. E-commerce sales increased 163% year-over-year to approximately $146,000 and increased 47% compared to March. Amazon retail sales of Evolve products were approximately $96,000, and sales through the senestech.com website were approximately $50,000.

Subscription-based revenue also increased 198% year-over-year in April to approximately $36,000. While April is only one month, the early data supports the strategic rationale for direct management of our e-commerce channels. Gross profit increased 8% to $338,000 compared with $313,000 in the prior year period. Gross margin improved to 68.6%, another company record, compared with 64.5% in the Q1 of 2025. This margin improvement reflected improved production efficiency and a lower reliance on discounted sales activity. We view this as an important indicator of the underlying economics of the business as we scale. This becomes manifest when gross profit dollars are growing faster than top-line revenue.

Operating expenses reflected, among other factors, severance costs, one-time legal costs, and other extraordinary one-time items associated with the organizational transition and strategic restructuring currently underway. Q1 2026 results included approximately $443,000 of one-time expenses, as mentioned above. On a pro forma basis, adjusting for these items, adjusted EBITDA loss, a non-GAAP measure, was $1.6 million compared with $1.5 million in the prior year period. Reconciliations on these non-GAAP measures are included in today's press release.

Turning to the balance sheet, we ended the Q1 with $6.8 million of cash and cash equivalents. Based on our current operating plan, we believe this provides operating runway into the third quarter of 2027. We remain focused on managing expenses carefully while supporting the commercial initiatives that we believe can drive higher quality revenue growth over time. With that financial overview, I will turn the call back to Michael for closing remarks.

Thank you, Tom. I want to close by bringing the discussion back to the central point, which is our focus in driving revenues with product that we know works and how we can disrupt this category. We have a product we believe in, we have a market that needs better options, and we have clear evidence that customers are engaging with Evolve through the direct-to-consumer channels, that subscription behavior is building, that Amazon become a more effective channel under our direct management, and that B2B opportunities are beginning to move with more discipline. The company will not be defined by belief alone. It will be defined by execution. That means increasing revenue through channels where we can see the customer, understand performance, and control the economics. It means improving conversion on Amazon and our own e-commerce website. It means increasing the number of subscription customers and retaining them.

It means using the website redesign, packaging refresh, paid media, social efforts, and customer education to reduce friction. It means going after the largest and most attractive B2B opportunities with a validated pipeline and accountability to the sales process. It means supporting municipalities, pest management professionals, agricultural customers, distributors, and commercial accounts with a clear value proposition and better field support. It means expanding the Evolve platform in ways that make sense for the customer and for the company's economics. I'm very encouraged by the April data, but I view it as just the starting point. We need to convert early momentum into repeatable performance. We need to make every dollar of marketing, every customer interaction, every sales meeting, and every product initiative contribute to growth.

That is the standard I am setting for the organization. SenesTech's mission is to create cleaner cities, more efficient businesses, and healthier communities through effective and sustainable pest management solutions. That mission is powerful, but it must be matched with disciplined commercial execution. As CEO, my commitment is to bring that discipline to this business every day. We will focus resources on the highest impact commercial opportunities, improve sales execution, build scalable operating processes, and hold ourselves accountable to those metrics that matter. Thank you to our employees, our customers, our partners, and our shareholders for your continued support. We are very excited about the path ahead, and we are focused on turning the opportunity in front of us into measurable growth. Robert, we're now ready to open the call for questions.

Very good. Thank you very much, Michael and Tom, for your prepared remarks there. Again, to everyone listening through the webcast portal, if you would like to ask a question, you can type it into the Ask a Question there on your screen. I have a few questions already in the queue, so I will proceed here. First one is, given the early results from April, is it fair to expect Q-over-Q, quarter-over-quarter revenue growth and a reasonable chance at record revenue?

Thank you, Robert. I believe that from the results that we're already seeing and what we've talked about bringing in, and direct control over our D2C efforts, I do believe that we can see reasonable growth quarter-over-quarter, and I do believe that we will continue to break records.

All right. Very good. Next question here is, are you seeing any expansion internationally, especially with the hantavirus breakout?

Thank you, Robert. That's a very interesting question. The hantavirus really points out the potential risks involved with rodent or rat infestations. Obviously, our position is one to where we think we have a solution that can take care of rodent infestations long term. Related to the international parts of our business, as I mentioned before, we really wanna focus in international on those countries that we can make an impact short term. A lot of the regulatory requirements for certain parts of the world can take anywhere from two to three years to get through those processes. Unless we have a partner in place that's gonna support and bear some of those costs, we are going to focus only on those international opportunities that can bring in short-term, near-term revenues.

All right. Very good. Next question here, broadly relating to the New York City test or trial there. What announcements do you expect them to make relating to the results? Really anything more that you can add relating to New York City?

There's nothing I could really speak to today on the New York City tests or the trials at this point because we're getting prepared to announce some of the data and some of the results from the various areas that we've been testing. I would say that longer term, these types of solutions and these types of pilot programs require those partnerships in a city like New York that are willing to not only implement these types of pilots, but do all of the necessary work that is necessary beyond just the Evolve products. It's all about the environment that an area is creating for pests like rats. We want to make sure that it's a unified approach and an approach that is one where we have buy-in from the partners that we're working on at a trial or a test like New York City.

Okay, very good. Next question here is, can you please explain the rationale behind the Direct-to-Consumer focus?

Thank you. The direct-to-consumer focus, the company historically has led with B2B options. What the company found and learned very quickly is without brand awareness, it's very hard to drive partner business if the consumers are not aware of the product. That is especially true in large, brick-and-mortar retailers. Implementing the changes that we are leading with D2C is gonna create significant brand awareness. It's going to create significant success and exposure for the brand and the wins there, which then will carry over into the B2B efforts that we have going on right now.

All right. An extension of that, discuss the reviews regarding Amazon quality control the broader work that's being done to ensure customers understand how the product is utilized.

That's a great question, and it's been one of the main focus for us in our online presence is to really educate the consumers on how the product works, how it's going to be impactful, how long is it gonna take. It's not a matter of just simply putting our product out in the field. It really is a matter of deploying it in a manner that is gonna be successful for the environment that it's being used in. Education is a key part of that effort. Historically, we've not provided as much information, whereas now we're gonna be providing significantly more information and trying to set the proper expectations for a long-term solution to solve this problem.

Okay. Next question here is, were these changes that are being discussed already in effect under your prior role, or did they become more of a priority once Joel Fruendt retired?

It really was an early priority. As I had come in initially as consulting effort to really help understand what was driving the business and what the strategic focus and strategic plan should be, we started to implement those changes very, very quickly. A lot of those changes were started back in Q4 and really took final shape as we moved into Q1 of this year. That's why we've been able to see some of the incredible results of that you're seeing right now just in Q1. Very early, but pretty significant in terms of the results we're seeing.

Okay. Very good. Our next question here is SG&A remains high for the level of revenue this quarter, including the one-time severance and legal that were discussed there. Is there a plan to optimize SG&A to better match the levels of the business?

That's a great question, and I'm gonna let Tom take that question so he can speak more specifically to the amount of one-time out of the norm costs that we were dealing with as we were in this quarter.

Thanks, Michael. It's important to view these as part of the investment we're making in this strategic transition. We're bringing in, you know, new personnel to cover that have new skills, et cetera. We've taken out of the picture some litigation on other legal issues that were frankly just distracting to the business. There was a bit of what I would call investments in the SG&A in Q1. The focus here is now that we've gotten those things kind of out of the way, we're able to provide a more streamlined SG&A.

That's one of the reasons why we wanted to make sure that we put in as much detail about those one-time expenses and provide a more normalized view of what the burn rate would look as we move forward. Yeah, there is a plan to optimize SG&A. We needed to take these expenses in Q1 in order to make this transition and make it well and make it quickly, so we can then move on to all of the growth initiatives that Michael's been talking about.

Alright, our next question here. Again, just a reminder to everyone, if you'd like to ask a question and you're listening through the webcast portal there, go ahead and type that into the ask a question box there on your screen. Michael and Tom, there's a follow-up here pertaining to hantavirus. Has there been an uptick in incoming inquiries regarding the heightened hantavirus awareness?

Yes. There has been a significant uptick in search for options looking to solve rodent and pest-related problems. We have seen an increase in uptick.

All right. Very good. Next question here. Is there any update on the brick-and-mortar Home Depot, other brick-and-mortar companies, moving from online to in-store?

That's a great question, Robert. What I will say about Home Depot and other brick-and-mortar retailers is something I mentioned early on. The large retailers are not in the business of promoting a product. They're in the business of selling product. What they look for in a brand is the brand awareness and are consumers going to come into their store, understand that product, look for that product, ask for that product, and then purchase that product in store?

Historically, as I mentioned before, we didn't have the proper focus in creating brand awareness through our D2C and through Amazon, which is one of the main focuses that we have been talking about on this call and through this quarter. I do believe there is quite a bit of opportunity in the large brick-and-mortar retailers. We have to demonstrate clearly to them that these consumers are looking for this type of product and can expand their revenues in that category.

Alright. Very good. Again, just a quick reminder everyone, if you're listening to the webcast portal, final reminder here, please go ahead and type your question into the Ask a Question box there on your screen. Another question here, has there been any thoughts on capital structure and value in the company equity? Is there any update on when the company might get close to self-funding or being able to adjust the cap structure so it's not purely equity funded?

Yeah, Robert, thanks. This is also a great question. I'll take the first part of this and then turn it over to Tom. What I'd like to emphasize is the fact that we are extremely focused on driving revenue. Revenue solves a lot of problems. The type of revenue, such as recurring revenue, subscription, and so on, is even better. The goal is to reduce the burn so that we're incrementally, over time, moving closer and closer to that break-even point. If you have a focus on revenue, it solves a lot of problems. Tom, you could answer or add, chime in addition on this question.

Yeah. The two points I would make. I mean, one is to echo Michael's point, which is to say that what we're trying to provide here is as much information about our, the vector we're following in terms of the revenue growth and the profitability growth that allows us to move towards that. As we look at the capital structure, though, the second part, we are already looking at other options besides equity. We do use equipment financing for all of our capital equipment purchases, and we are getting closer and closer to the point at which we can utilize debt for more cash flow management purposes. This again gets back to the quality of the revenue.

As much as predictable as it can get, that provides the cash flow information that the lenders need in order to provide debt financing as opposed to solely relying on the shareholders.

Alright. Very good. Next question here is regarding subscriptions. You just touched a little bit on this, Michael, but, you know, really talk about why the subscriptions are an important part of the business going forward.

Thank you. That again is a great question, one we have been focused on. Since I got involved with the company as a consultant very early on, it became very clear to me that the product is a consumable product, that it is a repeatable product, and it was just absolutely perfect for establishing a recurring revenue. Recurring revenue and subscription business allows us to have a lower cost for customers. The customer acquisition on one-time purchases and bringing in new customers into the funnel is quite a bit more expensive than those customers that are on a regular subscription model or a subscription revenue. We think it's going to be absolutely critical to our business to really focus and grow that.

The side result of that is that the happier subscriber customers that you have and the more stickiness you create creates a very, like a flywheel effect, and it's creating a lot of momentum for the business. You can see that just through these results that we've been talking about on the D2C side of the business.

Alright. Thank you for that. This will be the last question, it appears. I'm showing no further questions after this in the queue. Congratulations on the quarter and the successful transition. Again, follow up on the hantavirus. Company seems to have a generational marketing opportunity to enter the conversation to build awareness around the product. Have you considered a different approach towards marketing and social to capitalize as one of the only pure rodent plays in the market?

Great question. I will tell you this. The historically, a lot of the efforts for social media, and being able to market to these types of opportunities has not really been focused. We're bringing in new teams like we brought in teams to manage and as we're managing the Amazon efforts and as we're doing on our own website. You'll be seeing quite a bit over the next quarter of all of the new path, the new approach to the social media and social markets that we're gonna be advertising on and posting to. Yes, we are going to be moving more in that direction to capitalize on those markets and those channels.

All right. Very good. Well, I'm showing no further questions. With that, Michael, I will turn it back over to you for any closing remarks.

Yeah. Thank you, Robert. Thank you, Tom. I wanna thank everybody for participating and taking the time out of your day to listen to what we have to say. We're very excited about the future, and we look forward to more updates as time marches on. Have a great day, and thank you.

The conference has now concluded. We thank you for attending today's presentation. You may now disconnect your lines.

Good afternoon, and welcome to the SenesTech, Inc. Reports Fourth Quarter and Fiscal Year 2025 Financial Results Conference Call. After today's presentation, there will be an opportunity to ask questions. To submit a question, you may type it into the Ask a Question box on the webcast screen. Please note, this event is being recorded. I would now like to turn the conference over to Robert Blum with Lytham Partners. Please go ahead.

All right. Thank you very much, operator, and good afternoon, everyone. Welcome to SenesTech, Inc.'s Year-End 2025 Financial Results Conference Call. Joining us today are Dr. Jamie Bechtel, Interim Executive Chair, and Thomas C. Chesterman, Chief Financial Officer. Joel L. Fruendt, the company's President and CEO, was unable to join us today. Earlier today, the company issued its financial results press release for the year ended 12/31/2025. As the operator indicated, at the conclusion of today's prepared remarks, we will open the call for a question-and-answer session. If you are listening through the webcast portal and would like to ask a question, again, submit that through the Ask a Question feature on the webcast player. Before we begin, I would like to remind everyone that today's call may include forward-looking statements within the meaning of federal securities laws. These statements are based on current expectations and involve risks and uncertainties that could cause actual results to differ materially from those described. Please refer to the company's SEC filings for a discussion of these risks. The company undertakes no obligation to update forward-looking statements except as required by law. Alright. With that said, let me turn the call over to Dr. Jamie Bechtel. Jamie, please proceed.

Thanks, Robert. Thank you, operator. Thank you to everyone who is joining us today. I am Dr. Jamie Bechtel, and I am the Chair of SenesTech, Inc.'s board. As we recently announced, Joel L. Fruendt is retiring following several years of leadership at SenesTech, Inc. On behalf of the board, I want to thank Joel for his and for helping position the company for the next phase of growth. To support continuity during this transition, the board created the role of Interim Executive Chair, and I was asked to step into that position. To help ensure alignment between the board and management the CEO search is underway. The transition is planned and orderly, and the business continues to move forward without interruption. The Board has initiated a formal search process to identify the company's next CEO. Our focus is on finding the right leader help scale the business and build on the progress that has been made. In the meantime, the board remains closely engaged in man with management and focused on execution. Our directors bring experience across areas such as e-commerce, international markets, finance, strategic growth, which we believe will be valuable if the company continues to expand. Importantly, the company's core strategy remains consistent. We are focused on delivering our current initiatives, scaling the areas where we are seeing traction, and maintaining discipline in how we allocate resources. We will continue to keep shareholders informed as the leadership transition progresses. With that, I will turn the call over to our CFO, Thomas C. Chesterman.

Thank you, Jamie. I will begin with a summary of the year's performance and key developments before reviewing the financial results in more detail. Overall, 2025 reflected continued progress in expanding our commercial reach and strengthening our business model. For the year, revenue increased 20% to approximately $2.2 million compared with $1.86 million in 2024. It is important to note that the fourth quarter included an approximately $200,000 revenue impact associated with the company's transition to directly managing the EVOLVE Rat and EVOLVE Mouse on Amazon. Excluding that transition effect, full-year revenue growth would have been closer to 30%. That transition represents an important step in our e-commerce strategy. Directly managing Amazon allows us to improve product presentation, optimize marketing performance using platform data, and retain a greater portion of the revenue generated through that channel. E-commerce continued to be our fastest growing segment. For the year, e-commerce revenue increased 88%, driven by strong growth on Amazon and our direct-to-consumer website. Even with that temporary transition impact, e-commerce now represents more than one-half of our total revenue. And now that we have direct control of Amazon selling activity, we can better tailor the message and accelerate growth much, much further. Beyond e-commerce, we continue to expand activity across several additional verticals. In municipal markets, interest in fertility control approaches continues to grow as cities evaluate alternatives to traditional rodent control methods. Programs such as the rat contraception initiatives in New York City, Chicago, and elsewhere reflect this broader shift towards integrated pest management strategies. The Chicago neighborhoods deploying EVOLVE continue to reorder and expand deployment. New York City will soon conclude their trial of EVOLVE, and we are already in discussions with potential deployment partners so as to be able to move quickly. Internationally, we expanded our footprint during the year with regulatory approvals and new distribution relationships. EVOLVE received regulatory approval in New Zealand, and we shipped the initial stocking order to our exclusive partner, Evicom. We have expanded distribution activity in Belize, through the Belize Raptor Center, and we have other areas with potential regulatory approval pending as well. On the retail side, where decision making is a longer process, we have made multiple presentations to some of the largest brick-and-mortar retailers about stocking EVOLVE on their shelves. I should point out that success on Amazon and the press around deployment feeds well into the retail decision making. We laid the groundwork last year, this is the year we will see the benefit of that work on the top line and the bottom line. Finally, should mention, some of you have been about our legal dispute with Leafotech. I am pleased to say that this dispute has been resolved in a manner satisfactory to all involved. All litigation has been dismissed and cannot be reinstated. Turning to the financial results in more detail. For 2025, gross margin improved to 62.5% compared with 54.1% in 2024. This reflects improved product mix and a growing contribution from e-commerce channels. The company reported a net loss of $6.4 million compared with $6.2 million in 2024. The 2025 results include approximately $131,000 in one-time legal expenses, some of which associated with Leafotech, and $135,000 in non-cash operating lease expense. Excluding these items, the adjusted net loss for the year would have been approximately $5.6 million. Adjusted EBITDA loss for the year improved to $5.3 million compared to $5.8 million in 2024. From a liquidity standpoint, the company ended the year with $8.6 million in cash and short-term investments, which we believe provides a solid operating runway as we continue executing our strategy. As we look towards 2026, our focus remains on maintaining financial discipline while investing in areas where we are seeing traction, including e-commerce expansion, municipal adoption, and continued validation of our technology. At the same time, we are managing operating expenses carefully and prioritizing investments that support measurable commercial progress. And, importantly, we are also maintaining flexibility for the company's next CEO to help shape that longer-term strategy. With that, operator, we are ready to open the call for questions.

All right. Thank you very much, Jamie, and Tom. We will now open for questions. Once again, if you have a question, you can type it into the Ask a Question queue there on your webcast player. First question here, given that 2025 revenue growth would have been 30%, excluding the impact of transition to directly managing Amazon sales, should we expect a similar growth rate in 2026 or could this be higher?

That is a great question. Yes, absolutely, it can be higher, and that is in fact what we are aiming for. We want to accelerate growth in the areas where we can and make sure that we maximize that growth as long as it remains profitable.

Alright. Our next question here. What are likely to be the contributors to 2026 revenues? Amazon and D2C, pest management professionals networks, municipal orders, or international expansion in New Zealand, Belize, and beyond.

So it will definitely be a mixture of all of those. But let me walk through kind of how each of them looks as we are moving forward. I mentioned the e-commerce and Amazon particularly. This is an area where with Amazon, we were not managing it directly. We were using a third party. And so we were not really in full control of the message and the rate of spend. As we begin taking over Amazon and also working on improving our own website, we know that further investments in the messaging, and in the ad campaign will drive sustainable and increasing growth. So, definitely, we expect to see strong growth in that area. Municipal certainly is an area of growth. There have been a number of successes in that area. All eyes are on New York right now where we have a trial underway. We do not know exactly what their deployment plans will be. We will see that when the request for proposals come out. But we do see that as a growth area. Retail is an area where we have not yet seen the growth that we would hope, but when you see growth in that area, you see it is a very explosive area. And to give you an example, we have made multiple pitches to brick-and-mortar retailers. We have worked with them on their website. We have worked on trials. At some point, one of them is going to say, alright. Let us go ahead and send one pallet to 200 stores. One pallet each. That is a $2 million order. So the growth there can be very, very explosive in that segment. International continues to look very good. There are a number of areas internationally where they have a similar need to improve their rodent management techniques, and they seek alternatives to traditional methods like EVOLVE, like ContraPest, etcetera. We do definitely see some improvement there. We have mentioned before, Australia is nearing the conclusion of the regulatory review. We are expecting an answer from them shortly. There are other jurisdictions as well. So in closing, it really is a combination of a variety of shots on goal as Joel used to put it.

Alright. Very good. Our next question here is what kind of follow-up should we expect from the two field validations in urban areas? What level of revenue should we expect from these two areas?

Well, I am not quite sure what the second one is that they are talking about. The one right now, the trial that has all eyes on it is in New York. And as I mentioned, that trial will be concluded sometime in the spring. We do not know what their deployment will be, so we cannot give you a good sense of how much revenue or how quickly. In the other areas, such as Chicago, they have already begun the deployment in Chicago in a number of neighborhoods and areas. So that will expand as additional neighborhoods come on into the program.

Alright. The next question here is why have all the social media accounts, Facebook, for example, been quiet since December 2025. Talk about the marketing department employment there.

Yeah. Jamie, actually, why do you not take this one?

Thanks, Tom. Robert, that is a great question. The marketing team is absolutely still in place. Over the past few months, we have been focused on strengthening our core commercial efforts, customer outreach, sales enablement, channel and partnership development rather than prioritizing social media. Social media will definitely pick back up as we roll out a couple of initiatives this year, but the team has actively been working on growth and brand positioning. So you will see a more structured communication cadence as we launch our new milestones this year.

Next question here, and I think Tom, you have addressed this in your prepared remarks, but if there is anything to add on to it. What is the status of the court case of Leafotech versus SenesTech, Inc.?

So that case has been settled. It has been settled, as the lawyers put it, to the satisfaction of all parties. The results were immaterial to us both financially and operationally. So at this point, we consider it a past issue.

Okay. And a bit of a follow-up on that. You guys mentioned in the prior quarter that you had incurred $100,000 of one-time legal costs due to the Leafotech IP infringement and NDA violations. It says here, I noticed that the one-time legal fees in this quarter came to $275,000. Let us see here. Can you, I guess, expand upon and clarify this cost and whether it is expected to recur going forward.

So let me take the last part first. No. It should not recur now that we have successfully concluded that litigation issue. It is, you know, litigation is very expensive these days. And so it takes quite a bit to defend oneself from charges or allegations. So, unfortunately, it did end up costing us quite a bit in terms of legal expense. But it was an investment well worth it given the positive outcome.

Okay. Following up on a question on legal fees, could you provide more granularity in how much of those fees during this last year related to financing?

The legal fees which were expensed do not have anything to do, are not classified as operating expense. Those would be part of the cost of the financing. So you would not see any of legal cost of financing in the income statement.

Next question here is what is the status of product registration in Australia?

Yeah. As I mentioned, we, with our partner, have submitted all the necessary information. The regulatory authorities have gone through it. They expect to be able to produce an answer to us, as our partner says, quote, in the spring. I do not have any more precise dates than that, but we are expecting a response from them. We are not expecting a positive response.

Okay. Our next question here is how much revenue do you expect from Belgium during the coming two years?

We actually do not have any direct input or insight into Belgium. We have no partner that is in Belgium. So, it really is more a matter of as we look at the European market and our distributors there, what are we selling to them? And, you know, whether it is in Belgium or somewhere else, really do not have a whole lot of insight into that.

K. Next question. Can you break out the SG&A, which is up? How much is sales and how much of the G&A and, well, there will be a follow-up to that.

So we are, at conclusion of this call, scheduled to file our 10-K. So all of the detail of the SG&A and R&D expenses will be in the 10-K. So I would encourage you to, our investors, to look at that, read that. If you have any questions on that, follow up with us. We would be glad to go into as much as we need. Yeah.

Next question here is, what are the new international opportunities?

Well, unfortunately, I cannot really comment on them until we have signed agreements in place. So I am going to have to let you wait for our press releases as we sign them. We will let our investors know.

Okay, very good. Next question here is how likely is it that EVOLVE bait gets to brick and mortar during 2026?

So we are already in some of brick and mortar, but not much. I think that given the time frame in which they make their decisions, that it may not be likely until at least the end of the second quarter, but it is more likely in the second half of the year for retail in a big way.

Okay. Our next question here is what municipalities besides New York City are evaluating EVOLVE?

Well, that is the biggest trial that has been out there. Baltimore concluded their study and has been deploying EVOLVE there. Chicago did not, they went right past a study, at least in the neighborhoods, but the city of Chicago continues to be assessing fertility control. I do not know if there are, I am sure, others that are doing trials that are not necessarily formal trials. But that would be a level of detail that I would not have readily available right now.

Alright. The next question here is on how is the agricultural sector working out?

It is working out quite well. There are, you know, we have talked about some of the successes in the past and the almond groves in the West. Those go well. They are expanding those as well. We continue to work on some of the crop issues like sugarcane. We continue to see actually some expansion as well into poultry. That is another area of growth. And we are beginning to see actually some of that in an interesting area, irrigation. Turns out that rats are very destructive to irrigation, so we are seeing some progress in that area as well. So it is going well. Very well.

Alright. Here, another follow-up here, and I am not sure if there is anything that could be added here. But how soon will you know about the trials in the New York City program, and what is the potential market for that?

Yeah. Unfortunately, as I have mentioned, the trial will be ending this spring. I believe it is the middle of the second quarter. We do not know what they are going to be doing immediately after that, but we have begun discussion with some people that are expecting to bid on whatever comes out. These are large pest management organizations that would like to be able to respond to New York's requirements. So we have already begun those discussions as to how to best be flexible and nimble when the information does come out.

Our next question here. How has the e-commerce business been when it comes to Home Depot and Lowe's?

So these are areas where they are really almost trials before they make their decisions about their shelf placement. We are focusing, as has been mentioned before, our own e-commerce program on Amazon now and on our website. So these programs have not been a huge e-commerce per se push. But rather are ways of continuing the discussions with them. So that at this point, they are nowhere near the size of what we are seeing in Amazon or on our own website.

Okay. Our next question here, are there any new species you anticipate in 2026 or 2027, such as ground squirrels, gophers, etcetera.

Well, I will let Jamie comment on this, but I will also kind of mention that, from my perspective, I think the rodent market is the rat and mouse market. It has enough potential that we could be quite successful maximizing those opportunities, but Jamie, you are one of our lead scientific types. Any comment there?

I will just add that the technology is really exciting because it is broadly applicable, especially to mammalian species. And while there is a lot of opportunity there, I second Tom with the idea that we are going to remain very focused and deliver what is in front of us with extraordinary discipline.

Alright. Thank you for that both.

Our next question here is, will evolverodentbirthcontrol.com be available in the future? Someone noticed that the site was down.

I will have to look into that to understand why it is down. I was not aware of that, but I will look into that immediately. We own it. Very good. So it should be up.

Alright. Very good. Our next question here, what qualities is the board looking for in the next CEO to improve profitability, or the, I am sorry, the probability of successful commercialization? Jamie, that sounds like a question for you.

It does, does it not, Tom? Robert, thanks for that. That is a great question. We are looking for a leader who can take the company through its next phase of growth. That means someone who has a strong commercial instinct, experience scaling a business, the ability to build and lead high-performance teams. Just as important is operational discipline. Someone who can translate strategy into consistent execution. The opportunity in front of us is significant, exciting and significant. So we want a CEO who can bring both that strategic vision and the day-to-day rigor necessary to capture that vision.

Alright. Thank you for that. Question here, discussing cash runway implies, obviously, losses at its current revenue levels. Is there any reason why improvement should not be expected?

There is no reason why improvement should not be expected and sought after. But the attorneys tell us to be very conservative in how we disclose things in the 10-K and on the press releases about such matters. So we take the most conservative approach in terms of that disclosure. But yes, improvement should be expected.

Okay. Next question here is on inventory. Inventory grew 25% year over year, which is relatively high compared with the quarterly revenue. Is the current inventory reflecting anticipated demand from newly expanded locations or slower-than-expected turnover.

It is the former. It is trying to make sure that we are ready for that surge demand I mentioned. If we do get a call from a retailer saying we want the pallets in every store, we want to make sure that we have that inventory available to fulfill.

Alright. Next question here is why was Joel not able to be on the call today?

I was going to say, Jamie, you probably should take this one.

Robert, thanks—oops. Sorry. Go ahead, Tom. That is exactly how aligned we are, Tom, and that is the answer to the Right? We have a really strong leadership team in place. As I mentioned earlier, there is continuity in this transition. And we are all fully engaged in communicating progress and executing on the strategy. While Joel was not on today's call, the team is completely aligned, we are moving forward.

The next question here is what other target markets will SenesTech, Inc. focus on this year? Will there be increased focus on the agricultural sector, for instance?

Yeah. To some extent, I have already answered that. It is going to be all of the markets that we have talked about before. We are going to be going after all of them. They each have a different strategic approach identified as to how we will address them, what the pacing will be. But these are the markets that we are focused on now. The specific verticals that we have talked about in past calls. Until we have sufficiently hit and hit our targets, our own internal targets and external targets, in these markets, we do not think that there is a need to expand to other verticals. These are the ones that look like they have the highest potential in the shortest amount of time. And so that is why we have chosen them to focus on.

Alright. Thank you for that. Our next question here, I think you have addressed some of this, but have there been any new trials or deployments in major cities, specifically on the West Coast? San Francisco, Los Angeles, for instance.

Well, San Francisco has a trial ongoing. We have talked about it before. It is being done with a local pest management company there, using some state funding. I am not aware of any other West Coast formal trials, although there certainly are a number of the smaller municipalities that tend to look at it first before they make their decisions, but those are more informal. We did have an interesting trial that we did produce some data on at the UC Irvine housing project, where they have quite a bit of interest in looking at innovative ways of controlling pests. And so that trial did conclude quite successfully. We put out a press release on it earlier, but they were very pleased with the approach and have continued to deploy and expand in that. I am not aware of any others that are as formal as that.

Next question here is does management attend any, I guess this would reflect to industry conferences, to showcase EVOLVE?

Management does not necessarily, but the sales department certainly does. Sales is responsible for identifying those conferences and those meetings that have the highest potential for a return. They tend to be very, very focused on that return. Is it really going to be something where we get a lot of orders? And these can be both professional organizations, but we also attend some of the, I will call them, retail or other shows. For example, we were very recently at the Bradley Caldwell show, where they bring in all of their potential customers into one place and present different companies like ourselves. We have also been to the ACE show. So we are at both kinds of shows. We are also at the PestWorld. We have had a booth there for a couple years now. So, yes, answer is yes. We do.

Okay. Next question here. Will the new CEO have incentives built around the price of the company's stock? I am sure that Jamie is ready to answer this one.

Robert, the short answer is yes. As with most public companies, the CEO's compensation structure, we expect a meaningful portion of that to be equity based and aligned with long-term shareholder value. The board's compensation committee will finalize the specific structure, of course, but alignment with stock performance will absolutely be a key component.

Okay. The next one, I am not sure if there is a question in here, but maybe more of a comment at top. Agricultural production state California would greatly benefit from expansion of the label for use in ground squirrels. With ever-increasing regulations on pesticides, 25(b) products have incredible potential. So maybe this circles back to expansion into adjacent species.

Yeah. I would agree. It is very definitely, California is not the only area that would benefit from an expansion. There are lots of different pest species that need some work, need better solutions. When we have, again, when we have managed to demonstrate success in rat and mouse, we certainly would look at that. I will tell you there is an issue around ground squirrels. They are not considered the same kind of pest as rodents are. So they have a different regulatory approach that is required there. So there are a few complexities that would need to be worked out before we could really consider that kind of an expansion.

Okay. The next question here is, will you be expanding your sales team?

The short answer is yes. We will. We actually had the sales team in for a kind of a beginning-of-the-year conference not that long ago. We are going to have another one coming up shortly where we are really focused on exactly what resources do we need to maximize the B2B sales effort, and whether it be more people, and if so, where, or how are they focused, what materials are needed, what, again, all the resources that are necessary to really expand and drive the B2B growth to its maximum potential.

And, Robert, before we move on, I just want to add to Tom's answer there that because we have brought e-commerce in-house, not only are we going to see a bigger sales force, both in the D2C and the B2B profile, but we are going to see a higher ROI on that because we are going to be able to collaborate across those two verticals.

Alright. Fantastic. Our next question here, can you clarify when the New Zealand order was shipped and if it was in Q1, how much of the did that eat up, and has it been replaced?

And, yes, it has been replaced. Yes. That shipment was in Q1.

Alright. I think that was all the questions. I think you hit it there. Next question here. Is sales working with UC Davis regarding Kern County and other California counties being overrun by rats.

The short answer is yes. We are focused on that, in general. But that is also one of the areas where we think some additional resources might very well be useful. And so as they have been, one of the things that came out of that sales meeting was looking specifically at different opportunities in California being not only a large market, but also a market which has taken the step to ban or limit the use of certain rodenticides. So, there are definitely the problem now is fewer solutions, and so even more opportunity for rat birth control.

Alright. Tom, quick asking of clarification on the New Zealand order. Was that revenue recognized in Q1? Or was that revenue recognized in Q4 for the New Zealand order?

Q1. Q1.

All right. And as a follow-up to that, how frequently do you expect follow-up orders from New Zealand and for how long?

Well, New Zealand has an initiative, which we have talked about before, to rid itself of predators and other pests, invasive pests. And their target is, I think, 2050 to complete that. That is a massive, massive, multibillion-dollar undertaking. How exactly they are going to be going through that may change now with fertility control being added. I think, I know Evicom is working with the authorities in New Zealand to really focus on how to best now incorporate rat birth control with the other methods that have been used. So I do not have a forecast for you yet. But the opportunity there, the need there, is tremendous.

Alright. Coming back to California here with a question is, do you have any other distributors in California outside of Ace Hardware?

Well, Ace Hardware, we do not consider a distributor. We consider that a retail. But in terms of other distributors, yes, we do. As a matter of fact, with AgriCom, AgriTurf, a couple of the ones that have come across my desk recently. They are focused more on the agricultural side, particularly poultry. So, yes, we do have other distributors there. And, of course, our top distributors, two top distributors in the pest management industry, Veseris and Target Specialty, both of them have a solid presence in California.

Alright. Very good. I am showing no further questions. So with that, I will turn it back over to you both for any closing remarks.

Great. Well, thank you all for joining us. And we certainly look forward to being able to update you as frequently as we can on our progress. This is, as I said in my prepared remarks, last year was a year of preparation, of setting the groundwork, setting the foundations. This year is undoubtedly going to be the most exciting year that we have. And you do not usually hear CFOs saying things like that, but I am truly excited for the potential in the coming year. So thank you very much.

Thanks, everybody.

Thank you. That concludes today's conference call. We thank you all for attending today's presentation. You may now disconnect.