CDIO — Q2 2026 Financial Report Analysis

Cardio Diagnostics booked $5,360 of revenue in the quarter to June 30, 2026, down from $7,475 a year earlier, against a net loss of $1.50 million. The loss narrowed 10.8% because legal, consulting and insurance bills came down, but the loss per share improved far more (from $0.97 to $0.51) mainly because the share count rose by about 70%: the company keeps itself running by selling new stock into the market. The commercial story is still at the very first step. Revenue doubled from the first quarter's roughly $2,700, one regional physician group started covering its tests, and first reagent shipments went to India, but sales are still a rounding error next to about $1.5 million of quarterly spending.

At a glance

• $5,360 revenue vs $1.50M net loss. The company spends about $280 for every $1 of sales. For scale, the quarter's revenue equals the Medicare payment rate ($854 per test) for roughly six tests.
• Shares outstanding up 62% in six months (1,826,051 to 2,959,469). Selling stock raised $3.69M net, more than the $2.90M the business burned in cash over the half-year.
• $5.59M cash at June 30 covers about four quarters at the first-half burn rate. Management says cash plus further stock sales should fund the next 12 months, and shareholders have since approved larger private share issues.

The quarter in numbers

Operating margin (operating profit as a share of revenue) is left out on purpose: with revenue this small it works out to about -28,000%, a figure that says nothing useful. The figures that matter here are cash burned, cash in the bank and shares issued.

For the first half as a whole, revenue was $8,040 versus $8,415 (-4.5%) and the net loss $3.29M versus $3.32M.

Revenue: still a pilot-scale business

The company sells two blood tests that read chemical marks on DNA (epigenetics) to estimate heart disease risk: Epi+Gen CHD, which predicts the risk of a coronary event such as a heart attack, and PrecisionCHD, which looks for signs of existing coronary heart disease. Per the filing, the year-on-year drop came from "the conclusion of the Family Medicine Specialists' Heart Attack Prevention testing initiative", which had supported prior-year revenue. Second-quarter revenue of $5,360 was about double the first quarter's (roughly $2,680, derived from the six-month and three-month figures), which management credits to additional providers being onboarded.

The specific progress points the filing lists for the quarter:

• First payer coverage. Atlas Healthcare Physicians, a physician association serving managed-care patients in Los Angeles and Orange County, began covering both tests (with prior authorization) in May 2026. The company also set up the ability to bill commercial insurers out-of-network. Both tests already have billing codes and a Medicare payment rate of $854 each, but not a Medicare coverage decision, which is the step that would let doctors order them routinely for Medicare patients.
• Own lab running. Its high-complexity CLIA lab (the federal certification a US lab needs to test patient samples) is processing samples from every state except New York, where a license is pending. That removes reliance on a third-party lab.
• India. First shipments of proprietary reagents went to partners Aimil Ltd and Dr. Lal PathLabs.

None of these has yet shown up as meaningful revenue. Management itself devotes a page of the filing to explaining why diagnostic-test adoption "may require a decade or more", and says sales cycles can run up to 24 months.

Costs: cheaper quarter, flat half-year

The quarter's $182,667 cut in operating expenses came mostly from general and administrative costs (G&A, the cost of running the company rather than selling or researching), down $151,501. The filing breaks out the drivers: legal and professional fees fell to $114,551 from $209,744, consulting and contractor fees to $111,534 from $165,905, and insurance to $141,614 from $158,263. Software and web computing costs went the other way, rising to $145,584 from $101,723. R&D fell $15,607 on lower lab processing.

Over six months, though, G&A was slightly higher ($2.60M vs $2.57M), largely because of a $178,467 franchise tax charge in 2026 against $225 a year earlier. Management guides that payroll, lab equipment and a new office lease will push costs up, and that sales and marketing will rise with the India rollout, so the second-quarter cost dip should not be read as a new run rate.

Takeaway: The narrower loss per share is mostly a dilution effect, not operating progress. Holding the share count at last year's level, this quarter's loss would have been about $0.86 a share rather than $0.51, so roughly three-quarters of the per-share improvement came from issuing more shares. With revenue at $5,360 a quarter, the company's survival depends on continued access to equity markets, and the conditions for that are getting harder: a share price of $1.66 and a proposed Nasdaq rule that would delist companies worth less than $5 million.

What the headline numbers hide

• Cash burn is steady and funded by share sales. Operating cash outflow was $2.90M for the half (about $1.45M a quarter), a little smaller than the $3.29M net loss because of non-cash depreciation and amortization ($190,093) and a $232,590 drawdown of prepaid expenses. Cash rose $476,067 in the half only because the company sold 1,133,418 new shares for $3.69M net through its at-the-market program (an arrangement letting it sell shares gradually into the market through a broker, here Craig-Hallum, at a 2.5% commission). Strip out financing and cash fell by about $3.0M.
• The share price has halved since those sales. The shares sold this year went for about $3.34 each on average (gross proceeds of $3.79M over 1,133,418 shares). The filing gives the last price as $1.66 on August 6, 2026, so each further dollar raised now costs roughly twice as many new shares. As of August 7, $5.30M of capacity remained on the at-the-market program.
• The company's market value is close to the new Nasdaq floor. At $1.66 and 2,959,469 shares, the stock market valued the company at about $4.9M, less than the $5.59M of cash on its balance sheet. The SEC approved a Nasdaq rule on July 22, 2026 requiring at least $5 million in market value of listed securities, with no cure period, but stayed it on July 29 pending review. The company says delisting to the over-the-counter market would make raising capital "more difficult".
• More dilution is authorized. At the September 18, 2026 annual meeting, shareholders approved issuing 20% or more of the outstanding shares in non-public deals (936,488 votes for, 193,532 against). That clears the way for a private placement, typically priced at a discount to market.
• Warrants won't help. 284,292 warrants carry exercise prices of $53.40 to $345 a share, far above $1.66. Management says they "may expire worthless" and it is not counting on that cash. There are also 168,556 stock options outstanding.
• No going-concern warning. Unlike many companies this size, the filing does not include "substantial doubt" language. Management states that existing funds plus the at-the-market program will cover the next 12 months, while warning that it will need more capital beyond that and that it does not expect significant operating cash flow "in the near term". That 12-month view relies on being able to keep selling stock.
• Smaller one-offs. Amortization (the gradual write-down of patents and other intangible assets) fell to $11,125 for the half from $53,923, because an intangible asset was fully written off in 2025. Two old banking-advisor disputes (Boustead Securities and The Benchmark Company) remain disclosed as potential claims; no lawsuit has been filed in the Boustead matter.
• Receivables are trivial ($3,905) and the company carries no bank debt; liabilities total just $499,780, mostly leases and an insurance financing agreement.

Outlook

The company gives no revenue or loss guidance. What the filing does say: sales cycles will "continue to be long"; R&D will rise to fund clinical and economic evidence for payers; sales and marketing will rise with India; and the remainder of 2026 will be funded "primarily" through at-the-market share sales.

Our read: on current numbers the business is a funding question first and a product question second. Quarterly burn of about $1.45M against $5.59M of cash gives roughly a year of runway before new money, and every route to new money (more market sales at a lower price, or a discounted private placement now that shareholders have approved one) dilutes existing holders further. Signs that would change the picture in the third-quarter 10-Q, expected around mid-November 2026: revenue moving into the tens of thousands of dollars per quarter as the Atlas coverage and own-lab testing feed through, a first measurable contribution from India, any Medicare coverage decision, and whether the SEC lets the $5 million Nasdaq market-value rule take effect.

Source: Cardio Diagnostics Holdings, Inc. Form 10-Q for the quarter ended June 30, 2026, filed August 7, 2026; annual meeting results from the company's Form 8-K filed September 18, 2026.