MODD 10-Q Quarter ended Sept. 30, 2025

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2025

or

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _______________ to_______________

Commission file number: 000-49671

MODULAR MEDICAL, INC.

(Exact Name of Registrant as Specified in its Charter)

Nevada		87-0620495
(State or Other Jurisdiction of Incorporation or Organization)		(I.R.S. Employer Identification No.)

10740 Thornmint Road , San Diego , CA 92127

(Address of Principal Executive Offices) (Zip Code)

(858) 800-3500

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading symbol(s)		Name of each exchange on which registered
Common Stock Par Value $.001 per Share		MODD		The Nasdaq Stock Market, LLC

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.

☒ Yes ☐ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

☒ Yes ☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☐		Accelerated filer ☐
Non-accelerated Filer ☒		Smaller reporting company ☒
		Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

☐ Yes ☒ No

The number of outstanding shares of the registrant’s common stock, par value $0.001 per share, was 63,599,550 as of November 12, 2025.

MODULAR MEDICAL, INC.

FORM 10-Q

SEPTEMBER 30, 2025

TABLE OF CONTENTS

PART I — FINANCIAL INFORMATION				1
Item 1.		Financial Statements (Unaudited):		1
		Condensed Consolidated Balance Sheets as of September 30, 2025 and March 31, 2025		1
		Condensed Consolidated Statements of Operations for the three and six months ended September 30, 2025 and September 30, 2024		2
		Condensed Consolidated Statements of Stockholders’ Equity for the three and six months ended September 30, 2025 and 2024		3
		Condensed Consolidated Statements of Cash Flows for the six months ended September 30, 2025 and 2024		4
		Notes to Condensed Consolidated Financial Statements		5
Item 2.		Management’s Discussion and Analysis of Financial Condition and Results of Operations		15
Item 3.		Quantitative and Qualitative Disclosures about Market Risk		18
Item 4.		Controls and Procedures		18
PART II — OTHER INFORMATION				19
Item 1.		Legal Proceedings		19
Item 1A.		Risk Factors		19
Item 2.		Unregistered Sales of Equity Securities		20
Item 3.		Defaults Upon Senior Securities		20
Item 4.		Mine Safety Disclosures		20
Item 5.		Other Information		20
Item 6.		Exhibits		21
		Signatures		22

Part I – FINANCIAL INFORMATION

Item 1. Financial Statements

Modular Medical, Inc.

Condensed Consolidated Balance Sheets

(In thousands, except par value)

		September 30,
		2025				March 31,
		(Unaudited)				2025
ASSETS
CURRENT ASSETS
Cash and cash equivalents		$	5,316			$	13,095
Prepaid expenses and other			631				422
TOTAL CURRENT ASSETS			5,947				13,517
Property and equipment, net			6,459				4,453
Right of use asset, net			568				765
TOTAL ASSETS		$	12,974			$	18,735
LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES
Accounts payable		$	2,879			$	338
Accrued expenses			715				504
Short-term lease liabilities			450				423
TOTAL CURRENT LIABILITIES			4,044				1,265
Long-term lease liabilities			161				393
TOTAL LIABILITIES			4,205				1,658
Commitments and Contingencies (Note 7)
STOCKHOLDERS’ EQUITY
Preferred Stock, $ 0.001 par value, 5,000 shares authorized, none issued and outstanding			—				—
Common Stock, $ 0.001 par value, 100,000 shares authorized; 61,171 and 53,706 shares issued and outstanding as of September 30, 2025 and March 31, 2025, respectively			61				54
Additional paid-in capital			107,515				101,776
Common stock issuable			438				—
Accumulated deficit			( 99,245	)			( 84,753	)
TOTAL STOCKHOLDERS’ EQUITY			8,769				17,077
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY		$	12,974			$	18,735

The accompanying notes are an integral part of these condensed consolidated financial statements.

Modular Medical, Inc.
Condensed Consolidated Statements of Operations
(Unaudited)

(In thousands, except per share data)

		Three Months Ended September 30,								Six Months Ended September 30,
		2025				2024				2025				2024
Operating expenses
Research and development		$	5,593			$	3,702			$	10,727			$	6,907
Selling, general and administrative			2,236				1,294				3,906				2,309
Total operating expenses			7,829				4,996				14,633				9,216
Loss from operations			( 7,829	)			( 4,996	)			( 14,633	)			( 9,216	)
Other income			41				42				143				125
Loss before income taxes			( 7,788	)			( 4,954	)			( 14,490	)			( 9,091	)
Provision for income taxes			2				2				2				2
Net loss		$	( 7,790	)		$	( 4,956	)		$	( 14,492	)		$	( 9,093	)
Net loss per share
Basic and diluted		$	( 0.14	)		$	( 0.14	)		$	( 0.26	)		$	( 0.27	)
Shares used in computing net loss per share
Basic and diluted			55,576				34,338				54,936				34,114

The accompanying notes are an integral part of these condensed consolidated financial statements.

Modular Medical, Inc.

Condensed Consolidated Statements of Stockholders’ Equity

(Unaudited)

(In thousands)

																		Additional
		Common Stock								Issuable Shares								Paid-In				Accumulated				Stockholders’
		Shares				Amount				Shares				Amount				Capital				Deficit				Equity
Balance as of March 31, 2025			53,706			$	54				—			$	—			$	101,776			$	( 84,753	)		$	17,077
Shares issued for services			10				—				—				—				11				—				11
At-the-market sales of stock, net			1,000				1				—				—				727				—				728
Exercise of warrants			532				—				—				—				5				—				5
Issuances under equity incentive plan			27				—				—				—				4				—				4
Stock-based compensation			—				—				—				—				720				—				720
Net loss			—				—				—				—				—				( 6,702	)			( 6,702	)
Balance as of June 30, 2025			55,275			$	55				—			$	—			$	103,243			$	( 91,455	)		$	11,843
At-the-market sales of stock, net			9				—				—								6				—				6
Issuance of common stock and warrants from warrant inducement offering			5,860				6				644				438				3,454				—				3,898
Issuances under equity incentive plan			27				—				—				—				4				—				4
Stock-based compensation			—				—				—				—				808				—				808
Net loss			—				—				—				—				—				( 7,790	)			( 7,790	)
Balance as of September 30, 2025			61,171			$	61				644			$	438			$	107,515			$	( 99,245	)		$	8,769

																		Additional
		Common Stock								Issuable Shares								Paid-In				Accumulated				Stockholders’
		Shares				Amount				Shares				Amount				Capital				Deficit				Equity
Balance as of March 31, 2024			32,464			$	32				—			$	—			$	77,432			$	( 65,929	)		$	11,535
Shares issued for services			10				—				—				—				15				—				15
Exercise of warrants			55				—				—				—				68				—				68
Issuances under equity incentive plan			32				—				—				—				6				—				6
Stock-based compensation			—				—				—				—				529				—				529
Net loss			—				—				—				—				—				( 4,137	)			( 4,137	)
Balance as of June 30, 2024			32,561			$	32				—			$	—			$	78,050			$	( 70,066	)		$	8,016
Shares issued for services			20				—				—				—				35				—				35
Exercise of warrants			939				1				—				—				844				—				845
At-the-market sales of stock, net			825				1								—				1,922				—				1,923
Issuances under equity incentive plan			25				—				—				—				9				—				9
Stock-based compensation			—				—				—				—				1,044				—				1,044
Net loss			—				—				—				—				—				( 4,956	)			( 4,956	)
Balance as of September 30, 2024			34,370			$	34				—			$	—			$	81,904			$	( 75,022	)		$	6,916

The accompanying notes are an integral part of these condensed consolidated financial statements.

Modular Medical, Inc.

Condensed Consolidated Statements of Cash Flows

(Unaudited)

(In thousands)

		Six Months Ended
		September 30,
		2025				2024
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss		$	( 14,492	)		$	( 9,093	)
Adjustments to reconcile net loss to net cash used in operating activities:
Stock-based compensation expense			1,537				1,588
Depreciation and amortization			801				456
Shares issued for services			4				26
Changes in assets and liabilities:
Prepaid expenses and other assets			( 200	)			64
Lease right-of-use asset			197				182
Accounts payable and accrued expenses			1,576				( 355	)
Lease liabilities			( 206	)			( 182	)
Net cash used in operating activities			( 10,783	)			( 7,314	)
CASH FLOWS FROM INVESTING ACTIVITIES
Purchases of property and equipment			( 1,705	)			( 1,003	)
Net cash used in investing activities			( 1,705	)			( 1,003	)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from at-the-market sales of common stock, net			732				1,923
Proceeds from exercise of common stock purchase warrants			5				1,055
Proceeds from warrant inducement offering, net			3,972				—
Net cash provided by financing activities			4,709				2,978
Net decrease in cash and cash equivalents			( 7,779	)			( 5,339	)
Cash and cash equivalents at beginning of period			13,095				9,232
Cash and cash equivalents at end of period		$	5,316			$	3,893

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

MODULAR MEDICAL, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

NOTE 1 – THE COMPANY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Modular Medical, Inc. (the “Company”) was incorporated in Nevada in October 1998 under the name Bear Lake Recreation, Inc. The Company had no material business operations until approximately 2017, when it acquired all of the issued and outstanding shares of Quasuras, Inc., a Delaware corporation (“Quasuras”) and changed its name from Bear Lake Recreation, Inc. to Modular Medical, Inc.

The Company is a pre-revenue, medical device company focused on the design, development and commercialization of innovative insulin delivery systems using modernized technology to increase pump adoption in the diabetes marketplace. Through the creation of innovative two-part patch pumps, the Company seeks to fundamentally alter the trade-offs between cost and complexity and access to the higher standards of care requiring considerable motivation that presently available insulin pumps provide. By simplifying and streamlining the user experience from introduction, prescription, reimbursement, training and day-to-day use, the Company seeks to expand the wearable insulin delivery device market beyond the highly motivated “super users” and expand the category into the mass market. The product seeks to serve both the type 1 and the rapidly growing, especially in terms of device adoption, type 2 diabetes markets. In January 2024, the Company submitted a 510(k) premarket notification to the United States Food and Drug Administration (“FDA”) for its initial product, the MODD1, and, in September 2024, the Company received FDA clearance to market and sell its MODD1 pump in the United States. The Company is seeking FDA approval for an updated version of the MODD1 product, called the Pivot, which is a tubeless version of the product that integrates the set into a true tubeless patch. The Company intends to go to market with its Pivot product, when the required regulatory approval from the FDA is received.

Liquidity and Going Concern

The Company does not currently have revenues to generate cash flows to cover operating expenses. Since its inception, the Company has incurred operating losses and negative cash flows in each year due to costs incurred in connection with its operations. The Company expects to continue to incur operating losses for the foreseeable future and incur cash outflows from operations as it continues to invest in the development and commercialization of its products. The Company expects that its operating expenses will continue to increase, and, as a result, it will eventually need to generate significant revenue to achieve profitability. When considered with its current operating plan, these conditions raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date that these financial statements are issued. In addition, the Company’s independent registered public accounting firm, in its report on the consolidated financial statements as of and for the year ended March 31, 2025, expressed substantial doubt about the Company’s ability to continue as a going concern. These condensed consolidated financial statements do not include any adjustments that might result from this uncertainty. Implementation of the Company’s plans and its ability to continue as a going concern will depend upon the Company’s ability to raise additional capital, through the sale of additional equity or debt securities, to support its future operations. There can be no assurance that such additional capital, whether in the form of debt or equity financing, will be sufficient or available and, if available, that such capital will be offered on terms and conditions acceptable to the Company. The Company’s operating needs include the planned costs to operate its business, including amounts required to fund working capital and capital expenditures. The Company’s future capital requirements and the adequacy of its available funds will depend on many factors, including the Company’s ability to successfully commercialize its pump products, competing technological and market developments, and the need to enter into collaborations with other companies or acquire other companies or technologies to enhance or complement its product offering. If the Company is unable to secure additional capital, it may be required to curtail its product commercialization and research and development initiatives and take additional measures to reduce costs in order to conserve its cash. As disclosed in Note 4, in September 2025, the Company effected a warrant inducement offering for net proceeds of approximately $ 3.9 million, and, during the six months ended September 30, 2025, the Company received net proceeds of approximately $ 0.7 million from sales of shares of common stock under its at-the-market sales program.

Basis of Presentation

The Company’s fiscal year ends on March 31 of each calendar year. Each reference to a fiscal year in these notes to the condensed consolidated financial statements refers to the fiscal year ended March 31 of the calendar year indicated (for example, fiscal 2026 refers to the fiscal year ending March 31, 2026). The condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary, Quasuras. All significant intercompany transactions and balances have been eliminated in consolidation.

The accompanying condensed consolidated financial statements are unaudited and have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) and with the rules and regulations of the United States Security and Exchange Commission (“SEC”) regarding interim financial reporting. The condensed consolidated balance sheet as of March 31, 2025 has been derived from the audited consolidated financial statements at that date. Certain information and disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted in accordance with these rules and regulations of the SEC. The information in this report should be read in conjunction with the Company’s consolidated financial statements and notes thereto included in its most recent annual report on Form 10-K filed with the SEC.

In the opinion of management, the accompanying unaudited condensed consolidated financial statements reflect all adjustments (consisting only of normal recurring adjustments) necessary to summarize fairly the Company’s financial position, results of operations and cash flows for the interim periods presented. The operating results for the six months ended September 30, 2025 are not necessarily indicative of the results that may be expected for the year ending March 31, 2026 or for any other future period.

Use of Estimates

The preparation of the accompanying condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amount of revenues and expenses during the reporting period. Estimates may include those pertaining to accruals, stock-based compensation and income taxes. Actual results could differ from those estimates.

Research and Development

The Company expenses research and development expenditures as incurred.

Risks and Uncertainties

The Company is subject to risks from, among other things, competition associated with the industry in general, other risks associated with financing, liquidity requirements, rapidly changing customer requirements, limited operating history and the volatility of public markets. The Company may be unable to access the capital markets, and additional capital may only be available to the Company on terms that could be significantly detrimental to its existing stockholders and to its business.

Cash and Cash Equivalents

Cash and cash equivalents include cash held in demand deposit and money market accounts, certificates of deposit and all highly liquid debt instruments with original maturities of three months or less.

Property and Equipment

Property and equipment are recorded at historical cost. Depreciation is computed using the straight-line method over the estimated useful lives of the assets, generally three to five years . Depreciation is recorded in operating expenses in the consolidated statements of operations. Leasehold improvements and assets acquired through finance leases are amortized over the shorter of their estimated useful life or the lease term, and amortization is recorded in operating expenses in the consolidated statements of operations. Construction-in-process includes machinery and equipment and is stated at cost and not depreciated. Depreciation on construction-in-process commences when the assets are ready for their intended use and placed into service.

Fair Value of Financial Instruments

The Company measures the fair value of financial instruments using a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three broad levels:

●

Level 1 inputs to the valuation methodology are quoted prices for identical assets or liabilities in active markets.

●

Level 2 inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument.

●

Level 3 inputs to the valuation methodology are unobservable and significant to the fair value measurement.

Due to their short-term nature, the carrying values of cash equivalents, accounts payable and accrued expenses, approximate fair value.

Leases

The Company’s right-of-use assets consist of leased assets recognized in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) No. 842, Leases , which requires lessees to recognize a lease liability and a corresponding lease asset for virtually all lease contracts. Right-of-use assets represent the Company’s right to use an underlying asset for the lease term and the lease liability represents the Company’s obligation to make lease payments arising from the lease, both of which are recognized based on the present value of the future minimum lease payments over the lease term at the commencement date. Leases with a lease term of 12 months or less at inception are not recorded on the consolidated balance sheets and are expensed on a straight-line basis over the lease term in the consolidated statement of operations and comprehensive loss. The Company determines the lease term by agreement with the lessor. In cases where the lease does not provide an implicit interest rate, the Company uses the Company’s incremental borrowing rate based on the information available at commencement date in determining the present value of future payments.

Stock-Based Compensation

The Company periodically issues stock options, restricted stock units and stock awards to employees and non-employees. The Company accounts for such awards based on FASB ASC Topic 718, whereby the value of the award is measured on the date of grant and recognized as compensation expense on a straight-line basis over the requisite service period, usually the vesting period. With respect to performance-based awards, the Company assesses the probability of achieving the requisite performance criteria before recognizing compensation expense. The fair value of the Company’s stock options is estimated using the Black-Scholes-Merton Option Pricing (“Black Scholes”) model, which uses certain assumptions related to risk-free interest rates, expected volatility, expected life of the options, and future dividends. Compensation expense is recorded based upon the value derived from the Black-Scholes model. The assumptions used in the Black-Scholes model could materially affect compensation expense recorded in future periods.

Per-Share Amounts

Basic net loss per share is computed by dividing loss for the period by the weighted-average number of shares of common stock outstanding (“WASO”) during the period. In addition, the Company includes the number of shares of common stock issuable, including under pre-funded warrants, as outstanding for purposes of the WASO calculation. Diluted net loss per share gives effect to all potentially dilutive common shares outstanding during the period. Potentially dilutive common shares consist of incremental shares of common stock issuable upon the exercise of stock options and exercise of warrants.

For the six months ended September 30, 2025 and 2024, the following table sets forth securities outstanding which were excluded from the computation of diluted net loss per share as their inclusion would be anti-dilutive (in thousands).

		Six Months Ended September 30,
		2025				2024
Options to purchase common stock			7,229				4,531
Unvested restricted stock units			63				146
Common stock purchase warrants			15,100				10,430
Total			22,392				15,107

Reclassifications

Certain prior year amounts have been reclassified for consistency with the current period presentation. These reclassifications had no effect on the reported results of operations or cash flows.

Comprehensive Loss

Comprehensive loss represents the changes in equity of an enterprise, other than those resulting from stockholder transactions. Accordingly, comprehensive loss may include certain changes in equity that are excluded from net loss. For the three and six months ended September 30, 2025 and 2024, the Company’s comprehensive loss was the same as its net loss.

Recently Issued Accounting Pronouncements

In November 2024, the FASB issued ASU No. 2024-03, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses . The new standard requires disclosures about specific types of expenses included in the expense captions presented on the face of the income statement as well as disclosures about selling expenses. The standard is effective for the Company for annual periods beginning April 1, 2027 and interim periods beginning April 1, 2028, with early adoption permitted. The standard may be applied either prospectively to financial statements issued for reporting periods after the effective date or retrospectively to any or all prior periods presented in the financial statements. The Company is evaluating the impact that this ASU will have on the presentation of its consolidated financial statements.

NOTE 2 – CONSOLIDATED BALANCE SHEET DETAIL

		September 30,				March 31,
		2025				2025
		(in thousands)
Prepaid and other current assets
Prepaid expenses		$	606			$	352
Other receivables			25				70
		$	631			$	422

		September 30,				March 31,
		2025				2025
		(in thousands)
Property and equipment, net
Machinery and equipment		$	7,904			$	5,311
Computer equipment and software			45				66
Construction-in-process			788				685
Leasehold improvements			33				33
Office equipment			45				45
			8,815				6,140
Less: accumulated depreciation and amortization			( 2,356	)			( 1,687	)
Total		$	6,459			$	4,453

		September 30, 2025				March 31, 2025
		(in thousands)
Accrued expenses
Accrued wages and employee benefits		$	460			$	391
Other			255				113
Total		$	715			$	504

NOTE 3 – LEASES

Thornmint Road, San Diego, CA

The 48 -month lease term commenced February 1, 2023, and the lease provides for an initial base monthly rent of $ 36,000 with annual rent increases of approximately 4 %. In addition to the minimum lease payments, the Company is responsible for property taxes, insurance and certain other operating costs. A discount rate of 8 %, which approximated the Company’s incremental borrowing rate, was used to measure the lease asset and liability. The Company obtained a right-of-use asset of approximately $ 1,560,000 in exchange for its obligations under the operating lease.

Future minimum payments under the facility operating lease, as of September 30, 2025, are listed in the table below (in thousands).

Annual Fiscal Years
2026		$	237
2027			405
Total future lease payments		$	642
Less: Imputed interest			( 31	)
Present value of lease liability		$	611

Cash paid for amounts included in the measurement of lease liabilities was approximately $ 234,000 and $ 225,000 for the six months ended September 30, 2025 and 2024, respectively. Rent expense was approximately $ 225,000 for each of the six-month periods ended September 30, 2025 and 2024, respectively, and $ 113,000 for each of the three-month periods ended September 30, 2025 and 2024.

NOTE 4 – STOCKHOLDERS’ EQUITY

ATM Offering

In November 2023, the Company entered into a Sales Agreement (the “ATM Agreement”) with Leerink Partners LLC (“Leerink”) under which the Company may offer and sell, from time to time at its sole discretion, shares of its common stock, for aggregate gross proceeds of up to $ 6,500,000 through an “at the market offering” program under which Leerink will act as sales agent or principal. The ATM Agreement provides that Leerink will be entitled to compensation for its services equal to 3.0 % of the gross proceeds from sales of any shares of common stock under the ATM Agreement. The Company has no obligation to sell any shares under the ATM Agreement and may, at any time, suspend solicitation and offers under the ATM Agreement. During the three and six months ended September 30, 2025, under the ATM Agreement, the Company sold 9,200 and 1,009,200 shares of common stock for net proceeds of $ 6,286 and $ 733,786 , respectively.

Warrant Inducement Offering

In September 2025, the Company entered into inducement offer letter agreements (the “Inducement Letters”) with certain holders (the “Holders”) of warrants issued in May 2023 (the “2023 Warrants”) and in March 2025 (the “March 2025 Warrants” and, collectively with the 2023 Warrants, the “Existing Warrants”) to purchase up to an aggregate of 6,504,731 shares of the Company’s common stock. Pursuant to the Inducement Letters, the Holders agreed to exercise for cash i) 2023 Warrants to purchase 1,901,700 shares of common stock with an original exercise price of $ 1.22 per share and ii) March 2025 Warrants to purchase 4,603,031 shares with an original exercise price of $ 1.12 per share at a reduced exercise price of $ 0.68 per share in consideration for the Company’s agreement to issue in a private placement new common stock purchase warrants to purchase an aggregate of 3,252,366 shares (the “September 2025 Warrants”). The September 2025 Warrants have an exercise price of 0.84 per share, were exercisable upon issuance and expire on the five-year anniversary of the date of issuance.

As of September 30, 2025, the Company had issued 5,860,483 shares of common stock and 2,930,242 September 2025 Warrants, and the processing of the exercise of 175,500 2023 Warrants and 468,748 2025 Warrants was pending. As a result, as of September 30, 2025, 644,248 shares of common stock (the “Issuable Shares”) and 322,124 September 2025 Warrants were pending issuance. The fair value of the unissued Issuable Shares has been presented separately as issuable shares on the condensed consolidated balance sheets and statements of stockholders’ equity as of September 30, 2025. The Company accounted for the issuance of the: i) shares of its common stock and ii) the September 2025 Warrants as a single equity transaction for gross proceeds of approximately $ 4.4 million, which proceeds had been received in full as of September 30, 2025.

In relation to the above warrant inducement offering, the Company engaged Newbridge Securities Corporation as the servicing agent and paid a fee of $ 400,000 and expense reimbursement of $ 50,000 .

Equity-Classified Warrants

The following table sets forth changes in the number of common stock purchase warrants outstanding during fiscal 2026 (share amounts in thousands):

		Number of				Exercise
		Shares				Price ($)				Expiration
Balance as of March 31, 2025			18,561
Warrants exercised			( 531	)			0.01			—
Balance as of June 30, 2025			18,030
Warrants issued			2,930				0.84			September 2030
Warrants exercised			( 1,726	)			0.68			May 2028
Warrants exercised			( 4,134	)			0.68			March 2029
Balance as of September 30, 2025			15,100

As of September 30, 2025, the Company had the following warrants outstanding (share amounts in thousands):

		Number of				Exercise
Type		Shares				Price ($)				Expiration
Common stock			2,930				0.84			September 2030
Common stock			2,374				1.12			March 2029
Common stock			1,839				1.22			May 2028
Common stock			484				1.32			May 2027
Common stock			875				1.40			March 2029
Common stock			381				1.875			November 2027
Common stock			768				6.00			January 2027 - February 2027
Common stock			4,011				6.60			February 2027
Common stock			1,438				6.60			November 2027
Total			15,100

Share Issuances to Service Providers

During the six months ended September 30, 2025 and 2024, the Company issued 10,000 and 30,000 shares of common stock, respectively, with fair values of approximately $ 11,000 and $ 51,000 , respectively, to service providers.

NOTE 5 – STOCK-BASED COMPENSATION

Amended and Restated 2017 Equity Incentive Plan

In October 2017, the Company’s board of directors (the “Board”) approved the 2017 Equity Incentive Plan (the “Plan”) with 1,000,000 shares of common stock reserved for issuance. In January 2020 and August 2021, the Board approved increases in the number of shares reserved for issuance under the Plan by 333,334 and 1,333,334 shares, respectively. In January 2023, February 2024 and February 2025, the Company’s stockholders approved increases in the number of shares reserved for issuance under the Plan by an additional 2,000,000 , 3,000,000 and 3,000,000 shares, respectively. Under the Plan, eligible employees, directors and consultants may be granted a broad range of awards, including stock options, stock appreciation rights, restricted stock, performance-based awards and restricted stock units (“RSUs”). The Plan is administered by the Board or, in the alternative, a committee designated by the Board.

Stock-Based Compensation Expense

Stock options granted by the Company generally vest over 36 months and have a 10 -year term. As of September 30, 2025, the unamortized compensation cost related to stock options was approximately $ 1,526,736 and is expected to be recognized as expense over a weighted-average period of approximately 1.12 years.

In April 2025, under its Two-Part FDA Submission and Product Milestone Bonus Program, the Company granted stock options for 1,941,000 shares, which are subject to vesting based upon achievement of certain performance milestones by the Company and continued service by the optionee. As of June 30, 2025, the Company had commenced expense recognition for all 1,941,000 of these option shares based on its assessment of the probability of achievement of the applicable performance requirements, including (i) submission of the 510(k) to the FDA for the Pivot pump product on or before October 31, 2025 and (ii) validation of the manufacturing line validated for the Pivot pump product with capacity to serve 6,000 patents by March 15, 2026.

The weighted-average grant date fair value of options granted was $ 0.74 and $ 1.41 per share for the six months ended September 30, 2025 and 2024, respectively, and $ 0.56 and $ 1.51 for the three months ended September 30, 2025 and 2024, respectively. The following assumptions were used in the fair-value method calculations:

		Three Months Ended September 30,				Six Months Ended September 30,
		2025		2024		2025		2024
Risk-free interest rates		3.7 % - 4.1 %		3.4 % - 4.1 %		3.7 % - 4.1 %		3.5 % - 4.4 %
Volatility		102 % - 106 %		114 % - 117 %		102 % - 107 %		114 % - 123 %
Expected life (years)		5.0 – 5.7		5.0 – 5.7		5.0 – 5.7		5.0 – 5.7
Expected dividend %		—		—		—		—

The fair values of options at the grant date were estimated utilizing the Black-Scholes valuation model, which includes simplified methods to establish the fair term of options, as well as average volatility. The risk-free interest rate was derived from the Daily Treasury Yield Curve Rates, as published by the U.S. Department of the Treasury as of the grant date for terms equal to the expected terms of the options. A dividend yield of zero was applied because the Company has never paid dividends and has no intention to pay dividends in the foreseeable future. The Company accounts for forfeitures as they occur.

The following table summarizes the activity in the shares available for grant under the Plan during the six months ended September 30, 2025:

						Options Outstanding
										Weighted
		Shares								Average
		Available				Number of				Exercise
		for Grant				Shares				Prices
Balance at March 31, 2025			5,397,872				4,917,090			$	3.17
Share awards			( 6,375	)			—				0.68
Options granted			( 2,291,172	)			2,291,172				0.93
Options cancelled and returned to the Plan			8,056				( 8,056	)			1.52
Balance at June 30, 2025			3,108,381				7,200,206			$	2.46
Share awards			( 6,375	)			—				0.70
Options granted			( 139,375	)			139,375				0.71
Options cancelled and returned to the Plan			110,555				( 110,555	)			1.13
Balance at September 30, 2025			3,073,186				7,229,026			$	2.44

There were no stock options exercised during the six months ended September 30, 2025. A stock option was exercised on a cashless basis for 7,530 shares of common stock during the six months ended September 30, 2024. During the six months ended September 30, 2025 and 2024, the Company awarded 12,750 and 7,750 shares, respectively, and for the three months ended September 30, 2025 and 2024, the Company awarded 6,375 and 3,875 shares, respectively, to its non-employee directors under the Company’s outside director compensation plan. For the six months ended September 30, 2025 and 2024, the Company recorded stock-based compensation expense for these share awards of approximately $ 9,000 and $ 15,000 , respectively, and for the three months ended September 30, 2025 and 2024, the Company recorded stock-based compensation expense for these share awards of approximately $ 4,000 and $ 9,000 , respectively.

A summary of restricted stock unit (RSU) activity under the Plan is presented below.

						Weighted Average
		Number of Shares				Grant-Date Fair Value
Non-vested shares at March 31, 2025			104,168			$	0.91
Vested			( 20,833	)		$	0.91
Non-vested shares at June 30, 2025			83,335			$	0.91
Vested			( 20,834	)		$	0.91
Non-vested shares at September 30, 2025			62,501			$	0.91

The total intrinsic value of RSUs outstanding as of September 30, 2025 was approximately $ 44,000 . The unamortized compensation cost at September 30, 2025 was approximately $ 58,000 related to RSUs and is expected to be recognized as expense over a period of approximately 0.75 years.

The following table summarizes the range of outstanding and exercisable options as of September 30, 2025:

		Options Outstanding												Options Exercisable
						Weighted
						Average
						Remaining				Weighted								Weighted
						Contractual				Average								Average				Aggregate
		Number				Life				Exercise				Number				Exercise				Intrinsic
Range of Exercise Price		Outstanding				(in Years)				Price				Exercisable				Price				value
$0.68 - $2.28			5,796,752				8.42			$	1.27				2,712,909			$	1.53			$	795
$3.95 - $7.51			933,145				5.69			$	5.30				933,145			$	5.30				—
$8.61 - $17.70			499,129				5.73			$	10.56				499,129			$	10.56				—
$0.68 - $17.70			7,229,026				7.88			$	2.44				4,145,183			$	3.47			$	795

The intrinsic value per share is calculated as the excess of the closing price of the common stock on the Company’s principal trading market over the exercise price of the option.

NOTE 6 – INCOME TAXES

The Company determines deferred tax assets and liabilities based upon the differences between the financial statement and tax bases of the Company’s assets and liabilities using tax rates in effect for the year in which the Company expects the differences to affect taxable income. A valuation allowance is established for any deferred tax assets for which it is more likely than not that all or a portion of the deferred tax assets will not be realized. Based on the available information and other factors, management believes it is more likely than not that its federal and state net deferred tax assets will not be fully realized, and the Company has recorded a full valuation allowance.

The Company files U.S. federal and state income tax returns in jurisdictions with varying statutes of limitations. All tax returns for fiscal 2018 to fiscal 2025 may be subject to examination by the U.S. federal and state tax authorities. As of September 30, 2025, the Company has not recorded any liability for unrecognized tax benefits related to uncertain tax positions.

NOTE 7 – COMMITMENTS AND CONTINGENCIES

Litigations, Claims and Assessments

In the normal course of business, the Company may be involved in legal proceedings, claims and assessments arising in the ordinary course of business. The Company records legal costs associated with loss contingencies as incurred and accrues for all probable and estimable settlements.

Indemnification

In the ordinary course of business, the Company enters into contractual arrangements under which it may agree to indemnify the counterparties from any losses incurred relating to breach of representations and warranties, failure to perform certain covenants, or claims and losses arising from certain events as outlined within the particular contract, which may include, for example, losses arising from litigation or claims relating to past performance. Such indemnification clauses may not be subject to maximum loss clauses. The Company has also entered into indemnification agreements with its officers and directors. No amounts were reflected in the Company’s consolidated financial statements for the three and six months ended September 30, 2025 and 2024 related to these indemnifications. The Company has not estimated the maximum potential amount of indemnification liability under these agreements due to the limited history of prior claims and the unique facts and circumstances applicable to each particular agreement. To date, the Company has not made any payments related to these indemnification agreements.

Purchase Obligations

The Company’s primary purchase obligations include purchase orders for machinery and equipment. At September 30, 2025, the Company had outstanding purchase orders for machinery and equipment and related expenditures of approximately $ 1,719,000 .

NOTE 8 – BUSINESS SEGMENT AND CONCENTRATIONS

Segment Information

The Company determines its reporting units in accordance with ASC No. 280, Segment Reporting (“ASC 280”), as amended by ASU No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures , which the Company adopted effective March 31, 2025. Management evaluates a reporting unit by first identifying its operating segments under ASC 280. The Company then evaluates each operating segment to determine if it includes one or more components that constitute a business. If there are components within an operating segment that meet the definition of a business, the Company evaluates those components to determine if they must be aggregated into one or more reporting units. If applicable, when determining if it is appropriate to aggregate different operating segments, the Company determines if the segments are economically similar and, if so, the operating segments are aggregated.

The Company’s chief executive officer is the chief operating decision maker (the “CODM”), and the CODM evaluates financial performance and makes operating decisions about allocating resources based on financial data presented on a consolidated basis, including consolidated net income (loss). Because the CODM evaluates financial performance on a consolidated basis, the Company operates and manages its business as one reportable and operating segment as a medical device company focused on the design, development and eventual commercialization of innovative insulin pumps using modernized technology. The measure of segment assets is reported on the balance sheet as total consolidated assets. The Company’s reporting segment meets the definition of an operating segment and does not include the aggregation of multiple operating segments.

Significant segment expenses include research and development expenditures, salaries and benefits, and stock-based compensation. Operating expenses include all remaining costs necessary to operate the Company’s business, which primarily include facilities, external professional services and other administrative expenses. The following table presents the significant segment expenses and other segment items regularly reviewed by the CODM:

		September 30,
		2025				2024
		(in thousands)
Research and development		$	3,134			$	1,912
Compensation			6,202				3,497
Stock-based compensation			1,537				1,587
Other operating expenses			3,760				2,220
Other income			( 141	)			( 123	)
Net loss		$	14,492			$	9,093

Concentrations

Financial instruments that potentially subject the Company to concentration of credit risk consist primarily of cash held in demand deposit accounts. The Company maintains its cash at high credit quality financial institutions within the United States, which are insured by the Federal Deposit Insurance Corporation up to limits of approximately $ 250,000 . No reserve has been made in the financial statements for any possible loss due to financial institution failure.

The following table lists significant vendors that represented more than 10% of the Company’s total accounts payable balance at each respective balance sheet date:

		September 30,				March 31,
		2025				2025
Vendor A			30	%			13	%
Vendor B			12	%			*
Vendor C			*				12	%
Vendor D			*				10	%

*

Represents less than 10%

NOTE 9 – RELATED PARTY TRANSACTIONS

A family member of one of the Company’s executive officers is an employee of the Company. During the three months ended September 30, 2025 and 2024, the Company paid the family member approximately $ 33,760 and $ 43,365 , respectively, which includes the aggregate grant date fair values, as determined pursuant to FASB ASC Topic 718, of any stock options granted during each period. During the six months ended September 30, 2025 and 2024, the Company paid the family member approximately $ 86,460 and $ 100,625 , respectively, which includes the aggregate grant date fair values, as determined pursuant to FASB ASC Topic 718, of any stock options granted during each period.

A second family member of one of the Company’s executive officers consulted with and became an employee of the Company during 2025. During the three months ended September 30, 2025, the Company paid the family member approximately $ 16,000 , which includes the aggregate grant date fair values, as determined pursuant to FASB ASC Topic 718, of any stock options granted during each period. During the six months ended September 30, 2025, the Company paid the family member approximately $ 34,600 , which includes the aggregate grant date fair values, as determined pursuant to FASB ASC Topic 718, of any stock options granted during each period.

NOTE 10 – SUBSEQUENT EVENTS

Subsequent to September 30, 2025, under the ATM Agreement, the Company sold 1,793,064 shares of common stock for net proceeds of approximately $ 1.1 million.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

This Management’s Discussion and Analysis of Financial Condition and Results of Operations should be read in conjunction with the accompanying condensed consolidated financial statements and notes included in this Quarterly Report on Form 10-Q (this Report). This Report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, which include, without limitation, statements about the market for our technology, our strategy, competition, expected financial performance and capital raising efforts, and other aspects of our business identified in our most recent annual report on Form 10-K filed with the Securities and Exchange Commission on June 20, 2025 and in other reports that we file from time to time with the Securities and Exchange Commission. Any statements about our business, financial results, financial condition and operations contained in this Report that are not statements of historical fact may be deemed to be forward-looking statements. Without limiting the foregoing, the words “believes,” “anticipates,” “expects,” “intends,” “plans,” “projects,” or similar expressions are intended to identify forward-looking statements. Our actual results could differ materially from those expressed or implied by these forward-looking statements as a result of various factors, including the risk factors described under Item 1A of our Annual Report on Form 10-K for the year ended March 31, 2025. These forward-looking statements represent our intentions, plans, expectations, assumptions and beliefs about future events and are subject to risks, uncertainties and other factors including, without limitation, inflationary risks, including the risk of increasing costs for certain of the Company’s components and related issues that may arise therefrom. Many of those factors are outside of our control and could cause actual results to differ materially from those expressed or implied by those forward-looking statements. In light of these risks, uncertainties and assumptions, the events described in the forward-looking statements might not occur or might occur to a different extent or at a different time than we have described. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this Report. All subsequent written and oral forward-looking statements concerning other matters addressed in this Report and attributable to us or any person acting on our behalf are expressly qualified in their entirety by the cautionary statements contained or referred to in this Report. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events, a change in events, conditions, circumstances or assumptions underlying such statements, or otherwise.

Our fiscal year ends on March 31 of each calendar year. Each reference to a fiscal year in this Report, refers to the fiscal year ended March 31 of the calendar year indicated (for example, fiscal 2026 refers to the fiscal year ending March 31, 2026). Unless the context requires otherwise, references to “we,” “us,” “our,” and the “Company” refer to Modular Medical, Inc. and its consolidated subsidiary .

Company Overview

We are a pre-revenue medical device company focused on the design, development and commercialization of innovative insulin pumps using modernized technology to increase pump adoption in the diabetes marketplace. Through the creation of a novel two-part patch pump, we seek to fundamentally alter the trade-offs between cost and complexity and access to the higher standards of care that presently-available insulin pumps provide. By simplifying and streamlining the user experience from introduction, prescription, reimbursement, training and day-to-day use, we seek to expand the wearable insulin delivery device market beyond the highly motivated “super users” and expand the category into the mass market. The product seeks to serve both the type 1 and the rapidly growing, especially in terms of device adoption, type 2 diabetes markets. In January 2024, we submitted a 510(k) premarket notification to the United States Food and Drug Administration (the “FDA”) for our initial product, our MODD1, and, in September 2024, we received FDA clearance to market and sell our MODD1 pump in the United States. In August 2025, we announced the first human use of our MODD1 pump delivering insulin to a human patient. In addition, in August 2025, we announced our next-generation patch pump, branded as Pivot. We submitted a 510(k) premarket notification to the FDA for our Pivot product on November 13, 2025, when the United States government shutdown ended. We intend to initiate our commercial launch with the Pivot product, when the required regulatory approval from the FDA is received, which is expected in the first quarter of 2026. We are actively working to i) obtain regulatory clearance and prepare to commence commercialization of our Pivot product, ii) obtain regulatory clearance to market and sell our Pivot product in foreign jurisdictions, iii) improve the manufacturability and usability of our Pivot product and iv) develop new pump products.

Historically, we have financed our operations principally through private placements and public offerings of our common stock and warrants and sales of convertible promissory notes. Based on our current operating plan, substantial doubt about our ability to continue as a going concern for a period of at least one year from the date that the financial statements included in Item 1 of this Report are issued exists. Our ability to continue as a going concern depends on our ability to raise additional capital, through the sale of equity or debt securities, to support our future operations. If we are unable to secure additional capital, we will be required to curtail our research and development initiatives and take additional measures to reduce costs. We have provided additional disclosure in Note 1 to the consolidated financial statements in Item 1 of this Report and under Liquidity below.

Recent Developments

Financing

As disclosed in Note 4 to the condensed consolidated financial statements in this Report, in September 2025, we effected a warrant inducement offering for net proceeds of approximately $3.9 million, after deducting servicing agent fees and other offering expenses payable by us, and, during the six months ended September 30, 2025, we received net proceeds of approximately $0.7 million from sales of shares of our common stock under our at-the-market sales program.

Compliance with Nasdaq Continued Listing Requirements

On June 30, 2025, we received a letter from the Listing Qualifications Staff of The Nasdaq Stock Market LLC (“Nasdaq”) indicating that, based upon the closing bid price of our common stock for the 30 consecutive business days ending on June 27, 2025, we no longer met the requirement to maintain a minimum bid price of $1 per share, as set forth in Nasdaq Listing Rule 5550(a)(2).

In accordance with Nasdaq Listing Rule 5810(c)(3)(A), we have been provided a period of 180 calendar days, or until December 29, 2025, in which to regain compliance. In order to regain compliance with the minimum bid price requirement, the closing bid price of our common stock must be at least $1 per share for a minimum of ten consecutive business days during this 180-day period. In the event we do not regain compliance within this 180-day period, we may be eligible to seek an additional compliance period of 180 calendar days provided we meet the continued listing requirement for market value of publicly held shares and all other initial listing standards for the Nasdaq Capital Market, with the exception of the bid price requirement, and if we provide written notice to Nasdaq of our intent to cure the deficiency during this second compliance period by effecting a reverse stock split, if necessary. However, if it appears to the Nasdaq staff that we will not be able to cure the deficiency, or if we are otherwise not eligible, Nasdaq will provide notice to us that our common stock will be subject to delisting.

The above mentioned letter does not result in the immediate delisting of our common stock from the Nasdaq Capital Market. We are monitoring the closing bid price of our common stock and considering our available options in the event the closing bid price of our common stock remains below $1 per share.

Critical Accounting Policies and Estimates

The discussion and analysis of our financial condition and results of operations are based upon our condensed consolidated financial statements, which have been prepared in accordance with U.S. GAAP. The preparation of these condensed consolidated financial statements requires us to make certain estimates and judgments that affect the reported amounts of assets, liabilities, and expenses. On an ongoing basis, we make these estimates based on our historical experience and on assumptions that we consider reasonable under the circumstances. Actual results may differ from these estimates and reported results could differ under different assumptions or conditions. Our significant accounting policies and estimates are disclosed in Note 1 of the Notes to Consolidated Financial Statements in our Annual Report on Form 10-K for the year ended March 31, 2025. As of September 30, 2025, there have been no material changes to our significant accounting policies and estimates.

Results of Operations

Research and Development

		September 30,								Change
		2025				2024				2024 to 2025
		(dollar amounts in thousands)
Research and development – Three months ended		$	5,593			$	3,702			$	1,891				51.1	%
Research and development – Six months ended		$	10,727			$	6,907			$	3,820				55.3	%

Our research and development, or R&D, expenses include personnel, consulting, testing, materials and supplies, depreciation and amortization and other non-capitalizable operational costs associated with the production of our insulin pump product. We expense R&D costs as they are incurred.

R&D expenses increased for the three months ended September 30, 2025 compared with the same period of 2024, primarily due to increased personnel-related costs of approximately $1.0 million, an increase in depreciation expense of approximately $0.1 million, an increase in consulting costs of $0.4 million and an increase in materials and supplies costs of $0.4 million.

R&D expenses increased for the six months ended September 30, 2025 compared with the same period of 2024, primarily due to increased personnel-related costs of approximately $1.9 million, an increase in depreciation expense of approximately $0.3 million, an increase in consulting costs of $0.5 million, an increase in materials and supplies costs of $0.7 million, an increase in shipping costs of approximately $0.2 million and increases in other costs of approximately $0.2 million. Our full-time R&D employee headcount increased to 56 at September 30, 2025 from 42 at September 30, 2024. R&D expenses included stock-based compensation expenses of approximately $0.7 million and $0.8 million for the three-months ended September 30, 2025 and 2024, respectively, and $1.2 million for each of the six-month periods ended September 30, 2025 and 2024. We expect research and development expenses to increase in the second half of fiscal 2026, as we have commenced activities in support of commercialization of our Pivot product, which we expect to occur in the first half of calendar year 2026.

Selling, General and Administrative

		September 30,								Change
		2025				2024				2024 to 2025
		(dollar amounts in thousands)
Selling, general and administrative – Three months ended		$	2,236			$	1,294			$	942				72.8	%
Selling, general and administrative – Six months ended		$	3,906			$	2,309			$	1,597				69.2	%

Selling, general and administrative, or SG&A, expenses consist primarily of personnel and related overhead costs for facilities, finance, human resources, legal, sales, marketing and general management.

SG&A expenses increased for the three months ended September 30, 2025 compared with the same period of 2024, primarily as a result of increases in personnel costs of approximately $0.5 million, consulting fees of approximately $0.3 million, and marketing expenses of approximately $0.1 million.

SG&A expenses increased for the six months ended September 30, 2025 compared with the same period of 2024, primarily as a result of increases in personnel costs of approximately $0.8 million, increases in consulting expenses of approximately $0.5 million, and increased marketing expenses of approximately $0.3 million. Our full-time SG&A employee headcount increased to 13 at September 30, 2025 from 4 at September 30, 2024. SG&A expenses included stock-based compensation expenses of approximately $0.2 million for each of the three-month periods ended September 30, 2025 and 2024, and $0.3 million and $0.4 million for the six months ended September 30, 2025 and 2024, respectively. We expect SG&A expenses to increase in the second half of fiscal 2026 as compared with fiscal 2025, as we continue to expand our sales and marketing organization and increase our general and administrative headcount to support the commercialization of our Pivot pump product during fiscal 2026.

Liquidity and Capital Resources; Changes in Financial Condition

We do not currently have revenues to generate cash flows to cover operating expenses. Since our inception, we have incurred operating losses and negative cash flows in each year due to costs incurred in connection with R&D activities and SG&A expenses associated with our operations. For the six months ended September 30, 2025 and year ended March 31, 2025, we incurred net losses of approximately $14.5 million and $18.8 million, respectively. At September 30, 2025, we had a cash balance of $5.3 million and an accumulated deficit of approximately $99.2 million. When considered with our current operating plan, these conditions raise substantial doubt about our ability to continue as a going concern for a period of at least one year from the date that the financial statements included in Item 1 of this Report are issued. Our financial statements do not include adjustments to the amounts and classification of assets and liabilities that may be necessary should we be unable to continue as a going concern. Our operating needs include the planned costs to operate our business, including amounts required to fund continued research and development activities, working capital and capital expenditures. Our ability to continue as a going concern depends on our ability to raise additional capital, through the sale of equity or debt securities to support our future operations. In November 2023, we entered into a Sales Agreement (the “ATM Agreement”) with Leerink Partners LLC (“Leerink”) under which we may offer and sell, from time to time at our sole discretion, shares of our common stock (subject to availability on our shelf registration statement) through an “at the market offering” program under which Leerink will act as sales agent or principal. During the six months ended September 30, 2025, we received net proceeds of approximately $0.7 million from sales of common stock under the ATM Agreement. During the six months ended September 30, 2025, we effected a warrant inducement offering of warrants issued in May 2023 and March 2025 for net proceeds of approximately $3.9 million, after deducting servicing agent fees and other offering expenses. Subsequent to September 30, 2025, under the ATM Agreement, we sold 1.8 million shares of common stock for net proceeds of approximately $1.1 million. Our future capital requirements and the adequacy of our available funds will depend on many factors, including, without limitation, our ability to successfully commercialize our product, competing technological and market developments, and the need to enter into collaborations with other companies or acquire other companies or technologies to enhance or complement our product offerings. If we are unable to secure additional capital timely, we may be required to curtail R&D initiatives, reduce headcount and take additional measures to reduce costs in order to conserve our cash.

For the six months ended September 30, 2025, we used approximately $10.8 million of cash in operating activities, which primarily resulted from our net loss of approximately $14.5 million, as adjusted for net changes in operating assets and liabilities of approximately $1.4 million, stock-based compensation expenses of approximately $1.5 million and depreciation and amortization expenses of approximately $0.8 million. For the six months ended September 30, 2024, we used approximately $7.3 million of cash in operating activities, which primarily resulted from our net loss of approximately $9.1 million and net changes in operating assets and liabilities of approximately $0.3 million, as adjusted for stock-based compensation expenses of approximately $1.6 million, depreciation and amortization expenses of approximately $0.5 million and other immaterial adjustments.

For the six months ended September 30, 2025 and 2024, cash used in investing activities of approximately $1.7 million and $1.0 million, respectively, was for the purchase of property and equipment.

Cash provided by financing activities of approximately $4.7 million for the six months ended September 30, 2025 was attributable to $4.0 million of proceeds from a warrant inducement offering completed in September 2025 and $0.7 million of proceeds from sales of common stock under the ATM Agreement. Cash provided by financing activities of approximately $3.0 million for the six months ended September 30, 2024 was attributable to proceeds from the at-the-market sales of stock and exercise of common stock purchase warrants.

Purchase Obligations

Our primary purchase obligations include purchase orders for machinery and equipment. At September 30, 2025, we had outstanding purchase orders for machinery and equipment and related expenditures of approximately $1.7 million.

Recently Issued Accounting Pronouncements

Recently issued accounting pronouncements are detailed in Note 1 in the Notes to the Condensed Consolidated Financial Statements included in Item 1 of this Report.

Item 3. Quantitative and Qualitative Disclosures about Market Risk

Not required.

Item 4. Controls and Procedures

Disclosure Controls and Procedures.

Our management is responsible for establishing and maintaining adequate internal control over our financial reporting. Because of inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions or that the degree of compliance with the policies or procedures may deteriorate.

Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we conducted an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934. Based on this evaluation, our management concluded that, as of September 30, 2025, our disclosure controls and procedures were effective.

Changes in Internal Control over Financial Reporting.

During the six months ended September 30, 2025, there was no change in our internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

Part II – OTHER INFORMATION

Item 1. Legal Proceedings

We are not currently involved in any litigation that we believe could have a material adverse effect on our financial condition or results of operations. To our 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 us or our subsidiary, threatened against or affecting us, our common stock, our subsidiary or our subsidiary’s officers or directors in their capacities as such, in which an adverse decision could have a material adverse effect.

Item 1A. Risk Factors

We face many significant risks in our business, some of which are unknown to us and not presently foreseen. These risks could have a material adverse impact on our business, financial condition and results of operations in the future. Other than as set forth below, there have been no material changes to the risk factors set forth under Item 1A of our Annual Report on Form 10-K for the year ended March 31, 2025, which we filed with the SEC on June 20, 2025.

We might not be able to continue as a going concern.

Our condensed consolidated financial statements as of September 30, 2025 have been prepared under the assumption that we will continue as a going concern twelve months from the date of issuance of this Report. At September 30, 2025, we had cash and cash equivalents of $5.3 million and an accumulated deficit of approximately $99.2 million. As disclosed in Note 4 to the condensed consolidated financial statements in this Report, in September 2025, we effected a warrant inducement offering for net proceeds of approximately $3.9 million, and, during the six months ended September 30, 2025, we generated net proceeds of approximately $0.7 million from sales under our at-the-market sales program. Even with these proceeds, we do not believe that our cash and cash equivalents will be sufficient to fund our operations for the period of 12 months from the date of issuance of this report, and we need to raise additional capital. As a result of our expected operating losses and cash burn for the foreseeable future and recurring losses from operations, if we are unable to raise sufficient capital through additional debt or equity arrangements, there will be uncertainty regarding our ability to maintain liquidity sufficient to operate our business effectively, which raises substantial doubt as to our ability to continue as a going concern. If we cannot continue as a viable entity, our stockholders would likely lose most or all of their investment in us. If we are unable to generate sustainable operating profit and sufficient cash flows, then our future success will depend on our ability to raise capital. We intend to seek additional financing and evaluate financing alternatives in order to meet our cash requirements for the foreseeable future. We cannot be certain that raising additional capital, whether through selling additional debt or equity securities or obtaining a line of credit or other loan, will be available to us or, if available, will be on terms acceptable to us. If we issue additional securities to raise funds, these securities may have rights, preferences, or privileges senior to those of our common stock, and our current stockholders may experience dilution. If we are unable to obtain funds when needed or on acceptable terms, we may be required to curtail our current product development programs, cut operating costs, forego future development and other opportunities or even terminate our operations.

If we are unable to satisfy the continued listing requirements of the Nasdaq, our common stock could be delisted and the price and liquidity of our common stock may be adversely affected.

Our common stock may lose value and could be delisted from Nasdaq due to several factors or a combination of such factors. While our common stock is currently listed on Nasdaq, we can give no assurance that we will be able to satisfy the continued listing requirements of Nasdaq in the future, including, but not limited to, the corporate governance requirements and the minimum closing bid price requirement or the minimum equity requirement.

On June 30, 2025, we received a letter from the Listing Qualifications Staff of Nasdaq indicating that, based upon the closing bid price of our common stock for the 30 consecutive business days ending on June 27, 2025, we no longer met the requirement to maintain a minimum bid price of $1 per share, as set forth in Nasdaq Listing Rule 5550(a)(2).

In accordance with Nasdaq Listing Rule 5810(c)(3)(A), we have been provided a period of 180 calendar days, or until December 29, 2025, in which to regain compliance. In order to regain compliance with the minimum bid price requirement, the closing bid price of our common stock must be at least $1 per share for a minimum of ten consecutive business days during this 180-day period. In the event we do not regain compliance within this 180-day period, we may be eligible to seek an additional compliance period of 180 calendar days provided we meet the continued listing requirement for market value of publicly held shares and all other initial listing standards for the Nasdaq Capital Market, with the exception of the bid price requirement, and if we provide written notice to Nasdaq of our intent to cure the deficiency during this second compliance period by effecting a reverse stock split, if necessary. However, if it appears to the Nasdaq staff that we will not be able to cure the deficiency, or if we are otherwise not eligible, Nasdaq will provide notice to us that our common stock will be subject to delisting.

The above-mentioned letter does not result in the immediate delisting of our common stock from the Nasdaq Capital Market. We are monitoring the closing bid price of our common stock and considering our available options in the event the closing bid price of our common stock remains below $1 per share.

There can be no assurance that we will be able to regain compliance with the minimum bid price requirement, maintain compliance with the other continued listing requirements of Nasdaq, or that our common stock will not be delisted in the future.

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

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a limited availability of market quotations for our common stock;

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

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reduced liquidity for our stockholders;

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

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loss of institutional investor interest.

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

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Recent Sales of Unregistered Securities

During the six months ended September 30, 2025, we issued 41,667 shares to one of our non-employee directors upon vesting of a restricted stock unit award granted under our Amended and Restated 2017 Equity Incentive Plan.

Item 3. Defaults Upon Senior Securities

There has been no default in the payment of principal, interest, or a sinking or purchase fund installment, or any other material default, with respect to any indebtedness of ours.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

None .

Item 6. Exhibits

										Filed or
Exhibit				Reference						Furnished
Number		Exhibit Description		Form		Exhibit		Filing Date		Herewith
3.1		Third Amended and Restated Articles of Incorporation of Modular Medical, Inc., as filed with the Secretary of State of Nevada on June 27, 2017		8-K		3.1		06/29/2017
3.2		Certificate of Amendment to the Amended and Restated Articles of Incorporation of Modular Medical, Inc., filed with the Secretary of State of the State of Nevada on November 24, 2021		8-K		3.1		12/01/2021
3.3		Certificate of Amendment to the Amended and Restated Articles of Incorporation of Modular Medical, Inc., filed with the Secretary of State of the State of Nevada on February 15, 2024		8-K		3.1		02/15/2024
3.4		Amended Bylaws of Modular Medical, Inc.		10-SB		3.2		03/08/2002
4.1		Form of Common Stock Purchase Warrant		8-K		4.1		09/23/2025
10.1		Form of 2023 Warrant Inducement Letter		8-K		10.1		09/23/2025
10.2		Form of 2025 Warrant Inducement Letter		8-K		10.2		09/23/2025
31.1		Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002								x
31.2		Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes- Oxley Act of 2002								x
32.1		Certification of Principal Executive Officer and Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes- Oxley Act of 2002								x
101		The following financial information from Modular Medical, Inc.'s quarterly report on Form 10-Q for the period ended September 30, 2025, filed with the SEC on November 14, 2025, formatted in Inline Extensible Business Reporting Language (Inline XBRL): (i) the Condensed Consolidated Statements of Operations for the three and six months ended September 30, 2025 and 2024, (ii) the Condensed Consolidated Balance Sheets as of September 30 2025 and March 31, 2025, (iii) the Condensed Consolidated Statements of Stockholders' Equity for the three and six months ended September 30, 2025 and 2024, (iv) the Condensed Consolidated Statements of Cash Flows for the six months ended September 30, 2025 and 2024, and (v) Notes to Condensed Consolidated Financial Statements.								x
104		Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).

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 thereunto duly authorized.

	MODULAR MEDICAL, INC.
Date: November 14, 2025	By:	/s/ James E. Besser
		James E. Besser
		Chief Executive Officer
		(Principal Executive Officer)
	By:	/s/ Paul DiPerna
		Paul DiPerna
		Chairman, President, Chief Financial Officer and Treasurer (Principal Financial Officer)